US jobs growth will recover but increasing taxes right now could risk the economic recovery, Treasury Secretary John Snow said on Friday.
"Raising taxes at this time would imperil the recovery. We've got a good strong recovery going on. The last thing we should want to do is to remove this well-designed stimulus to continuing recovery," Snow said, adding that it would be a mistake to raise the tax burden on "anybody" right now.
Democratic presidential contender John Kerry has proposed rolling back the Bush administration's tax cuts for the richest Americans, leaving the rest in place. Retaining the tax cuts is a central plank of the Bush team's strategy for remaining in the White House after the November election.
The Treasury chief, interviewed on local radio before meeting business leaders on a one-day trip to the key voting state of Florida, said record energy prices were acting as a tax on the economy. "The economy has got a lot of basic thrust to it but these current energy prices have created some headwinds for us," he said.
But he voiced confidence that last month's anaemic jobs growth would prove a temporary blip.
"I believe the recent mild deceleration in job creation will be short-lived," Snow said in prepared remarks for delivery to a group of small-business leaders at a pharmaceuticals company.
July saw just 32,000 new jobs created in the United States, which was a very disappointing performance compared with forecasts for 228,000, while June's job gain numbers were also revised lower.
"The underlying fundamentals of our economy are very strong. We've seen that tax cuts work and that job creation does follow economic growth," Snow added.
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