Monday, October 28, 2013

Firing government employees will solve unemployment (Said too many people now)!

Over on Facebook I got into another argument with a moderate conservative friend. I should really stop doing that. But he was responding to my post of E.J. Dionne's Column today which essentially says that drastic cuts to government spending - given our current employment numbers - is the WRONG thing to do if we need jobs.  Which we do.

My well meaning, but underemployed friend took that as another "I'm entitled to my job" screed by another overstuffed, underachieving, under employed fed.  He should know better with me, but there we were.  His argument was that federal employment - for that matter - any government employment - should go down in a down turn, as should government spending.

Leaving aside the anti-Kenynes approach he has (RE stimulative impacts of federal spending in down economies since governments aren't actually bound by supply and can create demand through deficits), I took him to task over federal employment, since I'm not the only one of his friends who's a fed.

That argument led me to do some data analysis, which I present below.  First, looking at federal civilian employment trends since 1962 (Data courtesy, I find that the federal government is nowhere as big as it has been in my life time.  Specifically, the federal government topped out at over 3 Million employees under President Reagan, began to shrink under President Bush 41, shrank dramatically under President Clinton (to less then 2.65 Million), climbed again under President Bush 43 (During the prime years of the Great Recession), and began to shrink again under President Obama. 

Sadly, the data cut off from OPM is 2011 so we can't see what the impacts of 2012 and 2013 budget decisions are - particularly Sequestration.

Interestingly, I'm not the only one to notice the dip in employment under our current President.  Forbes published a short, to the point analysis of total government employment (in which they lump local, state, and federal employees) vs. total population.  Their "in the face of conventional wisdom" conclusion is that not only did the ratio of total government employees to the population go down, but that the rate of growth of government employees to the population went down under President Obama.  They rightly attribute the declines to the Great Recession, though they note most decline is due to budget cuts forced on states that are legally mandates to balance their budgets.

And then there's this little nugget from The Atlantic in May, 2013:

But rather than Washington leading the still-weak economy, the cart has led the horse, with the private sector adding roughly 2.2 million jobs over the past year while state, local, and federal governments have shed more than 90,000 jobs.

 Finally, the American Enterprise Institute notes that total government employment as well as Federal government employment have declined under President Obama (they conveniently carry their data back to 2001, and ignore the increase under President Bush; but theirs is the same data set I  used above):

So no, federal and state and local government employees haven't been spared the axe - far from it.  And no, federal employment isn't out of control - Mr. Reagan had a million or so more feds the Mr. Obama has.

And no, cutting federal spending on employees won't solve any economic problems.  If the private sector is adding jobs while government is still firing people, I'd say we're suffering enough.

No comments: