James Pethokoukis

Politics and policy from inside Washington

The Obama recovery vs. the Reagan recovery

October 13, 2010

Expect to see this chart from the Heritage Foundation all around the blogosphere. I don’ t think it is completely fair given the different flavors of the two recessions. But I certainly don’t think the current recovery is a robust as could possibly be expected. I think even the POTUS would concede that.

recovery

Comments

Seriously, doesn’t it get boring to completely ignore that relative debt situations of these recoveries? Reagan and industry at the time had a wide open field with debt opportunities to expand out of the recession(s)… Obama inherited the most indebted corporate climate in history. Even this blahblah about $1.8T in cash on mega-corp balance sheets is only 25% of their current debt loads.

If you don’t like Obama’s policies, that’s fine – they haven’t rolled out perfect policy by any stretch though TARP (the most hated?) was out of the Bush admin. But why do you need to drag up the same old data set to prove something when the situations aren’t really analogous? The dotcom bubble is much more analogous and I’d be happy and interested to see those numbers and make arguments based on those.

Posted by CDN_finance | Report as abusive
 

Interesting!
The current recession hasn’t ended, obviously. It just morphed into something else, possibly more serious, long term, and far reaching.

Posted by yr2009 | Report as abusive
 

Presumably, if the graph starts at January ’09, when statistically the recession ‘ended’ than it covers the first part of the Gulf Disaster that shut down the whole coast, and the regions’ tourist industries. The period covered since January ’09 covers some of the absolute worst times in America in recent memory. The discussion of economic indicators is so simplistic lately, and no one likes to rehash all those doomsayers from early 2009, most of whom predicted that the ‘recovery’ would take years, possibly a decade or more, with spurts and starts and occasional downturns. Those worst-case scenarios never happened; the jobs situation was never as bad as some predicted, was never as good as some predicted. And the most realistic interpretation of the jobs statistics is that the US economy has stopped hemmorhaging jobs, and there’s no growth in jobs because of the uncertainty of the legislative direction of the next Congress. Also, I’m sure that the Heritage Foundation won’t admit that the Reagan era saw the rise of the ‘McJob’ service industry as a major pillar of the 1980′s job market, because that might lead into tough questions about the ‘trickle down’ reagonomics failures.

Posted by ConnieDonoghue | Report as abusive
 

Thanks for stating the obvious and putting it into something visual for the tea partiers.

If you’re insinuating that the high unemployment rate is Obama’s fault, then whoop de doo! Heard that before!

The fact is, today’s economic situation is far more complex, far more global, and Reagan’s deficit spending at the time is not something people have the stomach for anymore. Maybe you should mention how the deficit gap tripled under his administration. Bush’s return to runaway deficits is what Obama has to deal with now- without laying off too many government employees (their jobs factor into the unemployment rate too, you know!), or causing disruptive changes in governance.

Too often, people take facts out of context to support their preconceived notions. I don’t like that. I like integrity.

Posted by cfrb83 | Report as abusive
 

I agree with James Pethokoukis and CND I guess it’s too naive to judge two completely different recessions with a simple graph line without undertanding the context.

Posted by CNDMX | Report as abusive
 

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