Business Groups, Conservatives Split on Jobs

A recent article at PA Independent sheds some light on a telling split between business organizations and political conservatives on President Obama's American Jobs Act.

The National Federation of Independent Businesses, the Chamber of Business and Industry of Centre County, and Lockheed Martin all told PA Independent's Caleb Taylor that the AJA will help boost sales by putting people back to work.

Notably, NFIB state director Kevin Shivers expressed disappointment that the plan may not go far enough to boost sagging demand:

"Tax credits are great, but if you don't have customers coming in to buy stuff, few businesses are going to make more investments," said Shivers.

Mr. Shivers is echoing what his member businesses are saying. Kamran Afshar, the economist who conducts a quarterly survey of Lehigh Valley businesses for the Greater Lehigh Valley Chamber of Commerce, has also called for more infrastructure stimulus.

All of these organizations evidently buy into the idea that Obama's bill will help them by putting more money in people's pockets, giving them more customers. Early analyses of the bill suggest they are correct. Macroadvisers and economist Mark Zandi have scored the AJA as creating between 1.3 million and 1.9 million jobs, respectively.

By contrast, Pat Toomey and Teri Adams of the Independence Hall Tea Party in Philadelphia oppose the President's plan on the grounds that stimulus spending allegedly doesn't work.

But the 2009 stimulus did work. The Recovery Act was designed to create or save 3 to 4 million jobs, and indeed, that is what it did. Some studies put the number even higher, but all of the major analyses of the stimulus confirm that the number of jobs created was within the target range.

If the stimulus failed to get us to full employment, it is most likely because it was too small, and was soon cancelled out by massive layoffs at the state and local level.

At the federal level, Tea Party favorites like Pat Toomey are piling on, pursuing an agenda of immediate spending cuts that the Fed has warned will hurt job growth.

What might account for this split between businesses and people who are narrowly focused on electing Republicans in 2012?

An anonymous Republican aide gave Politico a very cynical answer:

"Obama is on the ropes; why do we appear ready to hand him a win?" said one senior House Republican aide who requested anonymity to discuss the matter freely.

What's striking is how perversely sensible the aide's logic is.

Who will voters credit if President Obama is presiding over a strong recovery in 2012? House Republicans? Rick Perry? Sam Rohrer?

No, if the American Jobs Act works, voters will reward President Obama and the Democrats. So why would the people who are focused on electing Republicans in 2012 want to do anything that would help the economy before the election?