Friday, June 15, 2012

"The Private Sector is Doing Just Fine..."

Obama’s comment that the private sector “is doing just fine” continues to drive his campaign coverage this week.

What he was trying to argue was that the reason the economy has had so much trouble has been that the public sector at various levels of government has laid off so many workers. This of course has ripple effects in the overall economy. Public sector workers who lose their jobs and are unable to find new ones are unable to spend, save, or invest at the same level they once were, which means there is less consumer spending and less capital available to private sector businesses. Conservatives might respond that taxpayers would save substantial sums of money by laying off government employees which would then allow those same taxpayers additional money to spend, save and invest.

 Obama’s argument is a reasonable one, but saying “the private sector is just fine” makes Obama look out of touch and clueless about the economic situations they are facing. Average Americans looking at businesses closing around them and think the private sector is not doing fine. In fact, they are correct. The private sector may be doing ok relative to the public sector, but it is far from being healthy enough to generate the jobs and wages the economy needs to return to prosperity.

There is no denying that these comments hurt Obama. Republicans should have the comments on an endless loop and put them in campaign ads. But they risk nullifying the benefit of the comments when Romney says things like “He says we need more firemen, more policemen, more teachers.” On balance, the public likes having policemen, firemen, and teachers. Obama has a chance to counter-attack by capitalizing on fears about public safety and fears that the educational system will continue to decline as teachers are laid off, hurting the prospects of America’s children.

Obama would be well advised to choose his next words on the economy more carefully. Come to think of it, so would Romney. 

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