Expert: Happy ending possible for economy

President Obama sends his $447 billion jobs package Capitol Hill today after making a public statement to Congress and voters.

The president, CBS News Senior White House Correspondent Bill Plante reported, knows Republicans are reluctant to embrace the spending he wants. Republicans, Plante noted, call it stimulus and they don't like it.

But Mr. Obama says people can't wait for the next election to settle this argument. In a Democratic National Committee video, the president says, "The next election is 14 months away. And the people who sent us here -- the people who hired us to work for them -- they don't have the luxury of waiting 14 months."

But, Plante asks, will the president's agenda actually reduce unemployment and boost the overall economy if it were to pass?

Mark Zandi, an economist for Moody's Analytics, who advises both Republicans and Democrats, thinks the proposal could add two percentage points to next year's gross domestic product and add nearly two million jobs -- far short of the nearly seven million jobs lost in the recession. Other economists see the measures as having little or no effect.

With unemployment at 9.1 percent -- and forecast to remain near there through next year -- and consumer confidence taking a nosedive in August, some Democrats are now openly questioning whether the president could win another term, Plante notes.

Political analyst Larry Sabato, of the University of Virginia, said, "There are three important issues in the presidential campaign: jobs, jobs, and jobs. Everything else is number four."

With jobs and the economy in mind, then, "The Early Show" turned to New York Times columnist and Pulitzer Prize-winner Thomas Friedman, co-author of the new book "That Used To Be Us: How America Fell Behind in the World It Invented and How We Can Come Back."

Friedman says the U.S. needs to immediately do cut spending. "We have made promises to future generations we simply cannot keep," he says, adding, "At the same time, we need to raise revenues because ... we need to also invest in the sources of our strength: education, infrastructure, the things that have traditionally, basically, been the foundation of our economy, but have gone wanting. We have a $2 trillion deficit just in infrastructure spending, and you only need to visit certain airports and railway stations in the country to see it. We need to do three things all at once."

"Early Show" co-anchor Erica Hill noted some of those issues were addressed in Mr. Obama's plan, and added, "How much of this plan do you think Republicans will compromise on? What are the chances of bits of it passing?"

Friedman replied, "My view, Erica, is what we really need right now is a grand bargain that does all of those things, cut spending, raises revenues and makes the kind of investments that will actually produce growth. ... I think what Democrats and Republicans don't appreciate is how depressed the country is, simply watching our leaders, unable to agree on anything. I don't know how many percentage points that is worth in the economy, but there is really a sense, like the kids watching their parents constantly squabbling, who would want to invest in that kind of situation? So Obama has laid out his proposals. When you get back to the thing that Obama and (House Speaker John Boehner (R-Ohio)) were close to a grand bargain that proves Americans can do big, hard things together, that would be a huge stimulus, I believe."

Hill said, "You made that point in your column talking about the grand bargain and a lot of Americans would agree with you, they would like to see some sort of compromise, but it seems in many ways that idea is lost on Washington. So where does that begin to change so that both sides can come together?"

"Well, it's a very good point," Friedman said, "And I think that the president has laid out the sugar he wants to inject into the economy. But he also, in his speech ... on September 19th, that's a week from today, he is going to lay out the spending cuts. OK? And the revenue or tax reform ideas he has. I want to see that before, you know, I personally say, 'OK, now, this is the right track.' I would also like to see the Republican version of that. That's how we get to a grand bargain. So the president has given us the sugar. But he also has got to offer the castor oil."

So can the U.S. come back from the downturn and have a happy ending?

"People do ask that and we tell them it does have a happy ending -- we just don't know whether it's fiction or nonfiction. That is going to depend on us. I think people have to remember, we are driving around right now without a bumper or a spare tire. We use that up in the last stimulus program. Europe is about to melt down and I don't think that is fully, as they say, 'priced into' the market. Democrats and Republicans have to knock it off, get down to business, come up with a grand bargain. We are in such a dangerous situation; this is no time for playing politics."