The Economic Fiction of the Establishment

Obama recently asserted that “the private sector is doing fine.” In the same exchange he also implied that in contrast the public sector is not doing fine, and so needs more money from the federal government presumably.

Private sector “growth” has been on a slight up trend over the past year but just barely and overall private sector jobs aren’t even halfway to what they were pre-recession. So things are still very bad.

During the front end of the recession however the Keynesians poured money into the public sector and public sector jobs actually increased during the acute (first) phase of the downturn. Now as these policies have broadly failed and the money is running out localities and states are forced to make cuts (because they can’t be as profligate as the feds who just keep spending no matter what.)  So public sector jobs have recently exhibited a downward trend, but only if one doesn’t count federal hiring, which I will tell you as a resident of suburban Washington DC, has been robust.

Even still Obama and many on the left think this slight downturn in local government jobs is a drag on the economy and that more money should come from Washington to pay for state and local government workers, similar to the teacher bailout of 2010.  The fact that this infusion of money would come just before elections is of course a coincidence.

Click here for more on “economic fiction.” from Robert Tracinski at Real Clear Politics.