IT DOESN’T HAVE TO BE THIS WAY…. In September, the economy added 64,000 private-sector jobs, while losing 159,000 public-sector jobs. The former number can best be described as “meh”; the latter as “awful.”
But the public-sector losses, unlike most of the summer, weren’t driven entirely by the Census Bureau. Indeed, David Leonhardt explained that local governments cut 76,000 jobs last month — and cut 143,000 jobs over the last three months — many of them from public schools. All told, local governments are now “cutting jobs at the fastest rate in almost 30 years.”
This is an important detail to keep in mind. Republicans are likely to say today’s jobs report is disappointing because private employers are worried about Bush-era tax rates, or health care reform, or whatever the new talking points say. But that’s foolish — the new jobs report would have looked a whole lot better if Congress had saved those local government jobs. It had the ability to do so, but chose not to.
Ezra Klein explained this morning:
The government is now impeding an economic recovery. But it’s not for the reasons you often hear. It’s not because of debt or because of taxes. Nor has it scared the private sector into timidity. It’s because, at the state and local level, it’s firing people. There are more than 14 million Americans looking for work right now — to say nothing of the 9.5 million who have been forced into part-time jobs when they want, and need, full-time work — and the government just added 195,000 more to the pool. Consider this: If we only counted private-sector jobs, we’d have had positive jobs reports for the last nine months. As it is, public-sector losses have wiped out private-sector gains for the past four months.
It doesn’t need to be like this. The government can’t make the private sector invest. They can’t demand that Wal-Mart stop hiring. They can offer incentives, and tax breaks, and encouragement, but that’s it. The same cannot be said when it comes to public sector jobs. The government can, if it’s willing to run deficits, keep those workers employed. But Senate Republicans, alongside some conservative Democrats, have decided to make the government pro-cyclical: Rather than fighting the downturn in the business cycle, the government is now accelerating it.
It would have been surprisingly easy for Congress to make the investments in state and local governments necessary to save these jobs. But lawmakers have come to believe (a) Republicans would block any such effort; (b) voters may punish Congress for “spending”; and (c) the electorate will reward GOP candidates for supporting the policies that prevented these jobs from being saved.
We have an obvious economic problem. But the political problem is standing in the way of making things better.