Michael Steele: Government Work Not Same as Job

Yesterday morning’s appearance on ABC’s “This Week” by new GOP chair Michael Steele is causing some consternation. This passage in particular:

STEELE: What this administration is talking about is making work. It is creating work.

STEPHANOPOULOS: But that’s a job.

STEELE: No, it’s not a job. A job is something that — that a business owner creates. It’s going to be long term. What he’s creating…

STEPHANOPOULOS: So a job doesn’t count if it’s a government job?

STEELE: . . . .That is a contract. It ends at a certain point, George. You know that. These road projects that we’re talking about have an end point. As a small-business owner, I’m looking to grow my business, expand my business. I want to reach further. I want to be international. I want to be national. It’s a whole different perspective on how you create a job versus how you create work. And I’m — either way, the bottom line is…

STEPHANOPOULOS: I guess I don’t really understand that distinction.

STEELE: Well, the difference — the distinction is this. If a government — if you’ve got a government contract that is a fixed period of time, it goes away. The work may go away. That’s — there’s no guarantee that that — that there’s going to be more work when you’re done in that job.

During this, I was shouting obscenities at Stephanoupolous, questioning his intelligence at being so unable to grasp an obvious point. Matt Yglesias and Steve Benen seem to share his confusion, however, so maybe I’m unusually adept at deciphering Steele’s secret code.

Steele’s formulation — that “work” and “a job” are different things — is rather awkward but the idea that a contract to do a specific project is not the same as a permanent position should be rather obvious. It’s the difference between a freelance assignment to write an article at 10 cents a word versus a staff position at a magazine.

Now, the obvious retort is that the perfect shouldn’t be the enemy of the good. That, to an unemployed person, paid work beats the hell out of nothing. The retort to that, presumably, is that the government contracts that are being created for the purpose of “stimulus” are mostly frivolous and are crowding out the creation of “real” jobs, since the would be entrepreneur is having to compete against Uncle Sam’s pocketbook.

At least that would be an interesting discussion.  Pretending to be so gobsmackingly stupid as to interpret Steele’s remarks as saying the schoolteachers and soldiers are unemployed, on the other hand, not so much.

FILED UNDER: Economics and Business, US Politics, , , , , , ,
James Joyner
About James Joyner
James Joyner is Professor and Department Head of Security Studies at Marine Corps University's Command and Staff College and a nonresident senior fellow at the Scowcroft Center for Strategy and Security at the Atlantic Council. He's a former Army officer and Desert Storm vet. Views expressed here are his own. Follow James on Twitter @DrJJoyner.

Comments

  1. raoul says:

    I do not see an economic difference between a job and work- in fact, in a macro-economic sense, all jobs are temporary- in practice (“reality”)- this goes to construction work, retail, farming, government, food service. In fact a vast minority of people stay with their work more than 5-7 years. Interestingly enough, one of the jobs that have created the greatest permanency, industrial manufacturing, is the one that has suffered the greatest work loss.

  2. Steven Donegal says:

    Even accepting Steele’s distinction, he has no proposal to create “jobs” other than more tax cuts. I understand that’s all the Rs have, but at some point, you think they would try to explain how lower marginal tax rates help people who don’t have jobs (or work, for that matter).

  3. Franklin says:

    Extrapolating Steele’s and Joyner’s comments, I come up with “building a road is frivolous.”

  4. Billy says:

    If a contract isn’t a “job,” then do we stop counting all positions held by contractors and their subs in the private industry too? It is my understanding that a great many industries revolve around such a structure, and many, many individuals are employed (solely in the private sector) on such a basis.

    Please explain how a government contract is different from a private one in this context – I also am apparently incapable of deciphering Steele’s secret code if he has explained this point.

  5. sam says:

    Uh, the distinction is lost on me, too.

    Steele’s formulation — that “work” and “a job” are different things — is rather awkward but the idea that a contract to do a specific project is not the same as a permanent position should be rather obvious.

    Construction workers are in this boat. As are aircraft workers, shipyard workers, and, indeed, given that the sorry MO in hitech when confronted with a downturn in stock price is to lay off workers, I’d put IT folks in there, too. I’d go further: there is no such thing as a permanent job in modern America for blue collar, and much of white collar, folks. A “job” lasts only untl management decides, often as a result of carping from Wall Street about the stock price, that it’s not not in management’s interest to keep you. How this equates to “permanence” is hard to fathom.

  6. Steve Verdon says:

    A 6 month make work “job” is not quite the same as an job with an employer that is for an indefinite period of time.

    In the former case you’ll take the money and save as much as you can so you can draw down your savings when the “job” ends. In the latter case you will likely spend a higher portion of your income since you’ll have an income stream with an indefinite end point. In short, different types of jobs elicit differnt types of behavior.

    Raoul,

    Yes, in the long run all jobs are temporary, but in the long run we are dead, so what’s your point?

    Franklin,

    No, not frivolous unless there is no need for the road. I would suggest that roads should be built when they provide more benefit than cost. To get really technical I’d argue we should build roads up to the point where the marginal benefit of an additional portion of road is equal to its marginal cost.

    sam,

    I’d go further: there is no such thing as a permanent job in modern America for blue collar, and much of white collar, folks.

    I don’t think there has ever been a time in America were any job is permanent. But as for your confusion see the explanation I offer at the top of my comment.

  7. Eneils Bailey says:

    During this, I was shouting obscenities at Stephanoupolous, questioning his intelligence at being so unable to grasp an obvious point.

    If you want to grasp the current situation from the other side, just consider the following:

    So a job doesn’t count if it’s a government job?

    STEPHANOPOULOS: I guess I don’t really understand that distinction

    FDR spent eight years of trying to make this crap work; it did not.
    Government does not create wealth and therefore more tax paying citizens. It creates a society that consumes the wealth of those capable of alleviating the problem.

    is that the government contracts that are being created for the purpose of “stimulus” are mostly frivolous and are crowding out the creation of “real” jobs, since the would be entrepreneur is having to compete against Uncle Sam’s pocketbook.

    YES, in a one word answer.

  8. Billy says:

    In the former case you’ll take the money and save as much as you can so you can draw down your savings when the “job” ends. In the latter case you will likely spend a higher portion of your income since you’ll have an income stream with an indefinite end point. In short, different types of jobs elicit differnt [sic] types of behavior.

    The real irony is that you call this an “explanation” when it is, in fact, unsubstantiated speculatory post-hoc rationalizing as to why Steel drew an arbitrary bright lexical line where no substantive line exists in the real world.

    You have yet to cogently address how a private contractor differs from a public one. Based on your “explanation,” do private contractor jobs not also elicit the same type of behavior as those entered into by public agencies? Do you have an explanation for why the same payment structures create different results simply because the taxpayers are behind one party?

    Or are you just a lick spittle follower?

  9. Steve Verdon says:

    The real irony is that you call this an “explanation” when it is, in fact, unsubstantiated speculatory post-hoc rationalizing as to why Steel [sic] drew an arbitrary bright lexical line where no substantive line exists in the real world.

    No Billy, it is based on the permanent income hypothesis. It is what forms the basis that lower income people have a higher marginal propensity to consume and why directing money their way results in a higher fiscal multiplier.

    You have yet to cogently address how a private contractor differs from a public one. Based on your “explanation,” do private contractor jobs not also elicit the same type of behavior as those entered into by public agencies?

    Yes they would. Of course, it also depends on one’s beliefs in terms of securing new employment. During strong economic growth one might conclude that the probability is high. Thus, a test of this hypothesis is whether or not contractors/consultants gravitate towards permanent employment during periods of weak economic growth.

    Do you have an explanation for why the same payment structures create different results simply because the taxpayers are behind one party?

    I said nothing about political parties.

  10. Billy says:

    I said nothing about political parties.

    Contracting parties, not political parties.

  11. raoul says:

    The point is that economically it makes no difference how you categorize a job- and your six month number is strictly arbitrary- a more realistic number would be the length of a given project: 1-3 years. I am curious as to whether Steele categorizes her sister’s private welfare as a job.

  12. just me says:

    I get the distinction.

    Also, I am not sure or nearly convinced that the best method of creating a recovery should rest on government providing the paycheck for a job. Make work at tax payer expense over the long haul is simply the government using tax dollars to keep some people afloat. Personally i would rather see tax incentives given to private businesses that would encourage them to grow their business rather than just transfer who the pay check is coming from to the government.

    I think road projects and other public works oriented things are good things, when there is need, but I am not sure these are going to stimulate the economy in the way we are being promised. All these positions come with finite time lines, the jobs come to an end. then do we end up in the same recession boat again?

  13. STEPHANOPOULOS: I guess I don’t really understand that distinction.

    What Steele should have said was, “No doubt.”

    Steele is correct, though he used a bad argument to make his point. Ultimately it comes down to a demand driven economy and a command economy. A job created because someone was freely willing to part with money for a good or service is fundamentally different than a make work or patronage timewaster driven by a politicians or bureaucrats whims.

    It like the nonsense President Obama is spouting about the seriousness of anyone who dares to question the need for his spending program. What is the expected return on this “investment”?

  14. Triumph says:

    Steele: As a small-business owner, I’m looking to grow my business, expand my business.

    Steele is a moron. There is NEVER such a thing as a “permanent” job–where the hell do you think we are, Japan?

    This is especially the case with small businesses. According to the SBA 50% of small businesses fail in the first 5 years. You may “look to grow,” but you will likely fail.

  15. Eneils Bailey says:

    Steele is a moron. There is NEVER such a thing as a “permanent” job–where the hell do you think we are, Japan?

    This is especially the case with small businesses. According to the SBA 50% of small businesses fail in the first 5 years. You may “look to grow,” but you will likely fail.

    Thank god for optimism…if that fails there is always socialism.

  16. James Joyner says:

    I’d go further: there is no such thing as a permanent job in modern America for blue collar, and much of white collar, folks. A “job” lasts only untl management decides, often as a result of carping from Wall Street about the stock price, that it’s not not in management’s interest to keep you.

    Right. But that’s very different than what amounts to a freelance job, wherein one is employed for the length of a project and then gone.

    We have a category of worker we call “temporary” who work on such a basis – they’re there for, say, three months while the regular receptionist is on maternity leave, for example. The opposite of “temporary” worker is not “permanent” worker but rather “ordinary” or “regular.” They’re hired indefinitely, subject to the vagaries of business.

  17. tom p says:

    STEELE: Well, the difference — the distinction is this. If a government — if you’ve got a government contract that is a fixed period of time, it goes away. The work may go away. That’s — there’s no guarantee that that — that there’s going to be more work when you’re done in that job.

    That is the story of my professional life, only about a third of it has been on gov’t… work. Funny to find out after all this time that those weren’t “jobs”. Funny because I couldn’t tell the differnce. Felt exactly the same to me.

  18. Steve Verdon says:

    The point is that economically it makes no difference how you categorize a job- and your six month number is strictly arbitrary- a more realistic number would be the length of a given project: 1-3 years. I am curious as to whether Steele categorizes her sister’s private welfare as a job.

    1 to 3 years is not stimulus then. It is something else. Spending on infrastructure. Maybe it needs to be done, and we should spend that money, but then have the balls to be honest about it and say it is for infrastructure and not to make the economy better 2 years hence (when it will likely be better anyways).

    tom p,

    It was a poor choice of words, but I wouldn’t be surprised if your savings rate is higher than the average person’s. People like to smooth consumption, not necessarily income. So saving during the fat years so you can maintain your consumption (at least to a similar level) during the lean years strikes me as a fairly obvious strategy.

  19. James Joyner says:

    That is the story of my professional life, only about a third of it has been on gov’t… work. Funny to find out after all this time that those weren’t “jobs”. Funny because I couldn’t tell the differnce. Felt exactly the same to me.

    It sounds like you don’t actually have a “job.” Rather, you’re an independent contractor.

  20. Bithead says:

    During this, I was shouting obscenities at Stephanoupolous, questioning his intelligence at being so unable to grasp an obvious point.

    I suspect Steffy understands all this quite well, but being a believer in bg government won’t acknowledge he knows what’s what.

  21. Billy says:

    It sounds like you don’t actually have a “job.” Rather, you’re an independent contractor

    .

    And we get to the heart of the matter. Using Steele’s arbitrary designation, no independent contractor in this country has a “job.”

    Are we going to start counting them as unemployed? Or does this belie the disingenuity of Steele’s criticism?

  22. Leisureguy says:

    I have to disagree with you, as probably several millions of Americans will too: the notion that a “job” with a company is permanent isn’t hold up so well—you can look at thousands and thousands of job cuts being announced.

    Moreover, the government jobs (here I’m thinking of the WPA and CCC and the like) created much value in the US: bridges, dams, parks, buildings, roads, and the like. Salon has a slide show and a very interesting article on some of those government jobs.

  23. tom p says:

    It sounds like you don’t actually have a “job.” Rather, you’re an independent contractor.

    I am a union carpenter, James, doing mostly commercial work, working for various contractors. At various times on any job there is a varying need for carpenters, but always the job comes to an end because the building is built. Might be a yr, might be 2, but they all end. Then we move on.

    tom p,
    It was a poor choice of words, but I wouldn’t be surprised if your savings rate is higher than the average person’s.

    Absolutely right Steve, about 15% over and above my pension contributions. Any overtime I get goes straight into the savings as well.

  24. Steve Verdon says:

    Leisureguy,

    I think the conversation has moved away from the notion of permanent about 7 or so comments back.

    Also the notion of value isn’t always in question, the question is was that the best use of the resources? Government doesn’t have to concern itself so much with that question and often does what is politically expedient. Politically expedient and what provides the most value are not always the same.

  25. Steve Verdon says:

    tom p,

    Another quick question.

    Given the current economic situation if you found employment where you could use your skills that held out some hope of being “permanent–i.e. indefinite” and paid similar to what you are used to being paid, would you go for it or hold out for more contract work?

    Just curious, your answer could provide some anecdotal evidence to support my initial explanation…or not.

  26. Drew says:

    This is one of the more bizarre threads I have seen.

    The issue isn’t whether a factory job is “permanent,” or not. Or if a construction trades job is really a “job.” Posters leaning on those distinctions are just being silly.

    Steve Verdon hit the relevant point. This issue revolves around “permanent income” expectations.

    If you are a construction tradesman, then it would be realistic for you to gage your long term employment prospects, and then your savings and spending habits based upon long term demand for residential and commercial construction. So unless you think the “stimulus” bill will become a permanent spending bill, you shouldn’t count on more than a year or two, and will set your spending habits accordingly. Its an artificial and temporary pop. So much for multipliers and such. And two years from now you’ll be gassed.

    On the flip side. Discrediting efforts to spawn sustainable employment growth by noting that “no job is permanent” is just high school level analysis. Long term employment growth must be the goal, and therefore it must be based upon sustainable demand for goods and services. Those things generally come from genuine market demand (the consumer, really) and from innovation and investment. A recent commentary by Barro noted that tax cuts are the better mechanism not just because they put money in people’s pockets, but they alter incentives, and therefore long term investment and work behavior.

    Look guys, the intersection of politicians showering dollars for bogus and temporary construction projects on their buds (not to mention political gifts, like ACORN funding) and sustainable long term growth is just about the null set.

  27. Leisureguy says:

    Steve: you’re right. I was responding to the post, not the comments. And government will do things that are politically expedient from time to time. What are your views on private companies doing the right thing, rather than the cheap or expedient thing? (I have a list of examples if you want. Here’s one near the top: knowingly shipping out salmonella-contaminated peanut butter.)

  28. Leisureguy says:

    Well, I read some of the comments. Tax cuts are stimulative? Not that I’ve seen.

  29. Steve Verdon says:

    What are your views on private companies doing the right thing, rather than the cheap or expedient thing? (I have a list of examples if you want. Here’s one near the top: knowingly shipping out salmonella-contaminated peanut butter.)

    I think doing the right thing for a company is generally not what they should be doing. However, I do think a firm should be trying to maximize profits while remaining within the bounds of legal behavior. Knowingly shipping salmonella obviously falls outside of that bound in both ways in that

    1. It is almost surely illegal,
    2. Is a great way to destroy your cusomer base.

    Tax cuts are stimulative? Not that I’ve seen.

    Permanent tax cuts? Yes. Temporary tax cuts? Not so much.

  30. tom p says:

    tom p,

    Another quick question.
    Given the current economic situation if you found employment where you could use your skills that held out some hope of being “permanent–i.e. indefinite” and paid similar to what you are used to being paid, would you go for it or hold out for more contract work?

    A clarification: I don’t do “contract” work. I am an employee with all my taxes taken out, as well as health and pension etc.

    To the question Steve: I am unsure. I have been a carpenter for 30 yrs. I like what I do and I am good at it. I get to be outside all the time. The guys I work with are some of the best and it is never boring (there is a feeling one gets when working on high steel that is unlike any other). At the same point, I am getting old and the wear and tear has definitely taken it’s toll (arthritis, bursitis, tendonitis and more)

    I guess I would probably go for it, but it would not be an easy choice and would depend in no small part on what kind of work I would be doing.

  31. Drew says:

    “Tax cuts are stimulative? Not that I’ve seen.”

    Then you are blind. See Kennedy/Johnson 63/64, Reagan in the 80’s and Bush in 2003.

    By the way. How’s that “only Republicans hire lobbyists” assertion workin’ out fer ya???

  32. Leisureguy says:

    I’m disappointed that Obama has hired at least two lobbyists, and the general Democratic reaction to that has been negative as well. I’m even more disappointed in the court case today.

  33. bains says:

    I suspect that many not “understanding” the distinction between creating work and creating jobs are either Obama supporters or not self employed.

    As a self-employed engineer, I have recently had to seek work, even from government sources. While this work pays my bills, it is not my job. Every time the work is done, I have to seek new work. Bear in mind that this work that I seek is increasingly outside the realm of the job which I spent 8 years training for. I do not hire employees for this work, it is acutely finite and inherently fickle.

    Because I am forced to seek work, I can not do my job. Because I can not do my job, I can not grow my company.

    And because I can not grow my company, I can not create new jobs…

    …I can only do work.

  34. steve s says:

    So my schoolteacher mom doesn’t really have a job. Really brilliant word games, Mr. Steele. Kind of hard to understand how your party botched everything it touched.

  35. James Joyner says:

    So my schoolteacher mom doesn’t really have a job

    Awfully late in the thread to say something this inane. Yes, she has a job. Someone hired to paint the school for two weeks, not so much.

  36. odograph says:

    So my dad, a teacher/administrator for 35 years, and a Seabee before that, never had a job … oh, not since he built p-38’s at Lockheed … ok.

    (Kinda glad I missed this thread.)

  37. odograph says:

    Awfully late in the thread to say something this inane.

    BS, your article started this inane.