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I have noticed of late the meme that Obama saved us from a second great depression being used to defend his failing economic polices. I have a friend on facebook who is posting items like Berrie Sanders saying it was two wars and the Bush tax cuts that caused government spending to go out of control. I answered him with a link to the heritage foundation showing how little the two wars and the tax cuts effected the budget. It was pointed out to me that the heritage foundation did not take include that we were heading into a great depression and that things were far worse than known. He recently posted a picture of Obama with a box of donuts captions killed Bin Laden, got rid of Gaddafi, saved us from the 2nd great depression and brought donuts. The first two are easy to disprove, but again how to disprove the second great depression.
It sort of sounds like the televangelist who proclaims that he prayed a hurricane to move off shore thus saving everyone. How do you prove to the televangelist and his followers that the hurricane would have tracked that way anyway.
It not be worth it. These people do not care, "Obama is awesome."
How do you counter the argument that it would have been worse? Where is the proof that we were saved from another great depression?
It sort of sounds like the televangelist who proclaims that he prayed a hurricane to move off shore thus saving everyone. How do you prove to the televangelist and his followers that the hurricane would have tracked that way anyway.
It not be worth it. These people do not care, "Obama is awesome."
How do you counter the argument that it would have been worse? Where is the proof that we were saved from another great depression?
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Did Obama save us from a 2nd Great Depression?
on Jan 27 2012 07:43 AM
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Can you post a link to the Heritage Foundation you mentioned?
Same thing with Obama as with Great Depression #1 under Roosevelt. History says that the aftereffects of the '29 crash should have lasted 18 to 24 months. For the sake of discussion, let's double it and say 48 months. Roosevelt stretched it out to 140 months.
Economically, he's doing the same type of things as FDR and getting similar results.
swede1962, on 27 January 2012 - 02:14 PM, said:
Here is the link.
http://www.heritage....-budget-deficit
Joe the Pagan, on 30 January 2012 - 11:05 AM, said:
swede1962, on 27 January 2012 - 02:14 PM, said:
It's a very good read and I agree with most of it, especially the part below that starts about 2/3 down the article. The only (minor) quibble I would have with it all is that they keep talking about the "2001 surplus" and "projected" surpluses after that. I don't believe the surplus was actually 'real' to begin with. And after the '99-'00 dotcom crash, I don't believe anyone at the time thought the future "projected" surplus were anything more than a fantasy.
Quote
-Higher revenues, mostly from a temporary stock and economic bubble.
- Lower defense spending following the end of the Cold War, and
- Net interest savings resulting from less borrowing, a result of the other two factors.
The rest of the federal budget merely remained level as a share of the GDP throughout the decade, which itself may be considered an accomplishment for lawmakers.
Returning to those budget levels would not be easy. The stock market bubble is unlikely to return, nor would that be desirable. The 9/11 attacks ended the era of massive defense spending cuts, higher debt has brought higher net interest costs, and 10,000 baby boomers per day are retiring into Social Security and Medicare. Overall, the difference between 2001 and 2020 can be explained as follows:
- The 2001 tax revenues were bubble-inflated (down 1.6 percent of GDP),
- 2001 defense spending was as at prewar levels (up 0.8 percent of GDP),
- Social Security, Medicare, and Medicaid costs are growing (up 3.3 percent of GDP),
- Presidents Bush and Obama hiked domestic discretionary spending (up 0.5 percent of GDP),
- Other entitlement spending is rising (up 0.8 percent of GDP), and
- Rising debt means rising net interest costs (up 2.6 percent of GDP).1.
As a result, a budget surplus of 1.3 percent of GDP in 2001 is set to become a deficit of 8.3 percent by 2020. (See Table 1.)