The Economy Under Obama
 

This forum is riddled every day with vitriolic criticism of President Obama's "management" of the economy. Let's forget whether this president or any president can really manage the economy. But it might be worthwhile to look at some of the numbers so commonly used in forming the criticism of the president.

Job growth is a measure commonly used to judge the effect of presidential policy on the economy. Presidents are somewhat disadvantaged, as they initially take office inheriting both an economy and a federal budget created under the administration of their predecessor. In the case of President Obama, he took office at the height of the deepest recession, maybe even a depression, since the 1930's. But even at that, during his short 3-year administration more jobs were created than during the terms of ten previous presidents. And that includes Hoover, Coolidge, Ike, FDR, Bush 42 and George W. Bush. In fact, George W. Bush holds the record during his second term as being the only U.S. president who left office with fewer people employed than when he took office. And for Bush's first term he had the benefit of the robust economy he inherited from Bill Clinton. (These are records kept by the U.S. Bureau of Labor Statistics.)

Unemployment Rate is another statistic commonly used to criticize presidents. Again, these statistics are created by the U.S. Bureau of Labor Statistics. Since the first six months after President Obama took office, the percentage of people unemployed in the U.S. has consistently declined. The number of people unemployed in the country is still at a level far higher than historic norms. But in fact, whatever policies adopted by the current administration is resulting in consistent, albeit slow, reductions in the rate of unemployment in the U.S.

Economic Growth is another measure commonly used to evaluate the effect of presidential politics on the economy. Economic growth is measured as a percentage change in the Gross Domestic Product (GDP) or Gross National Product (GNP) from one period to the next. Since GDP bottomed out with negative growth during the six months after George W. Bush left office, there has been twenty-three straight months of growth in the U.S. economy, as measured by month-to-month GDP growth. GDP grew again in the first quarter of fiscal 2012 and is forecasted to continue that trend for the balance of the fiscal year.

There's nothing wrong with people opposing candidates of one political or economic persuasion or another. People can criticize how things were accomplished and at what pace--I have my own criticisms of the president along those lines. But at least when criticism is leveled, the facts used should be accurate. As someone here noted recently, people have a right to their own opinions, but not thier own facts.

Good summary VK, as usual. Most attacks on the president seem more personal than factual.

This a little off subject but not all that bad. Yes facts should speak louder but when a person ,president or not does not gain the trust of the people they work with or govern in this case it become very hard for that person in that environment. The job I have I always tell the people I hire to never give anyone a reason to mistrust you . I think with all the questions that have come up about obama is the biggest problem here. Also the tactics that are used. Good as he appears on the fact sheet will never out weigh trust.

Some substantiation from you would be nice.

I have a chart here that shows people rapidly being dropped from the labor force. If you are going to ignore the people dropping out of the job seeker pool I guess the remaining numbers are going to look statistically favorable.

1.2 million people dropped out of the labor pool in one month.

So, the civilian labor force tumbled to a 30 year low of 63.7% as the Bureau of Labor Statistics is seriously planning on eliminating nearly half of the available labor pool from the unemployment calculation.

Evidence is that high paying jobs are being replace with lower wage jobs in the employment that is being created as evidence by withholding taxes.

Sure does look rosy, doesn't it.

Record 1.2 Million People Fall Out Of Labor Force In One Month, Labor Force Participation Rate Tumbles To Fresh 30 Year Low | ZeroHedge

Things are looking better every day.

Richie: I pointed out when you first brought that up that the 1.2 million unmber includes those RETIRING. The baby boomers are now starting to retire and that's the biggest demographic segment we've ever seen in this country.

And this trend has been predicted for decades.

I do agree that people are entitled to their own opinion but not their own facts. The reality is that the recession ended 2009 and while a president cannot help an economy the president's policies can certainly hurt. Since 1950 every recession ended within two years and followed with substantial growth. Because of poor economic policies Obama has frustrated the economic recovery ObamaCare, Tax policy, Dodd-Frank, etc have left businesses questioning the future. hence they are using the cash on hand to repurchase their stock . Those people who have been unemployment for a good deal of this econmic downturn may well never return to the market place because of loss of skills, etc.

Obama and his Admin's math reminds me of that story about the enterpreneur that interviewed an engineer, lawyer and accountant with only one question for his new business. When he asked the engineer what 2+2 is the engineer responded 2+2 is 4 unequivocally absolutely and cannot be anything more. When the lawyer was asked he said 2+2 is 4, however, I can make an argument that 2+2 can be 5. And when he asked the accountant, the accountant got up out of his chair closed the door then went behind the enterpreneur's chair and pulled the blinds came back sat down and then leaned forward and said "how much do you want it to be":D

Wow! Never knew that a President's policies couldn't help the economy but could hurt it. Thanks for the enlightenment.

People have, and are, always leaving the workforce by retiring. This is an abnormal number no matter how you spin it. Because of your spin you even have Jan swooning. Come up with the amount of people in this 1.2 Million that are retirees. If it's as significant as you think, the BLS has documented it.

There are now almost as many people in the job pool as not. This is not a good thing. There are less jobs and more people.

Did any of you know there are people - including Fox Noise darling Rush Limbaugh -who have hoped Obama would fail? Terrible thing to wish upon your President.

I'm thinking that what you say is not the truth. You heard this.....where? You read this........where? You must have a YouTube video of Rush saying this; right?.............Did you have strange dreams last night?

I must have been thinking of something else or another time. The synapses in the senior brain were not firing all at the same time, maybe.

VK: You suggest President Obama has led the nation toward overcoming almost unprecedented economic odds, within the Constitutional and media manufactured limitations of the chief executive. You didn't even mention the even-handed foreign policy which has eliminated a number of terrorist leaders and tiptoed closer to withdrawal instead of running headlong to hell. You are not thrilled with some of his actions, but you don't mention anything particularly bothersome. But for as long as I can recall, you categorically reject voting for any incumbent.

May I ask whom you think is best qualified to be our next President?

I don't get to listen to Rush much anymore. I'm too busy now that I've retired. (It's crazy to say that, but true) I used to be able to listen to a transistor radio with earphones as I went about my day, but radio reception is one of the only things that suck in TV.

But, having listened to him for over 20 years, I know Rush would never say what you said. He may predict something based on events and his intuition, but he'll always clarify that he hope's he's wrong about the doom and gloom he sees coming, if indeed he did say something of the sort.

The only broadcaster, that I know, who I can imagine saying something like you said is, maybe, Michael Savage. But, I haven't listened to Savage in years.

The Same But Different
 

Lots of economists would debate whether the recession we experienced was more like the Great Depression than any recession since 1950. It absolutely was different in the sense that home values declined so precipitously and dramatically. Most economists, all of them that I've read recently, have opined that recovery from the deep economic recession the U.S. experienced during 2007-2009 can't happen until home values stabilize and begin to increase again.

I won't argue that all of the actions taken on Obama's administration so far are good and effective in creating economic recovery and jobs. Both Dodd-Frank and the healthcare reform bill are Rube Goldberg abominations, in my opinion. But let's not forget that both those bills were the product of hot negotiations between two political parties in a Congress widely divided by both ideology and political motives. I will blame his administration for the installation of regulations which I don't believe are helpful, like blocking the oil pipeline from Canada for no good reason. And I definitely think that the president's fiscal policies will have long-term negative effects. But to say that President Obama slowed an economic recovery that might have proceeded at a faster pace is conclusion that can't be assigned solely to the POTUS and fully supported by the facts.

Voting Or Not
 

Now that we seem to be down to only two Republican candidates, I will admit that there's only one of them that I could draw myself to vote for. Depending on how the GOP primaries and their convention develops, I'll either be voting for Mitt Romney, or witholding my vote for anyone running for President from either party in the fall.

When things improve who ever is in the WH will get the credit and ditto for when things don't go so well.

What I would like to see is if the claim is things are improving because of Obama, how about tying the progress to something he did that resulted in any improvements.

What Obama is experiencing is what we called the lake effect improvement. That meaning if Obama is captain of the ship in a shallow lake that is rising to improve ship movement it is not because of anything he did at all. Any boat that happens to be on the lake will rise as well. And that is what is happening to the economy; the improvements as slight and as fragile as they are are not traceable to any money pay out programs.

Does anybody really believe the auto industry is seeing improving sales is attributable to the auto bail out?

btk

I don't even have to read the ultra liberal online rag to know what Rush is talking about. He's talking about The Obama Administration's schemes to take this country to socialism. He's not hoping for America to fail, he's hoping for Obama's socialist takeover and schemes to fail.

It's a big difference, if you're not just a knee-jerk partisan liberal who only sees opposition to Obama as opposition to America. Opposition to Obama is the ultimate patriotism if you're a real American with real American values.

You chastised buggy for saying limbaugh hoped Obama would fail - "not the truth, you heard this......where?". He has said that numerous times, and it doesn't matter what you or anyone else interprets as the meaning. from his own website: Limbaugh: I Hope Obama Fails - The Rush Limbaugh Show

Yes, Rush did say he hopes he fails. He doesn't deny it. He wants Obama's policies to fail. So do I.

So you want the country, and the people in it, to suffer, so that your party can win an election, and you can win a philosophical argument?

It would be difficult for the auto industry to see improving sales if GM and Chrysler had gone out of business. I don't get it.

The title of this thread is "The Economy Under Obama" and there's no better barometer than the Dow Jones Industrial Average which was 7949 when President Obama was sworn in on Jan 20, 2009 and closed yesterday, Feb 28, 2012, at 13,005.

So you wanted the Iraq war to go on, you wanted Bin Laden to live, you wanted GM and Chrysler to go bankrupt and one million people in the midwest to be out of work, you want to pay $600 more per year for your meds, you want your insurance company to be able to drop you when you get sick or refuse you coverage because of a pre-existing condition, you want to end social security and medicare as we know it, and you want the Dow Jones to be back at 7949 where it was when President Obama took office? WOW!!!!!

Yes, Absolutely!
 

Yes, I do.

Everyone seems to forget that the "auto bailout" was a forced bankruptcy wherein the government provided the "debtor in possession" (D-I-P) financing. Both GM and Chrysler came within a very short time of filing for a liquidation-type bankruptcy. They were essentially out of money, operating with negative cash flow, and their creditors had stopped negotiating. If you recall, at the time...

• The bondholders of both companies had stopped negotiating how big the a "writeoff haircut" they would take. They were prepared to let the companies be liquidated and use the preferential position of their bond terms to get a more generous payout than negotiationg any further.

• The UAW had refused any further concessions without more "give" on the part of the bondholders.

• The unsecured creditors, mostly the auto parts suppliers who were not being paid their accounts receivable, were all on the verge of bankruptcy and liquidation. Some had already filed.

• And given the stalemate among all the creditors, the equity holders could not and would not agree to voluntarily modify the value of their ownership position.

What the government did--mostly the Treasury Department under Tim Geithner with the President Obama serving as spokesman--was to strong arm all the parties to file for a pre-arranged bankruptcy in exchange for the government providing the necessary D-I-P loans. (None of the commercial banks or insurance companies, the usual providers of D-I-P loans, would provide bankruptcy financing as they were all badly undercapitalized at the time and would not undertake the kind and size of risk inherent in this type of financing.)

The pre-arranged bankruptcy worked exactly as it should have. The lenders had to write off substantial amounts of their bond loans, the UAW was forced to modify it's union contract terms, in pay, benefits and working conditions, as well as agree to a no-strike term for a considerable time. And the equity holders of both GM and Chrysler basically lost their entire investments.

Both companies stayed under the guidance of the bankruptcy courts for only a short time because all the terms that normally would have been negotiated by the unsecured and secured lenders and the stockholders had already been dictated by the government, who was providing the short-term financing.

The action by the government precluded massive and immediate unemployment which would have numbered in the millions of jobs. Since then, the economy has improved somewhat and the auto companies could manufacture and sell cars and trucks at a profit with their restructured balance sheets and cost structures. And in less than two years both GM and Chrysler have paid back the government's D-I-P loans.

I know that permitting free market forces to continue to try to resolve the problem at the time would have resulted in the liquidation of those two iconic American companies, taking most of the U.S. auto industry with them. Without question, both GM and Chrysler would not be operating today without the intervention of the federal government. For those who say that would have been a good thing, you have the right to your opinion. I don't agree.

So yes, I not only believe but I know that action by the federal government worked in this case.

I enjoy reading this forum, some of you are extremely articulate and very informative. I seldom, if ever post as I cannot keep up with the level of detail some of you possess.

WRT this thread I certainly have an opinion. I have always believed that the economy runs in cycles and to some degree runs its course no matter who is in charge. I have no links to prove this of course, but I do remember saying to my Dad the day after President Obama was elected that he is one of the lucky presidents. What I meant by that, is no matter what he does, the economy has to appear better than it does now and he will get credit for that deserved or not as any president would.

How would things be different if the election cycle was 2006 - 2010 and President Obama was elected in 2006? Would 2008 crash not have happened?

You're taking what Limbaugh says out of context. He hope's Obama's policy of turning this country into a socialist state is going to fail.

He's hoping for America to succeed, and it's needs Obama to fail in his schemes for that to happen.

No matter how many times you try to twist his words, it's you who are twisting in the wind.

No matter how hard you try to twist my words, it is you who basically said buggy was lying for saying limbaugh said he wanted obama to fail. That is EXACTLY what he said as I have demonstrated and you owe buggy an apology, though I know that is not in your make-up.

I was not aware the auto businesses were or would have gone out of business. They were headed for bankruptcy which does not = going out of business.

Without government throwing money at them, they would have gone into chapter 11 and with the high horsepower legal staff they would have no doubt already had a plan to submit to the judge, commonly referred to as a prepac bankruptcy. They would have secured a line of credit from some source without a doubt. Due to the requirements of the courts there would have been a purge of incumbent management and a down sizing of overheads. They would have not ever missed one day of production or new model introduction as that is the life blood of the newly organized business structures. The debt would have had a structured pay back and the bankruptcy plan would have established benchmarks with progress reviews via the courts. The auto makers involved would meet their criteria and they would emerge from bankruptcy....now get this part....AS PLANNED!!

The ongoing misinformation about these manufacturers shutting down and hundreds of thousands of jobs lost was never ever in the cards.
Obama struck a deal with the executives and more importantly the UAW using our money with no plan for assurance of accomplishment. Purely 100% political just like the stuff being currently spewed by Obama at the union meetings this past week. "They wanted to shut you down" = BS! He also inferred Romney would have allowed your company to shut down, lose your job = BS!

Obama doesn't know the bankruptcy policy and doesn't care. And unfortunately far too many of his supporters don't understand it either...OR CARE!!

In closing, to point to the stock market as an indicator of improvement is also mis information. The stock market has been puzzling those on the edges of it for the last two years as they continued to be amazed at the continuous improvement during the midst of the so called recession. And now that the networks are hailing the breaking of 13000 the political spinners and the naieve are claiming the market is an indicator of Obama's improving economy. More political spin and BS right along side the notion that auto companies were going to close their doors and millions be unemployed....PURE UNADULTERATED POLITICAL BS!!!

And the pied piper once again raises the volume on his flute for the flock to follow....

btk

Maybe if the auto companies would have filed Warren Buffet could have back them and we would have Buffetmobile. Just a joke

okay:eek:

Thanks, richielion. You said it better than I did.

President Obama said in his speech Tuesday there was no private equity available to save these companies. Even Bane Capital balked at the idea. If you know otherwise, please post a link. Don't forget that George W Bush was the one that authorized the 25 billion dollar bridge loan, and Obama increased it to 60 billion.

What did Romney mean in his editorial in the Wall Street Journal titled "Let Detroit Go Bankrupt"?

Obama champions auto bailout

I can hardly contain myself. Things are looking pretty glum for some of you right now. Keep up that sense of humor.

Xavier

"No matter how hard you try to twist my words, it is you who basically said buggy was lying for saying limbaugh said he wanted obama to fail. That is EXACTLY what he said as I have demonstrated and you owe buggy an apology, though I know that is not in your make-up."

Hey, I do not take things that are said on this forum on a personal basis. You, I, and all free-thinking Americans know that Limbaugh did say he wants Obama to fail.

If the Limbaugh-Lover Club wants the economy to go down, down, down and unemployment to climb; have wanted the Iraq war to go on, wanted Bin Laden to live, wanted GM and Chrysler to go bankrupt and one million people in the midwest to be out of work, wanted to pay $600 more per year for your meds, wanted your insurance company to be able to drop you when you get sick or refuse you coverage because of a pre-existing condition, wanted to end social security and medicare as we know it, and wanted the Dow Jones to be back at 7949 where it was when President Obama took office - that just shows want kind of people they really are.

Wanting your country to fail in the policies that have seen real successes in the past 3 years is just plain wrong - and all because you do not like the person voted into the Office of President of the United States by a majority of American voters.

$3.76 per gallon for regular gas this AM. Believe it is a fact that rising fuel prices negatively impacts many components of our economy. The President says he can't do anything about gas prices and all the others are merely creating bumper stickers. "Hope and change" and "yes we can" were bumper stickers too that have not resulted in much improvement after 3 plus years.

Neil Boortz said this morning that Obamacare is not about improving our healthcare, it's really about controlling healthcare which ultimately means gov't controls us. I'm inclined to believe this in light of recent events.

More time spent discussing contraception and proving "free" stuff while ignoring fact that nothing provided by gov't is free because someone outside of gov't must pay for everything that gov't provides.

More smoke and mirrors coming from DC in the next 8 months.

Hancle posted, "Neil Boortz said this morning that Obamacare is not about improving our healthcare, it's really about controlling healthcare which umtimately means gov't controls us. I'm inclined to believe this in light of recent events."

I would like Hancle to tell me if he would like his health insurance company to be able to drop him because he got sick and was costing them too much money. I would like Hancle to say if he would be pleased if he knew some young person who could not get health insurance because of a pre-existing condition. I would like to ask Hancle what "recent event" he is talking about when he says Obamacare is about controlling health care and means government is controlling us. Thank you for those 3 answers in advance.

I don't believe it's the White House that's been discussing contraception or trans-vaginal probes. Republicans really want to have their nose in women's healthcare and control all aspects of women's reproductive choices.

The high price of gasoline is due to the speculators buying and selling gasoline contracts on Wall Street. It is not due to President Obama in any way.