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Robert Reich writes: "Nothing is more central to average Americans than jobs and wages. Unless the President forcefully rebuts Republican's big lies, they'll soon become conventional wisdom."

Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)
Portrait, Robert Reich, 08/16/09. (photo: Perian Flaherty)

Obama, Stop Letting GOP Lie About Jobs

By Robert Reich, Robert Reich's Blog

23 March 2011

RSN Special Coverage: GOP's War on American Labor

The Republican's Big Lies About Jobs (And Why Obama Must Repudiate Them)

And if all others accepted the lie which the party imposed - if all records told the same tale - then the lie passed into history and became the truth. - George Orwell, 1984 (published in 1949)

ouse Majority Leader Eric Cantor was in town yesterday (specifically, at Stanford's Hoover Institute where he could surround himself with sympathetic Republicans) to tell this whopper: "Cutting the federal deficit will create jobs."

It's not true. Cutting the deficit will creates fewer jobs. Less government spending reduces overall demand. This is particularly worrisome when, as now, consumers and businesses are still holding back. Fewer government workers have paychecks to buy stuff from other Americans, some of whom in turn will lose their jobs without enough customers.

But truth doesn't seem to matter. Republicans figure if their big lies are repeated often enough, people will start to believe them.

Unless, that is, those big lies are repudiated - and big truths are told in their place.

What worries me almost as much as the Republican's repeated big lies about jobs is the silence of President Obama and Democratic leaders in the face of them. Obama has the bully pulpit. Republicans don't. But if he doesn't use it the Republican's big lies gain credibility.

Here are some other whoppers being repeated daily:

"Cutting taxes on the rich creates jobs." Nope. Trickle-down economics has been tried for thirty years and hasn't worked. After George W. Bush cut taxes on the rich, far fewer jobs were created than after Bill Clinton raised them in the 1990s.

To his credit, President Obama argued against Republican demands for extending the Bush tax cut for those making more than a quarter million. But as soon as Republicans pushed back he caved. And the President hasn't even mentioned that the $61 billion Republicans are demanding in budget cuts this fiscal year is what richer Americans would have paid in taxes had he not caved.

"Cutting corporate income taxes creates jobs." Baloney. American corporations don't need tax cuts. They're sitting on over $1.5 trillion of cash right now. They won't invest it in additional capacity or jobs because they don't see enough customers out there with enough money in their pockets to buy what the additional capacity would produce.

The President needs to point this out - not just in Washington but across the nation where Republican governors are slashing corporate taxes and simultaneously cutting school budgets. President Obama says he wants to invest in American skills, but many states are doing the opposite. Florida Governor Rick Scott, for example, says his proposed corporate tax cuts "will give Florida a competitive edge in attracting jobs." They'll also require education spending be reduced by $3 billion. Florida already ranks near the bottom in per-pupil spending and has one of nation's lowest graduation rates. If Scott's tax cuts create jobs, most will pay peanuts.

"Cuts in wages and benefits create jobs." Congressional Republicans and their state counterparts repeat this lie incessantly. It also lies behind corporate America's incessant demand for wage and benefit concessions - and corporate and state battles against unions. But it's dead wrong. Meager wages and benefits are reducing the spending power of tens of millions of American workers, which is prolonging the jobs recession.

President Obama and Democratic leaders should be standing up for the wages and benefits of ordinary Americans, standing up for unions, and decrying the lie that wage and benefit concessions are necessary to create jobs. The President should be traveling to the Midwest - taking aim at Republican governors in the heartland who are hell bent on destroying the purchasing power of American workers. But he's doing nothing of the sort.

"Regulations kill jobs." Congressional Republicans are using this whopper to justify their attempts to defund regulatory agencies. Regulations whose costs to business exceed their benefits to the public are unwarranted, of course, but reasonable regulation is necessary to avoid everything from nuclear meltdowns to oil spills to mine disasters to food contamination - all of which we've sadly witnessed. Here again, we're hearing little from the President or Democratic leaders.

Look, the President can't be everywhere, doing everything. There's tumult in the Middle East, we're suddenly at war in Libya, Japan is struggling with the aftermath of disaster, and surely Latin America is an important trading partner.

But nothing is more central to average Americans than jobs and wages. Unless the President forcefully rebuts Republican's big lies, they'll soon become conventional wisdom.

Robert Reich is Professor of Public Policy at the University of California at Berkeley. He has served in three national administrations, most recently as secretary of labor under President Bill Clinton. He has written twelve books, including "The Work of Nations," "Locked in the Cabinet," "Supercapitalism" and his latest book, "AFTERSHOCK: The Next Economy and America's Future." His 'Marketplace' commentaries can be found on and iTunes. your social media marketing partner


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-34 # forparity 2011-03-23 10:54
"After George W. Bush cut taxes on the rich, far fewer jobs were created than after Bill Clinton raised them in the 1990s"

Has nothing to do with anything, Robert.

Let me quote your buddy, progressive economist Dean Baker:

10 November 2008 - It is important to separate Clinton-era mythology from the real economic record. In the mythology, Clinton's decision to raise taxes and cut spending led to an investment boom. This boom led to a surge in productivity growth. Soaring productivity growth led to the low unemployment of the late 1990s and wage gains for workers at all points along the wage distribution.

At the end of the admin, there was a huge surplus, and we set target dates for paying off the national debt. The moral of the myth is that all good things came from deficit reduction."

Con't ..if the mod will allow - thank you
-34 # forparity 2011-03-23 10:56
Con’t. Quoting Dean Baker from Nov. 2008

"The reality was quite different. There was nothing resembling an investment boom until the dot-com bubble at the end of the decade funneled vast sums of capital into crazy internet schemes. There was a surge in productivity growth beginning in 1995, but this preceded any substantial upturn in investment. Clinton had the good fortune to be sitting in the White House at the point where the economy finally enjoyed the long-predicted dividend from the information technology revolution.

Rather than investment driving growth during the Clinton boom, the main source of demand growth was consumption. Consumption soared during the Clinton years because the stock market bubble created $10tn of wealth. Stockholders consumed based on their bubble wealth, pushing the saving rate to record lows, and the consumption share of GDP to a record high."

Baker will also confirm, as has Krugman, that the main reason for the dissappearance of the silly projected budget surpluses, and the return to massive deficits by 2003, was mostly because of the fallout from the collapse of that bubble in March, 2003.

It's true - there was little job creation following the Bush stimulus (tax cuts) - as there will be little job growth following Obama's stimulus (tax cuts, etc) - Times have changed.
+22 # BradFromSalem 2011-03-23 12:59

All that verbiage looks impressive.


The bottom line is that less jobs were created when Bush cut taxes on the wealthy than when Clinton raised taxes on the wealthy. Prof. Reich made the statement to refute a lie that cutting taxes on the wealthy creates jobs. He did not explicitly state that raising them creates them. In fact you support the assertion that Tax cut on the wealthy do not create jobs.

Remember, History almost always shows the lefties are right in the long run.
Have a Great Day!
-10 # forparity 2011-03-23 13:13
Reich certainly implied that.

Perhaps the larger point might be.. how much damage was done to our long term economy by events like the (Enron) bubble and the housing bubble - both born during the Clinton years?
+10 # BradFromSalem 2011-03-23 14:38
The implication is mainly derived from the prejudices of the reader.

But, while I do agree the long term harm done by both bubbles were more or less born during the Clinton years. The prophylactic regulations that could have prevented the birth had been removed.

Indeed, much of the regulations were taken down during the Clinton era, but the movement started in the Reagan era and was championed by Greenspan during all 3 administrations.

Reich's article was about lies on how to fix today's economic woes, not recreating the mess; which at best is all the Republicans can offer. Most likely, if we accept their liezs as fact we end up much worse off than now.
-12 # forparity 2011-03-23 17:58
Well, unfortunately (or not) I do not agree with much of any of Reich's economic sense - nor his oft revisions of history.

I think that his bold statements are straw-man presentations - and are completely out of context. For instance - Tax cuts can certainly create jobs (that's why Obama pushed more tax cuts). The R's wouldn't really argue that only pushing tax cuts on the very rich - create jobs. See, I'd argue that we should cut corporate taxes - a good bit - but then combine tax reform to guarantee that high up persons in corporations end up paying more.

(Hi Robert - it's not a secret, you know.)

I certainly do appreciate your ability to communicate, as opposed to so many others.

I do wonder how history would have played out if Reich would have married Hillary (you know he dated her first - and introduced them to each other, shortly later?
+6 # heraldmage 2011-03-23 16:18
That's because Bush retroactively raised taxes on the middle class while giving the wealthy a big break.
-8 # forparity 2011-03-23 17:40
What? No.. that is not true. Everyone got a tax cut. By far, the majority of the tax cuts - dollar amount went to lower and middle classes. They are still on the books - same for the top end tax cuts.

Yes, it's true, a 3% cut for someone making a $mil a year is a lot more money for that person, than a 50% cut for those making $20K a year.
+10 # heraldmage 2011-03-23 16:38
Bush's 2 wars were what adversely effected the budget surplus and plans to pay off the national debt.
Bush had a really expensive election campaign which 2 wars, reconstruction contracts, & privatizing federal government services paid off at the expense of the taxpayers & the budget surplus.
One thing you don't want to leave in front of Repubs is money.
The Bush era strategy was spend. As is said in the movie "The International" banks (financial institutions) are only interested in owning the debt. That's what made them rich.
But their greed brought the system down.
The Obama stimulus tax cut was to small and incremental to make a difference to the average workers spending habits.
Their answer is another war. It's always good for profits but not for the taxpayers who foot the bill.
The system has been broken for a while the difference now is that it is noticeably broken.
-11 # forparity 2011-03-23 17:47
Sure making odd points there herald.

The wars cost a lot. You think that Gore would have spent more or less on Afghanistan, following 9/11? Gore did run in 2000 on a pledge to increase military spending more than Bush was proposing to do - by the way.

I don't know what to say about that "Bush had a really expensive election campaign thing.?? That's really paid for out of non-government funds. Of course, Obama had the most expensive one in history, last time - and now has pledged to spend over $1 billion on his 2012 race. Whoopie!

Yes - Bush spent too much. Leaving Iraq out of this for a moment - on just about everything else out there - can you think of a time when the Democrats don't want to spend more?

Yes - the system is broken.

Obama's stimulus isn't working either, in case you didn't notice - neither will his promise last week to continue to support Brazil's deepwater offshore drilling with a promise to buy their oil.
+32 # Dale Fanter 2011-03-23 11:03
President Obama needs Robert Reich as financial advisor. Mr. Reich has the right knowledge and credibility to advise Obama on rebutting the Republican lies. The American voter believes the continual lies and needs to hear the truth about what the Republican agenda truly is.
+18 # CARROT 2011-03-23 11:24
Dale Fanter is definitely correct. Pres. Obama just overlooking the elephant's lies is wrong. The public people believe what they hear and Pres. Obama doesn't stand up to the plate and tell the American people when something is not true. He MUST GET FIRMER, STRONGER AND SPREAD HIS WORD.....
+11 # propsguy 2011-03-23 11:41
the president needed to go to wisconsin and take his stand with the workers. that he didn't is unforgivable
+15 # Info 2011-03-23 12:32
Quoting propsguy:
the president needed to go to wisconsin and take his stand with the workers. that he didn't is unforgivable

If the President had gone to Wisconsin, the story would have been all about President Obama trying to control State Government. By staying away, he allowed the focus to be on the citizens of Wisconsin and the message stayed focused on "Yes, we can" rather than what many would prefer "Yes, he can". He did exactly the right thing by letting the people of Wisconsin drive the story and we need to see more and more citizens rise up and take back control before the politicians drive us all into debtors prisons and workhouses.
+3 # KittatinyHawk 2011-03-23 19:50
Others should have gone, Biden should have since he does represent working man..even if one donot like him.
Unions should all have been there and in other Cities that are posing problems. All Unions not select few. Those who didnot go are creating the image GOP wants.
Democratic National Committee and their State Organizations should have been there.
However, none of these were so what message did we get. Your on your won, gee sounds like GOP. They should now be organizing, Pa is on its way to start Cutting.. Corbett should be the one cut. NY is trying to do good things and GOP standing in way.
+24 # Ken Hall 2011-03-23 11:43
Thank you, RR, for pointing out once again the negative impact of "trickle down" economics on job creation. It is myth, and should be reported as such. After thirty years of trickle down tax cuts and free market economics, how are we doing here in the states?
-9 # forparity 2011-03-23 13:03
I think I'd call it nearly 40 years - in regards to when the big tax cuts started. JFK's were actually slightly larger (as a % of Gross national product) than were Bush's 2001-2003 combined. Now - I'm not trying to establish that that is the only way to look at it (nor is that the only gauge), but it is certainly notable.

And before someone jumps all over me again - I've oft said here that I thought the Bush tax cuts "on the top end" should have been reversed once the economy got going again following the 2003 tax cuts. Federal income tax revenue did soar from 2004 thru 2007 (a whopping 44%) so I think that reversing those tax cuts would not have effected the economy in any negative way at all.
+2 # heraldmage 2011-03-23 16:09
It was the wars that made the economy soar. We were involved in 2, plus the fake for USA corporation Iraq reconstruction program made everything look rosy. Convincing the people to buy & go in debt was part of the Bush era economics.
But than the bottom fell out the fraud was exposed. But no one went to jail except the guy who swindled the privileged.
+1 # Ken Hall 2011-03-23 23:09
So, how have we done with all all the tax cuts for the rich and the deregulation pushed through by the free marketeers?
+22 # photojack53 2011-03-23 12:05
I've stated for DECADES that we Democrats need to call the Republicans to the carpet and counter their lies and heinous tactics out quickly and without remorse! The "swiftboating" of Kerry is the most egregious example I can think of. If that election had had U.N. monitors, it would have been declared null and void! For them to perpetrate such VILE and known to be flagrant lies so close to an election, without enough time to counter them effectively, was a true travesty of justice AND our political system. From voter disenfranchisem ent, to outright blatant lies and deception, they play the dirtiest politics imaginable, AND WE HAVE TO COMMUNICATE THIS TO EVERY AMERICAN CITIZEN!
+11 # DaveW 2011-03-23 12:10
News Flash: Why isn't the President using his "bully pulpit" to counter-mind GOP nonsense about taxes, regulations and job creation? Hint: He has little "pink elephants" on his pajamas.
+11 # Thomas Paine for Social Justice 2011-03-23 12:24
There are two distinct issues here. One is the efficacy of various economic policies in creating jobs. Let's leave that one aside. The other is the persistent [non-]response of Democrats to the successful framing and sloganeering of the political right.

Hamlet cynically stated, "there is nothing either good or bad, but thinking makes it so." While this may be untrue from an empirical perspective, it is all to true from a propaganda perspective. People respond to simple messages that are frequently repeated, and tens of millions of my fellow citizens eagerly gobble up and dutifully regurgitate their diet of factoids from the political right. They eat it up in part because it's often the only food on the table.

Despite occasional "tough talk" from the Democratic leadership about "rapid response" to right-wing misinformation (which we tend to hear about mostly in the context of fund-raising efforts) the reality has not changed appreciably over the past decade. The political left is still getting pummeled in the "framing" wars.
+10 # BradFromSalem 2011-03-23 12:42
President Obama has a serious personality flaw. He believes that all sides have a valid point. He believes this even when he understands intellectually, that a point's foundation is made of wet sand that crumbles when exposed to the light of the sun.

He personally believes differently, and knows truth from fact. But it appears he honestly thinks the Republicans must have a point. He believes that they are not that evil.

President Obama is correct on the last point, they are not that evil. They are that dumb. And he is way smarter than them.

He does not have to educate America, we don't have time. President Obama has to tell America, that there is a way to fix America and then lay out a Progressive economic agenda. Every time the Republicans sabatoge it, every time. Get on National TV and in 5 minutes 10 tops, tell America that the Republican are being Stupid.

Yeah, right. Like that will ever happen.
But it is how I feel.
+16 # Hank 2011-03-23 12:59
I have been writing the president and my congressmen for some time telling them the same thing.
Unfortunately, I think we've reached the point where many of the lies are being accepted as truth since there has been nothing to the contrary from the president.
+4 # BradFromSalem 2011-03-23 13:24

You are right.

He needs to realize that he really is smarter than the Republicans that think we can grow the econonomy by shrinking it.
cut to a Republican ad:

"Honey, I put on some extra weight. Do you mind throwing my sweater into the dryer under 'hot' so it will shrink?

Thanks, dear. Now it fits perfect!"

cue the happy music and fade away........
+3 # heraldmage 2011-03-23 15:57
But please keep writing, emailing anything the only way we get action is when they hear from us en mass. So share this article with others and please don't give up hope.
+6 # bigbear 2011-03-23 13:51
Some lies ARE being accepted as truth, but it is up to all of us, individually to inform people that they are lies, not just the president.

After all, who believes politicians?
+8 # heraldmage 2011-03-23 15:53
Th president needs to stop acting like a mediator and start acting like a leader.
Tell the American people the truth. Lay it all on the line.
Follow the example of the 22March2011 RSN article by Dave Johnson "Koch Brother: Koch Industries an "Organized Crime" Operation" give the people the facts & details on things work. Than keep it up with at least weekly addresses on government contractors, lobbyist & PAC. Than ask the American people to help him take back the country.
He should even admit his failure in negotiating with GOP/Congress thinking they had a shared goal, helping the people but as their action & the data indicates they are only interested in helping themselves & their corporate sponsors.
For the sake of the country he needs to take a chance. The Presidency give him a unique position to speak truth to power and to inspire the people to action. He needs to stop worrying about re-election & keep his promise of change. Instead of relying on Demo leadership he needs to rely on the people. It is the people who elected him not the Dem leadership.
It is not to late for the President to doing what is in the best interest of the nation & its people not the privileged few, corporations, and their paid Congressional lackeys.
It's time to fight!
+1 # KittatinyHawk 2011-03-23 19:55
Americans do not want the truth. They either do not care or they do not care.

Obama should have cleaned out the white House, his trying to run Washington like the Clintons is not working. Clinton could at least swing the Ball and hit hard when he needed to.
Mr Obama is still at the Plate thinking their is such thing as Bipartisanship. Foul Balls are running amuck...
+7 # Kayjay 2011-03-23 16:15
As for Obama's job performance more than two years into his term, I am still looking for the CHANGE that I believe in.
+2 # KittatinyHawk 2011-03-23 20:01
I am still waiting for Dems4Change to give him some advice..Get Rid of the Republicans in your Cabinets, clean sweep.
Trouble with Dems4Change=Yuppies.
Do you know one of the Conversations at a Meeting was about Palins Wardrobe. 'It was like 'Wow she actually bought some designer clothes'" Wow Like yaeh! I read that in the Trivia Pursuit Mag in Store. I'm gonna get some glasses like that. And so on...I guess they are still discussing everything but Changes, so like is that like how Obama is like thinking, Man? My Cell is texting, like I live on my cell...What carrier do you have, I don't have one I have like four.
Dems4Change are making me go to Independents or Independence, either way its like better than the other options
+1 # KittatinyHawk 2011-03-23 20:09
GOP do not speak about jobs because they destroy jobs, they never had a Job, and they certainly do not want anyone in USA to have a Good Paying Job with Benefits.

I don't even know if the Democrats want us to have them.
the only reason Unions are holding their breath is they will lose theirs, I am talking about the Internationals who are as much like Big Business as GOP. How many were at these Marches? How many are looking into their Pension Funds?

As far as American People, those are the robots we saw in movies of 50's and 60's. We are the robots Orwell warned us of. So perhaps when the next election votes our New Dictator in...Americans will see the irony.

Always quoting the Nostradamus or whatever Fear crap they can find, but it is going to be the Evil One comes from USA not Middle East as the Preachers Preach.

I wish we could get News, even your comments into local News. I looked at our local Newspaper today..there were no world News, No Topics on anything...obit s, police log and Local News. So how many Newspapers are like this, wonder why Mentality of America is where it is.

All these new Ibooks..why, what are they reading? Certainly not History.
+1 # Rita Walpole Ague 2011-03-24 08:46
Go, Robert Reich, go. And, yes, per ususal, you are so right, Reich.

I commend you for looking squarely at facts, and recognizing and condemning all the karlroving - the spin, manipulation, distraction. And you also don't fall into the trap of asking unanswerable 'why' questions. Over the centuries and certainly nowadays, trying to figure out evil (the greed and power addiction of our villainaire rulers is most certainly evil) is not doable, even for the brightest of the bright and holiest of the holy. So.....

Please just telling it like it is, and encourage us not to ask the 'why' question regarding Pres. Obama's many failures to be a rough and tough fighter for we the sheeple. It is what it is, and he is what he is - a disappointment to many of us who so long for CHANGE and an end to the military/indust rial/corp. coup d'etat.
+1 # rrchapman 2011-03-24 11:56
The last I checked, we elect more than a president to office. It is about time the elected Democratic representatives and senators to carry some of this water. One person cannot do it alone.
+1 # thrustblog.blogspot. 2011-03-24 14:46
Cutting corporate taxes might have spurred investment in jobs back in the 1950s, but not now. (see: Now, corporations invest in job-replacing tech and foreign operations. We need to separate small business policy from corporate policy. One is good for the economy, the other is only good for their own bottom line.
+2 # VSweet 2011-03-24 16:07
This is a commendable news worthy article. Too bad, President Obama has not spoken out to set the record straight and stop the Republican constant lying. President Obama should have an Address The Nation news media broadcast and spell out the truth for all Americans to hear.
0 # Amentha Dymally 2011-03-24 21:02
Why is it that no one is speaking on the end result of the Republican Agenda. To have a slave labor force, without any social services. Then What??? Those who are too old to work, or too feeble-minded from poor nutrition and hunger? Or those who are actually uneducable from a low third world type of society? What happens to them? Don't any of you see the next step will be Genocide....jus t like Nazi Germany?

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