Anyway, back to the main point: Large-scale layoffs of government workers continue across the United States. Such layoffs undermine local economies and stymie the recovery. For every five workers who were hired in the past three months, one was laid off by government.
This doesn’t make sense. Government may not always do such a great job of stimulating employment growth through fiscal and monetary policy, but it sure as heck can bolster the job market by continuing to employ those people who do have jobs. Instead, thanks to austerity policies, government has been doing the exact opposite.
Many of these laid off workers will get on unemployment and perhaps collect other government benefits such as food stamps, the EITC, or SCHIP. They also, obviously, will no longer be paying taxes. So quite apart from the human costs and economic costs, in terms of depressed consumer spending, layoffs of public workers don’t deliver all of the fiscal gains imagined because the unemployed cost government money while no longer contributing to the tax base…
The fiscal cliff deal should have included new aid to the states to prevent these layoffs. It didn’t and America— along with its children—will be paying the price this year. And for years to come.