Agreed. To complement Stephen’s fine post: Even as state and local governments have lost 212,000 jobs over the past year, state and local job totals stand at 19.5 million. We’re still 1.6 million people, or 8.7 percent, above the figures from summer 2000.
By contrast, residential construction has lost 31 percent of its jobs since summer 2000.
Both residential construction and state and local government jobs depend on the same bubble-era environment for their funding. So, it’s quite likely we’ve seen only the beginning of economic adjustment here.
As with any other big shift in the economy, the government’s job is to help individuals — with unemployment insurance and the like — rather than try to avoid the shift altogether with massive subsidies.
Please read more about this here.
— Nicole Gelinas is a contributing editor to the Manhattan Institute’s City Journal and author of After the Fall.