Business

Kudlow: March unemployment rate drop proof lower taxes work

Photo of Jeff Poor
Jeff Poor
Media Reporter

On Friday, the Labor Department released it March jobs report showing a significant drop in the jobless rate – to 8.8 percent, a full percentage lower from November 2010, which the Los Angeles Times reports is the steepest drop in nearly three decades.

So what changed – at least as far as government policy since then? Back in December, President Barack Obama signed a two-year extension of the Bush-era tax cuts and according CNBC “The Kudlow Report” host Larry Kudlow, Obama should thank the GOP for pushing him to that policy measure. He explained that on his Friday night broadcast.

“So, did the big March jobs report put President Obama back on the road to reelection? Well, if so, guess who he has to thank — the GOP, whose tax cuts saved him from himself,” Kudlow said. “At this rate, nearly 2 million jobs are going to be created in 2011. So, the White House has got to be very happy. But here’s the sublime irony: The wake-up in job creation is a function of Republican policy. After all, for two years the Obama Democrats spent themselves into oblivion. Over trillion dollars of so-called big-government stimulus – it didn’t work. It was replaced, however by Republican tax cuts that the president signed only after a shellacking at the polls.”

The CNBC host said those tax-rate freezes were welcomed by small business, which some point to as the real engine of economic growth.

“Most business people I know — folks who work in both large and small companies – they welcomed the tax-rate freeze,” Kudlow said. “Maybe it was a truce in the war against capital and growth and small business. So you know what?  Presto – extend the tax cuts, the jobs numbers start jumping. That was incredible. Small businesses are the real measure of job creation on track for about two-and-a-half million jobs this year.”

However, there still much to be done according Kudlow on tax reform and energy prices.

“But the Republicans had better remember this,” Kudlow said. “Flat-tax reform, corporate tax reduction is going to also get the economy going to get the economy going. Don’t rest on your laurels. And also folks, as we said early in the show – all this still leaves the Achilles’ heel of jobs and the economy, namely sky-rocketing oil and gasoline prices as we just discussed. The battle for the economy has not yet been won. And guess what, November 2012 – a long ways away.”

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  • arepeoplepayingattention2012

    Perhaps companies are hiring because they know they have FRIGGIN WAIVERS on ObamaCare for at least a while… GE doesn’t pay their taxes – Gov’t Motors is going to ‘sell’ the Federal Govt ONE HUNDRED PERCENT of new hybrid, electric efficient cars – and GE will be selling the Govt their electric little boxes that will get you TWENTY FIVE MILES before you start using gasoline – BIG FRIGGIN DEAL! Eric Holder isn’t going to do sh!t to anyone that broke any SEC/Fiancial laws. McDonald’s is going to hire FIFTY THOUSAND people in one day – that might mean a handful of people will get a job that averages $8.30 an hour, but they will walk to work since the Gulf was closed and we are paying $3.67/gal (if you’re lucky). But BO can’t seem to stop spending… get a budget done. WOW, what a guy. Where did all those bumper stickers for HOPE & CHANGE GO?? And the best part… he thinks he’s done such a sensational job, he’s going to run again – getting ONE BILLION DOLLARS from COMPANIES that are sending OUR jobs overseas. Nice huh?

  • callenlaw

    Name calling and birtherism aside, I have an honest question — my economics is rusty, but I recall there being generally a lag between when government stimulus is injected into the economy and when the short-term impact of that spending is seen in terms of job creation. So, is there any empirical evidence other than Kudlow’s talking with “most of the business people [he knows]” that any downtick in unemployment is attributable to tax cuts rather than stimulus?

    (PS: I am well-aware that in the middle-term, government spending crowds out private investment, and that deficit spending comes at the cost of long-term growth — Kudlow’s comments are about short-term impacts of tax cuts v. stimulus, so that’s all I am talking about right now)

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  • pink

    Right, Kudlow. The tax cuts we’ve had for years only caused the unemployment rate to drop in the last few weeks.

    • TommyV

      That comment makes you either stupid or a liar…..which is it?

      • Brutus2

        You missed delusional.

        • TommyV

          Sorry Brutus….my mistake!

    • truebearing

      poink,

      Trying to out do yourself with yet more and bigger stupidity? When you don’t understand something, try keeping your big mouth shut. You’ll still be an idiot, but at least you won’t have broadcasted it to the four corners of the earth.

    • nevadastu

      Pink/Spring, let me explain: Bush cut the taxes in 2001 and 2003 to deal with the back to back recessions caused by the tech bubble bursting and 9/11. Those tax cuts brought our economy out of the recessions quickly, and kept us at or near full employmment until 2008 when the housing market went bust. Had Oboner and the rest of the Socialists agreed to extend the Bush tax cuts for all, which includes small businesses, the economy would have started to recover long before now. It took the Republican victory last Nov to get the extension passed, and give businesses the confidence to expand and start to hire again.

  • 68Truthseeker

    Attorney Taitz Discusses Obama’s Eligibility & Social Security Number – 4/1/2011

    http://www.youtube.com/watch?v=tTyyBGgVflE

    Dr.Alan Keyes Speaks About Obama’s Eligibility Question 3-29-11.

    http://www.youtube.com/watch?v=BUTvCiNduv8

  • landed right

    Spring what is your statistical evidence? Please click on link for proof there is a month by month chart since 2001- http://data.bls.gov/pdq/SurveyOutputServlet?data_tool=latest_numbers&series_id=LNS14000000

    The first day of President Obama’s presidency the unemployment rate was about 5%.

    Stimulus package signed and promised unemployment would not top 8% on 2/13/09, rate was 7.8%.

    Since the tax cuts were passed on 12/17/2010 the rate has dropped from 9.4 to 8.8 percent. Compare from the date the stimulus was passed it went up from 7.8% to 9.4% to a .6% drop since December after the tax cuts were extended.

    Bush was not a good president IMO but your comments have no merit.

    • jameslawsen

      Unfortunately, you are wrong in your statistics.

      The Unemployment Rate in January of 2009, when Obama took office was just under 8%. In his first month in office – it dropped another 1%. This was unexpected as the Republican Administration in the White House did not disclose the fragility of the job market – since it was election and legacy time.

      Since the time the stimulus was passed, the unemployment rate has dropped from close to 10%, down to 8.8%. That is a much more accurate statement than trying to suggest that a tax cut which was ALREADY in place has done anything to improve the job numbers. You right wingers can try and make 2+3=4 – but the majority of Americans understand that the tax continuation has done nothing but keep more wealth in the hands of the wealthy.

      The CBO has already reported that the tax agreement has had little to no affect on jobs.

      I suppose if the GOP hadn’t fought so hard (remember Boehner crying?) to approve the bank bailout and TARP back in 2008, an $800 Billion dollar tax cut wouldn’t have been so hard to swallow. But getting their bailout and their tax cut – that’s having their cake and eating it too.

  • Spring

    Not one thing changed with our tax rates, same rates as past 10 years. Kudlow, we have to wait 10 years for GOP policy to work? Seriously, 10 years? I like Obama’s plan better, his plan created jobs in less than 2 years during our worst economic mess ever.

    • TommyV

      Spring….are you really pink….tell the truth….oops I forget who I’m talking to…..progressives never learned how to do that?

    • Brutus2

      Amazingly enough, preventing the largest tax increase in the nation’s history (ObeyMe’s prefered alternative before November electons), allows those who plan beyond their next beer the opportunity to invest.

      • jameslawsen

        Wow Brutus. Such the capitalist mindset you have. Perhaps you should take a look at your investments, determine if any of your holdings were propped up by the bailouts passed by Bush and the GOP in 2008 – and if so, liquidate those assets and give the socialist money back to the government – back to the taxpayer.

        Republicans didn’t let capitalism work – instead, they used taxpayer money to keep businesses which they invested in from failing – with the end result maintaining their wealth. Complete opposite from what happened in the crash of 1929.

        And after the GOP and George Bush cried about America going down the drain if we didn’t use trillions in tax payer money to guarantee bad investments – the GOP wants to shoulder the burden of this taxpayer theft by way of a tax cut for the very same people who benefited from the bailout?

        Failure to see this means either you are ignorant or took benefit. Either way, it’s no wonder you have a right wing viewpoint.

    • truebearing

      Sprung,

      If you wouldn’t comment, no one would know what a moron you are. Just a tip.

  • snowshooze

    It is the usual construction jobs kicking in…
    happens every year.