Thursday, January 21, 2016

January, 2016, Bonus Post, By The Numbers: Obama's Hisotricxall Bad Economic Performance

This is the next post this month in our continuing theme of “by the numbers.” We do this theme occasionally where we look at the reality of the numbers in the world and not the lies, deceptions, and spin of the American political class. I used to work for a boss whose favorite quote was: “There is nothing more devastating to an opinion than the correct number.” By looking at the statistics, trends, and numbers in our world we can cut through the politicians’ smoke screen to truly understand what is going on and hopefully, remedy the issues of the day.

Yesterday, was supposed to be the final “by the numbers” post for this month but we just came across a set of economic numbers that are worth reviewing in order to put the current economic recovery in perspective on how bad it is compared to other recoveries over the past 80 years. These numbers are espeically relevant given that the President recently bragged about how good the economy is doing.

Remember, always believe the numbers before you believe our politicians, numbers do not lie but politicians do.

We have often and recently discussed the reality that the so-called Obama recovery since the end of the last recession has been anemic, weak, and spotty for a number of valid number reasons:
  • There are over 45 million Americans receiving food assistance from the Federal government every month which is about 50% higher than the number that were receiving food assistance prior to the recession despite the recession having ended over six years ago.
  • The true measure of unemployment, the government’s U6 measure, shows almost 10% of Americans are unemployed, a recession-like level.
  • Over 14 million Americans who are unemployed or underemployed would like a full time job but cannot find one.
  • Over 60% of Americans when polled said they have less than $1,000 in savings and a large number of them say they have NO savings.
  • Wage and income growth has been very small to non-existent depending on how and when you measure it over the Obama administration.
  • A great many of the new jobs that have been created during the Obama administration have been in lower paying industries, e.g. retail and food services, partially accounting for the low/no growth in wages.
  • The labor participation rate is as low as it has been since the stagflation years of the Carter administration with over 94 million American adults not in the workforce today.
These meager economic results were attained despite the following three powerful tailwinds that should have created outstanding economic recovery support:
  1. The Obama administration launched a massive (and failed) $800 billion economic stimulus program.
  2. Record low energy costs should have spurred growth and spending in both the business and consumer markets.
  3. The Fed pumped trillions of paper dollars into the economy.
And yet despite these tailwinds, the Obama administration and the Washington political class failed to generate robust economic growth.

How do these economic failure numbers stack up against post recession economic recoveries on a historical basis, as reported by the Wall Street Journal? Not good, according to official government numbers and history:
  • The top line reality is that Obama has presided over the worst economic recovery numbers in the past 8 decades.
  • From 2012 through 2014, the U.S. economy grew at an annual rate of about 2% according to recently revised numbers from Obama’s Commerce Department.
  • That estimate is down .3% from previous Commerce Department estimates.
  • Since the recovery started in June of 2009, the average annual economic growth has been 2.2%.
  • That is more than .5% worse than the next weakest economic recovery since the early 1930s.
  • Over the first five years of Obama’s presidency, the U.S. economy expanded slower than during any five-year period since just after the end of World War II, averaging less than 1.3% per year.
  • According to work done by Peter Ferrera writing in Forbes, the U.S. economy has not come close to reaching its long term average annual growth rate of 3.3% during the Obama years, with the best one year growth rate getting only up to 2.8%.
  • Total GDP growth in the five years after the end of the Great Recession under Obama has been 10.2%, which makes it the worst five year post recession recovery, trialing the second worst showing, George W, Bush’s recovery rate which was 15.1% and the 30% recovery rate when John Kennedy was elected.
Long term, short term, growth, unemployment, there no numbers, measurements or perspectives that can lead to any other conclusion but that Obama and the current Washington class has done an embarrassing bad job at creating a strong and robust economic climate. The addition of thousands and thousands of new regulations, the raising of taxes, massive new government debt, excessive and wasteful government spending, the whole Obama Care anti-growth and anti-business rules, regulations, and taxes and the failure to fix our public schools have colluded to establish the Obama administration as the most economic ignorant and useless Presidency of all time. 

The numbers do not lie.

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