The jobs number, reflecting a leap in unemployment to a five-year high of 6.1%, is bad news for the economy. But is it unalloyed good news for Barack Obama? The argument with John McCain boils down to “George Bush ruined the economy, McCain is more of the same” vs. “Obama will raise a ton of taxes and make things worse.” It seems that the first argument is already “factored in” to the poll numbers and voters’ antipathy toward another GOP president, although that sentiment can become more acute. But my sense is that McCain has yet to fully explain to voters what Obama has in mind and why this is a bad thing for the very issue they are concerned about–jobs.
I do expect McCain’s team to ramp up and to go after this issue in the debates. Is now really the time to hike income, corporate and capital gains taxes? Obama is either going to have to flip-flop yet again or explain what economic theory supports the view that tax increases create jobs.