Spending has helped more than austerity

On July 24, Mitt Romney was interviewed on TV by conservative economist Larry Kudlow. During the discussion, he told Kudlow that no matter who is elected, the president should be given six months to a year to allow his economic program to show results. Seems like a perfectly reasonable expectation and one of the few things where we agree.

When that standard is applied, a very interesting and enlightening picture of the Obama Administration emerges.

From February to July, 2009 the U.S. economy lost 3.4 million jobs. Over the next six months we lost nearly 900,000 more, bringing the total loss during Obama’s first year to 4.3 million. The Romney standard would attribute those losses to the previous administration.

What happened after that is eye opening. From March 2010 to June 2012 the U.S. economy added 3.8 million jobs. What this proves is that the stimulus worked. Did it work as well as anyone would like? Of course not. That 3.8 million jobs is an average of 137,000 per month. And the net result for the 3 1/2 years of the Obama Administration is still about 500,000 lost jobs.

But, would spending cuts have proven a better plan? Let’s compare the U.S. economy, aided by government stimulus, to the British economy which adopted an austerity program. Over the last 2 1/2 years, our GDP has grown each quarter, while the British economy has declined in five of those ten quarters, including the last three.

You be the judge, which is working better?

BOB WYNHAUSEN

Sandpoint