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“Politics Over People”: Romney Endorses Mass Public-Sector Layoffs

Mitt Romney chatted with Bloomberg Businessweek Editor Josh Tyrangiel for a good-but-brief interview, which was published today, and which turned out to be quite informative (thanks to Tricia McKinney for the heads-up).

Tyrangiel asked, for example, about the famous Bain Capital photo featuring Romney and his colleagues posing with cash, and what Romney thinks of the image now. “Oh, that was a moment of humor as we had just done what we thought was impossible,” he said.

The editor also tried to ask the tax-return issue in a new way: “If you’re an investor and you’re looking at a company, and that company says that its great strength is wise management and fiscal know-how, wouldn’t you want to see the previous, say, five years’ worth of its financials?” Romney dismissed the comparison, saying, “I’m not a business.”

I was also delighted to see Tyrangiel ask how Romney intends to balance the budget without raising taxes, without cutting defense, and without touching Social Security. Romney responded by talking about eliminating “Obamacare,” which, of course, would make the deficit worse, not better.

But what I found most interesting was an exchange that probably won’t get as much attention. Tyrangiel asked a fantastic question about the economy: “One thing that distinguishes this recovery is that public sector jobs, government jobs, have already fallen by 650,000. Given the conservative goal of shrinking government, is this a positive development or a negative one?” Romney didn’t give a straight answer, but his take was nevertheless illustrative of a larger point.

“Well, clearly you don’t like to hear [about] anyone losing a job. At the same time, government is the least productive — the federal government is the least productive of our economic sectors. The most productive is the private sector. The next most productive is the not-for-profit sector, then comes state and local governments, and finally the federal government. And so moving responsibilities from the federal government to the states or to the private sector will increase productivity. And higher productivity means higher wages for the American worker. All right?

“America is the highest productivity nation of major nations in the world, and that results in our having, for instance, an average compensation about 30 percent higher than the average compensation in Europe. A government that becomes more productive, that does more with less, is good for the earnings of the American worker, and ultimately it will mean that our taxes don’t have to go up, that small businesses will find it easier to start and grow, and we will be able to add more private sector jobs.”

It’s far from clear that Romney’s correct about the federal government being the “least productive of our economic sectors,” but for the sake of conversation, let’s say that’s true. Let’s just assume that those rascally federal bureaucracies are just too darned “unproductive.”

This is still a deeply misguided policy position.

Remember, the question from Tyrangiel has to do with the economic recovery: is it good or bad that America has been trying to dig itself out of a brutally-deep economic hole while simultaneously laying off 650,000 public-sector workers — on purpose.

Romney’s response is about a long-term vision — a more efficient and productive federal sector will eventually be good for the private sector. That may or may not be true, but the Republican is badly missing the point: how can the economy get better in a hurry if we’re deliberately putting 650,000 out of work? The answer is, we can’t, but apparently Romney doesn’t much care.

For that matter, Romney may struggle with the details of basic economics, but it’s disconcerting that he doesn’t realize who these people are. “The federal government is the least productive of our economic sectors”? What does that have to do with school teachers, police officers, and firefighters who’ve been laid off in droves in communities nowhere near the Beltway?

By: Steve Benen, The Maddow Blog, August 9, 2012

August 11, 2012 Posted by | Election 2012 | , , , , , , , , | Leave a comment

“Deliberate Sabotage”: The Public Sector Is Bleeding By The Knife Of Republicans

Public-sector jobs continued to disappear last month; according to today’s report, government employment is down by 4,000. To Republicans, these aren’t “real” jobs. For the rest of us, however, the decline of the public sector over the last three years has been a tremendous drag on economic growth. Since June 2009, state and local governments have shed more than 600,000 jobs. At the Economic Policy Institute, Josh Bivens and Heather Shierholz crunch the numbers to find that the economy would have 2.3 million more jobs if not for those ongoing losses:

Putting our four components together—the jobs lost in the public sector, the jobs the public sector should have gained just to keep up with population growth, the jobs lost in the private sector due to direct public-sector job declines, and the jobs likely lost when state spending cutbacks on transfer programs were made—we find that if it weren’t for state and local austerity, the labor market would have 2.3 million more jobs today—and half of these jobs would be in the private sector.

This is more than a fifth of our 9.8 million “jobs gap”, the number of jobs needed to bring the economy back to full employment. If all of these 2.3 million jobs had been filled, it is likely that the unemployment rate would now be between 6.7% and 7.5% instead of 8.2%, and the labor force participation rate (which has dropped dramatically in recent years due to weak job opportunities) would be up to three-tenths of a percentage point higher than it is.

Remember: Thanks to Republicans on the state and local level, the United States has been going through austerity for the last two years. Our sluggish economic growth has less to do with the administration’s policies and everything to do with a Republican Party that sees mass immiseration as an opportunity to cut spending.

 

BY: Jamelle Bouie, The American Prospect, July 9, 2012

July 10, 2012 Posted by | Economic Recovery, Economy | , , , , , , , | Leave a comment

“Threatening To Further A Very Bad Trend”: Romney’s All Wrong On Public Sector Employment

Is the 2012 election going to hinge on voters’ beliefs about the government workforce? It seems that at least this week’s news cycle will. It’s an important conversation to have. Public sector job loss is at the heart of our stagnant economy and is a big reason why the recovery can’t get real lift-off. Yet this isn’t a coincidental phenomenon or a bipartisan issue. Republican lawmakers are to blame for the bulk of these job losses, and their solutions to the problem will only add fuel to the fire.

To recap for those who don’t watch the Sunday talk shows: in a press conference on Friday, President Obama said, “The private sector is doing fine.” The full quote shows that he was talking about private sector job creation versus public sector job loss, but the pundits began a-punditing and soon his quote had become synonymous with “the economy is doing fine,” as if the private sector is all that matters.

Never one to sit on an opportunity to muddy his own message, Mitt Romney jumped in later in the day to take it further. Instead of confining his attack to Obama’s (purported) suggestion that things are hunky-dory in the private sector while the economy is still clearly suffering, Romney maligned some of the most beloved public sector workers. He said of Obama: “He wants another stimulus, he wants to hire more government workers. He says we need more fireman, more policeman, more teachers.… It’s time for us to cut back on government and help the American people.”

Both soundbites are likely to get so bent out of shape by the media game of telephone that they’ll eventually end up unrecognizable. But at the heart of each statement lies a fundamental difference in how the two candidates—and the two parties—view the nature of the jobs crisis. From Obama’s point of view, we’re not being dragged down by job loss in the private sector but by losses in the public sector. Romney sees exactly the opposite: we should cut even more jobs in the government and invest more heavily in private sector job creators. (He even explicitly called for government job cuts just a week ago.) So which view is right?

Evidence backs Obama’s perspective. Since the recovery officially began, the number of local government jobs has fallen by 3 percent, while the private sector has actually been able to add jobs—4.3 million, to be exact. And it’s worth comparing those numbers to recent recessions to get the full effect of just how bad, and abnormal, this trend is. Romney is at least partly right in that the private sector isn’t doing as well as it could be. At this point in the recessions experienced in 1992 and 2003, it had added 5 million and 4.5 million jobs, respectively.

But the public sector looks far, far worse now than it did then. As Ben Polak and Peter K. Schott write in the New York Times today, “In the past, local government employment has been almost recession-proof. This time it’s not.” Local government employment actually grew in the past two recessions by 7.7 percent and 5.2 percent for each respective period. This time around, it’s hemorrhaging jobs.

So it seems that while both candidates’ exaggerations were a bit off—Obama misspoke in suggesting that the private sector is completely shielded from pain—he gets closer to the heart of the problem than Romney. The huge fall in public sector employment really is dragging down the economy. As we wonder how to get out of this economic mess, it’s good to keep in mind another point Polak and Schott make: “If state and local governments had followed the pattern of the previous two recessions, they would have added 1.4 million to 1.9 million jobs and overall unemployment would be 7.0 to 7.3 percent instead of 8.2 percent.” That’s a huge difference.

But it’s also extremely important to remember why we’re in this situation. Polak and Schott hypothesize that it could be an electorate that is no longer willing to stomach paying for a growing government workforce. Or perhaps, they say, it’s that state and local governments have run out of ways to handle their extremely crunched budgets. But as Mike Konczal and I showed not too long ago, the massive job loss we’ve been experiencing in the public sector is no random coincidence or unfortunate side effect. It is part of an ideological battle waged by ultra conservatives who were swept into power in the 2010 elections. Republicans seized control of eleven states, and of those, five were at the top of the list for public sector job loss. Only seven states lost more than 2.5 percent of their government workforce from December 2010 to December 2011, and those five newly Republican states were among them. All others fared far better: they lost an average of .5 percent of their government employees.

This means that the eleven states that went red two years ago were responsible for 40 percent of these public sector job losses in 2011. If we add in Texas, a massive red state, we can pinpoint the source of 70 percent of those losses. And these losses were the result of deliberate decisions: even in the face of tight budget constraints, many of these states cut taxes for corporations and top earners while slimming down the public payrolls. It was part and parcel of a new agenda that came in with Tea Party–esque Republican legislators.

All of this is even more important when we switch from discussing the causes of the jobs crisis to the solutions. Romney’s plan looks very similar to those being played out in these ultraconservative states: he wants to further eviscerate the public workforce—including, apparently, policemen and teachers, who are desperately needed right now—while continuing tax breaks and creating even more for top earners and corporations.

On the other side of the aisle, Obama is still demanding—even if the demand is falling on deaf ears—that Congress pass his American Jobs Act, which would spend $35 billion in federal funds to keep those very government workers in their jobs. Guess who opposes that plan? Congressional Republicans and Mitt Romney.

There are still some remaining questions when it comes to Obama’s plan. Where’s the money to put public employees back to work after so many lost their jobs? Even more troublesome, if these job losses are due to ideologically driven decisions, will more federal spending really make a dent? Will these ultraconservative Republicans even accept the money? But it is clear that under a President Romney that money won’t even be offered and even less may be extended. Whether employed by the government or a private business, any voter should be nervous about a candidate that is threatening to further a trend that’s already holding our economy back.

 

By: Bryce Covert, The Nation, June 11. 2012

June 12, 2012 Posted by | Economy | , , , , , , , , | 1 Comment

“Extremely Weak Tea”: The Media Circus Finds A New Spectacle

Political coverage of President Obama can be odd sometimes. We’ve reached the point at which media professionals no longer evaluate the president’s comments at a press conference, for example, but rather evaluate how the comments might be used against him later.

What matters isn’t the substance, then, but whether the substance has the potential to be wrenched from context in future attack ads.

Take this morning, for example. Obama hosted a press conference at the White House, starting with a seven-minute opening statement on the economy and the need for Congress to act on pending job legislation. Then he opened the floor to questions, most of which dealt with the Eurozone crisis.

At one point, a reporter asked, “What about the Republicans saying that you’re blaming the Europeans for the failure of your own policies?” Obama responded:

“The truth of the matter is that, as I said, we’ve created 4.3 million jobs over the last two, 27 months — over 800,000 just this year alone. The private sector is doing fine. Where we’re seeing weaknesses in our economy have to do with state and local government, oftentimes cuts initiated by, you know, governors or mayors who are not getting the kind of help that they have in the past from the federal government and who don’t have the same kind of flexibility as the federal government in dealing with fewer revenues coming in.”

Reporters figured Republicans would seize of the notion of the private sector “doing fine,” so pretty much every other word uttered during the press conference has been deemed irrelevant. Now, the “gaffe” is what matters — include Obama’s important explanation of the policies needed to improve the economy and the damage done by austerity-like measures in the public sector.

Sigh.

As gaffes go, this strikes me as extremely weak tea. The choice of words probably could have been slightly better, but really, to treat this as some kind of breakthrough moment in the campaign is pretty silly. Indeed, what Obama said, in context, is largely correct — compared to the public sector, the private sector really is doing fine.

This isn’t complicated. Corporate profits have soared, the stock market is up, and private sector job growth has fueled the recovery entirely on its own. In fact, private sector job growth last year was the second best year we’ve seen since the late 1990s, and 2012 is on track to be even stronger.

The public sector, meanwhile, continues to be a drag on the economy, laying off workers and cutting budgets. Comparing the two sectors, there’s nothing shocking about saying one is “fine” and the other isn’t.

If the media pushback is that the current growth rates aren’t yet good enough, that’s certainly fair — but I think everyone realizes Obama has said the same thing several thousand times. Republicans and reporters may enjoy being opportunistic with these comments, but that doesn’t make the story legitimate.

For his part, Mitt Romney quickly learned of the media reports and told voters that the president is “out of touch.” Yes, Mr. Elevator For My Cars who isn’t concerned about the poor and who enjoys firing people wants to talk about which presidential candidate is “out of touch.”

The election is 150 days away. It’s only going to get sillier.

 

By: Steve Benen, The Maddow Blog, June 8, 2012

June 9, 2012 Posted by | Election 2012, Media | , , , , , , | 1 Comment

“You’re Under Oath”: Which Party Creates More Jobs?

Here’s a little something everybody ought to know about, from Bloomberg News. They tallied up private-sector job creation since Kennedy’s presidency. Democrats have held the White House for 23 of those years, according to Bberg, and Republicans 28. So fill in this blank: The U.S. economy has created ___ private-sector jobs in the Democrats’ 23 years, and ___ such jobs in the Republicans’ 28 years.

Before we get to the answer, let’s toss in a little background. The political scientist Larry Bartels published a book, Unequal Democracy, on precisely this subject in 2008. I reviewed it for The New York Review of Books. It was interesting because social scientists like Bartels don’t want to think that politics really drives events, but Bartels looked at the evidence on job creation and economic growth under every president since Truman and reached certain inevitable conclusions.

Does that give you any hints? I’ll tell you: Adjust your first-instinct numbers. Then adjust them again.

Ready? Now I’m just killing time so that the answer will be below the fold.

The answer is that 42 million jobs were created under Democratic presidents, and 24 million under Republicans. You can check out the chart here. The champion of course is Clinton, with 20.8 million under Bberg’s numbers. Then comes Reagan at 14.7. Then come Johnson and Carter (yep, Carter). Then Nixon. And so on.

George W. Bush? The private sector lost 600,000 jobs. Imagine. In eight years, he did not create a single job. Obama is now in positive territory to the tune of 40,000, so even though Dubya handed him the biggest economic catastrophe in 80 years, he at least is in the black.

Anyway. The numbers are amazing. And it gets even better. Bloomberg’s Bob Drummond also counted up the number of public-sector jobs created in the respective 23 and 28 years. Results: Federal, state, and local government payrolls grew by 7.1 million under Republicans, and 6.3 million under Democrats.

So drink this in: Private-sector job growth is massively greater under Democrats, and it’s Republicans who’ve increased the public tit.

Now, some sophisticates will say well, you can’t really measure these things from the day a president took office. Better to start when that president’s policies started taking effect. But that is exactly what Bartels did (read my Review piece for details)—and it still came out to a huge advantage for Democratic presidents. In fact, the Obama jobs numbers would be pretty terrific under this methodology, because he wouldn’t have all those Bush-created job losses hanging around his neck. And at the front end, Dubya got credit for some jobs that Clinton’s policies actually created.

If I were the head of the DNC, I’d buy a billboard on a prominent roadway in every county in America and slap these numbers up there.

By: Michael Tomasky The Daily Beast, May 10, 2012

May 11, 2012 Posted by | Economy | , , , , , , | 2 Comments

   

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