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Discussion: (21 comments)

  1. “Given the ambiguity over whether the senator was referring to total or federal workers, Professor Krugman, who was clearly referring to total government employment, is being a little hard on the senator . . .”

    Senator Paul was referring to the government sector, not the private sector, of the economy. This is clear from the discussion that precedes the quote you provide. the full transcript shows the discussion was about the latest jobs numbers. The government sector of the economy is defined to be government at all levels – - federal, state and local. There is no ambiguity here and no reason to excuse Senator Paul.

    1. So Obama’s defenders are now cheering the reduction of state and local government employees? Is that the takeaway? Aren’t police/teachers/firemen the first on the list of purported victims when Republicans push to cut government spending?

      I personally find it a more disturbing trend that the percentage of federal government employees continues to rise, while the percentage of state/local employees continues to decline. This is a President and a Democrat Party who is actively and openly hostile to the mere concept of federalism and localized decision making.

      1. Michael Stein

        @Eric T. – This is a truly bizarre misreading. Obama’s defenders are not cheering. Rand Paul, who is an extremely conservative Republican, is the person in this discussion cheering reductions in the size of government.

        Obama’s defenders are pointing out that if Obama’s jobs bill had been passed, there would have been money to keep some of those state and local workers, as there was following the passage of the stimulus package. Republicans are the party that wants to cut government wherever and whenever they can. However, even state and local governments in Democratic hands are finding themselves forced to cut because of state constitutions that mandate a balanced budget. With recession-depressed tax revenues, no more federal funds, and a legal inability to borrow, they have to cut whether they want to or not.

        1. I think the discussions here highlight the differences between most Republicans and Democrats. Republicans can’t see the logic in a federal government taking money from the citizens of the states just so they can turn around and give it back to the states. Get the federal out of what the local should be focused on and you solve the federal financial problems and most of the local financial problems (except, maybe, in the blue states).

          1. Really? “Except maybe in the Blue States?”

            YOU HAVE IT BACKWARDS!

            It is the Blue States who are contributing to the Federal government to prop up the Red States who can’t get their economies going or provide basic services to their citizens.

            ALL Red States are in fact, “welfare states” but true to form, the rhetoric never matches up to the reality. Consider gold plated hypocrites like Haley Barbour and Booby Jindal, who decry Federal taxation but feed from it greedily.

            http://voices.washingtonpost.com/ezra-klein/2010/04/the_red_state_ripoff.html

          2. I suppose New York is a good example of a “Prosperous blue state.Usta be 45 electorial votes.Now 29.Folks are runnin’ for their lives.To “Right to work states”!

        2. Boomushroom

          “…There would have been money…”
          That’s nice. I like that. There would have been money. NO! Either money would be confiscated from the few people managing to still run a business, or we would borrow more from China, or Helicopter Ben would further debase our currency.

          States borrow plenty. They have billions worth of bonds outstanding.

          1. Michael P. Stein

            @Boomushroom – Just as businesses distinguish between capital and operating expenses, so do governments. Government worker salaries are operating expenses. Governments with balanced budget requirements cannot issue bonds to pay those salaries. They can, however, issue bonds to construct schools, offices, subways, etc. These items are used over many years, and are considered capital expenditures. States can issue billions worth of bonds for these, but those with balanced (operating) budget requirements cannot issue bonds to pay ordinary government worker salaries. See:

            http://www.ncsl.org/issues-research/budget/state-balanced-budget-requirements.aspx

  2. Michael Stein

    Mr. Strain overlooks two important things. First, though he posted a link to the full transcript, I have to believe that he didn’t read more than what he quoted above. Here’s some additional context:

    WILL: The two numbers he stressed deserve stressing again. 368,000 dropped out of the job market, which means that for every job created, four people quit looking for jobs.

    This means that if the work force participation rate today were what it was in June 2009, when the recovery began, we would have an unemployment rate 11.2 percent. If you add in the involuntarily unemployed, you’re approaching 19 percent, which is why I should think from here on in, on the basis of these numbers, the Romney campaign slogan should be the title of Paul Krugman’s book which is, End This Depression Now, because these are depression level numbers. And if the Republican Party cannot win in this environment, it has to get out of politics and find another business.

    KRUGMAN: I think the thing that you need to bear in mind is that this is not President Obama’s policies at work, right. Last year Obama had a bill, the American Jobs Act that independent analysts said would have added 1.2 million, 1.3 million jobs by now. It was of course got nowhere in Congress. So you have got this amazing two-step, where the Republican Party blocks all of Obama’s proposed policies and then says look his policies aren’t working. That’s a hell of a…

    PAUL: Fundamental disagreement where we should put the money in the productive sector, which is the private sector, or put it in the non-productive sector, the government sector. Those who want to have government stimulus, they don’t understand what Milton Friedman said. Milton Friedman said something that is so true, “nobody spends someone else’s money as wisely as they spend their own. So there’s an efficient sector to the economy, which is the private sector. That’s where you want the money if you want growth.

    (CROSSTALK)

    STEPHANOPOULOS: But isn’t it true right now that the private sector is creating jobs and the public all the jobs cuts…

    ROBERTS: One of the places where the public sector is — a private second — the public sector is losing jobs big time is in education and that really is so shortsighted I can’t even begin and end with it. If we’re not educating our kids, then our future economic growth is really at risk. And so it’s just dumb.

    [...]

    PAUL: Roads don’t create business success, it’s the other way around, business success allows us to build roads. But building more roads doesn’t…

    [...]

    WILL: With regard to the education cuts, for several decades now, we have been expanding education employment — and that’s not just teachers, there’s an enormous administrative overhead, as you know. We’ve been expanding them much faster than enrollment has been expanding. Therefore there is room for some cutting back, even in education.

    Second, Bill Clinton took 50 minutes, because he needed every one of them, to give all of the excuses as to why these programs haven’t worked. Someone once said, Paul, Trotsky, proof of Trotsky’s far-sightedness is that none of his predictions have come true yet.

    (LAUGHTER)

    And all of Mr. — I mean, Mr. Obama gave a lot of hostages to fortune with his predictions of how his stimulus would work, and fortune shot the hostages.

    KRUGMAN: It was one — you know, one document that was released by his economists without a lot of thought early on, that has been — but, no, the fact of the matter is, all of us who are serious about the numbers, me, for example, warned from the beginning that this one was going to be inadequate.

    It should be clear to all that they were discussing the total national employment picture, and the role of the stimulus package in it. In all of the leadup to what Mr. Strain quoted, there is no mention of federal employment alone, and explicit mention of jobs that are clearly state and local jobs (teachers and highway department workers), not federal jobs. If Sen. Paul didn’t understand that, he is as woefully ignorant as Paul Krugman believes.

    Mr. Strain also overlooks the fact that Rand Paul was challenging Krugman’s statements, not the other way around. Even if we ignore the prior discussion context, and also allow that his initial misunderstanding of Krugman’s claim was reasonable, Sen. Paul should have caught on when Krugman explicitly gave a number that should have made it abundantly clear that Krugman was and always had been talking about all levels of goverment. If there were only 2.8 million federal employees at the start of Obama’s administration, there’s no way that the 1.5 million figure for federal employment growth could have been correct. That’s a greater than 50% increase in the federal workforce, as opposed to the actual 0.5% increase under Obama.

    Maybe the problem is that the zombies ate Sen. Paul’s ears, so that he doesn’t hear very well.

    1. I have no idea how you think that the context supports your view. Context seems to suggest to me that Rand Paul and Paul Krugman were having their own conversations independently of each other (i.e., they were not talking about the same things at all). Rand Paul does not appear to be listening to Krugman, nor vis versa, until Rand Paul eventually challenged whether or not “government” jobs had expanded under Obama. Seems reasonable to me that Rand Paul would be referring to federal government jobs seeing as he’s a federal legislator, and Obama is the federal executive (i.e., neither one of whom have any authority over personnel levels at the state/local levels).

      1. Michael P. Stein

        @Greg – Did you read the full transcript, not just the part that Mr. Strain included in his post? I suppose there’s a good chance you’re half right. Paul Krugman, George Will, Cokie Roberts, Cory Booker, and George Stephanopolous pretty clearly seemed to be talking about the same thing. Rand Paul was off in his own little world in one way or another.

        Given that all the other participants in the conversation seemed to understand the same context, I don’t see how Krugman could be faulted for failing to realize that Rand Paul wasn’t keeping up.

        It is true that Obama has no _direct_ authority over personnel levels in state and local governments. However, the federal budget can give grants to the states to help them with their budget woes. Perhaps you are not aware of this, but as a federal legislator, Rand Paul certainly ought to know that the original stimulus bill gave money to state and local governments to enable them to retain workers. Here is a _direct_ exchange between Krugman and Paul:

        KRUGMAN: I think the thing that you need to bear in mind is that this is not President Obama’s policies at work, right. Last year Obama had a bill, the American Jobs Act that independent analysts said would have added 1.2 million, 1.3 million jobs by now. It was of course got nowhere in Congress. So you have got this amazing two-step, where the Republican Party blocks all of Obama’s proposed policies and then says look his policies aren’t working. That’s a hell of a…

        PAUL: Fundamental disagreement where we should put the money in the productive sector, which is the private sector, or put it in the non-productive sector, the government sector. Those who want to have government stimulus, they don’t understand what Milton Friedman said. Milton Friedman said something that is so true, “nobody spends someone else’s money as wisely as they spend their own. So there’s an efficient sector to the economy, which is the private sector. That’s where you want the money if you want growth.

        As a federal legislator, Rand Paul likewise ought to know that the jobs bill to which Krugman referred wanted to continue this policy, to allow local governments to retain up to 280,000 teachers as well as hiring workers to repair schools, roads, and bridges. Yes, it would be up to the states and localities how many of the construction workers would be government employees and how many would be private contractors. But the teachers would clearly be non-federal public sector employees. I’m afraid the excuses that you and Mr. Strain are trying to make for Rand Paul just don’t fly.

        1. Point of fact. It is the states’ responsibility to pay for police, fire, and teachers. Many states are able to balance their budgets and have a stable workforce – ironically, mostly red states (ironically, because Obama acts like its a national problem).

          The AJA puts over 4 to 1 dollars into construction jobs (vs bailing out state governments). So, of the 1.2 million jobs that were mentioned, not all would be for police, fire, teachers. However, because infrastructure also covers material cost, I can’t tell you how much would be allocated for that, or what the mix of public vs “private” jobs would be.

          One thing is for sure – it would have been a big pay off to the unions, just like the stimulus. It would have been a short term sugar rush. Rand Paul is right – until the private sector is in good shape, we shouldn’t be tossing money into these stimuli. Let the states cut where they will. We all know there are a lot more folks on the payroll than teachers, police, or fire. Let them start there… And in the meantime, get the gov’t to reduce regulations, which are estimated to be almost a 2 trillion dollar per year drag on the economy. Now that would be a stimulus!

  3. This statement is beyond stupid:

    “PAUL: Roads don’t create business success, it’s the other way around, business success allows us to build roads. But building more roads doesn’t… ”

    No, fool, roads create business by creating mobility and that creates markets and business expansion and things like effective distribution and reach.

    1. You’re right! Tell Henry Ford to forget about those cars until we build the roads!

      You forget that businesses are the sharp end of the spear for paying taxes – especially small businesses. Additionally, if you were involved in the home building industry, you would know that now home builders are responsible for building roads, schools, community centers, what not, as a “responsibility” of the builders when they build new home developments (at least in California – probably other localities).

      So, beyond supplying services to the public, they also pay the majority of upkeep and development. Yet, you also show a significant lack of understanding of history. What came first? The chicken or the egg? Were there roads in the new world when the first business was erected? Or did business owners band together to create roads, after their businesses were built, to make things easier for their customers? Later on, gov’ts took over, and they expanded this mandate.

      Conservatives have nothing against roads. We view it as one of the few responsibilities of govt. Its useless govt programs (can you say the California bullet train? I knew you could!) that any sane individual rails against.

      I would call you a fool, but I know that years of indoctrination have taken their toll. I would feel pity for you if you and your kind weren’t so intent on turning us into Greece. Or into post collapse Russia.

      A final thought. My wife is eastern European, and lived under communism most of her life. She sees what is occurring. Worse, one of our daughter’s friend’s mother is from Russia – and she says things are starting to get worse in many ways than there. I asked her how. There, she told me, many of the smartest people went into govt, and you could bribe them to leave you alone. Here, only the intellectually limited and true believers go into govt – and they can’t be bribed.

      1. “You’re right! Tell Henry Ford to forget about those cars until we build the roads!”

        A response as clever as it is irrelevant. Even if they were roads originally built for horses and wagons, those were not private enterprises.

        “You forget that businesses are the sharp end of the spear for paying taxes – especially small businesses.”

        Bollocks.

  4. Ralph BarkBark

    More of the same liberal lies to cover up for the Chief Destructor. Only a willing fool believes government statistics.

  5. Mike Logan

    As we’re now down the road, and I have compiled the statistics since last September…and since last years obviously dishonest election on both sides…imagine that, we’re now on the rise of big government again. In fact, the spike started shortly after your story was written. It continued on because on Oct 1, guess what they did like they do every fiscal year…they started back hiring more people with more tax payer funds. So, I’m not sure if you were intentionally releasing this story at the cyclical bottom of government hiring season, but I hope the timing is just coincidence and you have better integrity than I expect.

  6. Milton and Ronald Reagan’s policy’s have dominated much of the past 35 years economy, just as Keynes and FDR did the Dem’s policy the preceding 35 years. Since the GOP era began the productivity in America is reported to have increased some 400%. The Dem policy’s insured a portion went to government and a portion went to labor, in the past 35 year almost 100% of the 400% has gone to investors and management. While deregulation of banking and access to the US market by subsistence labor importing have impacted jobs, wages, healthcare funding, and home equity.

  7. UPDATE!!!

    As of August 2013, there were 2,739,000 federal employees according to BLS Series Id: CEU9091000001. This is a reduction of 50,000 federal employees since January 2009.

  8. London ‘s Chinatown 22 afternoon 3 hours strike to protest against the UK Border Agency (UKBA) ” discriminatory enforcement .” Recently, the UK Border Agency for several weeks of mass arrests of illegal immigrants in Chinatown , raided a number of Chinese restaurants , the London Chinatown Chinese Association Chinese believe that this alleged acts of discrimination , to demonize the image of the Chinese community

  9. b4bcarson

    Krugman is an ideologue first and a economist second. He has never worked in the private sector and has no real concept of what it is like to run a business, what it needs to grow, the negative effect of increased taxes on business and the hiring and management of employees. He is strictly an academic with a blatantly biased view of private enterprise. He also frequently leaves out pertinent information to make his point. Need an example? Krugman (and Obama’s economists) leave out of their statistics the number of jobs contracted out to private enterprise by government as opposed to straight forward government workers. The truth is, those workers are, in effect, government workers: tax money paid to workers to accomplish government purposes. When those jobs are added back into the total government job picture, Paul is right and Krugman is wrong. He also repeatedly leaves out the real unemployment number which includes all those who have stopped looking for work. I don’t trust anyone who does that, not Obama, Krugman, or Bush for that matter.

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