gwen: talk about white house ups and downs. bad news on jobs numbers. good news on elena kagan. and mixed political fallout from a california gay marriage decision. tonight on "washington week." >> the road to recovery doesn't follow a straight line. some sectors bounce back faster than others. gwen: no kidding. the nation's economic zigzag continued in july with new signs of weakness. the light at the end of the tunnel still some distance away. but history was made in the senate this week with elena kagan's supreme court confirmation. the debate was familiar. >> her record clearly demonstrates a propensity toward pursuing an activist agenda. >> they want their own brand of activism. judicial activism of the right.

to pull the court and the country away from the mainstream. gwen: but the president won the day. >> so it is now my great pleasure to introduce as our next supreme court justice elena kagan. gwen: and in california, a judge overturned a ban on same sex marriage. >> americans are going to understand that we are people. we lead exciting lives, boring lives, we love our family, our friends, our children. and so it is a great day. >> the voters say no, then they should decide, not a federal judge. gwen: a constitutional fight most likely headed to the supreme court. covering the week, eamon javers of cnbc. joan biskupic of "usa today." and gloria borger of cnn. >> award winning reporting and analysis. covering history as it happens.

live from our nation's capital, this is "washington week with gwen ifill." produced in association with national journal. funding for "washington week" is provided by -- boeing. exxonmobil. the ethics and excellence in journalism foundation. the annenberg foundation. the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. once again, live from washington, moderator gwen ifill. gwen: good evening. it's tough to present bad news as good or to focus on silver linings when the cloud cover just won't break. but that was the task that faced the obama white house this morning when they were presented with these numbers. 131,000 jobs lost in july. 71,000 private sector jobs

created which was good except experts had predicted it would be 83,000. add it all up and 14 million people are still looking for work. that made it difficult today for the president to find much good to say. >> there's some good trends out there. that's the good news. but for america's workers, families, and small businesses, progress needs to come faster. gwen: so let's look behind the numbers. are there indeed good trends out there, abc's the president was saying today? >> there really are. the president is in a position where he wants to sell whatever silver lining he can find but bottom line, losing 131,000 jobs is really a political disaster for this administration. and when you look -- take away the census which was a big part of that. the census has started to lay off a lot of the temporary workers. so the private sector created the 71,000 jobs. that's tepid at best. and so barack obama is in a position now where he's got to go into the fall campaign selling these numbers which are just really, really bad.

after having spent a lot of money and spent the first year and a half of his administration trying to do something about jobs, jobs, jobs, the issue everyone has said in washington is going to be the number one political issue. gwen: the best thing that christina roemer, council of economic advisors share, his outgoing council of economic advisors chair, is look, the manufacturing industry is rebounding. or the auto industry is rebounding. even if these long-term jobs seem to be stuck. >> yeah. he was at a ford plant yesterday talking about next generation technologies in the auto manufacturing industry. he was at a g.m. plant last week. and the administration actually believes that talking about the auto industry is really good politically for them right now. because they think that the auto bailout has actually done something to preserve jobs, particularly in the midwest. and they're starting to see real traction. we're going to see an i.p.o. from g.m. and this might get out from under government protection at some point before too long. so they think that's a winner for them.

particularly because they can talk about made in america, blue collar working class jobs. those are jobs that people want to they're about on the campaign trail. so you'll hear a lot about that from the president. >> talking is one thing. mid-term election coming up in november. is there anything they can do realistically between now and then to change that jobless rate? >> the problem is when you have 14.6 million people who are out of work as we have right now, it's just a horrific situation. and there's not that much that they can do. the impressions politically sort of harden late summer, early fall. that's the sort of mindset that people are going to carry with them into the voting booth. for the democrats, it's going to be a bad late summer and early fall. it's too late. and when you look at this on a curve, and you look at the graph, the jobs that we were losing have started to lessen and lessen and we came into positive territory and tipped into positive and now flattening out again. and that's a problem for the administration. >> at least they're not dipping again, though. >> alan greenspan said we're in

a pause in a recovery and that's not what the country can afford so for obama it's really tricky. >> a deeper question about the people behind these numbers. does it really reflect some people who have been out of work for a very long time and who are -- who just are no longer looking for jobs and aren't being counted and isn't that group now swelling? >> well, that's right. and that's why the unemployment rate, even though we lost 131,000 jobs, the unemployment rate stayed fixed at 9.5%. the only reason that's possible is because so many people actually gave up looking for work. they're not counted in the unemployment numbers that we count statistically. so they're out of the work force altogether. but they're going to be voting in the fall. so those people are experiencing a lot of pain right now. gwen: we saw an interesting thing happen in the senate which they passed a jobs bill that was targeted toward state and local employees. which is -- which is one of the -- the segments that took a big hit according to these latest numbers. and then the house gets to come back from their vacation and wherever they've gone this

weekend in order to vote on the same thing. is there a connection between all these things, in the political sense? >> there is. and the connection is spending in washington. and whether government can do anything to get us out of this economic fix. the democrats have said yes, their theory of the case is that if you spend money in washington, eventually that's going to have some impact in pumping up the economy. republicans are very skeptical of that and say hate -- wait a second, more democratic deficit spending and they'll take that case into the fall elections, too. and say these democrats not only have they not fixed the problem, but they made the deficit -- >> isn't there some disagreement among the president's economic advisors about whether you need more stimulus? >> yeah. >> or whether you actually should not have any more -- because you norwood to be more concerned about those long-term deficits? >>nd we've seen some turnover among the top plarings. peter orszag. gwen: wasn't she on the losing side of that argument? >> she got into arguments with larry summers, the president's economic advisor who's maybe more in sort of the traditional centrist democrat camp

historically. and the president has a lot of economic advisors. he created all these advisory boards and panels and things when he was first sworn in to office. and now he's got a conflicting set of recommendations. gwen: why is she leaving really? >> a lot of people think that she will be the next head of the san francisco fed. and so moving back to the west coast and teing herself up for that job and as an economist a good job and get out of washington where she hasn't been able to find a place for herself in this administration. >> another trend line that was mentioned in gwen's opening, foreclosures. are people more reluctant now to move for jobs anywhere? and how is the troublesome housing market intersecting with the job rate here? >> a lot of people can't move for a new job offer. and that's part of what's going on. people are stuck. if you're like me and you bought your house in 2005, close to the peak of the market, you aren't going to be moving anywhere anytime soon. and that's a problem. and also --

gwen: you like your house? >> i love the house and we're not moving anytime soon. but look, people ultimately are in a situation where not only -- certain people are stuck. but confidence of everybody else is really impacted when they see that happening to their friends and their neighbors. consumers aren't spending and we also see that confidence affected on the corporate side. companies aren't spending. we have companies reporting huge earnings, and they're not spending money. and so that's keeping the economy stuck right now. gwen: and they revised the numbers from last month downward. so we don't even know what's going to happen next month. these numbers might not even hold. the white house didn't have good news on that front and didn't have to struggle to put a good face on yesterday's confirmation of elena kagan to serve on the nation's highest court. in fact, they threw a party today. >> and i also very much enjoyed meeting with 83 senators and really who's counting? [laughter] gwen: when she is formally sworn in tomorrow the history books will get a new entry.

>> for nearly two centuries, there wasn't a single woman on the supreme court. when elena was a clerk, there was just one. but when she takes her seat on that bench for the first time in history, there will be three women serving on our nation's highest court. it is as justice ginsberg recently put it one of the most exhilarating developments. gwen: the face of the court will change in other ways on the first monday in october as well. elena kagan is 50. the man she's replacing, justice john paul stephens, is 90. and that's not the only generational shift, is it, joan? >> that's right. think of how much this court has changed in the last five years. chief justice john roberts, succeeded william rehnquist who is nearly 30 years older. samuel alito, succeeded sandra day o'connor who was nearly 20 years older and both of them have come on and been much more assertive conservatives, much more active on the bench. pushing the court a little bit more toward the right. and i think we're going to see

evidence of that now from the liberal side. someone who's 40 years younger than her predecessor. and elena kagan has already showed us, with that kind of wit that we saw in that clip, that she's much more focused, determined, she's used to the rough and tumble of politics, too. so i think we're going to see someone who's much more active on this court even though she might vote the same way as her predecessor. gwen: and someone who didn't hesitate even when she was solicitor general to go toe-to-toe with someone like antonin scalia? >> nare a perfect pair. we have a couple of pairs. justice ruth bader ginsburg is very close to justice scalia. who is on the hard right. but elena kagan and scalia really get along. and even that new yorker thing, new jersey thing happening. he's from queens. she's from manhattan. ginsburg's from brooklyn. and we got sonia sotomayor.

gwen: a third of the court is from the five boroughs of new york and new jersey. >> really. and that shows. it shows in the youth of the court. it shows in this northeast thing going on. so i think that elena kagan is not going to have any kind of real freshman anxiety. she's not going to lay back. there's only so much you can do as a junior justice. >> she still gets a vote. >> right. but she votes last. >> and also different because she's never been a judge before. does she get a certain amount of hazing there? >> it's interesting you mention the experience because that's why some republicans said they voted against her because she had no judicial experience. we're so accustomed to this thing of -- the nominees coming already wearing a black robe. but back in 1972, president nixon named william rehnquist and louis powell, who went on to very distinguished careers and neither of them had been a judge before. elena kagan has been solicitor general of the united states for the past 18 months. she's the government's top

lawyer before the court. she gets the court. she knows the routines. there will be plenty of things that will be new to her. deciding cases. but she's already somebody who's been in that mileau who gets what they're doing. >> i'm wondering about this as i watched this process this year, i was thinking about back to last summer and the sotomayor situation. and that had all this heat and light and blogosphere and media. and then kagan is almost disappears from the media entirely for the entire time. i almost forgot she was in process here. why was that? >> yes. we were holding some nomination hearings. >> right. >> exactly. >> and b.p. oil spill. ok, first of all. what made sonya sotomayor such an important figure. the first latina and first appointment of president obama. very historic. so there was a lot of attention there. and a lot -- face it. a lot of political attention, too. now we have a woman come on who is highly credentialed.

went to princeton undergrad. harvard law school. had been the first woman dean at the harvard law school. you know, just had a very strong background in both the clinton administration and obama administrations. but she didn't give the republicans much to fight over. we had that -- we had the skirmish over the military recruiting policy at harvard. but it didn't really take off. so the republicans who tried to make her an issue found that there was no traction there. the obama administration have all these other things going on. so they didn't want any real attention on her except for -- to say look for putting the forth woman in history, the third woman for now. gwen: now that she is about to arrive, and she takes the oath of office at the supreme court chambers, justice roberts will swear her in on saturday. so that happens. what are the first things coming down the pike? the supreme court, past several years, as you well know, has been just a hotbed of incredible consequential action. we were going to talk in a moment about gay marriage. >> oh, look what's coming their

way. we have a fight over the health care overhaul. that's percolating up. we have a fight over the arizona immigration law. that's percolating up. we're going to talk about the fight over proposition eight in california. those are very big issues that will eventually get to her. and obviously in her lifetime with her just being 50. but immediately, the supreme court already has about a third of its docket set for the upcoming term that will begin the first monday in october. we have a fight -- another fight from california over state restrictions on video games. violent video games. they got that case coming. they have a very good first amendment case over -- that votches fred feps who will often -- involves fred phelps who will often picket at military funerals. >> the health care mandate issue -- >> it's in a lower court now but it will. she will be tested right away. nine, 10 months from now we'll say what -- how will her vote differ from john paul stephens.

gwen: let's talk about one of those issues that will be percolating up to justice kagan's court. u.s. district court chief judge vaughn walker stirred things up by ruling this week that california voters violated the constitution when they voted to ban same sex marriage. the winning lawyers in the case were an odd couple. ted olsen and david boies who you will remember opposed each other famously in bush v. gore in 2000. but they banded together to take on california's proposition eight. gloria spent some time with both of them. for her reporting at cnn. why do they take this case on now? and why this case? >> those are questions that lots of people were asking at the start of this. including lots of gay groups. because they were saying, ok, you have this conservative legal icon, ted olsen. teaming -- gwen: former solicitor general. >> teaming up with in democrat, david boies, to take on proposition eight. and it's something that the issue of gay marriage has not

been successful at the state level if you're for gay marriage. more than 40 states are on the record opposing it. only a handful of states support it. and there were a lot of gay activists saying wo. why are you rushing this? why not let this work its way flew the states? this could really be a problem for us if we lose, it will set us back. that's exactly the point i raised with these two superlawyers. and they said to me, look, we see this as a clear sism rights issue. they saw proposition eight as a violation of the equal protection clause of the constitution, period. that's exactly the way as it turned out judge walker saw it. and when i said to them, ok, so it's a civil rights case. still why now? and i'll tell you what, ted olsen is very emotional when he talks about this case. he said, when do you tell real people who are being denied their rights that they ought to

wait? and he refers to dr. king's letter from the birmingham jail when he talks about it. and he quotes from it. and says, who are we as lawyers to tell people, wait, 10 years, then you're going to get your rights. gwen: i was struck by the language of the decision. we are used to these narrowly drawn supreme court decisions. this was not narrow at all. he didn't just say it's a cons turingsal issue -- a constitutional issue. he said it was a scandal. >> he said proposition eight does nothing more than enshrine in the california constitution the notion that opposite sex couples are superior to same sex couples. gwen: that was farther than he had to go. >> well, he was talking about the finding of facts. and you're the legal eagle here. in this case. and it's interesting. the proposition -- the folks who were defending proposition eight did not bring a lot of folks to testify.

>> and in a turned out to be a problem. -- and that turned out to be a problem. judge walker hit that over the head and it's the j job of a trial judge to set out the findings of fact, appeals court judges look at the law so he's established this record that is very lopsided. >> right. >> gloria, you have talked to gay rights activists a lot on this. to get back to your very first point about the timing of this, the supreme court is still very polarized. it's very divided. the conservatives still have the upper hand. gwen: right. >> and were you finding that a lot of people who were suspicious of ted olsen and david boies think it's paid off? or anxious? >> i feel that gay activists are still anxious. it's got a long way to go before it gets to the supreme court. it could be a few years. it goes to the ninth circuit. and that's going to take some time. gwen: and still uncertain whether folks can actually get married in california. >> the judge issued a stay of his own opinion. because there's a question of

whether you put people in legal limbo. in california. you could create a whole new class of people who get married and then it could be invalidated. which has been a problem. so, you know, i think this judge was trying to be very, very careful. >> what about on the right? talking about gaietyists on the left. on the right, -- gay activists on the left. on the right, do conservatives feel betrayed by olson? gwen: they've been quiet. >> so is the white house. but conservatives, there are some who think, and i've spoken with a bunch who say this is a complete betrayal. you know, how does ted olson see this as a cons -- a constitutional issue? this man has argued before the supreme court 56 times and won 44 times, mostly on conservative issues. why is he seeing it this way? there are some libertarians who agree with ted olson and say that republicans should be thinking about what they ought

to do to promote family. and that in fact, this is a family issue. and olson told me he consulted with conservatives before he took this case on. and not one of them convinced him differently. as for obama -- gwen: i was going to ask you. the president is on record as not being in favor of gay marriage. >> well, this is -- this is the interesting thing. he is not in favor of gay marriage. he is in favor of civil unions. gwen: right. >> civil unions are very different from being able to get married. and it's an issue, you know, that cuts politically in very different ways. because david a.al rod, senior advisor to the -- axelrod, senior advisor to the white house, said it was a good ruling and the president doesn't support gay marriage. this is a states' rights issue, right? because people have voted in the state of california against gay marriage. 52% of the people in this country don't want gay marriage. so that's -- it's also politically a generational

issue. young people say it's fine. older people don't want it. gwen: in the president's first book, he talked about this and said maybe i'm on the wrong side of history. so maybe there's room if there are political reasons to do it to shift. we'll see. we'll be watching. thank you, everyone. we have to leave you a few minutes early this week. so you can have a chance to support your local pbs station which in turn supports us. but if you're hungry for more, the conversation continues online with web exclusive content. including our webcast extra. my blog, and links to other popular pbs programs. that's at pbs.org. keep up with daily developments on air and online and we'll see you again right here next week on "washington week." good night.

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