As ThinkProgress has noted on numerous occasions, the nation’s unemployment rate would be a full point lower were it not for budget cuts that have forced hundreds of thousands of public workers to lose their jobs. The last three years, in fact, were the worst on record for public employment.
This sort of austerity, of course, has negative implications for economic growth, which in the U.S. was a sluggish 1.5 percent last quarter. As the Tax Policy Center noted, “in 2011, the state and local sector contracted 3.4 percent, the largest decline since World War II.” Budget cuts have actually knocked several tenths of a percentage point off of national GDP in each of the last two years and in the first half of 2012, as this chart shows:
Europe is presenting a shining example of the effects that austerity has on a national economy. For instance, the UK has been in a double-dip recession for three quarters, while Spain’s youth unemployment rate is above 50 percent. Conservatives, however, have not stopped pushing for more European-style austerity.