Sunday, April 7, 2013

Austerity Is Not to Blame for Tepid Job Growth

Investors Business Daily ^ | 04/05/2013

Democrats were quick to blame the anemic March jobs number on the "sequester" spending cuts. If that were the case, what explains the previous four years of lousy job growth under Obama?
At 88,000, the jobs growth in March was well below expectations. And while the unemployment rate dropped, that was the result of hundreds of thousands dropping out of the labor force who as a result aren't counted as unemployed.
Democrats, of course, tried to pin the blame for this on Republicans for allegedly pushing austerity measures.
White House economic adviser Alan Krueger complained that "arbitrary and unnecessary cuts to government services will be a head wind in the months to come."
His predecessor in that job, Austan Goolsbee, worried that "maybe the sequester's a bigger deal than people thought it was."
And Sen. Majority Leader Harry Reid argued that "self-inflicted setbacks like the sequester" were behind the tepid jobs growth.
It didn't take long for the Democrats' amen chorus in the press to run with this spin.
"Friday's jobs report is the first to reflect the post-sequester world," is how Politico put it.
The Huffington Post said "austerity may be starting to squeeze the life out of the job market."
Just one problem: There's nothing unusual about this month's jobs report, and there's been no austerity.
(Excerpt) Read more at realclearmarkets.com ...

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