The White House is already attributing the disastrous March jobs report on the sequester – and by extension blaming the Republicans in Congress it deems responsible for the cuts.
The Department of Labor reported this morning that the economy added only 88,000 jobs last month, the slowest pace since June 2012, while unemployment declined to 7.6 percent – but mostly because people exited the workforce on a massive scale.
From a statement by White House Council of Economic Advisers Chairman Alan Krueger:
It is important to bear in mind that the March household and payroll surveys are the first monthly surveys to look at employment since the beginning of sequestration. While the recovery was gaining traction before sequestration took effect, these arbitrary and unnecessary cuts to government services will be a headwind in the months to come, and will cut key investments in the Nation’s future competitiveness . . .
Now is not the time for Washington to impose more self-inflicted wounds on the economy. The Administration continues to urge Congress to replace the sequester with balanced deficit reduction, while working to put in place measures to put more Americans back to work like rebuilding our roads and bridges and promoting American manufacturing.
But the White House line is misleading. Any deficit reduction, whether “balanced” or through sequestration, will have a contractionary effect on the economy because it will by definition either reduce government spending or raise taxes. And both sides – Republican and Democrat – support deficit reduction.
What’s more, Americans are probably just feeling the pain of tax hikes that went into effect in January at the insistence of the White House, well before sequestration took effect.
Further spinning the numbers, Krueger seemed almost divorced from reality, writing, “today’s employment report provides further evidence that the U.S. economy is continuing to recover.”