Who Knew Layoffs Were Bad For The Economy?

Apparently not Republicans, who insisted that laying off government workers would improve the economy because that would free up more resources for private sector to create jobs.  How's that theory working out for you?

The layoffs of thousands of government workers may threaten the already slow-motion economic recovery in many U.S. metropolitan areas, according to a report released on Wednesday by the Brookings Institution.

"Job growth, though occurring in more metropolitan areas than in the past, was sluggish," the think tank said. "Those that suffered the most, as well as those with the weakest economic recoveries, typically lost government jobs."

Since the recession began in 2007, 19 out of the 20 metropolitan areas with the strongest economies gained government jobs, according to the report which focused on the first quarter of the year. Conversely, 13 of the lowest performing 20 areas lost government jobs.

Looking at the 100 metropolitan areas combined, Brookings said total employment rebounded by 0.8 percent after hitting its low point in the recession. But local government employment fell 1.2 percent and state employment dropped 0.2 percent, "reflecting the impact of reduced local and state revenues."

So if the conservative theory that government jobs are completely parasitical on the overall economy is true, the areas that lost government jobs should have stronger economies.  Surprise, the complete opposite of that is true.  Where the government served as the employer of last resort to help when the private sector was reeling, the economy has picked up. 

And right now we're looking at record profits, productivity, and cash on hand for the private sector.  The lean times for big business are certainly over.  But guess what?  They're not hiring as much either, because the demand for their products isn't expanding...at least in the US it's not.  Overseas expansion is much higher...and that's where the private sector jobs are going.  Ironically, we're seeing a return of manufacturing jobs because the cost of labor is less expensive here than it is in rapidly growing China.  With unions all but destroyed and real wages stagnant for decades, the US is starting to look like the place to go for cheap manual labor...and cheap jobs to go with it.

So if the Republicans are right, and laying off thousands of government workers was good for the economy, we should be seeing the exact opposite of what we're seeing now, which is jobs with good benefits vanishing and being replaced by cheaper, non-union manufacturing jobs with far less pay and benefits.

And that's wrecking the economy.  But that's excellent for big business.  And that's what the GOP wants.