Report shows losses in government jobs choking economic recovery / LJWorld.com

Archive for Tuesday, October 25, 2011

Report shows losses in government jobs choking economic recovery

October 25, 2011

Washington — Conservative Republicans have long clamored for government downsizing. They’re starting to get it — by default.

Crippled by plunging tax revenues, state and local governments have shed over a half million jobs since the recession began in December 2007. And, after adding jobs early in the downturn, the federal government is now cutting them as well.

States cut 49,000 jobs over the past year and localities 210,000, according to an analysis of Labor Department statistics. There are 30,000 fewer federal workers now than a year ago — including 5,300 Postal Service jobs canceled last month.

By contrast, private-sector jobs have increased by 1.6 million over the past 12 months. But the state, local and federal job losses have become a drag on efforts to nudge the nation’s unemployment rate down from its painfully high 9.1 percent.

The economy has been expanding, at least modestly, since the middle of 2009. And state and local governments are usually engines of job growth during recoveries. But not now, said economist Heidi Shierholz of the labor-aligned Economic Policy Institute.

“The public sector didn’t start to lose jobs right away. But then it did as the budget crunch really hit. State governments are not allowed to run deficits. So the private sector is expanding while the public sector is shedding jobs — to the tune of 35,000 jobs a month,” she said.

President Barack Obama sought to ease the crunch by including $35 billion to prevent layoffs of police, firefighters and teachers in his $447 billion jobs package. But that big bill hit a GOP wall in Congress.

Efforts to pass what Obama called “bite-sized pieces” of the big bill have stalled, too. Republicans don’t want to swallow them, regardless the serving size. Senate Republicans blocked the $35 billion installment late last week when Democratic leaders called it up as stand-alone legislation.

The dynamic is already reverberating through the gathering presidential campaign cycle, with Republicans making an issue out what they depict as Obama’s inability to turn the economy around. This has been driven home in every one of the frequent Republican presidential debates, and is certain to become even more intense as the GOP field narrows. The weak economy is a main factor in Obama’s current approval ratings, the lowest of his presidency.

No sitting president since Franklin D. Roosevelt in 1936 and 1940 has been elected with the unemployment rate as high as it stands today — hovering near or above 9 percent for more than two years. In 1936, the rate was 17 percent and in 1940, 15 percent, but then it was on a downward trend from over 24 percent earlier in the Great Depression.

Ronald Reagan’s durable 1980 campaign slogan that government “is not the solution to our problem; government is the problem” is a cherished GOP refrain. Most recently, it’s been echoed in tea party calls for smaller government.

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Kookamooka 1 year, 6 months ago

Funny. The guy who wrote this just goes by his first name.

merrill 1 year, 6 months ago

Is city hall listening?

We know Sam Brownback is part of the problem.

Come on City Hall don't be Brownback thinkers ...... those that sponsor wreckanomics. Put people back to work instead of holding millions upon millions of our tax dollars in "reserve accounts".

Thank You

just_another_bozo_on_this_bus 1 year, 6 months ago

"The dynamic is already reverberating through the gathering presidential campaign cycle, with Republicans making an issue out what they depict as Obama’s inability to turn the economy around. "

And they'll continue to do everything they can to make sure the economy is worse a year from now than it is today.

hear_me 1 year, 6 months ago

Repubs do seem to be putting a lot of effort into thwarting the president, don't they? They have forgotten to represent us. Sold their souls for power.

It's not even that their political positions are right or wrong. It's their inability to work with anyone who has a different viewpoint.

jaywalker 1 year, 6 months ago

It's a shame that cutbacks hurt the unemployment rate and I wish no one had to lose their job, but seems to me such trimming off of state and federal roles is a necessary evil. Teachers, police, and fireman need be spared whenever possible, but get out the red pen out otherwise.

chootspa 1 year, 6 months ago

I agree. Nobody needs hospitals, road and building maintenance, clean streets, functioning sewers, street lights, foster care, marriage or drivers' licenses, etc.

jhawkinsf 1 year, 6 months ago

Nobody needs to pay $100 for a job that should cost $50. Then multiply that by a million. Then multiply that by a million. Then multiply that by a million.

chootspa 1 year, 6 months ago

You're right. We shouldn't be overpaying for services, but at the same time, you don't want to underpay and end up with bottom of the barrel employees.

It turns out the most cost efficient way to handle government labor and keep employee costs down is to keep those services in the public sector. http://www.nytimes.com/2011/09/13/us/13contractor.html Who knew?

just_another_bozo_on_this_bus 1 year, 6 months ago

There's only one way for the economy to recover, and that's to increase employment. Laying off government workers is exactly the wrong thing to do.

jaywalker 1 year, 6 months ago

Even when you can't pay them? You should work for the government.

just_another_bozo_on_this_bus 1 year, 6 months ago

They could easily be paid. Under current economic and fiscal conditions, it'd require deficit spending, but it'd be better to spend money on people who do something useful to society than flushing some much deficit spending down a whole on Wall Street or in Iraq or Afghanistan. But, of course, if we stopped that deficit spending, the salaries to government workers wouldn't require deficit spending.

jaywalker 1 year, 6 months ago

That could all be true, but government still needs to be severely cut back, might as well get started.

chootspa 1 year, 6 months ago

Why does government need to cut back? If it's simply a matter of debt, the best way for the government to reduce it is to boost the economy and therefore increase the tax revenue. To do that, they've got to boost employment.

jafs 1 year, 6 months ago

The last time we had a balanced budget, revenues and expenditures were both at about 18% of GDP.

Right now, revenues are low, at about 14%, but spending is high, at about 24%.

That's why we need to both increase revenue and decrease spending.

And, of course, pay attention to GDP growth, which is predicted to be slow for a while yet.

jaywalker 1 year, 6 months ago

Our federal government is a massive, wasteful beast. Thomas Jefferson once said, “the government that governs least, governs best”. This nation was built on four federal agencies: The Departments of Justice, Treasury, Defense and State. Anything else should be evaluated for its actual effectiveness and the original four should be shrunk to necessity and remove the largesse. These people are playing with our money, and they're doing so for ludicrous ventures, like "$19.6 million annually on the International Fund for Ireland. Sounds like a noble cause, but the money went for projects like pony-trekking centers and golf videos;" $440,000 a year for operators of the Capitol elevators, which are full automated; $11 million to the Pentagon so they could use psychics; $34 million to teach Americans to be better shoppers; $70,000 to see if the degu, a South American rodent, could help us better understand jet lag; $380 million a year for 500 planes and 100 helicopters to fly brass and bureaucrats around. http://www.thefreemanonline.org/featured/most-outrageous-government-waste/ The framers of the Constitution specifically sought to keep bankers and lawyers from holding public office, lessons they'd learned from history. The original 13th amendment prohibited such power brokers from holding office. It's not really so difficult to understand why today, is it? Just look at the ever expanding tax code for evidence. We're currently running a 4 trillion a year deficit and bringing in 2 trillion. Forget the fact that government shouldn't be used for job creation, there's no way our bumblers are going to create enough jobs to make up the other 2 trillion. And we certainly don't need to generate more tax revenue just to keep our bloated federal government operating at the status quo.
It's the citizens that need the help. Generating more tax revenue needs to go toward the country, not the middle managers in DC.

chootspa 1 year, 6 months ago

Or raising taxes on the rich to fund efforts to boost employment. Oh noez. Those "job creators" might lay off lots of people while hauling in record profits. Oh wait, that's what they've already been doing.

vertigo 1 year, 6 months ago

Work on the reading comprehension: "state and local governments have shed over a half million jobs since the recession began in December 2007" "States cut 49,000 jobs over the past year and localities 210,000"

"...since... December 2007"

"...over the past year"

There's a reason the number of jobs lost in the past year don't equal the total number of jobs lost since 2007. 4 years is a bit longer than 1 year.

vertigo 1 year, 6 months ago

Umm, no.

vertigo 1 year, 6 months ago

Yes it is quite funny how reality tends to favor the liberal case.

Agnostick 1 year, 6 months ago

In other words, what BAA is really saying: "I only paid attention to the words I wanted to read... those that would support another round of frothy liberal-baiting, hate mongering demagoguery."

There. Fixed it for ya. You're welcome.

yourworstnightmare 1 year, 6 months ago

Great article.

Apparently facts and logical are a "liberal viewpoint".

Populism burns brightly, but never for very long. Eventually the grown-ups in the room will prevail.

Mitt Romney is the only grown-up in the GOP cast (caste?) of characters.

snap_pop_no_crackle 1 year, 6 months ago

For people who loathe and despise the GOP, Romney is the GOP candidate of choice.

yourworstnightmare 1 year, 6 months ago

I am really pleased to hear you say this.

Popcorn, anyone?

Fossick 1 year, 6 months ago

Romney is like the GOP's very own John Kerry.

Agnostick 1 year, 6 months ago

Not necessarily...

http://www.jon2012.com

TongiJayhawk 1 year, 6 months ago

The question is when the economy recovers (it will) and revenues increase . Will they go back on a hiring binge? What will be done with the revenues?

hear_me 1 year, 6 months ago

Good question. We only plan for the moment.

snap_pop_no_crackle 1 year, 6 months ago

If the current regime can't protect the union jobs of government workers, they'll be in big trouble come the 2012 election.

merrill 1 year, 6 months ago

UNIONS brought to the work force: 1. Job protection from discrimination for whatever reasons 2. Good wages 3. 40 hour work week 4. Vacation with pay 5. Pay increases 6. Medical Insurance Coverage

Corporate America did not offer any of that up.

jaywalker 1 year, 6 months ago

Unions began long before corporations, merrill. And their time has passed.

LarryNative 1 year, 6 months ago

Took American jobs to foreign countries.
Bloated pensions funds forcing businesses to layoff current workers.
Lazy workers who get paid more then they are worth.
Drives construction prices higher which equals higher rents.

pace 1 year, 6 months ago

If Kochsas has done anything for jobs or working families, just let the voters know. All I see is a refinement and expansion of Bush style tax cuts to the wealthiest. How is that workng? We would have the money to pay for state services and infrastructure upkeep if it wasn't for the tax cuts to the rich. The tax cuts and loopholes aren't creating jobs, they just serve the rich.

Agnostick 1 year, 6 months ago

Would it be fair to say that, in the past 30-40 years, we've shifted from a more diversified economy, to one that is overwhelmingly service-based? If that's true, then why would this be a surprise? As a general rule, doesn't government--regardless of size--provide services, above all else? I suppose it could be argued that government spending supports some manufacturing, via government contracts for weapons, uniforms, bridges, etc. but the factories have to be in place before the government awards the contract, don't they?

Fossick 1 year, 6 months ago

"As a general rule, doesn't government--regardless of size--provide services, above all else?"

Yes, above all else. Of course, the question at hand is whether government services are economically valuable. Some are - roads, hospitals, firefighting have been mentioned. Some are surely not - there is no economic value added for paying people simply to move papers around, and government has plenty of that.

How to decide which is which? That is the trouble and probably cannot be decided by the overall 'size' of government. The hope obviously is that the reduced revenue will cause elected officials or management to jettison the least useful positions and save those which are most useful. But it's a hope, not an economic law.

Agnostick 1 year, 6 months ago

True. That was a sweetheart deal between...

1) Union(s)

2) Illinois legislators (probably only a few of the elder statesmen, not the entire legislature)

3) One or more current/past governors

What this story shows is that corruption can be found at all levels, in all sectors.

I'm interested in getting my hands on this book:

http://www.amazon.com/Retirement-Heist-Companies-Plunder-American/dp/1591843332/ref=sr_1_1?ie=UTF8&qid=1319556523&sr=8-1

snap_pop_no_crackle 1 year, 6 months ago

Illinois seems to have overtaken Louisiana as the most corrupt state in the union. Remember that the current resident of 1600 Penn. Ave was the coddled product of that system.