Refuting Occupy Democrats
Occupy Democrats published a meme that purports to show that Obama inherited a far worse position from Bush than Trump did from Obama. The meme is what a UK politician once called “being economical with the actualité”
The first point the meme claims is that Obama bequeathed Trump full employment. This is a wonderful example of how to lie with government statistics. It is “true” only because the statistics are highly misleading about counting the unemployed. If one looks at the labor participation rate – the faction of people who are working who could work – we see that this is at levels last seen in the early Carter administration
In other words some 4% of the working age population has simply given up looking for a job over the eight years of Obama’s presidency.
Next the meme points out (correctly) that Obama’s presidency left a record high stock market.
It fails to point out, the the chart above shows, the stock market has continued to rise under Trump and is currently still at a record high, having appreciated about 10% since Trump’s election in November last year. It would perhaps be churlish to point out that the Dow spent the whole of Obama’s first term below its 2007/2008 peaks.
Thirdly the meme claims that the housing market has recovered. This is partially true in that the Case Shiller Home Price Index is back to its level in mid 2005 after spending the whole of Obama’s first term at about 70% of the current price.
However as usual the devil is in the details. The Home Ownership rate has collapsed during Obama’s presidency and is lower than at any time in the last 40 years
Now there are arguments that renting is better and that the rate in the 2000s was too high, but, as with labor force participation we’re seeing a 4% drop during Obama’s presidency.
Then there’s a claim that the US car industry is “saved”. This again depends strongly on your definitions. If we look at the US public’s appetite for buying cars we see some worrying signs:
More Americans fell behind on their car loan payments in the fourth quarter, bringing auto delinquencies to their highest since the height of the financial crisis, Federal Reserve Bank of New York data released on Thursday showed.
Car loans delinquent by 30 days or more grew to $23.27 billion, the most since $23.46 billion in the third quarter of 2008. They were up from $22.98 billion in the prior quarter.
Seriously delinquent auto loans whose payments were 90 days or more past due jumped to $8.24 billion in the fourth quarter, the highest since the third quarter of 2016, according to the survey.
This should not be too surprising because a statistic that Occupy Democrats unaccountably failed to mention. Despite the “full employment” and the “healthy” housing and auto industries, wage growth in Obama’s presidency has been historically low.
Even if we ignore that actual NEGATIVE rate in 2009, we see that annual wage growth during the Obama era has been, at best, hovering in the 5% range whereas in the previous decades it has generally been well over that. This corresponds quite closely to GDP growth which has been equally pathetic during the Obama years compared to the previous decades
If we look at the Reagan recession of 1982/83, which was almost as bad as the 2008/09 one, we see that the economy rocketed out of that with growth rates of 8% in the following year and solidly in the 4% range until the early 1990s recession. During the Obama years, by comparison, GDP growth has struggled to get above 3%.
Finally, moving on from economics, there’s the claim about no active major wars.
This is clearly a case of cherry picking the word major. Obama was bombing people and authorizing drone strikes for his entire presidency and my understanding is that the US has naval, air and (mostly SF ) ground forces active in combat in Somalia, Syria, Yemen, Libya, Iraq and Afghanistan. All these are wars, even if some might not be classed as “major” – though personally I’d consider the Syrian civil war and the Daesh fighting in N Iraq as major. In addition the Obama presidency saw Russia annex Crimea, extend the borders of its puppet states in Georgia, and fight a proxy war in Eastern Ukraine. Meanwhile China extended its presence in the South China Sea and ignored the international ruling that this was illegal. Then there were the nuclear and ballistic missile tests by North Korea and the extremely shifty Iranian nuclear deal, as well as Iranian aggression against US forces in the Persian Gulf. I think we can say that that point is also inaccurate.
In summary then, just as President Trump claims, Obama has indeed handed him a mess and that mess, while different to the mess Bush handed Obama, is not notably better.
The Shadow of the Olive Tree