Texas Governor Rick Perry's parachute drop into the race for the GOP Presidential nomination has been accompanied thus far by a laser-beam focus on his (or at least his state's) record of job creation. Perhaps in response, Michelle Bachman is doing the same. And President Obama has dusted the topic off and trotted it out again.

I'm interested to know exactly what different politicians propose to do to create jobs. And as an aside, I'd like to know more about the nature of the jobs created in Texas (I forget the exact figure, but seem to recall something like 40% of all new jobs created over the past few years were created there).

The Keynesian approach (which I favor) is fairly obvious and straightforward--have the government spend money directly on municipal positions such as teachers, police officers, and fire fighters, or spend money indirectly on private sector positions such as engineers and construction workers by funding infrastructure projects. Rightly or wrongly, today's political climate seems to preclude this approach.

When those on the right talk about creating jobs (by which they invariably mean having the private sector create jobs), how exactly do they propose that government assist
(even if only by getting out of the way)? I hear platitudes about reducing unnecessary regulation (such as pesky clean air laws) and cutting taxes (when taxes in the US are already at a worldwide low among developed nations). But is there evidence that either of these really works? And are there other avenues?

My (admittedly novice) read of the economy is that companies have more than enough cash on hand to hire. They don't, however, as they fail to see the demand for products and services that would warrant such hiring. This demand doesn't exist because too many people don't have jobs at all or are underemployed (and those fully employed carry too much debt).

Besides government spending (even deficit spending in the short term), are there documented concrete steps that the government can take to encourage private sector firms to hire?