"Fog Of Uncertainty": Speaker Boehner Ignores Business Owners' Actual Concerns

September 02, 2011 11:20 am ET — Matt Finkelstein

Today's report that the economy created zero net jobs in August, as the addition of 17,000 private-sector jobs was offset by public-sector losses, is obviously bad news. However, the initial response from House Speaker John Boehner (R-OH) is equally discouraging. In a statement, Boehner blamed the deteriorating recovery on a "fog of uncertainty" created by President Obama's policies:

Private-sector job growth continues to be undermined by the triple threat of higher taxes, more failed 'stimulus' spending, and excessive federal regulations. Together, these Washington policies have created a fog of uncertainty that's left small businesses unable to hire and American families worried about the future.

That's an easy talking point, but it doesn't square with what business owners have been saying for over a year. As the Wall Street Journal recently reported, "The main reason U.S. companies are reluctant to step up hiring is scant demand, rather than uncertainty over government policies, according to a majority of economists in a new Wall Street Journal survey." McClatchy released a similar report yesterday finding "little evidence" that "fear of higher taxes and excessive regulation" are hindering job creation.

Meanwhile, Republicans are pushing an ideological "jobs agenda" of deregulation — which will have more of an impact on public health than employment — and budget cuts that have already produced an avalanche of public-sector job losses at the state level. The chart below shows the accumulation of private-sector job gains and government contraction since the implementation of the Recovery Act (click to enlarge):


As Matt Yglesias reminds us, this is the trend conservatives like Boehner publicly prefer. "According to the conservative theory of the economy, when the public sector shrinks that should super-charge the private sector," Yglesias writes. "What's happened in the real world has been that public sector shrinkage has simply been paired with anemic private sector growth."

Unfortunately, congressional Republicans appear unwilling to entertain any course of action that puts evidence above ideology.