While so much attention continues to be directed at the European Debt Crisis, the US continues to suffer from a Tea Party induced Austerity Crisis. While the private sector adds jobs each month, the cuts to public sector payrolls continue to weigh heavily on the recovery. Until we reverse this trend, we will continue to see weak economic growth and risk following Great Britain into a second recession.
A lot of data shows the effect of austerity on US jobs. One of my favorite charts can be found by comparing the rate of public sector job growth during the Obama administration compared to the Bush administration.
The good news for us in the US is that the Obama administration chose early on in our Great Recession to stimulate the economy. This jolt stopped us from following the path of austerity chosen by the British. Recent reports show just how disastrous that path has been for them.
The bad news for the US is that continued pressure by a Republican controlled House and by Tea Party controlled state governments across the US have savaged the public sector payrolls and cut hundreds of thousands of public sector jobs. The ripple effect is hard to overestimate as those out of work public sector employees aren't contributing to their local economy, nor buying goods and services produced in the private sector. This creates a damaging feedback loop that sucks down the entire economy.
This is precisely why in times of economic crisis, governments stimulate the economy by pumping up the public sector employment and public sector spending. Investments in ports, roads, bridges and other infrastructure boost the productivity potential of private firms and gets construction workers off the unemployment rolls. Investment in science and education push our national advantage in high tech markets while boosting public sector employment required for oversight and management of those programs.
The path forward is clear. Unless we want to follow Britain into a double-dip recession, we must move boldly to tackle unemployment through investments in our infrastructure. Already our outdated and undersized ports take a huge toll on the productivity of our export markets. But they are just one example how investing in our public infrastructure will boost employment while improving our efficiency and productivity.
The Republicans like to raise the specter of the European Debt Crisis and frighten Americans that our federal deficit is in the same league. The facts couldn't be farther from the truth. Just taking a quick look through the Wikipedia article, is enough to show anyone that we're not nearly in the same league. And being that so much of our debt was created by two unfunded wars, huge tax cuts, and the 2009 stimulus, the future for the US looks very bright as we put those burdens behind us.
Now all we need to do is emphasize the connection between unemployment and fiscal austerity during this election cycle. If we can take back control of Congress, we'll be able to get people back to work!