Whenever Obama Blames the Mess Inherited From Bush and Compares Himself to Reagan, He Shoots Himself in the Lazy Foot That’s Lodged in His Own Big Mouth


In one simple graph:

Almost full excerpt via AoSHQ from National Review Online:

Throughout the debt ceiling debate (and prior thereto) you and members of your administration have repeatedly referred to the “mess [you] inherited” and the “economic headwinds” you faced upon taking office. You’ve also made frequent comparisons to Ronald Reagan.

Speaking of economic headwinds, Reagan “inherited” a GDP rate of -3.2 percent. You inherited a GDP rate of -4.9 percent. Two and a half years after Reagan took office, however, GDP was at 5.1 percent (and exploded to 9.3 percent the next quarter). Two and a half years after you took office GDP growth is at 1.3 percent (and as likely to implode as explode next quarter).

Reagan inherited an inflation rate of 11.8 percent. You inherited an inflation rate of 0.3 percent. Two and a half years after Reagan took office inflation shrank to 2.46 percent. Two and a half years after you took office inflation has risen to 3.56 percent.

Reagan inherited interest rates of 20.5 percent. You inherited interest rates of 3.25 percent. Two and a half years after Reagan took office interest rates dropped to 11 percent. Two and a half years after you took office interest rates remain unchanged.

Reagan inherited a national debt (adjusted for inflation) of $908 billion. You inherited a national debt of $10.1 trillion. Two and a half years after Reagan took office, $390 billion more had been added to the national debt. Two and a half years after you took office $4.4 trillion more has been added to the national debt.

Reagan inherited an unemployment rate of 7.5 percent. You inherited an unemployment rate of 7.3 percent. Two and a half years after Reagan took office the unemployment rate was 9.4 percent, but fell to 7.6 percent within a few months and declined steadily thereafter to 5.3 percent. Two and a half years after you took office the unemployment rate is 9.2 percent. To fall to 7.6 percent by the end of this year, however, more than 1,000,000 jobs per month would need to be created. Only 18,000 were created in June; 25,000 in May.

Reagan slashed tax rates, encouraged American entrepreneurship, and didn’t complain incessantly about the mess he inherited. Will you ever do the same?

Another via AoSHQ, from American Spectator:

“A graph titled ‘Private Sector Job Creation’ on the Obama-Biden campaign website… announces proudly that 4.4 million private sector jobs have been created over the past 28 months.”… At the same point during the Reagan recovery, the economy had created 9.5 million new jobs.

Reagan’s recovery produced job growth in 81 out of its first 82 months, with 20 million new jobs created over those 7 years, increasing the civilian workforce at the time by 20%.

The relevant streak of Obamanomics was extended in the June jobs report. That report established that under President Obama America has suffered 41 straight months of unemployment over 8%, which the Joint Economic Committee of Congress confirms is the worst recovery from a recession since the Great Depression almost 75 years ago. Indeed, the last time before Obama unemployment was even over 8% was December 1983, when Reaganomics was bringing it down from the Keynesian fiasco of the 1970s. It didn’t climb back above that level for 25 years, a generation, which is a measure of the spectacular success of Reaganomics.

Obama’s tragic jobs record reflects the dismal economic growth under his administration’s throwback, Keynesian economic policies. For all of last year, the economy grew by a paltry real rate of 1.7%, only about half America’s long-term trend. The average so far this year has been no better. That dismal growth is further reflected in the Census Bureau reports of falling real wages under Obama, kicking median family income back over 10 years, with more Americans in poverty today than at any time in the more than 50 years that Census has been tracking poverty.

In sharp contrast, in the second year of Reagan’s recovery, the economy boomed by a real rate of 6.8%, the highest in 50 years. Real per capita disposable income increased by 18% from 1982 to 1989, meaning the American standard of living increased by almost 20% in those first 7 years of the Reagan boom alone. The poverty rate, which had started increasing during the Carter years, declined every year from 1984 to 1989, dropping by one-sixth from its peak. That is the proper comparison for Obama’s economic performance.

“The Distribution of Household Income and Federal Taxes, 2008 and 2009,” issued by CBO on July 10, reports that the top 1% of income earners paid 39% of federal individual income taxes in 2009, while earning 13% of the income. That means their share of federal income taxes was three times their share of income.

And that is down from 2007, before President Obama was even elected. In that year, after 25 years of Reagan Republican tax policies, the top 1% paid 40% of federal individual income taxes. That was more than double the 17.6% of federal individual income taxes paid by the top 1% when President Reagan entered office in 1981.

From Forbes:

Ronald Reagan suffered a severe recession starting in 1981, which resulted from the monetary policy that broke the back of the roaring 1970s inflation. But all the job losses of that recession were recovered after 28 months, with the recovery fueled by traditional pro-growth policies. By this point in the Reagan recovery, 64 months after the recession started, jobs had grown 9.5% higher than where they were when the recession started, representing an increase of about 10 million more jobs. By contrast, in April, 2013, jobs in the Obama recovery were still about 2% below where they were when the recession started, about 2 ½ million less, or a shortfall of about 10 million jobs if you count population growth since the recession started, as discussed below.

In the 10 post depression recessions before President Obama, the economy recovered the lost GDP during the recession within an average of 4.5 quarters after the recession started. But it took Obama’s recovery 16 quarters, or 4 years, to reach that point. Today, 21 quarters, or 5 plus years, after the recession started, the economy (real GDP) has grown just 3.2% above where it was when the recession started. By sharp contrast, at this point in the Reagan recovery, the economy had boomed by 18.6%, almost one fifth.

From Forbes:

The Reagan recovery started in official records in November 1982, and lasted 92 months without a recession until July 1990, when the tax increases of the 1990 budget deal killed it. This set a new record for the longest peacetime expansion ever, the previous high in peacetime being 58 months.

During this seven-year recovery, the economy grew by almost one-third, the equivalent of adding the entire economy of West Germany, the third-largest in the world at the time, to the U.S. economy. In 1984 alone real economic growth boomed by 6.8%, the highest in 50 years. Nearly 20 million new jobs were created during the recovery, increasing U.S. civilian employment by almost 20%. Unemployment fell to 5.3% by 1989.

The shocking rise in inflation during the Nixon and Carter years was reversed. Astoundingly, inflation from 1980 was reduced by more than half by 1982, to 6.2%. It was cut in half again for 1983, to 3.2%, never to be heard from again until recently. The contractionary, tight-money policies needed to kill this inflation inexorably created the steep recession of 1981 to 1982, which is why Reagan did not suffer politically catastrophic blame for that recession.

Real per-capita disposable income increased by 18% from 1982 to 1989, meaning the American standard of living increased by almost 20% in just seven years. The poverty rate declined every year from 1984 to 1989, dropping by one-sixth from its peak. The stock market more than tripled in value from 1980 to 1990, a larger increase than in any previous decade.

In The End of Prosperity, supply side guru Art Laffer and Wall Street Journal chief financial writer Steve Moore point out that this Reagan recovery grew into a 25-year boom, with just slight interruptions by shallow, short recessions in 1990 and 2001. They wrote:

We call this period, 1982-2007, the twenty-five year boom–the greatest period of wealth creation in the history of the planet. In 1980, the net worth–assets minus liabilities–of all U.S. households and business … was $25 trillion in today’s dollars. By 2007, … net worth was just shy of $57 trillion. Adjusting for inflation, more wealth was created in America in the twenty-five year boom than in the previous two hundred years.

See also pretty collection of relevant scary economic charts.

Regarding my title, yeah, I like overkill.

By Michael Ramirez:

5 Responses to “Whenever Obama Blames the Mess Inherited From Bush and Compares Himself to Reagan, He Shoots Himself in the Lazy Foot That’s Lodged in His Own Big Mouth”

  1. Ron Says:

    The Free Market
    Volume VI, No. 10,
    October 1988

    The Sad Legacy of Ronald Reagan
    by Sheldon L. Richman

    Ronald Reagan’s faithful followers claim he has used his skills as the Great Communicator to reverse the growth of Leviathan and inaugurate a new era of liberty and free markets. Reagan himself said, “It is time to check and reverse the growth of government.”

    Yet… Reagan abandoned the free-market position and acquiesced in further crippling of the economy and our liberties. In fact, the number of free-market achievements by the administration are so few that they can be counted on one hand—with fingers left over.

    Let’s look at the record:

    Spending

    [...]

    Even Ford and Carter did a better job at cutting government. Their combined presidential terms account for an increase of 1.4%—compared with Reagan’s 3%—in the government’s take of “national income.” And in nominal terms, there has been a 60% increase in government spending, thanks mainly to Reagan’s requested budgets, which were only marginally smaller than the spending Congress voted.

    The budget for the Department of Education, which candidate Reagan promised to abolish along with the Department of Energy, has more than doubled to $22.7 billion, Social Security spending has risen from $179 billion in 1981 to $269 billion in 1986. The price of farm programs went from $21.4 billion in 1981 to $51.4 billion in 1987, a 140% increase. And this doesn’t count the recently signed $4 billion “drought-relief” measure. Medicare spending in 1981 was $43.5 billion; in 1987 it hit $80 billion. Federal entitlements cost $197.1 billion in 1981—and $477 billion in 1987.

    Foreign aid has also risen, from $10 billion to $22 billion. Every year, Reagan asked for more foreign-aid money than the Congress was willing to spend. He also pushed through Congress an $8.4 billion increase in the U.S. “contribution” to the International Monetary Fund.

    His budget cuts were actually cuts in projected spending, not absolute cuts in current spending levels. As Reagan put it, “We’re not attempting to cut either spending or taxing levels below that which we presently have.”

    The result has been unprecedented government debt. Reagan has tripled the Gross Federal Debt, from $900 billion to $2.7 trillion. Ford and Carter in their combined terms could only double it. It took 31 years to accomplish the first postwar debt tripling, yet Reagan did it in eight.>/b>

    Taxes

    [...]

    If we look at government revenues as a percentage of “national income,” we find little change from the Carter days, despite heralded “tax cuts.” In 1980, revenues were 25.1% of “national income.” In the first quarter of 1988 they were 24.7%.

    Reagan came into office proposing to cut personal income and business taxes. The Economic Recovery Act was supposed to reduce revenues by $749 billion over five years. But this was quickly reversed with the Tax Equity and Fiscal Responsibility Act of 1982. TEFRA—the largest tax increase in American history—was designed to raise $214.1 billion over five years, and took back many of the business tax savings enacted the year before. It also imposed withholding on interest and dividends, a provision later repealed over the president’s objection.

    But this was just the beginning. In 1982 Reagan supported a five-cent-per-gallon gasoline tax and higher taxes on the trucking industry. Total increase: $5.5 billion a year. In 1983, on the recommendation of his Spcial Security Commission— chaired by the man he later made Fed chairman, Alan Green-span—Reagan called for, and received, Social Security tax increases of $165 billion over seven years. A year later came Reagan’s Deficit Reduction Act to raise $50 billion.

    Even the heralded Tax Reform Act of 1986 is more deception than substance. It shifted $120 billion over five years from visible personal income taxes to hidden business taxes. It lowered the rates, but it also repealed or reduced many deductions.

    According to the Treasury Department, the 1981 tax cut will have reduced revenues by $1.48 trillion by the end of fiscal 1989. But tax increases since 1982 will equal $1.5 trillion by 1989. The increases include not only the formal legislation mentioned above but also bracket creep (which ended in 1985 when tax indexing took effect—a provision of the 1981 act despite Reagan’s objection), $30 billion in various tax changes, and other increases. Taxes by the end of the Reagan era will be as large a chunk of GNP as when he took office, if not larger: 19.4%, by ultra-conservative estimate of the Reagan Office of Management and Budget. The so-called historic average is 18.3%.

    Regulation

    For all the administration’s talk about deregulation (for example, from the know-nothing commission which George Bush headed), it has done little. Much of what has been done began under Carter, such as abolition of the Civil Aeronautics Board and deregulation of oil prices. Carter created the momentum and Reagan halted it. In fact, the economic costs of regulation have grown under Reagan.

    Some deregulation has occurred for banks, intercity buses, ocean shipping, and energy. But nothing good has happened in health, safety, and environmental regulations, which cost Americans billions of dollars, ignore property rights, and are based on the spurious notion of “freedom from risk.” But the Reagan administration has supported state seat-belt and federal air-bag requirements. This concern for safety, however, was never extended to the Corporate Average Fuel Economy (CAFE) rules, which, by imposing fuel-efficiency standards, promote the production of small cars. The shift to small cars will cause an estimated 10,000 to 20,000 highway deaths over the next ten years.

    Bureaucracy

    By now it should not be surprising that the size of the bureaucracy has also grown. Today, there are 230,000 more civilian government workers than in 1980, bringing the total to almost three million. Reagan even promoted the creation of a new federal Department of Veterans’ Affairs to join the Departments of Education and Energy, which his administration was supposed to eliminate.

    Trade

    The Reagan administration has been the most protectionist since Herbert Hoover’s. The portion of imports under restriction has doubled since 1980. Quotas and so-called voluntary restraints have been imposed on a host of products, from computer chips to automobiles. Ominously, Reagan has adopted the bogus fair-trade/free-trade dichotomy, and he was eager to sign the big trade bill, which tilts the trade laws even further toward protectionism.

    Results

    Reagan’s fans argue that he has changed the terms of public-policy debate, that no one today dares propose big spending programs. I contend that the alleged spending-shyness of politicians is not the result of an ideological sea-change, but rather of their constituents’ fiscal fright brought about by $250 billion Reagan budget deficits. If the deficit ever shrinks, the demand for spending will resume.

    This is the Reagan legacy. He was to be the man who would turn things around. But he didn’t even try. As he so dramatically illustrated when he accepted the plant-closing bill, there has been no sea-change in thinking about the role of government.

    US National Debt by Presidential Term:
    Per Capita and as Percentage of Gross Domestic Product

    HEADLINES:

    By far, the president who increased the Natl. Debt the most, by all measures, remains Ronald Reagan. Clinton was best.

    The only years with average annual gains in the Natl. Debt over 15% have occurred under Republican presidents

    As a % of GDP, the Natl. Debt trend has been worsening since 2000

    We spend $1.13B per DAY on interest. How would our society look if we could spend just 20% of that on other needs?

    Thanks to today’s low interest rates, as a % of GDP, our interest expense has been worse in all but 2 years since 1989

    “Facts are stubborn things.”~Ronald Reagan

  2. Scott Thong Says:

    This is the Reagan legacy. He was to be the man who would turn things around. But he didn’t even try.

    So let me get this straight…

    Reagan spent like a drunken sailor, racked up a record deficit… And managed to boost GDP, boost employment, squish inflation, slash interest rates, AND brinkmanship the USSR into self-destruction.

    Obama is accomplishing the former, even moreso in absolute terms, but what is he accomplishing of the latter?

    Somebody tell PRESIDENT NOBEL GENIUSSIAH that when he molds himself as the Reagan of our age, he’s supposed to emulate the positives and ditch the negatives – not the other way around!

    So, what is actually different between Reagan and Obama? Could it be, ohhhh I dunno, that one slashed taxes? Seems to me that the ‘trickle down’ droplets of tax cuts ‘for the rich’ are more thirst quenching for the common man than the ‘bottom up’ clogged toilet overflow of Keynesian Spendulus.

  3. wits0 Says:

    President Bobblehead
    http://factsnotfantasy.blogspot.com/2011/08/presidebt-bobblehead.html

  4. Ron Says:

    Policy Changes Under Two Presidents

    Total cost of new policies:

    Bush – $5.07 trillion
    Obama – $1.44 trillion

  5. Ron Says:

    Pat Buchanan: Bush “Broke The United States As A Superpower”

    “The regret is — the Republican candidates out in the field are not calling for a dramatic new direction of — Father help me, but i agree with Dr. Jeffrey Sachs. The United States — the United States is in virtual headlong retreat from the world. We’re coming out of all these places. We are bankrupt as a nation. We cannot balance our budget. The great blunder was made by George W. Bush when he had the whole country and the world behind him and he went up to Congress and declared ‘now we’re going after an axis of evil; Iraq, Iran and North Korea.’ We are plunging into that part of the world instead of fighting al-Qaeda and handling it the way he should have. As a consequence of that, I think he broke the Republican party and frankly, he broke the United States as a superpower. We are a diminishing superpower today and there is no doubt China is a rising one,” Pat Buchanan said on MSNBC’s “Morning Joe.”

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


Follow

Get every new post delivered to your Inbox.

Join 118 other followers

%d bloggers like this: