Hillary, Obama, and FDR: Big Bad Government

Happy Days?

Yes, after July’s revised figures on job creation, U.S. average job increase over the last 4 months has risen to 179,000 a month, above the 145,000 minimum needed to stay even with population growth.  

But. . .

According to the Washington Post’s Ed Rogers:

93% of counties in the United States still have not fully recovered from the recession when factoring in job creation, the unemployment rate, GDP and median home prices in each county across the country. . . [T]his is modern, turbocharged, malignant malaise that the Democrats obviously can’t fix. [Recent] average job creation does not undo the damage caused by Obama’s failed economic policies. [And] Clinton’s embrace of all things Obama is forcing her to maintain a steady stream of discredited happy talk on the economy, which only generates more cynicism about her and more doubts about her ability to change anything about the economy.

Phil Gramm and Michael Solon, writing in the conservative Wall Street Journal, undertake a deeper dive that compares Obama’s Great Recession recovery to the worst recovery of all-time: Franklin Roosevelt’s long, slow (1933-40) Great Depression slog:

From 1932-36, federal spending skyrocketed 77%, the national debt rose by over 73%, and top tax rates more than tripled, from 25% to 79%. But the tectonic shift brought about by the New Deal was the federal government’s involvement in the economy, as a tidal wave of new laws were enacted and more executive orders were issued than by all subsequent presidents combined through President Clinton.

As government assumed greater control, private investment collapsed, averaging only 40% of the 1929 level for nine consecutive years. League of Nations data show that by 1938, in five of the six most-developed countries in the world industrial production was on average 23% above 1929 levels, but in the U.S. it was still down by 10%. Employment in five of the six major developed countries averaged 12% above the pre-Depression levels while U.S. employment was still down by 20%. Before the Great Depression, real per capita GDP in the U.S. was about 25% larger than it was in Britain. By 1938, real per capita GDP in Britain was slightly higher than in the U.S.

The dominant lesson of the Great Depression and the Great Recession is that when government overspends, overtaxes and over-regulates, economic freedom is suppressed and economic growth vanishes.