I still think Obama is toast—a result of his own making, since he’s really the apotheosis of a government-hating Republican who never tries to do anything because he’s afraid it would succeed. He’s basically Jon Huntsman, economic policy and all, with a slightly better social policy—or at least a willingness not to try to compete globally in the 21st century using employment policies that were outdated in the 19th. (Short version: you might be able, in general, to exclude 55% of your potential workforce—women and gay men—if you have the population of an India or a China. You can’t do it when you have 1/3 or less of their population; you need a market that is open to everyone, which means you need social policies to match.)
But there are way in which he is a Bad Republican (traditional definition—think Gerald Ford’s Presidency), and those, as much as anything else,are what has destroyed his re-election chances. Not to mention U.S. employment data.
I’d like to think I’m wrong, but let’s look at the data, comparing the last three recessions: the ones with so-called “jobless recoveries.” In the grand tradition of Mitt Romney, let’s look at job growth over the following 24 months.* First, the Private Sector:
The first thing we notice is that The George W. Bush-Mankiw-Hubbard “Recovery” Really Massively Sucked for U.S. Private Sector Employment.** Two-thirds of those post-recession months were negative, and the negatives were more than 1/3 again worse than the gains. Even the 24 months that follow the 1980 recession—half of which were the first 3/4 of the 1982 recession—show a net positive gain in Private Sector Employment.
But the second thing is that the Obama Administration really isn’t doing that poorly in Private Sector Employment. It’s rather similar to the George H. W. Bush Administration.*** The loss months are slightly more severe than the gain months (about 5%), but there are 2 gain-months for every loss-month. It’s still a “jobless recovery”—as was the post-1991 era—in that producing slightly over 1,000,000 jobs in a 24 month period is falling behind the growth in available workers, but it’s not a disaster, if the criterion is the recovery of private-sector hiring.
Sadly for BarryO—again, I consider this what the tennis-playing Brad DeLong calls an “unforced error,” a direct result of the errors of his priors—there is also employment in the non-private sector. Which both Bushes knew that, the “small government Democrat” appears not to:
On a proportionate basis, George H. W. Bush oversaw as large a post-recession expansion of Government workers as Barack H. Obama has overseen a reduction in those workers. This is even before one considers that at least three of those six positive months—a figured dwarfed by W’s 15 months of public-sector worker increase, let alone his father’s 19 months—are due to temporary hiring of U.S. Census workers. March, April, and May of 2010 show net gains because of Federal hiring that is more than completely reversed by September. Great “Recovery Summer,” that was!
But if we really want to be fair to Barack Obama, we would have to break this down further. After all,while the data is national, the breakdowns are not always so:
Federal government employment—now including the ever-expanding Department of Homeland Security, and with a military that continues to fight (at least) three wars—has been essentially flat during the “recovery”period. The damage has been done extensively at the State and, especially, Local levels.
Part of this is simply that the 2007-2009 recession was longer and deeper than the other two (18 months long v. 8 for each of the previous two; more than 7.5 million private-sector jobs compared to just over 1 million in 1991 and just under 2 million in 2001). That’s a lot more time and a lot less money flowing into taxes and budget-balancing requirements.
But if I were Barack H. Obama, and if I really wanted to be re-elected, the speech I would be giving tonight wouldn’t be about extending tax credits or capital amortization credits—with or without the idiocy of budgetary offsets—but direct state aid. Billions of dollars of it. Without offsets. The speech would run something like this:
The latest few years have been difficult for you. Almost every state in the Union has to balance their budgets, and with record levels of unemployment and job losses, that’s not easy to do. So they made decisions that affected you, your children, and your friends. They laid off police officers, firefighters, teachers, librarians, surveyors, road repair personnel, and trash collectors. They’ve cut back hours at the DMV, Social Security, and Employment Offices. They’ve made it more difficult to get an appointment to get health insurance for your children, support to buy healthy food for you and your children. Your classrooms are more crowded, your property taxes are higher, and you’re getting less for your money while you have to put in more effort.
The Federal Government doesn’t have to balance its budget, and the bond market has given us a rare opportunity to borrow money for less than it will cost us. I plan to take full advantage of that now, so that your children will have food, your streets will be safer, your opportunities for education will be greater, and the services for which you pay will be more available.
The private sector is rebuilding and restaffing, but that will—as it has in the past, as it almost always does—take time. But they cannot rebuild if there is no demand, and you cannot demand things if you cannot pay for them. So, along with $1T in infrastructure improvements to be made over the next 15 years, I will tomorrow send a bill to Congress to triple the total of the two previous grants-in-aid to the States that were made as part of the ARRA.
Now you have heard many people—and to my shame, I am one of them—who live in fear of deficits. They pretend that the government “has to be like a family”—a family that never takes out a mortgage, never borrows to buy a car, never needs a loan to pay for schooling or training, and never uses a credit card. I’ve seen families like that. They live on the streets of Honolulu and New York City and Chicago and Washington, D.C., and Richmond, Virginia, and Cincinnati, Ohio, and Detroit, Michigan, and Paint Creek, Texas. They’re impoverished.
The United States is not impoverished, and I will not allow it to become so. We will rebuild opportunity now and build our superhighways—information and otherwise—for life in the 21st and 22nd Centuries. The bankers—grateful for the bailouts that have been heaped upon them by my predecessor and myself—are willing to loan us money for less than the cost of inflation. We would be foolish not to borrow. Even as those of you who can are refinancing your houses, the U.S. government will—as families do and should—borrow now to make a better life for our children and their children.
We have a unique opportunity. We have massive unemployment because the states do not have the money to employ and hire workers—workers who help keep our streets and homes safe, who keep our roads in good condition, who educate our children, who find us opportunities for work and ways to keep us healthy so that we can do that work. And the bankers are telling us, “We will give you that money for free!” And some people are telling you that we should not take that money.
We have given the bankers enough. Now, they are willing to Pay It Forward, to give some small portion of that money back to us for less than it will cost them to do it. I intend to take that money and use it to make a better present—and the chance for a better future—for the American family.
Yeah, I want a pony, too.
*All data following derived from FRED(R).
**Let us leave aside whether this was a feature or a bug of that Administration
***It is left as an exercise that GHWB was a one-term president.