Published 05 Jul, 2011
Conservative Governors in states around the country are sticking to their ideology that spending cuts will create jobs, despite the facts showing that government spending actually leads to economic growth and more jobs.
As state governments push to slash budgets, a study by Adam Hersh, economist at the Center for American Progress, shows that states that have cut government spending have higher unemployment rates and created fewer jobs, even in the private sector. Meanwhile, states that stayed off the service cut bandwagon have created more jobs with stronger economies.
On the Think Progress blog, Hersh wrote:
Now these Republicans want the American public to drink a giant glass of their Cut-Grow Kool-Aid. But the data actually show the opposite of their claims to be true: steep spending cuts are hampering economic recovery in some states, while other states that resisted cuts or increased spending are now seeing declining unemployment rates, faster private-sector job creation, and stronger economic growth.
Hersh found that in the 24 states where spending had been cut by an average of 7.5% from the start of the Great Recession through 2010 there was a 1% increase in unemployment and 2.1% loss of private sector jobs, while the 25 states that increased spending by an average of 11% had a 0.2% decrease in the unemployment rate and a 1.4% increase in private sector jobs.
Doesn’t look like government spending and public workers’ salaries were destroying jobs and the economy-instead it was just the opposite, an inconvenient reality for the right-wing politicians who want to dismantle government and bust unions.