June 22 2012

Obama Advisor Asks Americans to Forget Our Actual Experience with the President's Economic Vision and Embrace More of the Same

Carrie L. Lukas

I was fortunate to have Professor Jeffrey Liebman while I was a student at Harvard’s Kennedy School.  He is an incredibly nice man, as well as an engaging teacher. 

However, I have to take issue with his oped in today’s Wall Street Journal, which suggests that the reason our economy is stuck in the doldrums in Republicans’ failure to move on the President’s budget and jobs plan. 

Much of the article is just a call for more stimulus spending to rehire laid off state and local workers and to support more clean energy programs.  Yet can Prof. Liebman really blame Americans for being a little gun shy on that front, since we were promised that the original nearly trillion dollar spending package, (that was also supposedly going to support “shovel ready” infrastructure spending, help state and local governments avoid layoffs, and advance clean energy projects) would cure our unemployment problems?

There are other claims in this article that seem both suspect and off-point.  For example, Prof. Liebman writes:

Economists Raj Chetty, John Friedman and Jonah Rockoff have shown that in a single year of teaching a great teacher raises the lifetime earnings of her students by $250,000 relative to an average teacher—so laying off some of our most promising teachers is tragic. Infrastructure boosts productivity and economic growth, yet we are spending less than half as much on infrastructure as Europe does as a share of the economy, and only a quarter of what China spends.

Everybody likes great teachers (apple pie and the American flag too!).  And we can all agree that great teachers can have a positive influence on a student’s life.  Yet why would we think that dumping billions of dollars into local governments would lead to there being more “great teachers”? 

I guess Prof. Liebman is referring to the union-backed practice of making firing decisions based on seniority, rather than on actual performance.  That means that any layoffs of teaching staffs that have taken place have left us with a worse crop of teachers. 

Yet isn’t that a reason to support meaningful education reform, instead of propping up dysfunctional union system of government-run schools that keep bad teachers employed just so we can also hire a few good ones? 

Lamenting our failure to keep up with Europe in terms of infrastructure investment is also a little bizarre.  Americans who have seen any international headlines know that Europe is hardly a pillar of economic growth.  In fact, Europe’s corpulent public sector—presumably which Liebman believes should lead to super-fantastic infrastructure and an educated populace that should lead to robust growth—is helping to create a debt crisis and Europe’s growth rate is even slower than the United States.   Why then are we supposed to think the European model of infrastructure investment is one we should follow?

He also applauds the President’s budget for advancing deficit reduction.  Yet Americans might wonder why, if the President’s mix of gutting defense and jacking up taxes is so appealing, has the Democratic-controlled Senate not even considered the President budget?  Why have Democrats rejected the President’s plan?  Why, in fact, have the Democrats not taken any meaningful steps to advance the President’s job plans?

Americans know that when the President had full control over the Congress, he had the opportunity to advance his economic vision for the country.  And he did just that by passing a nearly trillion dollar stimulus that poured money into saving union-public sector jobs, union-infrastructure projects, and clean energy programs.  Americans have now witnessed 3 years of stories about how that money was overwhelmingly wasted and failed to create the jobs we’d been promised.  The President also pushed a massive health care overhaul that was also supposed to be a part of creating a booming economy. 

The reason that no one (including the Democrats) is moving on the President’s new proposals is that the last ones failed miserably.  Team Obama can try to blame it all on Republicans in the House of Representatives, but it’s unlikely to wash away memories of the President’s economy policies in action.

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