Originally Posted by
Lemur
Um, no, that is the pattern of tax receipts, but not the usual response. In the '81, '90 and '01 recessions, deficit spending boosted the public sector, which boosted activity. In theory, at least, that spending should be dialed back when the economy is humming (doesn't work that way for the most part, but that's the idea). What is interesting about this recovery is that it is taking place despite government cutbacks. That's the observation I made in the OP.
But federal spending spiked during the recession. It spiked in 2009- two years after you peg the start of the recession. That's 2009, the same year that the GDP bottomed out and we nominally left the recession. Federal spending fell, slightly, in 2010, but only compared to the 2009 spike. Then it continued upward since. Both Bush and Obama threw alot of money at the economy- but it's still stagnant.
Obama’s been hobbled by public-sector layoffs during this crisis in a way his predecessor George W. Bush never was back in 2001. Where the federal government stepped up to prevent states and municipalities from laying off teachers and other government workers in previous recessions, it’s fallen on its face under Obama.
Again, the Obama stimulus package threw hundreds of billions of dollars at creating local government jobs. See if you can still find the "Jobs created or saved by the stimulus" counter on the white house website.....
More broadly, government spending at all levels rose steadily under Presidents Reagan and both Bushes, but was mostly flat under Clinton and has gone negative under Obama.
Federal spending is higher. Local government is funded largely by property taxes. I seem to remember something bad happening to the real estate market.
Also...
But if like the Wall Street Journal you imagine that the massive government job losses in Obama’s first term had never happened, then, all else equal, the unemployment rate right now would be down near 7 percent, a full percentage point below where it actually is.
A couple of points on this. First, it's a WSJ blog post. Secondly you, and the entirety of the left wing blogosphere are cherry-picking it.
"The unemployment rate would be far lower if it hadn’t been for those cuts: If there were as many people working in government as there were in December 2008, the unemployment rate in April would have been 7.1%, not 8.1%.
Ceteris is rarely paribus, of course: If there were more government jobs now, for example, it’s likely that not as many people would have left the labor force, and so the actual unemployment rate would be north of 7.1%."
That figure is speculative, not factual. The author dismissed the figure just as quickly as he stated it.
Bookmarks