For those who haven’t heard yet, this morning President Obama said the following:
“We’ve created 4.3 million jobs over the past 27 months. The private sector is doing fine, where we’re seeing weaknesses in our economy have to do with state and local government, oftentimes cuts initiated by, you know, governors or mayors who are not getting the kind of help that they have in the past from the federal government and who don’t have the same kind of flexibility of the federal government in dealing with fewer revenues coming in.”
He probably regretted saying “the private sector is doing fine” the moment those words left his mouth. Mitt Romney and the right-wing media are having a field day, describing his comments as “out of touch” and “Obama’s most clueless moment yet“. But is this statement really clueless or just a gaffe? Let’s consider the facts.
As can be seen from the data, private sector job gains are the same as they were at this point in the last recovery – 4.26 million gained 27 months after the bottom. On the other hand, government employment has been falling. At this point in the previous recovery, government employment had added about 900,000 jobs compared with the start of the 2001 recession. Today, government employment is about 400,000 lower than it was at the start of the 2007 recession.
Had government grown as it did in the last recession and recovery, there would be 1.3 million more government jobs now. But, unlike the government expansion that occurred 10 years ago, the government is now contracting. That’s what austerity looks like. The ironic thing is, the GOP wants to fix the economy by implementing even more austerity, while at the same time blaming Obama for the job losses it requires!
Update: A commenter asked about the state of corporate profits. They are at record highs: