Economy Under George W Bush
George W Bush, the 43rd President of the United States, a Republican, entered office in January 2001 and was replaced by Barrack Obama of the Democrats in January 2009. George W Bush became President under a flagging economy, one that had been quite strong under Bill Clinton for most of his run, but that had taken a serious hit from the "dot com" bubble and crash. There were fears of recession on the near horizon as economic numbers were almost all going in the wrong direction. Making matters even worse was the September 11 terrorist attack on the United States that caused a very serious hit to the economy as world confidence in the USA's security took a major beating. Note that despite the fact that President Bill Clinton (a Democrat) was the last President to have non-defecit national budget (the government was actually taking in more money than it was spending!), many signs of a bad economy (and what was coming to fruition by 2007) were already well under way. The biggest indicators of bad things to come were that the debt of Americans was increasing substantially while the savings were evaporating, even before Bush became President. That trend continued to escalate right through until the financial collapse epitomized by the crash in the stock market in late September 2008.
In 2001, when Bush became President, the US economy was in recession (beginning in 2000) with a GDP (Gross Domestic Product) growth rate of 0.3%. Investments were way down, the GDP (Gross Domestic Product) was wavering up and down right around a 0% increase, and unemployment was going up. George W Bush became leader of the US in the midst of a flagging economy (of course, "flagging" is much better than outright collapsing, like Obama faced).
Now for some specific numbers. Remember that Bush was President for fully 8 years, while Obama has been president for only just under 4.
Annual GDP Growth: 2.5% average over 8 years
Job Growth: Bush had job growth 52 months (4.3 years) in a row until the economic collapse.
Unemployment Rate: Bush had a larger total labour force to work with than Obama and had an amazingly low unemployment rate of 5.3% average over 8 years. The Unemployment rate at it's best was 4.4% in March 2007 and before the economic collapse was at its worst in June 2003 at 6.6%.
Federal Debt: George W Bush accumulated one of the largest national debts in US history, largely thanks to the 2 wars in Afghanistan and Iraq followed by the huge economic stimulus package and bailouts at the end of his Presidency. Under Bush's administration, the national debt doubled in 8 years (from before his first budget to his last budget). At the time, such a massive rise in government costs over 8 years was shocking. 5 trillion in 8 years!
Income Inequality: Under George W Bush's economic policies, he was lambasted for the fact that the richest 1% of the US population were getting much richer during the economic boom (good times) than the average American citizen, getting 65% of all growth in earnings compared to the rest of the population.
Poverty: Before the recession began in December 2007, the percentage of US citizens at or below the poverty line was at 12.5% of the population.
Economy Under Obama
Job Growth: Obama has had 12 months straight of job growth (1 year), from August 2011 to August 2012.
Annual GDP Growth: 1.5% 2012 so far, as of August. A 2% growth rate or above shows good economic growth. A rate below 2% indicates a bad economy. Economists say that for the Unemployment rate to drop much, the GDP will need to increase to 3% or higher over the next few years.
Unemployment: Currently as of August 2012, 8.1% Unemployment, but with the lowest total labour force (# of workers) in 30+ years. The huge drop in labour participation accounts for most of the apparent drop in the Unemployment rate under Obama (10.4% Unemployment at its worst). If Obama had the same labour force levels as Bush had at their worst, the US unemployment rate would currently stand at 11.2%. It is also notable that the vast majority of the jobs that were lost since the recession were full time jobs whereas most of the jobs added under Obama have been part time jobs, not full time jobs. A part time job, though, is obviously better than no job.
Income Inequality: If George W Bush was attacked for the growing disparity between the rich and the poor, Obama has REALLY screwed it up. The richest 1% in America have accounted for 93% of all earnings and wage increases in the past 4 years under Obama. The rich are getting far richer in the last 4 Obama years than they did under 6 years during Bush's economic boom, and the middle class has been shrinking and bleeding money while the poor are even worse off. What's especially shocking is that this is the exact sort of thing Obama promised he was going to do away with, the rich getting richer while everyone else was getting poorer. Instead, it's gotten much worse as more of the wealth has transferred up to the rich and away from the lower and middle classes. Huffington Post (April 11, 2012): Income Inequality Worse Under Obama Than George W Bush.
As the Huffington Post says:
That means the rising tide has lifted fewer boats during the Obama years -- and the ones it's lifted have been mostly yachts.
Poverty: A record number of people in the US now live below the poverty line, which accounts for 15.7% of the population. USA Today (July 22, 2012): USA Poverty On Track to Rise Highest Since 1960s. The Economic Collapse (November 12, 2011): Extreme Poverty Now At Record Levels.
Federal Debt: In just under 4 years of government, Obama's government has spent about as much as Bush's government did in 8 years plus two wars. ABC News (March 12, 2012): National Debt Has Increased More Under Obama Than Bush.
The Debt rose $4.899 trillion during the two terms of the Bush presidency. It has now gone up $4.939 trillion since President Obama took office.
If Mr. Obama wins re-election, and his budget projections prove accurate, the National Debt will top $20 trillion in 2016, the final year of his second term. That would mean the Debt increased by 87 percent, or $9.34 trillion, during his two terms.Unlike Bush's $5 trillion in 8 years. Obama's got $5 trillion in just under 3 years. National debt is an important factor when considering an economy because federal debt has a direct impact on all financial investments, international trade, and overall consumer economic confidence. You'll find that usually when an open government has a surplus or a neutral (even) yearly budget, their economies tend to grow.
Conclusions
Who's economy was better? Clearly George W Bush's, and that's despite coming into power during an economic recession, which his government quickly turned around. Of course, it could also be argued that a substantial portion of the "boom" (or growth) in Bush's years as President was based upon a massive economic bubble (unsustainable fast growth that was based upon a fairy tale instead of solid math), which then popped and crashed in the last 2 years of his presidency. Which then left Obama becoming President amidst one of the worst economies in US history, comparable to the crash in The Great Depression.
The big news, however, should be where the economy goes from here, and how well has Obama's administration managed to turn the economic ship of the United States around (like Bush did for the recession in 2001 when he became President).
Unfortunately, none of those numbers are all that good for Obama. It has been by far the slowest recovery from any recession on record, even when compared against The Great Depression. In fact, it has been so slow and lackluster, that there is still a lot of talk about whether or not the US economy is even IN a recovery at all. Forbse (August 1, 2012): Obama Wins Gold For Worst Recovery Ever. If the US economy crashes again (which tragically, it very well might within the next year no matter who becomes the next US President), then historians may end up grouping this "mild recovery" in with the greater whole of a decade long depression like what happened with The Great Depression of the 1930s.
The current signs of a high unemployment rate, a record low in labour force participation, record highs in government spending, record highs in poverty, food stamp and welfare usage, and a small growth in annual GDP make the "recovery" very weak, especially as the disparity between wages for the rich and the poor continues to widen. That means that most Americans are seeing little or no difference now compared to when Obama first became President.
At the very least, it'll be interesting to look back on this 10 or 20 years in the future and see how history and time has changed (or not changed) the perception of President Obama's economy compared to President Bush's.
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