The Occupy Democrats’ statement spans Ronald Reagan’s presidency, which began in January 1981 and continues to the present day.
However, by using the word “has supervised” in relation to a recession, the statement is less than clear about whether it refers to a recession that began during a president’s term or one that he has had to cope with during his presidency.
Similarly, using the word “has supervised” to describe the Democrats’ robust recovery renders it unclear if the president launched the recovery or inherited one, as President Donald Trump did from President Barack Obama.
The interpretation of the phrase “has overseen” makes fact-checking more difficult. According to the National Bureau of Economic Research, Obama inherited a recession from Bush II that lasted from December 2007 to June 2009, making it the longest economic downturn since World War II.
In the Reagan-to-Trump chronology, four recessions began during Republican administrations: one each under Reagan and George H. W. Bush, and two under George W. Bush. Democrats Bill Clinton and Barack Obama, on the other hand, had none.
With the coronavirus epidemic causing an economic slump, a recession is likely to be proclaimed after the latest GDP data is announced in July. We may be in one right now, but it isn’t recognized as such.
According to figures from the St. Louis Federal Reserve, the Clinton administration produced 7.5 percent GDP growth in the second quarter of 2000 and averaged 3.7 percent over eight years, proving its assertion of excellent economic performance by Democratic presidents since Reagan.
Only Truman, at 4.8 percent, Kennedy, at 5.2 percent, and Johnson, at 5.1 percent, had higher average growth rates than the post-World War II presidents. According to The Washington Post, Reagan received 3.5 percent, Carter 3.3 percent, Nixon 3.1 percent, Bush I and Ford 2.2 percent, and Bush II 1.65 percent.
After inheriting the greatest economic depression since the Great Depression from the George W. Bush years, when the US lost roughly 800,000 jobs per month, the Obama administration managed a moderate 2% growth rate over eight years.
Was the Obama administration, on the other hand, pushing or merely overseeing the expansion? The greatest decreases in GDP, according to James Pethokoukis, an economist and columnist for the American Enterprise Institute, stopped before Obama took office and before the new $831 billion stimulus package went into effect. “Obama didn’t stop the Great Recession that Bush didn’t start,” reads the headline on his analysis.
What presidents were responsible for recessions?
Ten of the last eleven recessions began under Republican presidents, according to CNN, and “every Republican president since Benjamin Harrison, who served from 1889 to 1893, had a recession begin in their first term in office.” The National Bureau of Economic Research (NBER) tracks the start of recessions, and the following list includes the president in office at the time, as well as their political party:
According to Blinder and Watson, the economy was in recession for 49 quarters between 1949 and 2013, with 8 quarters under Democratic leadership and 41 under Republican leadership.
During the Great Recession, who was the president?
Federal Reserve Chairman Ben Bernanke informed Treasury Secretary Henry Paulson on September 17, 2008, that a considerable amount of public money will be required to stabilize the financial sector. On September 19, short trading of 799 financial stocks was outlawed. Large short positions were also required to be disclosed by companies. The Treasury Secretary also stated that money market funds would form an insurance pool to protect themselves against losses, and that the government would purchase mortgage-backed assets from banks and investment firms. As of September 19, 2008, initial estimates of the cost of the Treasury bailout suggested by the Bush Administration’s draft legislation ranged from $700 billion to $1 trillion US dollars. On September 20, 2008, President George W. Bush requested authorization from Congress to spend up to $700 billion to purchase distressed mortgage assets and stem the financial crisis. The crisis worsened when the bill was rejected by the US House of Representatives, resulting in a 777-point drop in the Dow Jones. Despite the fact that Congress enacted a revised version of the plan, the stock market continued to tumble. Instead of distressed mortgage assets, the first half of the bailout money was utilized to acquire preferred shares in banks. This contradicted some economists’ claims that purchasing preferred shares is considerably less effective than purchasing regular stock.
The new loans, purchases, and liabilities of the Federal Reserve, Treasury, and FDIC, as of mid-November 2008, were estimated to total over $5 trillion: $1 trillion in loans to broker-dealers through the emergency discount window, $1.8 trillion in loans through the Term Auction Facility, $700 billion to be raised by the Treasury for the Troubled Assets Relief Program, and $200 billion in insurance for the GSEs.
As of March 2018, ProPublica’s “bailout tracker” showed that $626 billion had been “spent, invested, or loaned” in financial system bailouts as a result of the crisis, with $713 billion repaid to the government ($390 billion in principal repayments and $323 billion in interest), indicating that the bailouts generated $87 billion in profit.
Who is responsible for the 2008 Great Recession?
The Lenders are the main perpetrators. The mortgage originators and lenders bear the brunt of the blame. That’s because they’re the ones that started the difficulties in the first place. After all, it was the lenders who made loans to persons with bad credit and a high chance of default. 7 This is why it happened.
What caused the recession of 1980?
The 1981-82 recession was the greatest economic slump in the United States since the Great Depression, prior to the 2007-09 recession. Indeed, the over 11% unemployment rate attained in late 1982 remains the postwar era’s pinnacle (Federal Reserve Bank of St. Louis). During the 1981-82 recession, unemployment was widespread, but manufacturing, construction, and the auto industries were especially hard hit. Despite the fact that goods manufacturers accounted for only 30% of overall employment at the time, they lost 90% of their jobs in 1982. Manufacturing accounted for three-quarters of all job losses in the goods-producing sector, with unemployment rates of 22% and 24%, respectively, in the home building and auto manufacturing industries (Urquhart and Hewson 1983, 4-7).
The economy was already in poor health prior to the slump, with unemployment hovering at 7.5 percent following a recession in 1980. Tight monetary policy in an attempt to combat rising inflation sparked both the 1980 and 1981-82 recessions. During the 1960s and 1970s, economists and politicians thought that raising inflation would reduce unemployment, a tradeoff known as the Phillips Curve. In the 1970s, the Fed used a “stop-go” monetary strategy, in which it alternated between combating high unemployment and high inflation. The Fed cut interest rates during the “go” periods in order to loosen the money supply and reduce unemployment. When inflation rose during the “stop” periods, the Fed raised interest rates to lessen inflationary pressure. However, as inflation and unemployment rose concurrently in the mid-1970s, the Phillips Curve tradeoff proved unstable in the long run. While unemployment was on the decline towards the end of the decade, inflation remained high, hitting 11% in June 1979. (Federal Reserve Bank of St. Louis).
Because of his anti-inflation ideas, Paul Volcker was chosen chairman of the Federal Reserve in August 1979. He had previously served as president of the New York Fed, where he had expressed his displeasure with Fed actions that he believed contributed to rising inflation expectations. In terms of future economic stability, he believes that rising inflation should be the Fed’s top concern: “It is what is going to give us the most troubles and cause the biggest recession” (FOMC transcript 1979, 16). He also thought the Fed had a credibility problem when it comes to controlling inflation. The Fed had proved in the preceding decade that it did not place a high priority on maintaining low inflation, and the public’s belief that this conduct would continue would make it increasingly difficult for the Fed to drive inflation down. “Failure to continue the fight against inflation now would simply make any subsequent effort more difficult,” he said (Volcker 1981b).
Instead of focusing on interest rates, Volcker altered the Fed’s policy to aggressively target the money supply. He chose this strategy for two reasons. To begin with, rising inflation made it difficult to determine which interest rate targets were suitable. Due to the expectation of inflation, the nominal interest rates the Fed targeted could be relatively high, but the real interest rates (that is, the effective interest rates after adjusting for inflation) could still be quite low. Second, the new policy was intended to show the public that the Federal Reserve was serious about keeping inflation low. The anticipation of low inflation was significant, as present inflation is influenced in part by future inflation forecasts.
Volcker’s initial efforts to reduce inflation and inflationary expectations were ineffective. The Carter administration’s credit-control scheme, which began in March 1980, triggered a severe recession (Schreft 1990). As unemployment rose, the Fed relented, reverting to the “stop-go” practices that the public had grown accustomed to. The Fed tightened the money supply further in late 1980 and early 1981, causing the federal funds rate to approach 20%. Long-term interest rates, despite this, have continued to grow. The ten-year Treasury bond rate surged from around 11% in October 1980 to more than 15% a year later, probably due to market expectations that the Fed would soften its restrictive monetary policy if unemployment soared (Goodfriend and King 2005). Volcker, on the other hand, was insistent that the Fed not back down this time: “We have set our course to control money and credit growth.” We intend to stay the course” (Volcker 1981a).
High interest rates put pressure on sectors of the economy that rely on borrowing, such as manufacturing and construction, and the economy officially entered a recession in the third quarter of 1981. Unemployment increased from 7.4% at the beginning of the recession to nearly 10% a year later. Volcker faced repeated calls from Congress to loosen monetary policy as the recession worsened, but he insisted that failing to lower long-run inflation expectations now would result in “more catastrophic economic situations over a much longer period of time” (Monetary Policy Report 1982, 67).
This perseverance paid off in the end. Inflation had dropped to 5% by October 1982, and long-term interest rates had begun to fall. The Fed permitted the federal funds rate to drop to 9%, and unemployment fell fast from over 11% at the end of 1982 to 8% a year later (Federal Reserve Bank of St. Louis; Goodfriend and King 2005). Inflation was still a threat, and the Fed would have to deal with several “inflation scares” during the 1980s. However, Volcker’s and his successors’ dedication to actively pursue price stability helped ensure that the 1970s’ double-digit inflation did not reappear.
What exactly was President Franklin D. Roosevelt’s New Deal?
Between 1933 and 1939, President Franklin D. Roosevelt implemented a series of programs, public works projects, financial reforms, and laws known as the New Deal. The Civilian Conservation Corps (CCC), the Civil Works Administration (CWA), the Farm Security Administration (FSA), the National Industrial Recovery Act of 1933 (NIRA), and the Social Security Administration were all major federal programs and agencies (SSA). Farmers, the unemployed, youth, and the elderly were all helped. The New Deal imposed new restrictions and safeguards on the financial industry, as well as efforts to re-inflate the economy following a dramatic drop in prices. During Franklin D. Roosevelt’s first term in office, the New Deal programs included both congressional legislation and presidential executive orders.
The policies centered on what historians call to as the “3 R’s”: unemployment and poverty relief, economic recovery, and financial system reform to avoid a repeat depression. With its base in liberal ideas, the South, big city machines and newly empowered labor unions, and various ethnic groups, the New Deal produced a political realignment, making the Democratic Party the majority (as well as the party that held the White House for seven out of nine presidential terms from 1933 to 1969). The Republicans were divided, with conservatives rejecting the entire New Deal as anti-business and anti-growth, while liberals supported it. From 1937 to 1964, the realignment resulted in the formation of the New Deal coalition, which dominated presidential elections until the 1960s, while the conservative coalition primarily controlled Congress in domestic issues.
When the Great Depression began, who was the President?
Before becoming the 31st President of the United States from 1929 to 1933, Herbert Hoover had won international acclaim as a mining engineer and earned worldwide acclaim as “The Great Humanitarian” who fed war-torn Europe during and after World War I.
What brought us out of the Great Recession of 2008?
Congress passed the Struggling Asset Relief Scheme (TARP) to empower the US Treasury to implement a major rescue program for troubled banks. The goal was to avoid a national and global economic meltdown. To end the recession, ARRA and the Economic Stimulus Plan were passed in 2009.
Is there going to be a recession in 2021?
Unfortunately, a worldwide economic recession in 2021 appears to be a foregone conclusion. The coronavirus has already wreaked havoc on businesses and economies around the world, and experts predict that the devastation will only get worse. Fortunately, there are methods to prepare for a downturn in the economy: live within your means.
What was George W. Bush’s presidency like?
George W. Bush’s presidency as the 43rd president of the United States began on January 20, 2001, with his first inauguration, and ended on January 20, 2009. Bush, a Texas Republican, was elected president after a close victory over Democratic Vice President Al Gore in the 2000 presidential election. He was re-elected four years later, defeating Democrat opponent John Kerry in the 2004 presidential election. Bush was followed by Barack Obama, a Democrat who won the presidential election in 2008. Bush, the 43rd president, is the eldest son of George H. W. Bush, the 41st president.
The terrorist events on September 11, 2001, were a watershed moment in his presidency. Congress established the Department of Homeland Security as a result of the attack, and Bush declared a global war on terrorism. He ordered an invasion of Afghanistan in order to depose the Taliban, destroy al-Qaeda, and apprehend Osama bin Laden. He also signed the controversial Patriot Act, which allows the government to spy on suspected terrorists. Bush launched the invasion of Iraq in 2003, claiming that Saddam Hussein’s regime had weapons of mass destruction. When no WMD stockpiles or evidence of an operational affiliation with al-Qaeda were ever discovered, there was outrage. Bush had pushed through a $1.3 trillion tax cut package as well as the No Child Left Behind Act, a major education bill, prior to 9/11. He also supported socially conservative policies like the Partial-Birth Abortion Ban Act and faith-based welfare programs. He also signed the Medicare Prescription Drug, Improvement, and Modernization Act, which established Medicare Part D, in 2003.
Bush achieved a number of free trade deals during his second term and selected John Roberts and Samuel Alito to the Supreme Court. He attempted to make significant reforms to Social Security and immigration legislation, but both failed. The battles in Afghanistan and Iraq continued, and he sent more soldiers to Iraq in 2007. The Bush administration’s response to Hurricane Katrina and the scandal surrounding the dismissal of US attorneys were both criticized, resulting in a dip in Bush’s approval ratings. As policymakers sought to avoid a catastrophic economic calamity, a worldwide financial market crisis dominated his final days in office, and he formed the Troubled Asset Relief Program (TARP) to buy toxic assets from banking institutions.