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Why the poor March jobs report matters, and reflects poorly on Obama
It’s only one month. It seems kind of unfair to jump all over the Obama Administration for a poor month of job growth (only 126,000 in March, and yes that’s poor) after nearly a year of topping 200,000 every single month. And maybe you think it’s unfair to point out that, while unemployment remains at what seems like a low level of 5.5 percent, it’s only because people are once again leaving the workforce.
But let me tell you why it’s not unfair.
Labor force participation is at its lowest level in decades. On average, economic growth throughout Obama’s presidency is still barely above 2 percent – and it should be a lot better than that on a rebound from a recession.
So when you’re a long ways down, you have a long ways to go to catch up. You don’t have the luxury of as many slips as you would if you’d been sailing through a time of prosperity. And that’s all the more important when you recognize that the Bureau of Labor Statistics also revised – downward – its earlier reports from January and February. The original reports that showed job growth of 239,000 and 295,000 in those months, respectively, are now 201,000 and 264,000.
At the same time, 277,000 people left the workforce, and U-6 unemployment (which counts those who have given up looking for work as well as those who are underemployed) is 10.9 percent.
Now I agree that not everything that happens in the nation’s economy is the direct result of who is president or of the things the president does. Some people have a very wrong notion about the president personally managing every aspect of the economy. Economic cycles ebb and flow regardless of who is in office.
But that doesn’t mean public policy makes no difference. It makes a significant difference. And I’ll point to three very specific reasons the economy is worse than it should be directly because of Obama.
The first is something he has not done. We have the highest corporate tax rate in the world at 35 percent, as well as the most complicated. There are ways to avoid paying that rate on all your income, but only if you take advantage of a tangled web of tax shelters and incentives crafted by politicians. This is insane. We need to completely throw out the tax code and adopt a new one with much lower rates and a simpler structure. Obama absolutely refuses to do this. The employment picture would be much better if he did.
The second is something he did do, which is to sign ObamaCare. This has added to the costs of businesses across the nation. It’s incentivized the cutting of people’s hours because businesses are trying to avoid the 30-hour-a-week threshold that forces them to pay for health insurance. They’re also avoiding expanding their workforce above 50 because that means they have to get into compliance. I know the employer mandate has not yet been implemented but no smart business is going to build a workforce on the assumption that it won’t be implemented eventually.
The third is Obama’s overall hostility toward business. Whether he’s having his NLRB appointees tip the scales in favor of unions, or adding new regulations, or denouncing rich CEOs in his speeches, Obama constantly sends the message that business is the enemy. That gives business leaders little confidence that their concerns will be addressed in the U.S. It discourages domestic growth and encourages businesses to consider overseas alternatives.
This is by no means an exhaustive list. But the economy hasn’t been robust for a long time, and having an economically inept president who is hostile to business is absolutely part of the reason for that. We’re way too far behind to be able to afford disappointing reports like this. But we should probably expect more of them as long as we have this president.