It is not as simple as saying government either does, or does not create jobs; the answer is that government can create jobs and even boost the economy, but it has to do it in certain ways. Government has to be very careful that it isn't infringing on the private sector and that what it does is not pie in the sky and corrupt and wasteful of taxpayers money--such as has been done by the current administration as regards solar power and health care insurance.
Some projects are simply too large and complex for private enterprise to take the lead on. In many parts of the country there are water and energy projects that in practical terms can only be initiated by government. Often times there is no direct payoff, such as when levies are built on major waterways, or when similarly those waterways are dredged to allow shipping, but there are enormous implication for the economy in general. Energy projects such as the TVA, Bonneville and others were key to making it possible for untold private industries to be built and flourish. Some towns, cities and entire industries were only possible because of huge projects that government financed.
Even defense spending can be hugely beneficial if it is done right and with an eye on cost efficacy.
So yes, government can create jobs, but not when government is headed by stupid, unqualified people. We're seeing how that works right now.
