The Strongest Economy in a Generation — If You’re a Government Worker

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When Bill Clinton declared that 10.7 million new jobshave been created during his presidency, what he didn’t say isthat a bundle of those jobs were created with your tax dol​lars​.It turns out that under Clintonomics, the third fastest area ofemployment (behind the service and construction sector) is government.

Nearly 800,000 new government jobs have been added sinceJanuary, 1993. Take out the decline in Pentagon employment andthere are now nearly 1 million more non‐​defense government jobsthan there were when Bill Clinton took office. Clearly thegovernment employee unions can answer with a resounding yes, whenBill Clinton asks are you better off today than four years ago?

Government employment has grown more than manufacturing,mining, finance, insurance, and real estate combined. Tobe fair to the Clinton administration, this is a trend that beganunder George Bush. In 1989, when Reagan left the White House,there were 1.9 million more Americans working in manufacturing – building things – than working for government. Today, there aremore than 1.2 million workers in government than manufacturing.We now have less people making widgets than regulating and taxingthem.

The government is one of the few sectors of the economy wherethe economy is producing good, high paying jobs. Unionizedgovernment employees, particularly at the state‐​local level,typically receive salaries and benefits that exceed comparablyskilled private sector wrokers’ compensation by 30 percent ormore. How can government be on a hiring binge when the Clintonadministration claims that government employment is at its lowestlevel since the Kennedy administration? As usual, the White Houseis economizing with the truth. Today there are 415,000 morefederal workers than there were when JFK was president.

It is true that federal employment has fallen duringClinton’s tenure. Bureau of Labor Statistics data show that the workforcehas contracted by 5.6% since January 1993, a reduction of 160,000jobs. In Washington, D.C. – where reductions in the rate ofgrowth are considered cuts – any genuine cut (even just 5.6%)is a genuine achievement.

Where did the 160,000 workforce reduction come from? Whereelse? The military. Since Bill Clinton assumed office, Departmentof Defense (DoD) employment has fallen 152,500 or 17 percent. DoD employmenthas fallen from 32 percent of total federal employment in 1989 to27% today. The cuts in defense employment have been so deep, infact, that Postal Service employment now exceeds civilian DoDemployment for the first time since before World War II. Of every100 federal jobs eliminated over the past four years, 94 weremilitary personnel.

This leaves a reduction of 1,200 decline in the bureaucracyfor all other agencies. That’s a 0.6 percent cut. And virtuallyall of those reductions came in the legislative branch mostlyunder the 104th Congress. Legislative branch employment hasfallen by an impressive 17 percent since 1993. Employment in therest of the Executive Branch has fallen by 5,400 people.

The official government employment statistics actuallyunderstate the growth of federal civilian employment under Clinton.According to the Wall Street Journal, “federalpersonnel reductions aren’t as impressive as they first appear.Of the … civilians lopped from the federal payroll sinceJanuary 1993, 17% were part‐​timers and 13% were temporaryemployees. At the Environmental Protection Agency, 89% of thoselet go were temps.”

The official employment statistics also ignore the rapidgrowth rate of contracted labor, which has become a kind ofshadow government. As The New York Times pointed out lastMarch, of those federal “jobs that have vanished on paper,many of the responsibilities are being fulfilled by outside contractors.“Today, more than 22 million people work for companies doingbusiness with the federal government. Arkansas Sen. David Pryor,a Democrat and long‐​time associate of Bill Clinton, concedes:“The whole philosophy of beating our chest and saying howmany fewer employees we have but never in the same breath saying,‘Look at how much larger we are getting in the use of privatecontractors,’ is not an honest portrayal of what’s going on withtax dollars.”

Despite the congratulatory talk in Washington of lean budgetsand tight‐​fisted politicians, government in the 1990s continuesto be one of America’s most rapid growth industries. The $2.6trillion of total government spending in America is now more thanthe combined earnings of the Fortune 500 companies. And the governmenthas more workers than these firm’s combined payrolls. In fact,the federal government is the world’s largest — and mostgenerous — employer.

So the president wasn’t lying when he maintained thatgovernment employees are “the hardest working Americans“he knows. Having spent virtually his entire life as a government employee,they are about the only working Americans he knows.

Stephen Moore and James Carter

Stephen Moore is director of fiscal policy at the Cato Institute. James Carter is an economic analyst in Northern Virginia.