Obama inherited a nasty economy, the worst recession since the great Depression, as Bush did with the 2000 stock market crash, and then 9/11. Every President must live with the cards he is dealt, and make the best of their situation.
A President has marginal effect over the immediate economy, and possibly even less over the long term economy. But voters will judge them on the economy just the same. It is still to be seen if a President can get reelected with an unemployment rate over 8%.
The pressing political questions shouldn't be, what is Ann Romney wearing today, or if Obama Care is a tax or penalty, but, how did we get into this mess, and WHAT COMES NEXT?
My unsolicited thoughts on what comes next:
If we remember back, it was Americas ability to export endless goods to Europe, in the way of tanks, bombs, ships and planes, and our ability to put millions of our unemployed men and women to work as soldiers and workers, that brought us out of the Great Depression. For decades after the war, the U.S. was the only major supplier of goods to the world. We had destroyed their capacity to compete. Massive prosperity was our reward.
We can not duplicate these circumstances ever again.........
By 1980 competitors like Japan,Germany and England had rebuilt, and were challenging our prosperity. In 1981, "during the greatest recession since the great depression" we came up with a brilliant plan on how to continue the growth of our prosperity. We began the greatest debt boom in world history. Consumer debt went from 65% of disposable income in 1980 to 144% in 2007. Government debt exploded from 33% of GDP in 1980 to 100% of GDP in 2012.
Happy times were still possible.
This debt, "fake prosperity" pushed up major asset classes to unsustainable levels. In 2000, the stock market crashed, causing the greatest recession since the great depression. We couldn't create another world war, or destroy our competition, so, "before the American people turned against their Government" our Government had to find another asset class to inflate.
Our government saw only one remaining asset class to inflate, housing, and by 2005 even my grandmother wanted to buy investment property. In addition, our Government started two wars. "it worked in the 40's" and distributed money to the people through tax cuts. They then sat back to watched the prosperity roll in.
Buy 2007 Americans were consuming everything they could get their hands on, using borrowed money.
Then came the Great Housing crash of 2007, causing the worst recession since the great Depression. So you see....., Obama was just the last man standing when the music stopped.
$5 trillion in Fed printing, and $5 trillion in Keynesian spending, with 0% interest rates couldn't inflate Humpty Dumpty again.
40% of consumers net worth has evaporated, leaving little collateral for borrowing.
The piper must be paid, but who will tell the American people that their Great Debt driven Prosperity has come to an end?
Solving a debt crises with more debt is suicide. Unless our addiction to debt changes, I predict a slow growth stagnant economy for the next generation, and maybe much worse.
Pull this out in 10 years and grade my accuracy, if I am wrong, I will buy anyone reading this a dinner at Flemings.