GOP Budget Cuts Won't Kill This Recovery

Today’s positive jobs report is good news for Obama, but the numbers also debunk his claim that cutting government jobs could harm the recovery.

Today’s positive jobs report -- an 8.9 percent unemployment rate (lowest in 18 months) -- is good news for President Obama however one happens to look at it. But Republicans looking to capitalize on what’s happening can take two important pieces of strategic advice.

The good news for Obama first: voting patterns, historically, have much more to do with the economy’s trajectory than its actual state. Ronald Reagan and Franklin Roosevelt both coasted to reelection in economies that were actually pretty bad because, by all outward appearances, their policies had brought about a return to growth. George H.W. Bush, on the other hand, lost in an economic situation better than Reagan’s or Roosevelt’s because the economy appeared to be moving in the wrong direction under his leadership.

Now, two pieces of advice for Republicans.

First, the report—which showed strong private sector gains coupled with a decline in government employment—shows that cuts in government aren’t going to doom the economy. Over the past year, governments have shed about 200,000 jobs while the private sector has gained 1.5 million. Poorly designed cuts to government employment, of course, could hurt the private sector or the nation’s overall well-being. But, quite simply, the numbers by themselves disprove any liberal nostrum that simply cutting government employment will hurt the economy.

Second, the continuing strong growth in health care--which added 34,000 jobs, more than any other sector—shows that the terribly flawed health care bill probably isn’t the job-killing boogeyman some Republicans have portrayed it as.  The collective wisdom of the health care sector, which has hired all through the recession, seems to be that business is good and will remain so even as the health care bill’s provisions get implemented. This doesn’t indicate that Republicans should back down from criticizing it or proposing wholesale changes but it does mean that critics of the bill who want to retain credibility need to point more to specific flaws. The strategy of calling for “repeal and replace” without forwarding a workable replacement plan made for good political theater and may have even won votes but, in the long term, the health care sector’s continued strength makes it look like a dubious strategy at best.

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