Unlike Ronald Reagan Obama Doesn’t Use Government Hiring To Create Jobs

Over the weekend I put on my econ hat and started digging into the jobs numbers of President Obama and the President many conservatives enshrine, President Reagan.

This video from my radio show USAprogressive shows four different St. Louis Federal Reserve line graphs I put together using data from the bureau of labor and statistics.

It turns out the trajectory of job creation under both Obama and Reagan are very similar, about a 45 degree angle, from the depths of job losses to job creation and economic expansion.

Here is the difference, when Reagan came into office the job losses were nowhere near as devastating as when Obama came into office. This means the hole was a lot deeper when President Obama took the reins.

The other statistic I found was that President Reagan’s unemployment rate drop was helped significantly by all governments, local, state and the federal also hiring. President Obama doesn’t have that luxury.

President Obama’s private sector job gains have been off set by massive layoffs in the public sector.

By Reagan’s last year of his first term is when the economy began adding jobs at a rate of 3.3 million jobs that year.

We are just beginning Obama’s last year of his first term. So let’s compare his third year.

President Obama’s economy added almost 2 million jobs in 2011. The kicker is during Reagan’s 3rd year, government employment didn’t lay off. They did under Obama, over 250 thousand people.

In 1985, Reagan reduced unemployment further with government hiring 1.8 million people. Those 2 million people spent money and caused even more growth in the private sector through increased demand.

If the public sector was hiring as it did under Reagan, unemployment may be 8% or less today, rather than 8.5%. This is why the Republicans do not want to pass the Obama jobs bill, because they know that if the country can stop the bleeding of public sector layoffs, unemployment will drop and an Obama re-election would be inevitable.