On Sunday, economist Paul Krugman hit back against GOP claims that public sector employment has increased under Obama, and that such jobs consist mainly of wasteful bureaucrats and somehow count less economically than private sector ones. Back in September it was tea party Senator Rand Paul (R-KY) toeing that line, and this morning it was former Republican gubernatorial candidate Carly Fiorina.

The exchange commenced immediately after Krugman made the point that, had government employment in the current recovery followed the same path it followed under previous recessions in the Bush and Reagan years, unemployment now would be slightly above 6 percent:

CARLY FIORINA: I think it’s important to remember, when we talk about the economy, that a private sector job and a public sector job are not the same things. They’re not equivalent. I’m not saying public sector jobs aren’t important. But a private sector job pays for itself. A private sector job creates other jobs. A public sector job is paid for by taxpayers. [...]

PAUL KRUGMAN: But when we say public sector jobs, it is not a bureaucrat in Washington, D.C.

FIORINA: Oh, it is, actually.

KRUGMAN: When we talk about public sector jobs — when we look at the ones that have been lost in large numbers in this — it’s basically school teachers. Don’t think about bureaucrats. It’s school teachers. What we’ve laid off hundreds of thousands of school teachers. And when we talk about the cuts in public spending that have happened, they are not, you know, some god awful who knows what. It’s actually public investment. It’s largely fixing potholes and repairing bridges.

So, you know, you have this image of these wasteful bureaucrats doing god knows what. What we’ve seen is an incredible drought of basic infrastructure, and laying off hundreds of thousands of school teachers.

FIORINA: It is a fact that virtually every department in every organization in Washington, D.C. has seen its budget increase for the last 40 years. That money is being paid to hire people. The number of people who are — of course there are some teachers…

Watch it:

Public sector jobs at the federal level have actually remained pretty stable over the last forty years. They began and ended the period around approximately 2.8 million, with a bounce to about 3.1 million circa-1990. Public sector jobs at the state and local levels increased significantly over those forty years, peaking at a bit over 19 million total when President Obama entered office. (They’ve fallen since, accounting for the decline in overall public employment.) But nearly all of that growth was in teachers and support staff for the education system, who now total nearly 7 million of those state and local workers.

The other major categories of jobs in state and local public employment are, as Krugman noted, police, firefighters, health care workers, and maintenance workers and drivers for the country’s transportation infrastructure. And the overall population of the country has also been growing, so even though the raw number of state and local workers increased significantly, the ratio of those workers to the overall population did not — 59 per 1000 in 1980 versus 65 per 1000 today.

In fact, the hit the U.S. economy took in the fourth quarter of 2012 was almost entirely due to a drop in government spending, and the economy is in for another blow should the sequester cuts kick in. We’ve been cutting jobs that provide demand in the economy and invest in the country’s potential for future economic growth, at a time when both are sorely needed to help the economy recover.

Today’s report from the Bureau of Labor Statistics showed that the economy added 171,000 jobs last month, beating analysts’ expectations. The private sector added 184,000 jobs (offset by some public sector losses), making this the 32nd consecutive month that the private sector has grown.

Overall, even accounting for the horrific month for jobs that was January 2009, the private sector has added 759,000 jobs overall under Obama. At this same point in the George W. Bush administration — October 2004 — the private sector had lost more than 1 million jobs. This chart shows the difference:

During the entirety of the Bush administration, the private sector ended up losing nearly 650,000 jobs.

The only reason that the unemployment rate did not spike during Bush’s first term is that the public sector so derided by conservatives was rapidly adding jobs. If the public sector had added jobs at the historical pace under Obama, rather than hemorrhaging hundreds of thousands of jobs, the unemployment rate would be under 7 percent today.

Data compiled by Jane Farrell.

One of the least appreciated but easily-confirmed facts about the current state of the American economy is that the number of Americans employed by the government has gone down under President Obama. But apparently this is news to one the Republican Party’s most prominent tea party conservatives. During a roundtable discussion on ABC this morning over the size and adequacy of the 2009 stimulus, a flabbergasted Sen. Rand Paul (R-KY) asked economist Paul Krugman if he was actually arguing that government employment had gone down under Obama:

PAUL: The thing I don’t understand is that you’re arguing that the government sector is struggling. Are you arguing that there are fewer government employees under Obama than there were under Bush?

KRUGMAN: Of course. That’s a fact. That’s a tremendous fact.

PAUL: No, the size of growth of government is enormous under President Obama.

KRUGMAN: If government employment had grown as fast under Obama as it did under Bush, we’d have a million and a half more people employed right now — directly.

PAUL: Are there less people employed or more people employed now by government?

Watch it:

As Krugman quickly pointed out on his blog, the answer is “less.” Now, perhaps Paul was thinking of employment by the federal government alone, which did tick up just slightly: 2.77 million at the end 2008 versus 2.8 million currently. But add in state and local government jobs, and the hard number for government employment dropped by around 600,000 after Bush left office.

As a matter of fact, the share of jobs in the economy provided by the public sector went up following the 2001 recession under George W. Bush, the 1990 recession under George H.W. Bush, and the 1981 recession under Ronald Reagan. Only after the latest recession, which hit just before Obama took office, did the share of public jobs drop.

In no small part this is due to another point Krugman made — that the stimulus, while large, was inadequate to the country’s needs. This has been particularly true in the area of state aid. Spending cuts at the state level overtook additional spending at the federal level in late 2009 and have been driving a contraction in the public sector ever since.

Rep. Paul capped off his anti-Keynesian argument with the strangely Zen-like assertion that “Roads don’t create business success. It’s the other way around. Business success allows us to build roads.” It’s unclear what this could mean. While tax revenue is dependent on economic growth, the very nature of a depression is a self-reinforcing negative spiral in the private market. Business success is sluggish, meaning employment and income is sluggish, meaning consumers are held back from buying enough goods and services, so business success remains sluggish. The whole point of Keynesian stimulus — of which government employment is one form — is to move money into the hands of consumers by the alternative route of the government and thus reverse the process.

Women have been disproportionately affected by the public sector layoffs that have become an unfortunate mainstay of the sluggish economic recovery, according to the National Women’s Law Center. The public sector has shed some 700,000 jobs in the last three years — which are the three worst years for public employment on record — and women have born the brunt of those cuts, while not seeing a large share of private sector job gains:

Since the start of the recovery three years ago, women have gained 908,000 net private sector jobs — and lost 396,000 net public sector jobs. Men have gained 2,304,000 net private sector jobs — and lost 231,000 net public sector jobs. In the last three years, women have a net gain of 512,000 jobs; men have a net gain of 2,073,000 jobs.

Men have gained enough jobs in the last three years to equalize the unemployment rate between the sexes. As Bryce Covert explained at Forbes, “Some of this is making up for the disproportionate number of jobs that men lost during the recession itself as construction and manufacturing collapsed. But given that men have experienced over four times the job gains made by women, that can’t account for all of it.”

Public sector layoffs have also disproportionately affected African-Americans. If public employment had simply grown at the historic rate during the recession, instead of shrinking dramatically, the unemployment rate would be a full percentage point lower.

Our guest blogger is Brian Frederick, Executive Director of the Sports Fans Coalition, the country’s largest nonprofit fan advocacy organization, which fights to give fans a voice on public policy issues.

In May, the city of Glendale, Arizona, home to Jobing.com Arena, where the National Hockey League’s Phoenix Coyotes play, faced a $35 million budget shortfall. Why? For the past two seasons, the city has paid the NHL $25 million per season to manage the Coyotes — a team that the NHL owns — in order to keep the team from moving. The league has owned the team since 2009, when owner Jerry Moyes declared bankruptcy, and has prevented any sale of the team that would have resulted in relocation.

In order to close its enormous budget gap, Glendale laid off 49 employees — two percent of the workforce – and, last night, the City Council passed a final budget that includes cutting social services and raising the city sales tax and secondary property taxes. The Tucson Citizen reported that the layoffs included:

– Community Development, six employees.

– Parks, recreation and library, 15 employees.

– Management and budget, one employee.

– Field operations, 20 employees.

– Police, 5 (non-sworn) employees.

– Transportation, one employee.

– Human resources, one employee.

There’s still the matter of the future of the Coyotes, however, and Glendale is doubling down on its “investment” in the franchise. Last Friday, the City Council voted for a lease agreement that would give any future Coyotes owner an average of $15 million per year for 20 years. It also agreed to pay $24 million in capital improvements to Jobing.com Arena, which is only nine years old. And keep in mind that the city still has to pay over $12 million in annual debt payment for construction of the arena.

So what’s the payoff? “$2.2 million in annual rent payments, ticket surcharges, sales taxes and other fees,” according to the Arizona Republic. Glendale officials also point to the usual intangibles such as jobs provided by the arena and increased tourism. But still, the price seems steep, particularly when the city is laying off workers and cutting social services. As The Arizona Republic’s editorial board wrote:

An analysis revealed that even if the Coyotes went to the Stanley Cup Finals for years, Glendale could still expect to lose about $9 million annually. It also is obligated to make debt payments on the arena, which will average about $12.6 million a year over the next 20 years.

Of course, money being spent on the Coyotes is money not being spent on other things, like capital improvements elsewhere in the city. According to the Arizona Republic, there are no new capital improvements funded in the next budget; plans to finish the city’s courthouse and build a new library are being pushed back until 2017.

The city of Glendale did, though, set up a “transition center” to help out the laid off employees. No word if it simply referred them to Jobing.com.

During a press conference Friday, President Obama noted accurately that layoffs at the state and local government level have hurt the economy as it slowly recovers from the Great Recession. “The big challenge we have in our economy right now is state and local government hiring has been going in the wrong direction,” he said.

Later in the day, New Jersey Gov. Chris Christie (R) responded by saying that the firing of government workers means things are going in “the right direction,” as reported by CBS’ Rebecca Kaplan:

The public sector has shed more than 700,000 jobs since President Obama took office, making it the worst three year stretch for public employment since records have been kept. And it’s in Republican states that the bulk of the cutbacks occurred. If the public sector had grown over that period at the same rate that it grew under Republican Presidents Ronald Reagan and George W. Bush, the unemployment rate would be a full point lower.

Christie is not along amongst the GOP in calling for laying off more public sector workers, despite the detrimental effect that it has on the economy. In fact, GOP Rep. Jeb Hensarling (R) responded to the latest jobs report, which was disappointing by all accounts, by claiming that public sector job growth was harming the recovery.

Hopes were not high today for this month’s jobs report after the economy appeared to net exactly zero jobs in August. While the numbers beat expectations, the story behind them reveals a pervasive trend in public sector job loss that Republicans seem committed to ignoring.

In August, the Bureau of Labor Statistics reported that the private sector added 17,000 jobs, but the public sector lost the exact same number (those numbers have since been revised). This month, the private sector created 137,000 jobs, but the public sector continued to hemorrhage jobs, losing 34,000. As Matt Yglesias notes, “month after month we see a labor market that’s basically treading water primarily because government employment is shrinking rather than keeping pace with population growth.”

Political Correction charted the plummeting public sector growth next to the steady rise in private sector jobs over the past two years. While the private sector marked a net gain of 1.4 million jobs, budget cuts have eliminated 572,000 government jobs. If governments maintained the same employment rate since 2009, “the economy would have grown by about 2 million jobs”:

This trend of public job depletion puts the Republican jobs agenda in stark contrast with the administration’s approach. President Obama’s American Jobs Act would not only add 1.9 million jobs next year, but makes targeted investments to arrest the trend in layoffs. The plan includes $35 billion in direct state aid infusion that will “prevent up to 280,000 layoffs of teachers, who are — along with cops and firefighters — particularly vulnerable to local government budget shortfalls.”

However, Republicans continue to block Obama’s much-needed plan because, in part, they see public job loss as a positive. As Yglesias points out, “this shrinkage is exactly what conservatives claim to believe will spark growth once they bring the era of Kenyan Anticolonialism to an end.” Buying into the conservative campaign against government workers, Republicans governors like Chris Christie (NJ) and Rick Scott (FL) openly tout laying off thousands of workers as a badge of honor. Scott actually bragged about getting rid of 15,000 jobs in his state. In talking up his draconian budget cuts, Scott admitted that his “biggest cut” is “always people.”

However loud Republicans sing about the shrinking public sector, plummeting public job numbers have failed to deliver on the promise of “private sector magic” — and the economy will continue to suffer for it.

Both the news media and a number of politicians have claimed recently that the U.S. Postal Service (USPS) is in “crisis,” and that it is necessary to lay off thousands of workers or reduce service in order to make the post office fiscally stable. And the Post Office itself has proposed laying off as many as 120,000 employees and withdrawing from federal health care plans in order to navigate upcoming fiscal crunches.

It is true that USPS is facing fiscal challenges — it lost nearly $20 billion over the last four years and is at risk of not being able to meet a $5.5 billion mandated payment to the Treasury at the end of this month (which has been put off six weeks thanks to the last continuing resolution in Congress).

But what has been lost in the political debate over the Post Office is why it is losing this money. Major media coverage points to the rise of email or Internet services and the inefficiency of the post model as the major culprits. While these factors may cause some fiscal pain, almost all of the postal service’s losses over the last four years can be traced back to a single, artificial restriction forced onto the Post Office by the Republican-led Congress in 2006.

At the very end of that year, Congress passed the Postal Accountability and Enhancement Act of 2006 (PAEA). Under PAEA, USPS was forced to “prefund its future health care benefit payments to retirees for the next 75 years in an astonishing ten-year time span” — meaning that it had to put aside billions of dollars to pay for the health benefits of employees it hasn’t even hired yet, something “that no other government or private corporation is required to do.”

As consumer advocate Ralph Nader noted, if PAEA was never enacted, USPS would actually be facing a $1.5 billion surplus today:

By June 2011, the USPS saw a total net deficit of $19.5 billion, $12.7 billion of which was borrowed money from Treasury (leaving just $2.3 billion left until the USPS hits its statutory borrowing limit of $15 billion). This $19.5 billion deficit almost exactly matches the $20.95 billion the USPS made in prepayments to the fund for future retiree health care benefits by June 2011. If the prepayments required under PAEA were never enacted into law, the USPS would not have a net deficiency of nearly $20 billion, but instead be in the black by at least $1.5 billion.

In order to remedy this problem, Rep. Stephen Lynch (D-MA) has introduced bipartisan legislation (which has 193 co-sponsors) that would allow the USPS to spend more of its own money to pay down its deficits, including $6.9 billion in pension overpayments or other overpayments that may total as much as $25 billion to $50 billion. These are Post Office funds, not taxpayer dollars.

Meanwhile, Rep. Darrell Issa (R-CA) has been pushing for legislation that would lead to widespread layoffs and break the back of the postal workers’ unions to defuse the “crisis” that Congress created. Yesterday, thousands postal workers and the Americans who value their contributions to our society held hundreds of rallies at congressional offices across the country to support Lynch’s bill and to protest against Issa’s. Here’s are some snapshots of the demonstrations:

It’s up to Congress to act to allow the Post Office to save itself, lest it become a victim of a crisis that Congress itself manufactured.