The New York Times editorialized today about the supposed “brutalizing” effects of state and local government spending cuts. They claim that “most states also have cut their public workforces.”
Yet USA Today reporter Dennis Cauchon takes a look at the actual data, and he finds that state and local governments added 12,000 workers in the latest quarter, while the private sector cut 1.3 million jobs.
Thus, it appears that “brutal” restructuring is going on in the private sector, but not in the government sector. Indeed, Cauchon finds that “a huge influx of federal stimulus money to state and local governments more than offset a sharp drop in tax collections” this quarter. The article shows that state and local government spending rose quickly in the first three quarters of 2008, then dropped for two quarters, but is now rising again quite quickly. That doesn’t sound very brutal to me.
Too often editorial boards and columnists seem to write economics articles based on their preconceived notions about what they think is going on, without looking at any solid data. Cauchon’s columns at USA Today are a refreshing alternative to the sort of impressionist writing on economics we see in the NYT editorial today.