The Washington Post reports that Barack Obama is developing a plan that he hopes will “create or preserve” 2.5 million jobs over the next two years. The plan would consist of sprending billions of dollars to rebuid roads and bridges, modernize public schools, and construct wind farms and other alternative sources of energy. It’s difficult to see how new public works programs will “preserve” existing jobs. “Job preservation” is thrown into the equation, I imagine, just in case (as seems likely) 2.5 million new jobs don’t materialize.
One can question the economic wisdom of vast government expenditures on public works and energy sources of dubious value. However, the political wisdom of Obama’s plan seems indisputable.
By next year at this time, we could well be looking at an unemployment rate unprecedented in the memory of most Americans. Obama will not, and should not, be blamed for this. But he’ll be far better off politically if he enacts an aggressive program to address the problem. And when the unemployment rate comes back down, as it almost certainly will do in the next four years, Obama will be better positioned to claim credit if he can point to a jobs program he put in place.
There is also political advantage for Democrats in the expansion of government employment. So too with the cultivation of “industries” beholden to the government.
Meanwhile, Obama’s plan will put pressure on Republicans. Voting against a “jobs” package in the face of cascading unemployment is not an attractive option. I wouldn’t be surprised to see bipartisan support for such a package if Obama is willing to make a few concessions and, especially, if he is willing to keep the Bush tax cuts in place until their expiration date in two years.
But Obama holds the whip hand on this issue, and may prefer to hold Republican feet to the fire. That would be the Washington way.
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