The monthly jobs report for April is encouraging for what it says about the economic recovery — but it’s also a reminder of the degree to which Congress is holding the recovery back. The economy added 165,000 nonfarm payroll jobs, and the unemployment dropped a bit to 7.5 percent. The upward revisions to the two previous months are key: Together they mean that in February and March, 114,000 more jobs were added than previously reported.
The upward revisions raise the possibility that today’s number will also be revised upwards, and suggests the possibility of gathering strength — but only the possibility of it. As economist Betsey Stevenson put it: “This report isn’t enough to conclude that the labor market recovery is accelerating. Enough to hope, but not to conclude.”
On the bright side, today’s report suggests that recent bad economic data is not necessarily the sign of something deeply troubling, as some economists had feared.
What does today’s report tell us about the sequester? April was only the first month in which sequestration really took effect, and many observers don’t expect to be able to gauge its real impact for some time. But as Jared Bernstein notes:
Those looking for losses in sequester-sensitive industries could see some evidence in the report, as construction (down 6,000), government (down 11,000), and manufacturing (zero jobs added) all came in weak. Thus, all of the job gains last month came from private, service producing industries.
All of this makes you wonder how much better the economy would be performing if Congress were not actively impeding the recovery with its emphasis on deficit slashing and sequestration. We’re moving in the right direction, but we could be moving in the right direction a whole lot faster.
* Yes, spending cuts are a drag on the economy: The Times talks to economists who make it simple: A key reason the economic recovery remains sluggish is cuts to government spending, including the cuts from the sequester (the expiration of the payroll tax is also to blame). Paul Krugman’s column this morning is directly relevant, noting that the failure to do precisely the opposite could have potentially disastrous ramifications over the long term:
Whenever anyone talks about the need for more stimulus, monetary and fiscal, to reduce unemployment, the response from people who imagine themselves wise is always that we should focus on the long run, not on short-run fixes. The truth, however, is that by failing to deal with our short-run mess, we’re turning it into a long-run, chronic economic malaise.
But the sequester is a “victory” for Republicans…
* Republicans expect Mel Watt to be confirmed: Buried in this Politico story is the following revelation about Mel Watt, Obama’s pick to oversee Fannie and Freddie, and Penny Pritzker, his Commerce Secretary nominee:
Barring unforeseen disclosures, Pritzker and Watt will most likely be confirmed by fairly narrow majorities, both White House and Senate Republicans predicted to Politico, in part, because GOP Senators would be reluctant to filibuster a woman or an African-American.
Replacing Ed DeMarco as head of the Federal Housing Finance Agency would be a first step towards realizing “principal reduction” and bringing relief to distressed home borrowers — and by extension, boosting the economy.
* Top Dems focus on Massachusetts Senate race: Michelle Obama is set to headline a fundraiser for Ed Markey, the Dem Senate candidate in Massachusetts, the first of many top Dems who will likely involve themselves in the race. It seems unlikely that Markey’s opponent, former Navy SEAL Gabriel Gomez, will prove to be another Scott Brown — it’s not 2010 anymore; Markey is a better candidate than Martha Coakley; and Brown was a very strong candidate — but Dems clearly are taking no chances.
* Obama is right to insist on a “permission structure”: Brian Beutler explains that in calling for a “permission structure,” Obama actually is showing the “leadership” the Green Lanternites are calling for. The idea: make it possible for Republicans and Dems to reach a budget deal by minimizing impressions of his involvement:
In this instance, the “permission structure” refers to Obama’s efforts to convene a bipartisan group of senators who can reach a budget deal without his direct imprimatur…His recent dinners with members of both parties were designed to ferret out the Republican and Democratic senators who are likeliest to agree to a mix of higher taxes and lower spending…Obama’s putative absence is key to creating the political space Senate Republicans need to negotiate in good faith.
As noted here yesterday, the problem is Republican voters are not inclined to allow their representatives to compromise with Obama. The “permission structure” is a way around this problem — hence, it should be embraced by the “Obama must lead” pundits.
* Why the Green Lantern Theory of Presidential Power matters: Relatedly, John Dickerson makes an important point: The constant claim Obama has failed to “twist arms” as an explanation for stalemate actually has consequences:
If a president is dunned for not leading, he gets some or all of the blame when policies get stuck. This relieves public pressure from Congress: It’s not their fault for dithering, it’s the president’s for not prodding them into action. In the current context, the more Obama’s weakness is the story, the less coverage there is of the dysfunction in the House of Representatives. Occasionally, both sides will get a share of the blame in the coverage, but the result is the same: Everyone throws up their hands and nothing gets done.
And the dysfunction among Republicans is really the core problem here.
* Does the GOP face serious long term problems? Ron Brownstein has a must read in which he poses a question that’s familiar to readers of this blog: Is there a point at which being on the wrong side of public opinion on many major issues will actually matter to the GOP’s national aspirations? As Brownstein notes, lockstep opposition to gun reform is only the latest way the GOP may be alienating core voter groups they must improve among. However, the bad economy could prevent Dems from capitalizing fully among those constituencies.
* Marco Rubio renews pressure for immigration reform: The Florida Senator makes his pitch for reform in the Wall Street Journal. This is the key line: “defeating it without offering an alternative cannot be the conservative position on immigration reform. That would leave the issue entirely in the hands of President Obama and leave in place the disastrous status quo.”
It seems the best hope for winning over conservatives is to paint failure to pass reform as a victory for Obama.
* And your sorely needed Friday comic relief, Louis Gohmert edition: The GOP Congressman has been claiming the FBI has been hampered in its investigation of the Boston bombings because of a reluctance to talk about Islam and jihad out of fear of offending certain ethnic and religious groups. Glenn Kessler thoroughly dismantles the claim, giving it Four Pinnochios.
Yet this claim has gained wide circulation on the right; until more rational Republicans extract some kind of public price for trafficking in this kind of stuff, it will hamper that GOP makeover.