Barack Obama taking credit for today's booming economy is the equivalent of, if Neville Chamberlain had tried to bows for Britain’s victory over Nazi Germany.
Here are the reasons why Obama simply has no claim on our current economic vitality:
1. Obama boasts of the rise in the stock market and the creation of jobs throughout his tenure. But Obama came into office when these numbers were at rock bottom.
There was simply no place for them to go but up. The market dropped 50 percent as a result of the 2008 crash. Almost nine million jobs were lost. The policy that prevented further losses was TARP — which was implemented at the end of the Bush administration — not Obama's.
2. The market went up primarily because the Federal Reserve kept rates at historically low levels and pumped an unprecedented $2 trillion into the economy via Quantitative Easing — something not done for Trump. Additionally, few investors were willing to put their money into the toxic real estate market, which benefited stocks, by making them the preferred option.
This meant the stock market increases were not based on fundamentals, as they are in the Trump economy. Today, it is corporate profits that are spurring the market’s rise.
This is a solid foundation that mitigates the risk of experiencing another bubble.
3. A traditional healthy recovery would result in a "V" shaped diagram. That is, a sharp drop, followed by a line trending sharply upward. Obama’s so-called recovery was more of an "L"; a sharp drop, followed by a relatively flat line, with just a slight upward tilt .
Obama’s was the most anemic recovery our nation experienced since World War II.
Obama’s last year in office gave us a 1.6 percent growth rate. His minions considered this the "new normal." Obama even stated that the blue-collar manufacturing jobs were gone for good.
Trump’s economy is proving that wrong.
Democrats harp on the fact that there were four quarters in Obama‘s two terms in which growth exceeded 4 percent. But that was 4 out of 32 quarters, an average that would usually demote you to the minors. Obama was the first president not to have at least 3 percent growth for at least one full year.
4. Barack Obama had no specific policy to address the economy, other than the Stimulus. While it was helpful to local governments by covering Medicaid costs, it did little to support investment. The Car Allowance Rebate System ("Cash for Clunkers") just wasn’t going to do it.
Meanwhile, Obamacare was a major drag on the economy, and Dodd-Frank, which was meant to deal with banks that were "Too Big to Fail," actually made the bigger banks larger than they were before the crash. Ironically, Dodd-Frank actually wound up crushing smaller community banks — the traditional lenders to millions of small businesses — thereby further retarding the recovery.
5. Trump's huge increase in jobs stemmed from:
a.) A new pro business attitude that replaced the "You didn’t build that" hostility of Obama. In Economics 101 we learned that the economy is a reflection of the consumer and investor confidence.
b.) Trump's deregulation boosted such confidence in the economy through the roof. It’s at its highest level in 18 years.
c.) Trump's lowering of the tax rate has repatriated offshore money back to the U.S. and sparked greater investment and larger profits, which in turn are now leading to wage and job growth.
Obama had eight years to produce these results.
He wants us to believe that the effect of his policies laid dormant until after he left office and then suddenly kicked in after he left. Sorry, it’s just the opposite. It’s no coincidence that the economy took off into that "V"-shaped recovery the very year after Obama’s anti-business policies were lifted off the backs of our business community.
Steve Levy, former New York state assemblyman, Suffolk County executive, and candidate for governor, is now a distinguished political pundit. Levy's commentary has been published in such media outlets as Washington Times, Washington Examiner, New York Post, Albany Times, Long Island Business News, and City & State Magazine. He hosted “The Steve Levy Radio Show" on Long Island News Radio, and is a frequent guest on high profile television and radio outlets. Few on the political scene possess Levy’s diverse background. He’s been both a legislator and executive, and served on both the state and local levels — as both a Democrat and Republican. Levy published Bias in the Media, an analysis of his own experience, after switching parties, with the media's leftward slant. Levy is currently Executive Director of the Center for Cost Effective Government, a fiscally conservative think tank. He is also President of Common Sense Strategies, a political consulting firm. To learn more about his past work and upcoming appearances, visit www.stevelevy.info. To read more of his reports — Click Here Now.
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