Krugman: The Threat to the Recovery is Washington
The threat to the recovery is Washington.
There is more truth in those seven words than in the entire 11.5 hours of Sunday news programming we monitor put together.
We were at the precipice of a global economic catastrophe, thanks directly to Republican policies, at the time that Barack Obama was inaugurated. While it's difficult to gauge success from the absence of devastation, there is no argument that the preemptory measures taken in the early days of the first Obama term did slowly turn the economy around. There's far to go still, especially when it come to jobs, but we're at least moving away from the cliff.
But...
If Republicans still take their marching orders from deep thinkers like Rush that could change. And Carly Fiorina shows the same fundamental understanding of the drivers of the economy that enabled her as a CEO to drive two major American corporations into the ground. For her, we have to keep cutting federal spending because...bureaucrats!
FIORINA: I think it's important to remember when we talk about the economy that a private-sector job and a public-sector job are not the same things. They're not equivalent. I'm not saying public-sector jobs aren't important, but a private sector job pays for itself. A private-sector job creates other jobs. A public-sector job is paid for by taxpayers.
The government does not spend and invest money as efficiently as the private sector. There's all kinds of data to support that. So it isn't simply a matter of saying, well, whatever job is created out there, if it's a bureaucrat in Washington, D.C., or a small-business owner hiring another employer, those are not equivalent thing.
(CROSSTALK)
KRUGMAN: ... when you say public-sector jobs, it is not a bureaucrat in Washington, D.C.
FIORINA: Oh, it is, actually.
KRUGMAN: When we talk about public-sector jobs, we look at the public-sector jobs that have been lost in large numbers in this, it's basically school teachers. Don't think about bureaucrats. It's school teachers. What we've laid off is hundreds of thousands of school teachers.
And we talk about the cuts in public spending that have happened, they are not, you know, some god-awful who-knows-what. It's actually public investment. It's largely fixing potholes and repairing bridges. So, you know, you have this image of these wasteful bureaucrats doing god knows what. What we've actually seen is an incredible drought of basic infrastructure...
FIORINA: And it is a fact...
KRUGMAN: ... and -- and laying off hundreds of thousands of school teachers.
FIORINA: It is a fact that virtually every department in every organization in Washington, D.C., has seen its budget increase for the last 40 years. That money is being paid to hire people. The number of people who are -- of course there are some teachers...
KRUGMAN: Almost -- almost no...
FIORINA: Of course there are some police officers. I'm not saying that.
KRUGMAN: ... the vast bulk of -- the vast bulk of public-sector employees are at the state and local level. They are largely school teachers, plus police officers, plus firefighters.
(CROSSTALK)
KRUGMAN: And your notion that it's all these bureaucrats, that's a myth that is used to...
(CROSSTALK)
FIORINA: It's a fact. It's not a myth. It's a fact.
Words have meanings. Fiorina needs to understand that the word "fact" has a specific definition which is not "partisan talking point" or "my opinion". There is little question that there is bloat in the bureacracies of federal offices. But that isn't where the cutting is happening.
A notable aspect of the July employment report is the decline in public-sector employment. In fact, public-sector employment (i.e. federal, state, and local government jobs) declined in 10 of the past 12 months, in sharp contrast to 29 consecutive months of private-sector job growth. Indeed, falling public employment has been among the largest contributors to unemployment in the United States since the end of the Great Recession.
In this month’s employment analysis, The Hamilton Project examines public-sector employment trends over the last three decades and finds that government employment contracted, both in absolute numbers and as a share of the population, during the Great Recession and throughout the current recovery.
Additionally, we report on the results of a new analysis that finds that the cuts in public school teachers are projected to reduce the future earnings of today’s students by more than five times as much as the current budget savings.[..]
Total government (i.e., the sum of state, local, and federal) employment has decreased by over 580,000 jobs since the end of the recession, the largest decrease in any sector since the recovery began in July 2009. State and local governments, faced with tough choices imposed by the confluence of balanced-budget requirements, falling tax revenues, and greater demand for public services, have been forced to lay off teachers, police officers, and other workers.
[..]In raw numbers, the largest cuts were to teachers, but of these occupations, the largest percentage decline was among emergency responders.
Transcripts below the fold:
