There is something of a consensus that federal dollars do more to affect jobs during the depths of a recession, which is why the recovery makes it easier for us to contemplate spending cuts. If we start with Wilson’s $125,000-per-job number seriously, this means that reducing annual government spending by $125 billion would mean somewhat less than one million fewer jobs, at least in the short run. That is a considerable figure and probably more than the U.S. would feel comfortable losing right now.
If we cut only $50 billion, this should mean 400,000 fewer jobs, and possibly less if the effect of public spending on employment is weaker today than it was during the recession. That’s a serious loss, but if private-sector job creation continues at its current annual rate of 1.9 million a year, private-sector growth could offset that loss in less than three months.
The data hold out hope. It is time to start thinking beyond the present, and embrace the spending cuts that will mean a smaller debt burden for our children.
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