Growth: President Obama has taken to touting his “middle class economics” as a big success. That’s difficult to believe, given the latest GDP numbers, and impossible when you look at his complete record.
On Friday, the Bureau of Economic Research reported that the last quarter of the year produced another round of mediocre growth — just 2.6%.
That undercut the average economist’s forecast by about six basis points and continued a pattern of weak quarters typically following periods of decent growth.
But it didn’t stop White House economic adviser Jason Furman from claiming that “today’s report affirms the underlying pattern of resurgence in the economy.”
And it hasn’t dissuaded Obama from extolling the benefits of what he’s now calling “middle class economics,” and how much better it is than the alternative.
In a speech to Democrats this week, Obama went so far as to boast how it’s “pretty rare where you have two visions, a vigorous debate, and then you test who’s right. And the record shows that we were right.”
Well, not quite.
Obama is correct that we can compare two very different economic visions. One is called Reaganomics and the other is Obama’s “middle class economics.”
To get the economy moving again, President Reagan cut taxes, simplified the tax code, reined in regulations, kept spending under control, and generally treated government as more of a problem than a solution to many of the country’s troubles.
Obama promised to set the country on a new and different course, and has been doing a bang-up job of it ever since. He boosted spending, raised taxes, vastly complicated the tax code, unleashed federal regulators and massively expanded the entitlement state with ObamaCare.
And how did these two visions work out?
In the first five years of the Reagan recovery, the economy grew 4.6% a year on average. Under Obama, it’s been a paltry 2.2%.
Employment had climbed more than 18% by this point in Reagan’s recovery. Under Obama, it’s a mere 7.2%.
Looked at another way, the growth gap between Obama’s economic policies and Reagan’s is now $2.4 trillion in lost GDP and a stunning 14.4 million in lost jobs.
Obama hasn’t just underperformed Reagan, he’s underperformed every president since the Great Depression.
Consider the fact that in the past five years, real annual GDP growth hasn’t once reached 3% — which is the average growth rate, including recessions, from 1945 through 2009. If you strip out years when the economy contracted, the average growth rate is more than 4%.
For the past four years the GOP has managed to stop Obama from imposing still more “middle class economics” on the economy. But with control of only one house of Congress, they’ve been unable to dial back much of anything.
That could change with the Senate now in Republican control. But change will come only if enough Democrats realize Obama’s failures and vote to override his attempts to veto sound policies.
More likely, we’ll have to wait until we get someone in the White House who understands what it takes to produce real, sustained economic growth, and not just “underlying” suggestions of it.
