The Bush Boom
| Tue Aug. 26, 2008 6:40 PM PDT
THE BUSH BOOM....The Bush expansion is over, and Brad DeLong describes it as "the first business cycle during which median household income in America falls from peak to peak." And indeed it is.
The closest we've come to such a dismal recovery in the postwar era was the dreaded stagflation-driven economic expansion of Jimmy Carter's presidency. You remember Carter, don't you? The president vilified by Republicans for decades as almost single-handedly responsible for destroying the American economy.
Poor Jimmy, of course, has gotten a bad rap: he may have had his problems, but he inherited stagflation from his Republican predecessor and, to his credit, eventually had the biggest hand in killing it by appointing Paul Volcker as chairman of the Fed. George Bush, by contrast, had only a mild recession to tackle when he took office. He inherited a fundamentally strong economy from his Democratic predecessor, immediately set out to manage it with supply-side nostrums that would make Gordon Gecko blush, and after eight years ended up with an economy that wasn't even as good as poor old vilified Jimmy Carter managed in four.
And yet, somehow we're still supposed to believe that Republicans know how to manage economic growth? Can someone please explain this to me?
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Comments
Carter also said that we should use conservation and technology to stop depending on foreign oil and that it is better to talk with people than shoot at them. After eight years of the opposite,Carter's beginning to look a lot better.
Submitted by TangoMan (not verified) on Tue Aug. 26, 2008 7:07 PM PDT.
"the first business cycle during which median household income in America falls from peak to peak."
What's so surprising here? All we're seeing is the effects of importing poverty. More than half of our population growth since 1998 has been through immigration, legal and illegal. The fact that we're importing poverty at such drastic rates will affect the median much more significantly than the mean.
Secondly, demographics of the nation have been changing. Take a look at the rate of marriage and illegitimate birth in Hispanic communities compared to White communities. Changing demographics is leading households having greater fragmentation over time.
You want a solution? Stop importing poverty and start stressing family formation policies in minority communities.
George Bush, by contrast, had only a mild recession to tackle when he took office. He inherited a fundamentally strong economy from his Democratic predecessor, immediately set out to manage it with supply-side nostrums that would make Gordon Gecko blush, and after eight years ended up with an economy that wasn't even as good as poor old vilified Jimmy Carter managed in four.
You are referring to Ronald Reagan, of course, not George Bush (either one). Remember, this isn't Orange County; you can actually criticize him here.
No, Vincent; he means Dubya. Take another gander at that chart which shows a decline heading into Reagan's first term . Having lived through it, I can also testify that both unemployment & inflation trended along that same downward (for the economy) slope.
To rephrase what Kevin said, When W took office, median income was increasing to about $55,800, declined for a few years & rose again to only about 55,300 before declining again. In other words, W's was the only term of office of those mentioned (or any since WW II) where the median actually declined from one peak to the next. Kevin is correct.
So much for the Bush prosperity!
Pretty poor graphic. The Carter circle appears to encompass 1971 to 1981. Carter was in office from 1976-80. The three other presidents in that circle especially those that preceded him, deserve to share some of the pie. Stagflation, the era of "whip inflation now" buttons, was the Ford Presidency. Carter gets a bad enough rap, but lets not hang stagflation on him.
There are a lot of negatives you can hang on Bush, but let's not get carried away.
Households are shrinking but at the same time income per capita is going up nicely. This doesn't capture the issues with overall distribution which are a real problem and (and really started to get worse in the 90's), but it hardly looks like a country who's economic management has been a total disaster.
Kevin, you're very good at looking at issues fairly, but if you want to have a hope of converting the other 50% of the country, you can't start pushing these little easy to pick apart sound bytes as proof of why the republicans can't govern the country. Focus on the problems that are actually problems.
America is still extremely good at creating wealth, the trouble is spreading it around.
http://www.visualizingeconomics.com/2007/07/22/real-gross-national-incom...
You're mixing up statistics, Karl; average and median are not the same. If McCain dropped by here, the average number of houses per commenter here would probably double, but the median number of houses would stay pretty much the same.
Explanation: Attack the opposition at election time with anything and everything. An article in the Atlantic once said: "The Democrats can't win and the Republicans can't govern." Proof: McCain's lead in the most recent Gallup tracking poll.
Submitted by Equal Opportunity Cynic (not verified) on Tue Aug. 26, 2008 10:09 PM PDT.
I always think of median as being like Olympic gymnastics, where you "throw out the high and low scores." Only, you don't stop there -- you keep throwing out one on the top and one on the bottom until there are only one or two left (in which case you average the two).
Submitted by Bithead (not verified) on Wed Aug. 27, 2008 5:29 AM PDT.
How much of the difference is due to external sources, such as oil manipulation, or attacks in southern Manhattan. carter faced the oil thing, true, and I'll remind you the result was 21% inflation, and high unemployment, despuite having a Rubber stamp Democrat run congress.
Bush faced the attck, the oil manipulation and a less than freindly Congress and came up with what is currently around 6.5% unemployment... a figure that most of the world would LOVE to have...(including the Europians we're suppsoed to be emulating) around 5.5%, or around one quater of what Carter producted.
If we're going to, as Drum proposes, comare presidential performance between Bush and Carter, let's tell the whole story, shall we? I can understand why Drum didn't bring all this up; after all, it's a little hard to sell...
And yet, somehow we're still supposed to believe that Republicans know how to manage economic growth? Can someone please explain this to me?
when you consider these additional factors I've mentioned... and Drum did not.
Submitted by Bithead (not verified) on Wed Aug. 27, 2008 5:43 AM PDT.
Oops.
Editing error. You got the raw text from my palm, not the touched up version. Here's the correct one>>>
(Shake of the head) Let's break this down, shall we?
How much of the difference is due to external sources, such as oil manipulation, or the 9/11 attacks?
Carter faced the oil thing, true, and I'll remind you the result was 21% inflation, and high unemployment, despuite having a Rubber stamp Democrat run congress.
Bush faced the 9/11 attack, (And the resulting military commitments) the oil manipulation and a less than freindly Congress and came up with what is currently around 6.5% unemployment... a figure that most of the world would LOVE to have...(including the Europians we're suppsoed to be emulating) and inflation of around 5.5%, or around one quater of what Carter produced, when Cater started in a far better position than Bush did.
If we're going to, as Drum proposes, compare presidential performance between Bush and Carter, let's tell the whole story, shall we? I can understand why Drum didn't bring all this up; After all, it's a little hard to sell this nonsense...
And yet, somehow we're still supposed to believe that Republicans know how to manage economic growth? Can someone please explain this to me?
...when you consider these additional factors I've mentioned... and Drum did not.
Will someone please explain to me why so many find Drum so impressive? If this is an example of the best Drum can produce, I do NOT understand.
Bush faced ... a less than freindly Congress and came up with what is currently around 6.5% unemployment
When was this? Bush got everything and anything he asked for the first 6 years and the Dems didn't curb that much at all in the final 2. How many vetoes has Bush had again? And what oil manipulation did Bush face? Unregulated out of control speculators perhaps, while Carter did indeed have Opec manipulating supply. I love your use of "military commitments". If you mean the fiscal blunder that is Iraq - that was an entirely avoidable commitment and supports Kevin's thesis that Republicans are fiscally irresponsible - to say nothing of their foreign policy. Kevin is also correct that Bush inherited a much better economy from the previous (Dem) president - you fail to address that in your "break down". Oh, and I don't give a shit what other countries would love to have for unemployment rates. Irrelevant.
I do NOT understand.
I can see that.
Submitted by Bithead (not verified) on Wed Aug. 27, 2008 7:57 AM PDT.
Bush got everything and anything he asked for
He only asked for what he knew he could ram through.
Unregulated out of control speculators perhaps
No, more like a 'drill nothing' Congress, which created an artificial shortage. All in the name of saving the planet, of course.
If you mean the fiscal blunder that is Iraq
So, that's how you regard responses to attacks on us? Interesting. And perhaps more revealing of yourself than you're aware.
Bush inherited a much better economy from the previous (Dem) president
Actually, no... The economy was pretty much flatlined for Clinton's first two years, mostly due to the tax increases imposed by Clinton. Come 1994, the contract with America and the tax cuts linked to that, and the economy started moving again.
Before I go, did anyone note the Census report, this morning?
*Income. Median household income rose to $50,233 in 2007 after adjusting for inflation. That's $665 more than a year earlier but still below the peak of 1999. Income in black households rose for the first time since 1999
* Poverty. The poverty rate remained stable at 12.5% of households.
*Equality. The top one-fifth of households took home slightly less of the nation's income in 2007. The middle and lower-middle class gained the most.
* Insurance. The number of people without health insurance dropped 1.3 million to 45.7 million. The uninsured fell to 15.3% from 15.8%. The primary reason for decline: More people, especially children, are covered by government-sponsored insurance.
I imagine it's kinda hard to talk about all the gloom and doom at the conevntion with this kind of report popping up right smack dab in the middle of it, huh?
bithead, obviously you don't understand anything.
in particular, you don't understand that real median household income discounts inflation (we can discuss your inaccuracies regarding inflation another time), and therefore is a perfectly legitimate indicator.
you also don't understand that the "unemployment rate" is subject to definitional inconsistencies (the better internal metric is employed-to-population-ratio), but if you use the same basic definitions, then US unemployment is actually right in the neighborhood of european unemployment.
as for the 9/11 attacks (oh yawn, frickin' yawn, yet another excuse-maker), they were irrelevancies in terms of economics, and the "resulting military commitments" were, from an economic standpoint, entirely stimulative.
finally, anyone who says that bush was facing a less than friendly congress really doesn't deserve the time i've just given. however do you ill-informed right-wingers learn to tie your shoes correctly?
Submitted by Robert Waldmann (not verified) on Wed Aug. 27, 2008 8:06 AM PDT.
Also Carter looks much worse according to median household income than to other statistics.
He was president when boomers were entering the job market. That made him look bad as a job market crowded with young people is one where young people are poor.
The number of households sharing the income shot up due to divorce too.
Also there was a huge oil shock which was arguably his fault (arguable if you are an imperialist is arguable) but has nothing to do with his management of the economy.
Carter presided over rapid employment growth that came at the expense of real wages (there was no other way back then before al Gore and the internet* saved us from the productivity slowdown).
* This is not meant ironically. I believe it. I might be nuts but I believe it.
this is really cute! bithead obviously just did some googling and some cut-and-paste: you know, my child, we can see the differenced in writing tone!
in order: your "bush only asked for what he knew he could ram through" is at least as stupid as "less than friendly congress."
the "drill nothing" congress didn't create an "artificial shortage;" you obviously don't even understand the words.
9/11! 9/11! 9/11! talk about revealing! (did you know that mccain was a POW? i'm sure that's why the economy didn't do even better)
no, the economy didn't flatline the first two Clinton years: once again, you know not what you speak. and yes, bush inherited a much, much, much stronger economy than clinton did, in any number of ways. are you really so ill-informed that you don't get that?
as for your remaining points: yes, real median household income is below what it was in 1999. this is something you're proud of? so the poverty rate remained stable? this is something you're proud of? you're cheating on income cohorts (what's happening is that income is being compressed in the upper 1% and .1% in particular), pretending that there is good news when there isn't. and the idea that it's good news that the ranks of medicaid are growing: god, you right-wingers really just throw words without meaning out there, doncha?
Bithead
If you mean the fiscal blunder that is Iraq So, that's how you regard responses to attacks on us? Interesting. And perhaps more revealing of yourself than you're aware.
When did Iraq attack us? More revealing of your ignorance than you are aware, I think.
Carter's administration was doing pretty well until the oil prices skyrocketed. Who is to blame for that? I'd argue there's a strong possibility the Bush family is guilty.
Remember, Jimmy Carter FIRED George H W Bush (as head of the CIA). Remember, George H W Bush wanted to be president and had hoped Gerald Ford would make him the V.P. nominee in the 1976 race. [ I wonder if Bush had anything to do with the death of Veep Rockefeller. ]
Then there was the 1980 October surprise where the Iranian hostages were held until Carter left office.
Is there any doubt Bush (and his cronies) were pulling all the strings to make Carter look bad?
The Bush family has been a plague upon America and we'll be in much better shape when they're gone from the scene.
The Republicans don't know how to manage the economy. They do know how to massage the financial and corporate types who manage the economy. At least they have until now, when food, fuel, mortgage and medical costs eat so much of the paycheck that the consumer economy is crashing. Now let's see how the boosters and beneficiaries of Bushonomics try to explain away the consequences. More likely, they'll bankroll a McCain campaign that tries to change the subject.
I am outraged that the US being attacked by Al Qaeda is still being superglued to an Iraq which did not attack the US nor did it aid anyone attacking the US. Anyone who can atill keep asserting a case that Iraq is involved in attacking the USA is even less sentient than GW Bush.
The nit picking about average and median and household size means for income data can be resolved by looking at wages which is what the real issue is about. This data does still not look good for the Republican' argument that they are good for the working class.
http://www.visualizingeconomics.com/?s=stagnating
The article is comparing peaks to peaks in the US's recovery/recession/recovery cycles, hence the graphics circling some of Nixon/Ford in Carter's recovery then finishing with the presumed peak in Bush's before the recession that republicans claim is not here. Bithead, inflation metrics changed - they don't include energy or food, since people don't need to eat, heat, cool, or drive. Unemployment changed,too - underemployed - those seeking full time, [because that's what it takes to survive]but can't get it [because that means company paid healthcare subsidies], are considered employed, even though it's part time.
Sorry, correct the link is
http://www.visualizingeconomics.com/2007/11/04/has-middle-americas-wages...
Just a quick observation.
To Bithead, it doesn't take more than a little recollection to realize how badly your boy Dubya bent this country over financially.
Let's see, 2k3 economy tankin' what say we trickle down some checks to the folks and keep 'em coming back to work. Hmm, for all his faults Clinton didn't have to do that.
2k8. Call the treasury and see if we have any of those checks left over will ya?
To Mark H. Hear,Hear!
Probably the biggest reason for being in Iraq was to take out Saddam. Sure he was pure evil, but he didn't attack us. He did make daddy Bush look the fool though and there wasn't enough time left in his term to handle it. So, look daddy, I got 'im for ya. Nobody makes my daddy look bad and gets away with it.
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