Romney And Obama Spar Over Disappointing Jobs Numbers

Mitt Romney and Barack Obama traded barbs over the June jobs report, but neither one seems to have the answer to our problems.

 

Not surprisingly, the disappointing jobs numbers released this morning quickly became fodder for the political world and the primary subject on the campaign trial, where President Obama is on a bus tour of Ohio and Pennsylvania while Mitt Romney wraps up in 4th of July family holiday gathering. The White House was the first out of the gate with an official statement that did its best to paper over what was clearly a disappointing report, saying that people shouldn’t read too much into the report and that the economy was continuing to recover. House Republicans countered by drawing attention to President Obama’s comments earlier this month that the private section was “doing fine,” by arguing that these numbers point out that this clearly isn’t true. It fell to Mitt Romney, though, to make the first public statement by a Presidential candidate on the new data at a hardware store in Wolfeboro, New Hampshire:

WOLFEBORO, N.H. – Mitt Romney called a rare press conference this morning to respond to June’s tepid jobs report, calling the unchanged unemployment rate “unacceptably high,” and repeatedly referring to the numbers as a “kick in the gut.”

In the hastily-called press conference, Romney’s first in more than a month, the presumptive GOP nominee conceded that some factors in the slow pace of jobs growth may be out of President Obama’s control, but said also that the president had failed at taking advantage of opportunities to improve the labor market that he could influence.

“In any jobs figures, there are going to be factors that come and go that you can’t control, but the things you can control you want to get right,” Romney told reporters gathered in a hardware store here. “In the case of President Obama, this is not a monthly statistic or even a yearly statistic. We’ve looked at now almost four years of policies that have not gotten America working again.”

Romney also responded broadly to critics who say his own economic proposals have not been specific enough by referring the questioner back to his 59-point economic plan, released last fall, and by deflecting the question back towards the president, whom Romney claimed had not offered sufficient new proposals to spur growth himself.

“I don’t say much to critics,” Romney said. “I have put out 59 steps for how I would get the economy going, and I don’t think I have seen any from the president that show what he’s planning on doing. I laid out my 59 steps. Take a look at them, I think you’ll find them very specific.”

Romney continued. Referring to the president’s campaign bus tour through the Rust Belt, which began yesterday, he said, “How do you go across Pennsyvlania and Ohio and not talk about being serious about creating jobs through manufacturing policies that make America more attractive for investment and growth?”

President Obama’s chance to speak came about an hour later during a stop in Poland, Ohio, and he pretty much echoed what the White House said, which quite honestly comes across as trying to put lipstick on a pig:

POLAND, Ohio-Speaking at a campaign event, President Obama told supporters that this morning’s worse-than-expected jobs report marks a “step in the right direction.”

“We learned this morning that our businesses created 84,000 new jobs last month. And that, overall, means that businesses have created 4.4 million new jobs over the past 28 months, including 500,000 new manufacturing jobs,” he said to applause from the packed auditorium at Dobbins Elementary School. “That’s a step in the right direction.”

Before the report, economists had projected around 90,000 new jobs were created in June, so the report was a disappointment. The economy needs to create around 150,000 jobs a month just to keep up with population growth.

“But we can’t be satisfied,” Obama told voters in the key swing state, “because our goal was never to just keep on working to get back to where we were back in 2007. I want to get back to a time when middle-class families and those working to get into the middle class have some basic security. That’s our goal.”

The president made no mention of the nation’s 8.2 percent unemployment rate in his brief comments on today’s jobs report.

That’s understandable, of course, given the fact that this is not great news, and that it comes on top of four months in which the jobs numbers had become increasingly disappointing. As I noted this morning, over the past three months, we’ve averaged only 75,000 new jobs a month, over the past four months it’s been 84,000, and for the first six months of the year it’s been about 150,000 per month but we’ve been below that average since March. It seems rather clear that the jobs engine has slowed down once again this year, and there’s no real indication that it’s going to rev up again any time soon. In addition to the problems in Europe and China, both of which clearly seem to be entered phases of slow growth if not outright recession, it’s likely that employers are going to be extremely cautious about increasing investment and hiring until the various uncertainties in the economy — including the outcome of the election and the fate of the Bush Tax Cuts and the other items included in the so-called “fiscal cliff” — are resolved.  As long as that’s the case, these jobs numbers are going to continue to be disappointing, and the Obama campaign is going to want to change the subject.

More importantly, though, calling this jobs report “a step in the right direction” strikes me as completely tone deaf. Yes, it’s great that 80,000 people got jobs last month, and it’s also good that 4.4 million people have gotten jobs since the recession ended. But an average of about 156,000 jobs over 28 months isn’t exactly something to be bragging about, Mr. President, and you can only blame your predecessors for so long.

The same goes for those who would point to the decline in public employment as the cause of our problems. as Dave Schuler points out over at his place, the primary reason for that is the fact that tax revenues at the state level have plummeted since the recession and states, unlike the Federal Government are generally required to balance their budgets (although many have found creative was around this requirement in recent years as California shows us). The idea that the Federal Government, which already has fiscal problems of its own, should be sending money to the states so they’ll hire people might sound like a good idea, but what happens when that money runs out and the states are left with an entirely new group of employees with overly generous benefit and retirement packages that they’ll have to find a way to fund? No, the only way that we’ll get out of this mess and get the economy back to a growth rate that will produce jobs and help us solve some of those Federal fiscal problems is if we find a way to spur business investment and new business creation. Federal subsidies aren’t going to do that, but one thing that would help is if Congress and the White House could figure out a way to reduce that uncertainty I spoke of above. It isn’t really surprising that people aren’t investing in growth when they don’t even know what their tax levels are going to be in seven months, or when the Federal budget is going to get fixed. The gridlock in Washington, motivated by it is by a desire on both sides to score partisan points, has created a situation where people in Main Street have no idea what they future holds, and when that’s the case, they hold on to their cash.

Politically, this news is likely to work to Romney’s advantage, especially if the slow growth continues for the next several months. The truth, though, is that he doesn’t seem to have much of a better answer to all of this than the President does and, if he gets handed the keys to the White House on November 6th, he’s going to have to figure out pretty quickly how to deal with a multitude of problems that will face him when he enters office. the same is true of President Obama should he eke out a re-election here. Quite frankly, I don’t have much confidence in either one of them.

FILED UNDER: Barack Obama, Campaign 2012, Economics and Business, Politicians, US Politics,
Doug Mataconis
About Doug Mataconis
Doug holds a B.A. in Political Science from Rutgers University and J.D. from George Mason University School of Law. He joined the staff of OTB in May 2010 and contributed a staggering 16,483 posts before his retirement in January 2020.

Comments

  1. The idea that the Federal Government, which already has fiscal problems of its own, should be sending money to the states so they’ll hire people might sound like a good idea, but what happens when that money runs out and the states are left with an entirely new group of employees with overly generous benefit and retirement packages that they’ll have to find a way to fund?

    The idea might be that the Federal Government would fill-in, in a counter-cyclical way.

    You assume that state revenues would not return, and displace “emergency” Federal funding.

  2. (If you think, as I said in a prior thread “we have to take our lumps” then you won’t think there is any Federal spending that can improve the situation. Of course, that means you must disbelieve “cycles of contraction” right?)

  3. HarvardLaw92 says:

    No president, of whatever party, can magically reverse post-industrialism. Despite that sad fact, the underlying argument in the electorate seems to be one of fervent belief that one’s preferred political party / politician / etc. can somehow do so.

    In other words, it’s not so much a case of people believing that Obama is inherently better than Romney, or vice versa, as it is one of choosing to believe that either of them can produce the impossible.

    Americans tend not to like accepting uncomfortable realities, preferring instead to believe that they can somehow be overcome, or more pointedly that we can somehow become the only industrialized society in history to accomplish it.

    Best of luck. Go into it with that expectation and whomever you elect in 2012 will be who you will be blaming in 2013.

  4. @HarvardLaw92:

    I think post-industrialism might be the longest cycle component of our conundrum. In shorter term we have a credit crisis and contraction in aggregate demand, then the globalization cycle, and then finally a global transition to post-industrial economies.

  5. Tano says:

    Seems like Doug has completely bought into into the notion that the President (i.e. the federal government) should be held responsible for the vageries of the private markets.

    You wonder why there is a relentless encroachment of government into the private sector? Set up an incentive system like this, and it is no surprise that government officials, in both parties, will do all they can to actually have control over the economy, given the fact that they will be held responsible for it.

  6. HarvardLaw92 says:

    @john personna:

    No argument, but that reduces these monetary interventions to the rhetorical level of rearranging deck chairs on the Titanic. It makes things look lovely and palatable for the time being, but it does nothing to address the larger problem.

  7. Tano says:

    The idea that the Federal Government, … should be sending money to the states so they’ll hire people

    The idea is that the states will not need to lay people off – it is not about new hires…

  8. What I think is quite irrelevant to the fact that, inevitably, political leaders are held responsible for the state of the economy by the public, and receive credit for it when the economy is good. The assessments of blame and credit are likely exaggerated, but that’s the way things work.

    Additionally, even though there is very little that the government can to do *help* the market, there’s plenty that they can do to *harm* it.

  9. An Interested Party says:

    Quite frankly, I don’t have much confidence in either one of them.

    It’s a shame Gary Johnson doesn’t have a chance to win the White House…surely he would be able to do something…

  10. @Tano:

    Is the Federal Government going to help the states with the costs associated with all those employees? Because that’s the reason the layoffs have gone, the benefits packages that outstrip anything in the private sector

  11. @Tano:

    Is the Federal Government going to help the states with the costs associated with all those employees? Because that’s the reason the layoffs have gone, the benefits packages that outstrip anything in the private sector

  12. anjin-san says:

    It’s worth noting that when he was a governor, Romney blamed his poor job creation record on the economy he inherited:

    “You guys are bright enough to look at the numbers. I came in and the jobs had been just falling right off a cliff, I came in and they kept falling for 11 months. And if you are going to suggest to me that somehow the day I got elected, somehow jobs should have immediately turned around, well that would be silly. It takes awhile to get things turned around. We were in a recession, we were losing jobs every month.”

    — Mitt Romney, at a press conference in June 2006 saying reporters were unfair to hold him accountable for disappointing jobs data.

  13. Tsar Nicholas says:

    Just for shits and giggles, below is a non-exhaustive list of categories of jobs that need to be filled when you decide to build a gasoline refinery:

    – The people who design, plan and engineer the refinery.
    – The folks who build the refinery.
    – Those who supply the builders of the refinery.
    – Those who supply the suppliers of the builders of the refinery.
    – The folks to build the equipment that goes into the refinery.
    – The folks to supply the builders of the equipment for the refinery.
    – Those who transport and install the equipment into the refinery.
    – The people who build the attendant railroad links.
    – Those who build the pipeline links.
    – Those who supply the builders of the rail and pipeline links.
    – Those who then operate the refinery.
    – Those who supervise and manage the operators.
    – The people who fix and maintain the refinery, the railroad links and the pipeline links.

    Similar categories of necessary jobs are present in connection with LPG terminals, LNG terminals, oil drilling operations, fracking operations, shale oil operations, natural gas wells, and nuclear power plants.

    You don’t need a Ph.D. in economics to realize that all other things being equal a larger supply of a given commodity will over time = a lower price for said commodity. Also, it’s pretty f’n obvious that a country could do a lot better than to rely on the volatile Middle East for its energy needs.

    How much more obvious do the solutions need to become?

  14. anjin-san says:

    then finally a global transition to post-industrial economies.

    That’s a big part of it. People are still looking at the economy, for the most part, through the lens of a post WW2 world. Things have changed.

  15. wr says:

    @Doug Mataconis: ” Because that’s the reason the layoffs have gone, the benefits packages that outstrip anything in the private sector”

    You mean we’d be better off if the public sector figured out how to steal workers’ benefits and transfer all that money to a handful of executives and owners? Because the only reason public benefits outstrip private ones is that all the big companies figured out how to loot their employees pension and health plans several decades back.

    You know, maybe if companies had decided not to slash wages and benefits and hold on to the vast majority of cash flowing into corporate pockets, the general economy would be working a little better.

  16. wr says:

    @Tsar Nicholas: “You don’t need a Ph.D. in economics to realize that all other things being equal a larger supply of a given commodity will over time = a lower price for said commodity. ”

    Which is why the big oil companies have refused to build any refineries in years, and have in fact refused to sell refineries they’ve shuttered even to willing and qualified buyers. Why spend all the money making more gas when you can make even more making less?

  17. HarvardLaw92 says:

    @Tsar Nicholas:

    You don’t need a Ph.D. in economics to realize that all other things being equal a larger supply of a given commodity will over time = a lower price for said commodity.

    You also don’t need one to realize that the US market for gasoline consumption has pretty consistently remained below refinery capacity. We haven’t built a new refinery in this country in over 35 years for a simple reason – existing capacity serves existing demand and oversupplying the market would lower retail prices on a commodity that is grossly price inelastic.

    Also, it’s pretty f’n obvious that a country could do a lot better than to rely on the volatile Middle East for its energy needs.

    Which is why, I would imagine, that we do not obtain the bulk of our energy imports from the Middle East already? (Hint: the bulk of our imports come from Canada).

  18. @HarvardLaw92:

    I think in the short term the government should be a counter-cyclical actor. I don’t think that in itself fights longer term trends. It just smooths short-term economic cycles.

    In that longer term … it might depend on how optimistic you are about the both globalized and post-industrial world, 20 or 30 years out.

  19. @wr, @HarvardLaw92:

    FWIW, I believe refineries have expanded production on the same sites. That’s cost and regulation effective. Having the same number of refineries does not actually imply the same capacity.

  20. @Doug Mataconis:

    Additionally, even though there is very little that the government can to do *help* the market, there’s plenty that they can do to *harm* it.

    In what sense “can’t” the government?

    They could lay down much more slow rail, and reap the benefits of lower transportation costs for the next 50 or 100 years.

    But they “can’t”, right?

  21. HarvardLaw92 says:

    @john personna:

    It implies marginal adjustments to existing capacity in order to maintain the existing tidelevel. I think that my underlying point remains – Tsar seems to believe that petroleum companies have an incentive to build new refineries and desperately wish to do so, but are being stymied by regulations. The truth of the matter is a bit different – they have an pretty inelastic commodity from which it is in their best interest to extract maximum value precisely by limiting supply. They don’t want lower gasoline prices, and frankly their shareholders would be justified in burning them at the stake if they did.

  22. HarvardLaw92 says:

    @john personna:

    I think in the short term the government should be a counter-cyclical actor. I don’t think that in itself fights longer term trends. It just smooths short-term economic cycles.

    Which, I think you’ll agree, amounts to rearranging deck chairs on a sinking ship, precisely because the goal of those policy initiatives is to preserve an expected standard of living which is predicated on a period of aberrant prosperity and which hasn’t been sustainable for the bulk of the population for decades now.

    In that longer term … it might depend on how optimistic you are about the both globalized and post-industrial world, 20 or 30 years out.

    We’re Britain, post WW2 at present. Where they are is where now we are headed. Where they were is where we are presently at.

  23. jan says:

    @wr:

    “Which is why the big oil companies have refused to build any refineries in years, and have in fact refused to sell refineries they’ve shuttered even to willing and qualified buyers. Why spend all the money making more gas when you can make even more making less? “

    It takes over 800 permits, and cutting through all the environmental EPA obstacles to build an oil refinery. It’s probably equally daunting to upgrade them to satisfy current EPA standards. It’s the bureaucracy not necessarily disinterest from the oil companies to build these refineries.

  24. @HarvardLaw92:

    There is a chart here which shows steady growth in refining capacity.

    By 2009, Valero attained the position of the largest U.S. refiner with 14 refineries and 2 million barrels per day of capacity. The share of U.S. refining capacity for the top four companies increased from 26 percent in 1997 to 40 percent in 2009, while the top 10 share went from 51 percent to 69%.

    Possibly higher emissions standards have strengthened the leading players. That’s usually the way it goes. But given that those players have dramatically increased their production, I don’t buy that they are being blocked.

  25. @jan:

    And yet refining capacity continues to rise.

    Actually, the fact that we are exporting more refined gasoline these days is stronger proof that we have “high” capacity.

    As that page calls it:

    We’d like the gasoline to stay here and drive the price down. That’s not gonna happen. No oil company will sell to you for less than China or Europe will pay.

    I suppose you like those free markets, right Jan?

  26. HarvardLaw92 says:

    @john personna:

    And, again, that capacity has been driven solely by incremental increases in demand. Gasoline is a pretty inelastic commodity. Gross increases in supply won’t product commensurate increases in consumption, because the correlation is not proportional.

    What we’ve seen from petroleum company profitability bears that out – despite reduction in consumption during periods of higher prices, profitability during those same periods goes UP, not down, and again because the demand is inelastic. People have to consume a certain minimum of the product in order to function.

    FWIW, Valero arrived at that position by buying existing refineries. There is little incentive for a petroleum company to increase the supply of gasoline. In fact, I would go so far as to assert (as I did above) that doing so would hurt them, not help them, from a profitability standpoint.

    It seems that folks are basing their arguments on what is best for them as consumers, and expecting petroleum company policy to follow suit, in the erroneous belief that what is good for the consumer is good for the producer. That doesn’t really work with inelastic goods.

  27. C. Clavin says:

    @ Jan…

    “…It’s the bureaucracy not necessarily disinterest from the oil companies to build these refineries…”

    Please provide a link supporting this statement of fact.

  28. @HarvardLaw92:

    Which, I think you’ll agree, amounts to rearranging deck chairs on a sinking ship, precisely because the goal of those policy initiatives is to preserve an expected standard of living which is predicated on a period of aberrant prosperity and which hasn’t been sustainable for the bulk of the population for decades now.

    I do disagree. It probably derives from my personal business cycle theory. I think things get too hot and too cold, and that with some damping there would be stronger sustained economic growth. I believed the old line that the Fed’s job was to take away the punch-bowl when the party really gets going. I also believe Congress should spend when no one is on the dance floor.

    The alternative would look like more free-wheeling 19th century, with many more panics, crashes, and bankruptcies. That is, at a minimum, inhumane, and at worst restricting our full potential.

    We’re Britain, post WW2 at present. Where they are is where now we are headed. Where they were is where we are presently at.

    That’s possible, but I’m not talking about purchasing British Leyland here. I’m talking about finding wise government investments and executing them slow times.

    The test should be ROI. One of my favorite examples of that was the wholesale conversion to LED traffic signals in recent years. It cost money, it employed people, and it saved so much electricity that the payback was something like 18 months.

  29. HarvardLaw92 says:

    @john personna:
    I do disagree. It probably derives from my personal business cycle theory. I think things get too hot and too cold, and that with some damping there would be stronger sustained economic growth. I believed the old line that the Fed’s job was to take away the punch-bowl when the party really gets going. I also believe Congress should spend when no one is on the dance floor.

    The alternative would look like more free-wheeling 19th century, with many more panics, crashes, and bankruptcies. That is, at a minimum, inhumane, and at worst restricting our full potential.

    Again, no argument. There is a pronounced role for the federal government, acting to implement monetary policy, in smoothing out the amplitude of the peaks and troughs inherent in a consumer economy.

    That doesn’t address the underlying problem though – we as a society consume more than we produce (in terms of value). Our trade balance has been negative for decades now, resulting in the sad position that our largest export has become capital.

    It’s the same analogy that I made above – rearranging the chairs makes it a great deal easier for people to function while the ship sinks around them. It doesn’t prevent the ship from sinking. It’s a reactionary policy.

    That’s possible, but I’m not talking about purchasing British Leyland here. I’m talking about finding wise government investments and executing them slow times.

    The test should be ROI. One of my favorite examples of that was the wholesale conversion to LED traffic signals in recent years. It cost money, it employed people, and it saved so much electricity that the payback was something like 18 months.

    Obvious comparisons to GM & Chrysler aside, I think you missed the point. Britain transitioned from a heavily industrialized economy to one that is, for all practical purposes, now devoid of any meaningful level of industrial production. For close to 50 years, that meant declining industrial employment and an increasingly displaced sweat labor class.

    Britain’s answer was to subsidize that segment, which has become essentially structurally unemployable, via the public purse.

    What will our solution to the same problem, which we WILL have to deal with, be?

  30. @HarvardLaw92:

    I never said refining was a bad business to be in. I just think prices are more natural than conspiracy theorists like to think.

    Refineries are hugely expensive. That is enough to allow current producers a healthy profit. If anyone wants to compete, they need to raise billions.

    I don’t think refiners have a moral obligation to maintain a low profit margin .. because the business is hard?

    (I just drive a Prius and don’t worry.)

  31. jan says:

    The Obama Recovery:

    Job numbers are bad = “It’s a step in the right direction.” or “Recovery is slow.”

    1/3 of the 80,000 new jobs are temp jobs = ” Did you hear me, we’re in recovery!”

    Promised, if the stimulus was passed we would be at 5.6% UE right now = 8.2% today “I inherited it.”

    Broader Joblessness is 14.9% = “It’s Bush’s fault. Blame him, not me.”

    11% hispanic UE & 14.4% Black UE == “Stick with me. I’ll give you more unemployment benefits. Or, you can go on disability (85,000 more on disability).”

    State revenues down = “Raise taxes on the rich.”

    780,000 fewer women employed under Obama = …” BTW, I am for government paid contraception.”

  32. @HarvardLaw92:

    That doesn’t address the underlying problem though – we as a society consume more than we produce (in terms of value). Our trade balance has been negative for decades now, resulting in the sad position that our largest export has become capital.

    That’s kind of an “in the long run, we’re all dead” argument. That’s hard to argue with, but not real useful either.

    Obvious comparisons to GM & Chrysler aside

    Actually, that one was both a smoothing and a reduction in capacity. It was more sensible than simply propping-up.

  33. HarvardLaw92 says:

    @john personna:

    I never said refining was a bad business to be in. I just think prices are more natural than conspiracy theorists like to think.

    I think it may be a case of people under stress looking for a convenient target to blame for that stress. Gasoline prices make people unhappy, and they seem to believe that deliverance from that is just around the corner of automagically building more refineries.

    It speaks to a erroneous belief that petroleum companies actually want to help them in that regard. Of course they don’t. They want to extract (as they should) the maximum possible value from the sale of their product, and unlike elastic goods (which the consumer can reasonably eschew if prices trend too high for the consumer’s liking), gasoline is inelastic.

    So it’s really a case of petroleum companies having consumers over the barrel of their own inability (or unwillingness) to reduce their own exposure to needing the product to begin with. It’s in a sense a captive market. Of course they’re going to take advantage of that by limiting supply. They’d be fools not to.

  34. C. Clavin says:

    Did I read the old “uncertainty” canard?
    Holy crap.
    The only uncertainty is that no one is certain when demand will return. This is a demand crisis.

    “…The idea that the Federal Government, which already has fiscal problems of its own, should be sending money to the states so they’ll hire people might sound like a good idea, but what happens when that money runs out and the states are left with an entirely new group of employees with overly generous benefit and retirement packages that they’ll have to find a way to fund?”

    This is pretty basic stuff here…you spend money to get through the tough times and you save during the rough times. Government spending should be counter-cyclical. Republicans have turned that idea on it’s head. They spent everything during the good times. Not blame…fact. Now, during the tough times, they have succeeded in forcing cutting back. Today we have a choice…we can ride this out with a stagnant recovery and get back on cycle when it inevitably happens on it own…or we can spend some money now (while it’s very cheap money) and get back on track faster. Republicans, by their actions, want the stagnant recovery. Which is fine…but when you get what you want you shouldn’t complain.

  35. C. Clavin says:

    @ Jan…

    “..Promised, if the stimulus was passed we would be at 5.6% UE right now = 8.2% today..”

    Please provide a link that verifies this “promise”.

  36. HarvardLaw92 says:

    @john personna:

    That’s kind of an “in the long run, we’re all dead” argument. That’s hard to argue with, but not real useful either.

    And yet it remains the 900 pound gorilla in the room which nobody wants to acknowledge. Of what use is a monetary policy that focuses on the short term to the almost entire exclusion of consideration of the long term? Not to belabor the Britain analogy, but that path leads you to Britain in the 1970s, with an economy that is essentially collapsing around you while people have the nerve to act surprised that it happened at all.

    Simple truth time? Our ability to function as a society at all has become entirely dependent on our ability to borrow while simultaneously devaluing our currency. Anybody with simple math skills should be able not only to recognize that, but also to see where it leads, therefore motivating action to proactively address it.

    People don’t want to do that, because it involves adjustments to their expectations which they are unwilling to make, ergo nothing gets changed.

    At least until it’s Britain in the 1970s again anyway …

  37. Tano says:

    @Doug Mataconis:

    Is the Federal Government going to help the states with the costs associated with all those employees?

    Well, first off, lets acknowledge that the issue is preventing layoffs, not new hires. OK?

    Now then…To the extent that the problems states are having are not really a function of the present economic crisis but rather are chronic issues having to do with pension and health care benefits, then yes, federal help to keep those employees on the books will only help so long as the federal help persists.

    To the extent that the problem the states are now having is a function of the present-day, temporary economic crisis, then any federal help will serve as a safety-net, or a bridge to get the state through till the economy improves and the states can handle their responsibilities themselves again.

    I don’t really have a good sense of the balance of factors, but I am pretty certain it is not all the former.

  38. @HarvardLaw92:

    I don’t know what to write .. I think that there are short term effects and responses, and I think they can be separated from the great cycles of history.

    … it’s like someone with a compound fracture and clogged arteries. We wouldn’t leave the fracture untreated because the arteries are going to get him anyway …

    The things that we should do about a housing crash are different than the things we should do about globalization and changing trade dynamics.

  39. Tano says:

    @Doug Mataconis:

    What I think is quite irrelevant to the fact that, inevitably, political leaders are held responsible for the state of the economy by the public, and receive credit for it when the economy is good.

    I am just a bit surprised by the fact that neither you, nor any of the libertarians I come across ever do what I would imagine y’all would be highly motivated to do….to constantly push back against this notion that Presidents, of either party, should be judged as if their job was to be the conductor of the national economy, if not its CEO.

    To allow this notion to persist, to never be challenged, seems to be conceding without a fight the essential core of your belief system.

  40. C. Clavin says:

    As for Romney’s solution to the slow recovery…he offers massive tax cuts for the rich, a tax increase for the poor, a massive increase in defense spending, a massive reduction in discretionary spending (20%), overturning the PPACA which increases the deficit, and of course eliminating Medicare as we know it and replacing it with a voucher sytem that is specifically designed NOT to keep pace with Health Care increases. And there are voters who take this seriously? I guess he’s got the dumb vote locked up.

  41. HarvardLaw92 says:

    @john personna:

    … it’s like someone with a compound fracture and clogged arteries. We wouldn’t leave the fracture untreated because the arteries are going to get him anyway …

    And again, I don’t disagree. We need to treat the fracture, and we did so. Now, what are we going to do about those arteries, because once he’s up and about, he will be much less willing to listen to being told why he needs to change his diet.

    I think you see where I’m going with this – when can there possibly be a better time to introduce the uncomfortable reality that we have structural problems, far beyond those that can be addressed by cranking up the federal credit card, than a period of economic contraction?


    The things that we should do about a housing crash are different than the things we should do about globalization and changing trade dynamics.

    Again, no argument. The point is that we aren’t doing anything about globalization and changing trade dynamics. We’re interested in band-aids that allow us to pretend that everything is still happy delightful, and that’s exactly what we’re getting.

  42. anjin-san says:

    @ Jan…

    “..Promised, if the stimulus was passed we would be at 5.6% UE right now = 8.2% today..”

    I would like to see that too. Jan has been caught in a couple of flat out lies recently. When she gets busted, she simply vanishes from the thread and pretends it never happened à la Eric Florack…

  43. @HarvardLaw92:

    And again, I don’t disagree. We need to treat the fracture, and we did so. Now, what are we going to do about those arteries, because once he’s up and about, he will be much less willing to listen to being told why he needs to change his diet.

    We are having this conversation because we are in a “third dip” or something. We have a contracting economy and contracting government employment.

    I’m not sure it is time to focus on long problems.

    For long problems I’d try to improve education, and public transportation, and to reduce housing costs. Low wage workers with a big house and a long commute have a poor future.

  44. anjin-san says:

    It’s the bureaucracy not necessarily disinterest from the oil companies to build these refineries.

    Right. Just like “Obama won’t let us drill”, which is repeated endlessly in the Foxverse, in spite of the fact that oil output in this country has soared in the last three years & we are now a net exporter of energy.

  45. al-Ameda says:

    @jan:

    The crash of the financial and housing markets in 2008 (which was, by the way, prior to Obama’s inauguration) caused the loss of $14 Trillion in wealth and income from our economy, and goes a long way toward explaining why our economy has experienced an extremely weak recovery. You cannot pull that much wealth out of the economy and expect that aggregate demand will resume strong growth. In fact, it’s amazing to me that we have anemic growth.

    By the way, more private sector jobs have been created in Obama’s 1st 3 years than in Bush’s first 3 years. The problem is the that the housing market crash and subsequent decline in assessed valuations across the country has caused a severe decline in tax revenes to local and state governments, which in turn has caused the loss of over 700,000 public sector jobs.

  46. bk says:

    Ok, I have read this three times, in the hope that I would see at least a passing mention to the FACT that the Republicans in Congress have done everything to block any possible job-related legislation, and all I see is Doug’s usual “both sides do it” bullshit:

    motivated by it is by a desire on both sides to score partisan points

    Doug, that is BULLSHIT, and even the lamest brain should be able to realize that.

  47. bk says:

    You’re Sean Hannity with a law degree. Along with that legal insurrection idiot from Cornell and Glenn Reynolds (among others), you make me embarrassed to admit that I am an attorney.

  48. anjin-san says:

    Doug, that is BULLSHIT

    I think Doug is stuck here. It’s too bad, because he is a bright guy with ability. That being said, I have not really seen any evidence of growth in his work, and at some point it is time to give up and move on.

  49. bk says:

    @anjin-san: Sometimes it’s more like Tucker Carlson with a Yankees cap instead of a bow tie. That being said, I enjoy the comments.

  50. al-Ameda says:

    @anjin-san:
    @bk:

    I think Doug does a pretty good job of posting items that generate discussion. And because I think he’s probably somewhat libertarian I think he’s predisposed to use the “both sides do it” approach more often than many like it. I know a few people like Doug – conservative leaning libertarians, and even some liberal leaning libertarians – and their complaints often include “both sides do it.” These are people who are looking for a way out of the current 2-party lockdown. I understand, it’s just that I haven’t reached that point.

    To me, “both sides do it” is too generic, and tells me nothing. On many issues it just doesn’t cut it. If one side does something objectionable 90 times and the other 10 times, then how is that equal? I know, I know, we can parse this forever …

  51. An Interested Party says:

    These are people who are looking for a way out of the current 2-party lockdown.

    Endlessly spouting “both sides do it” isn’t going to get these people where they want to go…

  52. Just nutha' ig'rant cracker says:

    @HarvardLaw92: @john personna: More to the point, HL is basically making an argument from what appears to be economic geography. That is, if the standard of living in the country over the past 60 or so years is an abberation, our society is too large for the economic system to sustain. We have too many people for our industry to employ and each of those people expects to live with an infrastructure that cannot be supplied.

    Which brings us to the questions of the day: What is your proposal for lowering the population to eqaualibrium levels and how do you propose to encourage those remaining people (particularly the ones at the top of the pyramid) to lower their lifestyle expectations?

  53. Ben Wolf says:

    @Just nutha’ ig’rant cracker:

    What is your proposal for lowering the population to eqaualibrium levels and how do you propose to encourage those remaining people (particularly the ones at the top of the pyramid) to lower their lifestyle expectations?

    If we’ve actually reached the point our non-government sector is literally incapable of providing full employment, then government should step in and guarantee every person a job who wants one. In fact there is absolutely no excuse for not enacting such a program if the private sector cannot carry the burden on its own when the government easily has the capacity to do so. There’s no coherent argument against doing so.

  54. Ron Beasley says:

    What the thinking politicians know but can’t tell you is we are at the End Of Growth, As I have said here many times we have lived in a society/economy based on cheap liquid fuels and credit. . The cheap liquid fuels are a thing of the past and the world economy is so leveraged that there a trillions of dollars of debt that is never going to be re-payed. We are never going to see the “good old days” again. There is nothing that Obama or Romney can do to change that although they will both tell you they can.

  55. An Interested Party says:

    There’s no coherent argument against doing so.

    Well of course there is–“Communism!1!!! Socialism!11!!!!”

    Oh wait, you mentioned a coherent argument…nevermind…

  56. Scott O says:

    @Tsar Nicholas: Go for it dude. Build a refinery. You can build it in Jan’s basement. She won’t make you put in a fire suppression system and you can dump any waste products in the back yard.

  57. rodney dill says:

    @jan: I believe the “promise” Obama made was to keep unemployment under 8.5% with the passage of the 2009 stimulus. (Which didn’t happen, UE went considerably above 8.5%.)

    This was based on a report by his own administration that predicted 5.6% by 2012. That was a predicition, probably not a “promise”. Minor oversight. Still it was what he was leading the American people to believe what he was going to achieve.

  58. john personna says:

    @rodney dill:

    Based on what reputable (irony noted) economists were telling him.

    There are good criticisms of both macroeconomics and the macro-gov complex, but they are hardly unique to Obama