JUST LIKE CLOCKWORK…. As frustrating as it is to see the economy shed another 216,000 jobs in August, the trend is at least going in the right direction. August’s numbers were bad, but they were slightly better than expected, and more importantly, they constituted the best month for the U.S. job market in the last 12 months.
White House press secretary Robert Gibbs said the improvements are evidence of successful administration efforts. House Speaker Nancy Pelosi added, “We have a long way to go; but fortunately, President Obama and congressional Democrats acted decisively earlier this year, and the results are beginning to show.” The chief economist for the U.S. Chamber of Commerce — not exactly Liberal Central — said the stimulus has, in fact, helped turn the economy around.
Then, there’s the other side. Republicans responded to this morning’s jobs report exactly as they have every month since February — by expressing outrage that President Obama, who inherited the worst recession in generations, has not already fixed the economy. Republican National Committee Chairman Michael Steele said the August numbers are proof “this administration is ignoring reality.”
The irony is rich. In fact, Pat Garofalo has a good item about reality today.
Of course, the new numbers have ignited the monthly ritual of conservatives labeling the stimulus a failure. Rep. Eric Cantor (R-VA), after calling this week for completely canceling the stimulus, doubled down today, saying that the jobless numbers mean we should use stimulus funds to “pay down our debt.”
But as Bloomberg News pointed out, “rising joblessness underscores Treasury Secretary Timothy Geithner’s judgment this week that it’s ‘too early’ to start exiting from the unprecedented stimulus measures aimed at stabilizing the economy.” Indeed, as Felix Salmon noted, the effects on economic activity of the overall number of unemployed workers “are huge.” “If each person ends up spending $20,000 less a year on average, that adds up to $138 billion in lost economic activity,” he calculated. It’s because of this vastly reduced activity that the economic stimulus is so important.
Economists at Goldman Sachs predict the U.S. economy will grow by 3.3 percent in the third quarter of this year, and that “without that extra stimulus, we would be somewhere around zero.” But it will take time for GDP growth to translate into job growth, meaning that conservative calls for canceling the stimulus or abandoning all manner of domestic policy items will likely continue.
The blazing fire the president found burning when he was sworn in hasn’t been extinguished. And the first Friday of every month offers his detractors another chance to ask why the president keeps throwing water at the problem, using the smoldering ashes as evidence of why the spigots should be turned off immediately.
Republicans fought like hell to defeat the recovery efforts, and are prepared to fight again to stop these efforts from continuing. But let’s not forget that these GOP critics were wrong — they demanded a five-year spending freeze that would have devastated the economy. The Washington Post reported today that “economists generally agree that the [stimulus] package has played a significant part in stabilizing the economy.”
That doesn’t mean the new job figures aren’t discouraging, but for those who don’t want to “ignore reality,” it’s something to keep in mind.