.
That's the point: WE WERE in a massive recession with growth rate far below what anyone was predicting at the time. . .and to make it worse, Wall Street and our bankers like of ethics made it into a GLOBAL recession, which didn't help take our country out of the recession any faster either!
From the
Wall Street Journal:
Consider next the government-spending part of the stimulus package. The Obama administration points to the sharp reduction in the decline in real GDP from the first to the second quarter of 2009 as evidence that the package is working. Economic growth was minus 6.4% in the first quarter and minus 1% in the second quarter, so the implied improvement of 5.4 percentage points is indeed big. But how much of that improved growth rate can be attributed to higher government spending due to the stimulus? If we rely on predictions of models, again we see disagreement and debate. According to our research with modern macroeconomic models, the increase in government spending would add less than a percentage point, a relatively small portion. The model predictions cited by the administration's economists suggest a much larger portion: two to three percentage points. Prof. Barro's model predicts zero.
So let's look at the data on the contributions of government spending and other components of GDP to the 5.4 percentage-point improvement. By far the largest positive contributor to the improvement was investment--which went from minus 9% to minus 3.2%, an improvement of 5.8% and more than enough to explain the improved GDP growth. Investment by private business firms in plant, equipment and inventories, rather than residential investment, were the major contributors to the investment improvement. In contrast, consumption was a negative contributor to the change in GDP growth, because consumption growth declined following the passage of the stimulus package.
One is hard put to see what specific items in the stimulus act could have arrested the decline in business investment by such a magnitude. When one looks at monthly investment indicators--such as new orders for nondefense capital goods--one sees a flattening out starting early in the first quarter of 2009, well before the package went into operation. The free fall of investment orders caused by the financial panic last fall stabilized substantially by January, and investment has remained relatively stable since then. This created the residue of a very large negative growth rate from the fourth quarter of 2008 to the first quarter of 2009, and then moderation from the first quarter to the second of 2009. There is no plausible role for the fiscal stimulus here.
Direct evidence of an impact by government spending can be found in 1.8 of the 5.4 percentage-point improvement from the first to second quarter of this year. However, more than half of this contribution was due to defense spending that was not part of the stimulus package. Of the entire $787 billion stimulus package, only $4.5 billion went to federal purchases and $17.7 billion to state and local purchases in the second quarter. The growth improvement in the second quarter must have been largely due to factors other than the stimulus package.
As I said before, three elements of the Bush administration combined to create this massive recession:
Bush's two long, expensive wars
Bush tax cuts for that benefitted mostly the wealthy (supposedly "job creators" who stopped "creating jobs!")
Bush's era deregulation policies that led to unethical practices for Wall Street and the Banks and led to the WORLD WIDE recession.
It is entirely laughable that you blame Bush for the creation of subprime lending, credit default swaps, etc.
As for the wars, the total cost of both is under $1.5 trillion. Break that down over a ten year period and we are looking at a mere $150 billion a year...surely you are not arging that is what caused the recession?
Bush's tax cuts again are estimated by AP to have added 1.6 trillion to the deficit over ten years. Keep in mind of course there was a $9 trillion dollar increase in the deficit over this time. You will of course argue that the tax cuts created lower revenues for the government. This is again false. The CBO incorrectly calculated that the post-March 2003 tax cuts would lower 2006 revenues by $75 billion. Revenues for 2006 came in $47 billion above the pre-tax cut baseline.
What really caused the recession, was the housing bubble exploded. It had nothing to do with much else.
So. . .we both take the "party line." What makes yours better than mine?
Mine is backed up with more than simply talking points. Additionally, I can accept what the party line is, and that it has flaws. You seem unable to do that with your own party line.
