The Very Serious People debate the wrong issue while jobs outlook deterioriates

Posted by AzBlueMeanie:

While the Very Serious People in Washington, D.C. along with their media villagers and Beltway boviators try to tell us that the national debt is the most serious problem confronting the country — it is not, Do nothing: Let the Bush tax cuts expire to reduce the deficit – The Hill's Congress Blog (To be practical, the first option is the best – do nothing and let the tax cuts expire. . . Allowing the tax system to revert back to the pre-Bush era would reduce the deficit by about $4 trillion, an amount consistent with the goals of the deficit hawks.) — the American people know that job creation is their number one concern, as it has been for years.

"Mr. Boehner, where are the jobs?" Not a single jobs bill has even been debated, let alone passed, by this Tea-Publican Congress.

The American people's concern over job creation is approaching panic with today's June jobs report. Political Animal – Wake up, Washington, jobs landscape is deteriorating:

[The] optimism is now long gone. If May’s job numbers were a punch to the gut, June’s job numbers felt like getting kicked while already on the ground.

Expectations were that the job numbers would tick higher after an awful May, but the opposite happened — in June, the economy created even fewer jobs, totaling just 18,000 for the month. The unemployment rate also went up, reaching 9.2%.

All told, the private sector gained 57,000 jobs, while the public sector lost 39,000 jobs, due entirely to budget cuts at the state and local level.

Yes, the economy is still adding jobs, but it’s hard to overstate how dreadful this recent turn of events is. Just to keep up with population growth, the economy should be adding over 150,000 jobs a month. To bring down the unemployment rate quickly, we’d look for 300,000 jobs a month or more. A report showing 18,000 jobs created in the month is just terrible.

Making matters even worse, the totals from April and May were also revised downwards, adding insult to injury.

If our political system were in any way sane, elected leaders would look at these numbers and conclude that the economy desperately needs a boost. Job creation should be the first, and arguably only, priority on the minds of policymakers. Instead, the only topic of discussion allowed in Washington is about debt reduction — which takes money out of the economy and makes unemployment worse.

This jobs report is a flashing red light. It’s a wake-up call. It’s a screaming siren — the point is, we have a jobs crisis, not a debt crisis. The longer we’re stuck in the wrong conversation, the longer it will be until conditions improve.

Steve Benen continues. Political Animal – Private-sector job creation deteriorating, too:

Overall, the U.S. economy added a terrible 18,000 jobs in June, but as has been the case for a long while, there was a major gap between the public and private sectors. Businesses added 57,000 jobs in May, while 39,000 jobs were lost in the public sector at the same time, thanks to budget cuts at the state and local level.

Those are, by the way, budget cuts Republicans are desperate to bring to the federal level.

The new numbers are the weakest in over a year, and further evidence that the economy is in desperate need of a boost. It can’t get that boost, of course, because congressional Republicans refuse to consider anything other than austerity measures, which necessarily make unemployment worse.

Making matters slightly worse, the private-sector totals for April and May were also revised in the wrong direction.

And with that, here’s a different homemade chart, showing monthly job losses/gains in the private sector since the start of the Great Recession.

In a statement this morning, Republican National Committee Chairman Reince Priebus blamed rising unemployment on “out-of-control spending.”

"Perhaps now would be a good time for reasonable political observers to call this what it is: dangerously stupid." Political Animal – It’s not too late to change priorities. "It’s a nice little scam Republicans have put together: when more jobs are being created, it’s proof they’re right; when fewer jobs are being created, it’s proof Obama’s wrong. Heads they win; tails Dems lose."

[W]hether they want to admit it or not, the economy is advancing exactly as they want it to. The private sector is being left to its own devices; the public sector is shedding jobs quickly; and the only permitted topic of conversation is about debt-reduction.

This is the script the GOP wrote. When it’s followed to the letter, Republican complaints are absurd.

Indeed, the great irony of the 2010 midterms is that voters were angry and frustrated by the weak economy, so they elected a lot of Republicans who are almost desperate to make matters worse.

“If anyone actually does care about the deficit, more jobs would help that too.” Political Animal – Create jobs, lower the deficit:

[T]he country basically has a choice: focus on growing the economy and creating jobs, or focus on deficit reduction. Tackling one problem generally means making the other problem worse — creating jobs means investing a lot of money; reducing the deficit means taking money out of the economy.

Conservative economic theory argues that we can address both problems at once: if we address the budget shortfall, the confidence fairy will sprinkle confidence dust on employers, magically reducing unemployment.

Reality shows that’s backwards. Indeed, the one sure-fire way to improve the nation’s fiscal conditions is to also improve the nation’s economic considition. As David Leonhardt explained several months ago, economic growth lowers the deficit.

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Indeed, perhaps the most astounding aspect of Republican rhetoric on the economy lately is how contradictory it is. On the one hand, a top GOP goal is, at least in theory, deficit reduction. On the other hand, those same Republicans want more tax cuts (which makes the deficit worse), and spending cuts that would likely slow the economy (which also makes the deficit worse).

Simply stated, "job creation = deficit reduction" because when more people are working, more people are paying taxes (increased revenue) and are in less need of social safety net programs (decreased spending). Even the Very Serious People in Washington, D.C. ought to be able to understand this very simple concept. And yet. . .