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ThePlumLIneGS whorunsgov plumline
Posted at 12:39 PM ET, 01/16/2012

Slashing government is the biggest jobs killer

 Greg has been beating the drums for a while now on Mitt Romney’s claims about jobs during Barack Obama’s presidency, and rightly so — especially when those claims get repeated uncritically by network correspondents who should know better. Greg has focused on the point that it makes no sense at all to blame Obama, either explicitly (as Romney sometimes does) or implicitly (by using Romney’s statistics) for jobs lost during the first few months of 2009, before there had been any time for the new president’s program to have any effect.

That’s a good point, but it’s also important to realize that perhaps the most important reason that people believe the economy stinks — and make no mistake about it, they do — is the devastating job losses decreed by state and local governments and enthusiastically supported by Republicans in Washington, including Romney and the other GOP candidates.

Matt Yglesias has the numbers for 2011 — 280,000 government jobs lost. And of course it’s not just the actual jobs lost that hurt the economy; it’s also every teacher who didn’t take a summer vacation because she was worried that she would be laid off and every cop or firefighter who decided against buying a new home after hearing about the state budget.

I continue to believe this was the biggest underreported story of 2011, both the direct and indirect effects. Yglesias nails it:

What has happened is that we’ve seen what’s basically a historically unique sustained decline in the quantity of people employed by state and local government. The fact that Barack Obama has been president during this time tends to somewhat confuse people’s analysis, but we basically just ran a year-long experiment in the idea that curtailing the public sector would supercharge private-sector growth, and it's a bit hard to see the supercharging in the data.

By  |  12:39 PM ET, 01/16/2012

 
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