Politics

Since inauguration, the economy has improved dramatically

34 short months ago, my son and I stood in front of the U.S. Capitol in 15 degree weather to watch Barack Obama’s inauguration. It was January 20th, and the economy had already shed more than a half million jobs on the year, on the way to losing about 2 million for the first quarter of 2009. The final month of the Bush presidency, December of 2008, posted a negative annualized GDP of 8.9%. The banking system was teetering on complete collapse. The auto industry was on life support. The Dow was at 7900. We were mired in two, intractable, un-winnable wars. Quick, unpopular, bold action was necessary to save the country, and the world, from a full-on depression. The nation was in crisis, our economy in shambles.

From the moment Obama took his oath, Republicans, led by Mitch McConnell in the Senate and John Boehner in the House, charged with the responsibility of responding to an economic emergency, instead dedicated themselves to Obama’s (and by extention, America’s) failure. Tragically, they were rewarded for their malfeasance at the 2010 mid-terms.

When President Bush was presented with the national crisis of 9/11/01, his own failure, he immediately was rewarded with a 90% approval rating and support from the overwhelming majority of elected Democrats. When Obama took over during a national crisis not of his making, he got squat. Virtually all of the Senate Republicans, and nearly all Republicans in the House, did everything possible to help the President fail. But Obama and the Democrats, despite playing with one hand tied behind their backs as Senate Republicans filibustered everything, managed to nonetheless muster a half-assed stimulus bill and a few other nuggets that saved us from utter catastrophe.

34 months later, the Dow is up 50%, GM has been saved, tens of thousands of jobs with it. GDP for the latest quarter is an anemic 1.3%, yet represents an improvement of 10.2% from where we were at at the end of the Bush administration. Taxes are lower for all but the very richest Americans. Despite the hysterical protests of a movement called “Taxed Enough Already”, all Americans are enjoying a tax burden that is historically low. Tens of millions of Americans previously without access to health care now have hope. We’ve had eight consecutive quarters of economic growth, and despite massive government layoffs, have experienced a net gain of jobs every month the last two years.

The stimulus, watered down with tax cuts as it was, nevertheless worked. It put the brakes on the job losses, then turned the corner to positive job growth. Unemployment topped out a little over 10%, then reversed course and worked its way down to 9%. A bigger stimulus would have produced better results.

The prevailing meme from the Republicans is, so far as I can tell, that if we had elected McCain and Palin, fired more public employees, cut corporate tax rates, eliminated the capital gains and inheritance taxes, and allowed businesses to endanger workers and the environment to their heart’s content, the economy would now be in better shape than it is.

The argument is absurd. There isn’t a shred of historical evidence or credible economic theory to support it. Yet it somehow has legs. Strong ones. Meanwhile, the fact that the economy is in relatively good shape compared with where Obama started is rarely even mentioned. Democrats can’t brag about how good the economy is, but we should remind the public how drastically worse it was three years ago.

Unemployment has settled in at about 9%, without any catalyst to move it significantly lower. So what do we do now? Sure, if we build pipelines and grant more drilling leases, that would create a few jobs, but in order to make substantial progress on the jobs front, the government needs to be willing to spend money. We have two options: tax and spend, or borrow and spend. Pick your poison.

In any event, the worst possible solution would be to give Republicans control of the presidency and Senate. That would just be an opportunity to eliminate needed environmental, consumer, and workplace regulations and serve up more and more tax breaks to the richest corporations and individuals, followed by little or no increase in employment.

Unfortunately, there are progressives out there that think we would have been just as well off if Obama had lost, and others that aren’t that extreme, but are too depressed or apathetic to lift a finger to help Obama win re-election. They could very well cost Democrats the White House and the Senate.

That, my friends, would be a shame.

Comments

comments