Looks like those green shoots of economic recovery remain rooted in hope more than reality. The December jobs report is out and, to the surprise of no one who’s actually dealing with the shrinking job market, we lost yet another 85,000 jobs last month. Hopeful forecasters had grasped at the slowed rate of decline in November and predicted we’d lose fewer than 10,000 jobs over the holiday season. But we can toss that one in the trash bin alongside predictions that foreclosures would stop and credit would flow if we just gave big banks enough money.

The White House has rightly noted that 85,000 jobs lost is nothing like the nearly 700,000-a-month we averaged in the first quarter of 2009. “As the President has said for a year, the road to recovery will not be a straight line,” White House Council of Economic Advisors Chair Christina Romer stressed in a statement. “Therefore, it is important not to read too much into any one monthly report, positive or negative.”

But Romer also joined the undaunted soothsayers of recovery in pointing out that the unemployment rate held steady at 10 percent in December. “Compared with the unexpectedly good report for November, December’s job loss is a slight setback,” Romer insisted.

But as the Economic Policy Institute counters, the only reason the unemployment rate didn’t rise in December is another 661,000 people gave up trying to find a job; they join an estimated 3.6 million “missing workers” who have dropped out or just never entered the labor force since the recession began.

Meanwhile, 40 percent of America’s millions of unemployed have been jobless for more than six months. If recovery is defined by fewer and fewer people even trying to participate in the economy, then sure, we’re building steam. Otherwise, November’s “good report” is more truthfully described as an aberrational surge.

The political necessity of defending President Obama’s stimulus package drives the White House into a losing rhetorical battle on the economy. It’s gotta prove a negative — that the stimulus averted an unseen disaster that would have been even greater than the one we’ve got. That’s true, but it’s a tough political argument to make. And it has compelled the White House to soft-peddle today’s reality — that the stimulus, while necessary, wasn’t nearly enough and we now need a massive job creation package, too.

Progressive economists are busy making the case that job creation is smart deficit spending — unlike the reckless deficits we ran up over the past decade with unchecked defense spending and tax cuts. President Obama faces a tall job making that case, too. He’d have been far wiser to do it back in 2009, but that’s history.

Since Obama finally joined congressional Democrats in calling for a jobs package last month, he has framed it as limited and stressed his own deficit-reduction commitment. He’s expected to unveil a budget in early February that will show his deficit hawk bona fides. And certainly, as The American Prospect’s Tim Fernholz details, progressive economists would be well served to begin framing what smart deficit reduction looks like. But let’s hope the president doesn’t get lost in his political rhetoric on this one. It’s an argument he can’t win, as Robert Reich argues well. And without a massive investment in job creation, and soon, the new year will be as ugly as the old one.