5 Big Myths (and 1 Big Truth) from the Republican National Convention

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The GOP is totally right: Obama's jobs record is miserable. But this good fundamental argument is jumbled up with an array of fibs and obfuscations.

RNC 2012 full.jpg
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It's hardly surprising that political conventions don't hold themselves to the scientific rigor of, say, a national conference on particle physics. It's true for the Republican National Convention, and it will be true of the Democratic response in a few weeks. The purpose of a convention, after all, is to thrill, and the Republican National Convention -- with its sold-out, decked-out crowd and dazzling collage of jumbo screens -- was nothing if not thrilling.

It also contained at least five sizable myths -- and one very important truth.

First, the big truth. Republicans are right: President Obama's jobs record is miserable. Even though it is not the president's fault that he inherited a recession, the numbers are the numbers. Unemployment has been over 8% for more than 40 months. Only twice since the Census have we surpassed 200,000 jobs created in consecutive months. Both times, jobs added had dipped below 100,000 two months later.

It has been an uneven recovery, held back by a housing and family debt crisis the administration has been powerless to help. The gap between the president's expectations and reality -- so efficiently illustrated in the graphic below -- is a deficit matched only by the actual trillion-dollar annual deficits that make Americans worried that we're shooting money as if out of a confetti cannon.

But circling around this big truth at the convention were five myths.

(1) "We Built That." Day One of the convention was built around a distorted comment by President Obama, who told supporters in July that entrepreneurs are helped by teachers, friends, and government-backed infrastructure. "Somebody invested in roads and bridges, if you've got a business, you didn't build that," he said. Romney seized on the line: "To say what he said is to say that Steve Jobs didn't build Apple Computer or that Bill Gates didn't build Microsoft." In fact, to say what Obama said is to say that Steve Jobs didn't build the Caltrain connecting San Francisco to the Valley, which is not controversial.

"I built that," numerous entrepreneurs told the convention in videos of their companies, "not government." We can debate the degree to which these particular companies were helped or not helped by the government (one was reportedly working with a government contract), but that's not really the point.

Obama didn't say start-ups don't build businesses. He said start-ups don't build bridges.

(2) "Gutting work requirements"

Republicans claim that the president issued an executive order to allow anyone to collect a welfare check without trying to get a job. Nope. That's just not true. I'll turn this one over to The Atlantic's Conor Friedersdorf:

The easiest place to begin to understand the issue is with the 1996 welfare reform law signed by President Clinton. Under that law, the federal government would no longer cut checks to welfare recipients as an entitlement like Social Security. Instead, states would get federal funds to administer their welfare caseload as they saw fit, subject to certain requirements ...

Recently, in response to a request from a bipartisan group of governors for more flexibility, the Obama Administration has said the federal government would consider waiving existing work participation requirements for states that were experimenting with "new, more effective ways" of helping welfare applicants find work, "particularly helping parents successfully prepare for, find, and retain employment."

Might this EO give some states room to loosen work requirements? It might. But you could say giving states flexibility is a federalist, even conservative, instinct. Either way, the Obama administration didn't kill the work requirement.

(3) Obama built the deficit all by himself. There is no debate that Obama has run up historic nominal deficits. There is also no debate that it obfuscates matters to blame him for every dollar of those deficits, as Republicans did repeatedly last night. Ezra Klein snagged a graph from the liberal-leaning Center on Budget and Policy Priorities that makes the point elegantly: The Bush tax cuts, combined with automatic revenue losses and spending increases due to the recession, make up the vast majority of the projected debt.

To be clear, the president owns the deficit. His advisers believe that low taxes and high spending is the only reasonable combination to fight the recession. But President John McCain would have extended the same tax cuts and dealt with the same automatic spending increases and huge revenue collapse. Much of these deficits was inevitable.

(4) Entrepreneurship and the safety net are incompatible. 

Spinning off the "we built that" theme, many speakers said we need a government that helps, not hinders, business. This is an uncontroversial goal, but it's wrong to suggest that less government is universally better for entrepreneurs. Starting a company is a high-risk bet. Building a strong safety net, some studies have show, could mitigate that risk and encourage more people to try to start their own enterprises.

Take, for example, the issue of universal health care, which was held up as an example of government getting in the way of industry. Both young and middle-aged entrepreneurs understand that our current health care system is probably a hindrance to innovation. Fear of not having insurance keeps graduates from starting companies, and fear of losing coverage keeps entrepreneurial employees from leaving companies to start their own, as I've written. One study from the RAND Corporation found that "the self-employed are much less likely to have health insurance than are wage/salary workers and even our sample of unemployed and part-time workers." Universal health care, and its subsidies for families, would put the self-employed on equal, or nearly equal, standing with workers who now benefit from subsidized health care.

(5) High unemployment has nothing to do with slashed government spending

Governor Scott Walker spoke about job creation and getting tough on government, but he elided the fact that job creation under his administration has been strikingly weak precisely because he's cut public sector pay so aggressively. His state finished 50th out of 50 in 2011Q3-2011Q4 personal income growth.

And Wisconsin's story is, to a large extent, the country's. Since the end of the Great Recession, we've lost 600,000 public sector jobs. You might argue that this is good news for the long-term. Conservatives would say that one cut government job is one that doesn't have to be paid for by taxes. Fair enough! But let's grapple with the math. Slashed public sector spending has elevated the unemployment rate and held back the recovery.

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Derek Thompson is a senior editor at The Atlantic, where he writes about economics, labor markets, and the entertainment business.

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