COMMENTARY

Peter Burgess

Nonexistent out-of-control government spending dragging down the economy and hurting Obama

(New York Times) Over the last two years, David Leonhardt notes, 'The government shrank at an annual rate of 1.4 percent.' That meant that though the private sector grew at an average annual rate of 3.2 percent, the economy as a whole grew only 2.3 percent. Jared Bernstein looks at state and local government spending, which throughout the 1990s contributed to the GDP, and shows that today, massive cuts in local and state governments are creating a drag on the entire economy.

Yet we keep hearing about 'out-of-control government spending,' often from the same commentators acting mystified about why President Obama can't or won't do more to help the economy and create jobs.

Joe Weisenthal at Business Insider points to an exchange epitomizing this problem. On Meet the Press, David Gregory insistently questioned Obama adviser David Axelrod about what 'hard choices' Obama would make, about 'dealing with entitlements,' and of course about debt, debt, debt. And Axelrod accepted the terms Gregory was laying out, just arguing about the details of how it would be done and how much would be done. As Weisenthal writes, 'The premise of the question is accepted by everyone. That premise is that Obama has been a wild spender, and that now there's an urgent need to make cuts.'

But it's not true. It couldn't be true first because, as Leonhardt and Bernstein show, government spending has been shrinking, and its shrinkage has been dragging down the economy. So the premise is wrong on two points: First, that government spending would be a bad thing and that cuts need to be made for the health of the economy, and second, that Obama has been spending a great deal—not remotely true. So Obama's taking it from both sides, getting blame for doing a thing he's not doing and for the negative economic effects of not having done it. And, at least on Sunday's Meet the Press, David Axelrod wasn't pushing back very hard against either side of that.

ORIGINALLY POSTED TO DAILY KOS LABOR ON MON JAN 30, 2012 AT 08:18 AM PST.