Pethokoukis, Economics, U.S. Economy

Has Washington given up on the economy? Maybe so …

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As a quasi-preview to tomorrow’s April jobs report, National Journal provocatively asks: “Has Washington Given Up on the Economy?”

Basically, the story is trying to ding President Obama and Republicans — mostly the latter — for being too focused on debt cutting:

It seems like ages since the passionate, months-long presidential campaign fought largely over how to help the middle class and rev up job creation. Since then, Congress has allowed across-the-board budget cuts that are creating across-the-board hardships and shrinking the gross domestic product. House Republicans have  proposed a budget that decimates the federal government. Obama gave a State of the Union address about how he would build the economy, but he hasn’t sustained that focus. He held a press conference this week that made a lot of news, none of it related to what probably will be a disappointing April jobs report Friday.

1. The big GOP focus this year has been the sequester and a balanced-budget plan. Neither is growthy in the short run. Thankfully the Fed is offsetting through monetary policy. Where is the jobs and take-home pay agenda, especially for the long-term unemployed?

2. Obama, the piece explains, has put out “a number of constructive if less sweeping ideas, including universal preschool, a better tax code, a revamped immigration system, more manufacturing and an upgraded infrastructure. All would stoke economic growth and need to be framed in those terms.”

Would pre-K really “stoke” economic growth? And what about the Obama tax hikes already passed and the ones the president still wants? Would those “stoke” growth, too? C’mon.

3. Again, let me cite this passage from Obama’s recently budget plan: “In the 21st Century, real GDP growth in the United States is likely to be permanently slower than it was in earlier eras because of a slowdown in labor force growth initially due to the retirement of the post-World War II baby boom generation, and later due to a decline in the growth of the working age population.” And if that isn’t bad enough, there are worrisome signs of a productivity slowdown and a less entrepreneurial culture.

I am alarmed by this. I don’t see that Washington is alarmed. So maybe the politicians have given up on the economy.

5 thoughts on “Has Washington given up on the economy? Maybe so …

  1. Jim, Jim, Jim, Jim, Jim….

    Washington is THE CAUSE of this crap economy.

    And when the data disagree with the narrative, they change the data.

    Let’s stay focused. The less economic intervention, the better the economy. Or, Reinhart/Rogoff are exactly correct that larger deficits (caused by more intervention/redistribution/social organizing, etc.) cause worse economic performance and growth.*

    This is the Europification of the US. You guys voted for this, so deal with it.

    *Reinhart & Rogoff were wrong about a different aspect which has been swept under the rug – financial sector-driven recessions are not historically deeper than “regular” recesions.

    http://johnbtaylorsblog.blogspot.com/2013/04/another-take-on-reinhart-rogoff.html

  2. Ferguson ,as usual, is quite correct . It struck me that each of his four issues are the product of the liberal agenda and as a whole serve very well to advance the agenda of the liberal mandarin class . The rent seekers and fixers who thrive gaming the system they create , all the while sneering at The Little People who pay the freight for their excesses . I would add one more to Ferguson’s list and that is the demise of serious education . The issues are now well known from the WSJ Kagan piece and the Bowdoin College dustup . Suffice it to say that minds fed on liberal pablum will not help matters any nor provide any solutions .

    • Yep, it is the ultimate form of perpetuation – destroy the past by controlling future thought (or lack thereof).

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