The jobs slowdown this past month isn't the worst news in the world, despite what you might be reading on various alarmist blogs. The unemployment rate went up by one-tenth of one percent, from 8.1 percent to 8.2 percent. The economy only added 69,000 new private sector jobs. And so we're all doomed, evidently.
The reality of the jobs report isn't so much that we're backsliding into another recession (we're not), but that, 1) we were almost entirely unprepared for the true depth of the "Great Recession," 2) there are way too many people leaning on the panic button over the deficit and debt instead of robust spending on job creation, and 3) the corrosive nature of our news media (traditional and digital) and our party politics in this era has allowed the Republicans to sabotage the economy with impunity.
If we look at the monthly jobs graph going back to the beginning of the recession, we can clearly see the crisis as it truly is. It's been a mess-and-a-half for a great while, but since the full force of the president's stimulus, the American Recovery and Reinvestment Act (ARRA), took effect, the jobs situation has greatly improved and more or less stabilized with positive "jobs added" numbers for more than two years. As of February of this year, the economy has been adding private sector jobs every month without exception, and the trend continues. Since the president's policies were implemented, 3.7 million private sector jobs have been created (and 500,000 public sector government jobs have been lost).
But those additions have been inconsistent. Way up for a group of months, then lower in other months. April and May of this year happen to be two of those lower months. And you know what? Last August was dismal, too, with only 52,000 jobs added. September was back up to 216,000. January was relatively huge with 277,000 jobs added. The stimulus money is slowly disappearing and there's nothing else on the horizon, especially give the conventional wisdom that austerity is more important that infusing cash into the economy when -- point of fact -- private corporations are sitting on record cash assets and not spending beyond the bare minimum to keep themselves and economy on life support.
What else can the president do to circumvent the congressional Republicans, who have filibustered and obstructed all of his efforts to add jobs? Not much else, given their sabotage strategy. They literally filibustered the American Jobs Act, and no one really noticed. No one is really noticing their ongoing strategy of economic sabotage either -- their disgusting effort to stymie the recovery and therefore hurt the president's reelection odds. Not to sound too radical here, but this is virtually criminal behavior. They're toying with the national economy for the sake of defeating Barack Obama and electing Mitt Romney -- Mitt Romney! The most cynical, inauthentic, jittery, maladroit, barely-lifelike Republican candidate in modern history.
And the press won't cover this. What we should be hearing from every objective news outlet (the few that remain) is that one of the two major political parties in America is sabotaging the economy for political gain, and then lying about any positive results on the record. The focus, spurred by an unrelated crisis in Greece of all places, has been on the deficit and debt rather than a cornucopia of positive economic indicators.
In spite of Republican sabotage, the president has presided over a significant turnaround from where we were in 2009.
GDP is growing steadily, though still sluggish. Jobs are being added every month. Unemployment is slowly declining. The deficit is shrinking. Middle and working class taxes are lower. Inflation is nearly an entire percentage point below the average that began in the middle 1920s (long term average is 3.43%, while our current rate is 2.3% and dropping). The price of oil dropped below $90 last week and stockpiles are huge -- the highest level in 22 years. New home sales are up by 10 percent over a year ago. Moody's Analytics called this a "genuine rebound" in housing, and mortgage rates remain tantalizingly low. Consumer debt is declining and corporate profits -- despite the president's false reputation as a profit-hating commie -- are nearly double what they were in the boom times of 1999. 9.75 percent at the end of 2011, compared with 5.7 percent in the final quarter of 1999. The Dow has doubled since the deepest, darkest days of the Great Recession and some analysts suggest that the DJIA should be around 20,000, not 13,000, given all of these positive indicators.
But we don't hear these things in the news or from the Republicans, whose hero is President Reagan -- a president who, as Krugman pointed out yesterday, was in fact a Keynesian. Reagan, by the way, raised taxes 11 times, significantly increased government spending, tripled the debt in eight years, doubled the deficit, presided over a recession and an increase in unemployment from 7.5 percent to 11.5 percent during his first term.
Now, the Republicans are trying to feed the American people pitches for more tax cuts that will only balloon the deficit and debt, according to the Wall Street Journal -- the two indicators which the press and the Republicans are screaming most about and actively exploiting as a means of blocking further job creating measures. It's unprecedented. It defies logic and reason. They're emphasizing the apocalyptic deficit and debt, while blocking measures to grow the economy and proposing measures that won't grow the economy and will only create more debt.
And the press isn't reporting it because they're perpetually freaked out over whether they'll sound too liberal, despite reality's "well-known liberal bias," as Stephen Colbert once said.
Related to all of this, Karl Rove's Crossroads GPS outfit released a $7 million ad buy targeting the president's record on the debt. The commercial, now being wet-farted into the earholes of undecided voters in swing states, claims that the president is adding $4 billion in debt every day.
Fact: President Obama isn't adding $4 billion to the debt every day. Karl Rove and President Bush are adding $4 billion to the debt every day.
As we've covered here before, the Congressional Budget Office calculated that the three largest drivers of the ongoing national debt are in this order: 1) the Bush tax cuts, which continue to carve a massive chunk out of government receipts, increasing deficits and adding to the debt, 2) the wars in Afghanistan and Iraq, which Bush didn't pay for and never once asked the richest Americans, especially those in the oil and defense industries, to help cover the bill, and 3) the Great Recession, which began under Bush and was the direct result of deregulatory Reaganomics. A distant fourth are the recovery measures, which were implemented by President Obama and which successfully mitigated an even deeper and costlier recession.
These factors are causing the debt to grow by $4 billion a day. Not the president's policies.
The president actually boasts the lowest rate of annualized growth in government spending of any modern president, other than President Clinton. Lower than Reagan, lower than Bush 41 and way lower than Bush 43. There are several reasons for this. First, he signed a PAYGO bill mandating that all spending programs be paid for. Second, he agreed to massive spending cuts as part of the (awful, in my opinion) debt ceiling deal. Third, he allowed massive reductions in public sector government jobs (also awful, in my opinion), unlike all other previous modern presidents. Fourth, he found additional ways to reduce the deficit, including the healthcare reform law which reduces the deficit. And fifth, he rescued the economy from the brink of disaster -- and now, the economy is growing, corporate profits are at record highs, unemployment is down and the housing market is slowly recovering, all of which are contributing to better government revenue.
This entire approach by Karl Rove and, formerly, the Bush administration is what's popularly known as the "starve the beast" strategy. Republicans, because of their successful self-branding as "fiscal hawks," are able to run up huge deficits. They've done this under all three recent Republican administrations. And then, when Democratic President X enters office, the Republicans blame the subsequent fiscal fallout on the Democratic administration -- you know, because Democrats always spend and tax too much. So Rove et al went nuts with big spending on tax cuts and wars, resulting in massive increases in long-term deficits and debt, and they're blaming President Obama for it. Why? Because they can. President Obama happens to be president now, even though he inherited this crap-on-a-stick from Bush/Rove. And Bush/Rove are exploiting the fact that voters aren't bright enough to see the larger picture.
So no, the economy isn't crashing and burning, even though the Republicans really, really want it to. However, we can only imagine what the recovery might have looked like if half of the country was more tethered to reality rather than politically motivated sabotage.
Crossposted at The Daily Banter.
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