With the recent reports of private sector job growth coming in under previous estimates at only 96,000 jobs created, we’re hearing lots of handwringing on both sides about the implications of those numbers and the drop in unemployment from 8.3% to 8.1% (mostly due to those dropping out of the labor force).
The 24-hour news cycle and constant newsy soundbites makes it easy to lose perspective on things like the economy. I think Reagan was mostly right when he asked the question in 1980. It’s an important one to ask in framing an election and we all will have our own subjective measures upon which we’ll base our personal answer.
There are many examples of things President Obama has done that don’t involve the economy but still lend themselves to good will in the minds of some voters. Finally getting Osama bin Laden comes to mind. Saving the domestic automotive industry is another – even CEOs of companies who weren’t technically “bailed out” were in favor of it for obvious “rising tide lifts all boats” reasons. The repeal of Don’t Ask Don’t Tell. The end of the war in Iraq and winding down in Afghanistan. Arguably the largest tax cut in American history – whoops that might fall under “economy”. Finally getting comprehensive Health Care Reform done – something that most modern day Democratic Presidents have tried and failed to do. All of this happening in less than four years while dealing with Republicans in Congress who weren’t at all willing to strike any kind of bi-partisan tone. They consider “bi-partisan” a hammer and not a method of political compromise.
So let’s take a look at some economic metrics that may shed some light on whether we’re better or worse off than we were four years ago
Private Sector Job Creation
Republicans like to pounce on any private sector jobs number that misses estimates by any measure, completely forgetting the fact that their President oversaw the economy bleeding off hundreds of thousands of jobs a month. The graph above is stark and informative. It shows a clear trend of improvement, whether or not you consider month-to-month progress enough to get us back to prosperity (both sides will admit it’s not). The fact remains that Obama policies set in motion the long slog back.
Dow Industrial Average
If the free market is any guide, there is plenty of faith in the first term of the current President and their faith has only risen since the depths of doubt left by George W. Bush.
But what about these jobs? Most, including the President, would admit they’re not enough to replace the enormous amounts lost under the Bush Presidency. Why is that?
For one, an obstructionist Republican Congress has done everything in their power to prevent any good economic news prior to the election. Most rational economists saw the original stimulus underpowered and unable to counter the effects of The Great Republican Recession. Leaders in the Republican Party, instead of helping to right-size the stimulus based on the economic trouble we were in , made it next to impossible politically for President Obama to do more. Mitch McConnell famously remarked “The single most important thing we want to achieve is for President Obama to be a one-term president”. It is telling that their main priority was defeating Obama and not solving the economic calamity created on their watch. Their priority was massive obstructionism to regain political power. They weren’t in it for the middle class. I know this may come as somewhat of a shock to some of you dear readers.
You might have at some point in all this turmoil over jobs ask yourself where these “job creators” were. I know I did. This group of people who are richer than ever before and taxed at ten year low rates. You might ask yourself how corporate profits could be so strong under nearly 4 years of “repressive socialism by an illegitimate Kenyan President.” There are many questions raised by the data. If we are to be believe the theory postulated by the GOP for years (that the wealth will trickle down from the “job creators” to the middle class), then why are corporate profits rising as the middle class is hurting? Maybe the elder Bush was right when he called it “voodoo economics”. It’s all smoke and mirrors. It may sound good and a reasonable person might consider it, but in practice it has failed miserably. There is no evidence at all that lower taxes create periods of growth. In fact, it could better be argued that our most prosperous times were also our most highly taxed:
So what are these job creator doing with all this wealth? Their hoarding it overseas, where they’re making a great deal of it as well. The reason they don’t want to repatriate it back here to the good ‘ol U-S-of-A is they’d have to pay taxes (the horror). As much as $21 Trillion (with a T) may be in these offshore tax havens. That’s the combined GDP of The United States and Japan!
When Republicans are having a conniption over raising the marginal rates on high earners by some 4.5 percentage points, you realize how completely out of touch they’ve become. The fact is after years of favorable tax climates for corporates and “job creators”, the result has been more stark income inequality:
What about big government? Surely after one term of Hussein Obama we’re very close to a socialist dictatorship here in America, right? Um, no. The fact is government spending has flattened out under Obama (a great deal of this attributable to The Great Republican Recession). Conservatives could argue that if we were in an abundant period Obama would surely have tried to grow government, but that would all be hypothetical nonsense. The truth is Obama is presiding over the slowest growth in federal spending in a very long time.
Here’s a highly recommended TED talk on the matter of income inequality and the myth of the job creator (watch the whole thing). Nick Hanauer is an entrepreneur and venture capitalist – and a really smart guy who gets it. As one of the first investors in Amazon.com, it’s pretty clear the guy knows his stuff.
Let’s remember something VERY important here. The question that Republicans want to ask is not “are you better off than you were four years ago” (because it is very obvious that we are), but “are you as well off as you’d like to be and do you blame Obama for that?”
Unfortunately that’s not their dearly revered Ronald Reagan litmus test. Ronnie was very clear in his phrasing. Are you better off than you were four years ago – and by extension are we all?
The answer is a resounding yes. Where we want to be? That’s coming, and why we must move forward with President Obama.
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