The Economy Is On The Upswing

The Private Sector Has Added 4.97 Million Jobs Over 32 Consecutive Months Of Private-Sector Growth. The following chart shows the monthly change in private-sector jobs dating back to January 2008.

[BLS.gov, accessed 11/2/12; MSNBC.com, 11/2/12]

Latest BLS Benchmark Shows “Net Job Growth…During Obama’s First Term.” According to the Huffington Post: “The Labor Department on Thursday morning quietly released a new benchmark for payroll employment in the U.S. It turns out that with the revision, there has been net job growth — not much, but more than nothing — during Obama’s first term. According to the revision, total non-farm payrolls stood at 133.686 million jobs in August, up from 133.561 million in January 2009, when Obama’s first term began. Before the revision, payrolls were at 133.300 million in August. In other words, 125,000 jobs have been created, in total, during Obama’s first term, compared with a prior estimate of a loss of 261,000.” [Huffington Post, 9/27/12]

Consumer Confidence Is Higher Than It Has Been Since February 2008. According to Bloomberg News: “Confidence among American consumers climbed in October to a more than four-year high, which may help drive bigger gains in the largest part of the economy. The Conference Board’s sentiment index increased to 72.2, the highest since February 2008, from a revised 68.4 in September, figures from the New York-based private research group showed today. […] The percent of respondents who say jobs are currently plentiful rose to the highest level since September 2008, indicating that a decline in joblessness is brightening Americans’ moods. Lower gasoline prices and a budding housing recovery are also contributing to the improvement in confidence.” [Bloomberg News, 11/1/12]

Massive Monthly Job Losses Obama Inherited Have Turned To Steady Private-Sector Growth

Recession Officially Ran From December 2007 To June 2009, Making It The Longest Since World War II. From the National Bureau of Economic Research: “The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months. In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.” [NBER.org, 9/20/10]

• Recession Resulted In 8.3 Million Job Losses. According to the Associated Press, “the Great Recession killed 8.3 million jobs, compared with 1.6 million lost in the 2001 recession.” [Associated Press via Yahoo! News, 5/4/12]

• Rise In Food Aid Recipients Is Result Of Recession. From the Center on Budget and Policy Priorities: “A primary driver of the recent rapid caseload growth is the increase in the number of eligible households because of the recession.  Poverty has increased substantially, from 12.5 percent in 2007 to 15.1 percent in 2010, resulting in more households qualifying for the program.  And, the deep and prolonged nature of the recession has led to record levels of long-term unemployment, extending the length of time that unemployed individuals have needed SNAP.  Between 2007 and 2010, as the unemployment rate more than doubled (from 4.6 percent to 9.6 percent), SNAP participation grew 56 percent.” [CBPP.org, 4/18/12, emphasis original]

Bush Recession Was So Severe That Economy Was Still Shedding Over Three-Quarters Of A Million Jobs Per Month Through First Few Months Of President Obama’s Term. According to the Bureau of Labor Statistics, the economy shed 839,000 jobs in January 2009, 725,000 in February 2009, 787,000 in March 2009, and 802,000 in April 2009, for a four-month average of 788,250 lost jobs per month. [BLS.gov, accessed 5/3/12]

Since The Recession Ended In June 2009, The Private Sector Has Added 3.8 Million Jobs While Public-Sector Employment Has Fallen By 569,000. According to the Bureau of Labor Statistics, there were 107,933,000 private-sector jobs in June 2009, and 111,744,000 private-sector jobs in October 2012, an increase of 3,811,000 jobs. The BLS also reports that there were 22,570,000 Americans working in the public sector in June 2009, and 22,011,000 working in the public sector in October 2012, a decrease of 559,000 jobs. The private-sector gains and public-sector losses add up to a total increase of 3,252,000 jobs. The following chart shows the cumulative private-sector job gains and public-sector job losses since the recession officially ended in June 2009:

[BLS.gov, accessed 11/2/12; BLS.gov, accessed 11/2/12; NBER.org, 9/20/10]

• Conservative AEI: The Public Sector Has Shrunk, But Private-Sector Growth Is Above Average. From American Enterprise Institute scholar Mark J. Perry: “In the second quarter of 2012, ‘public sector GDP’ decreased -1.44%, and that was the eighth straight quarter of negative growth for total government spending, averaging -2.88% per quarter over the last two years. In contrast, there have been 12 consecutive quarters of positive growth for private sector GDP averaging 3.07% per quarter in the three years since the recession ended, which is slightly higher than the 2.8% average growth rate in private real GDP over the last 25 years.” [AEI-Ideas.org, 7/31/12]

Bush Policies And Recession Caused Debt To Skyrocket

Prior To President Obama’s Inauguration, President Bush Had Already Created A Projected $1.2 Trillion Deficit For Fiscal Year 2009. From the Washington Times:  “The Congressional Budget Office announced a projected fiscal 2009 deficit of $1.2 trillion even if Congress doesn’t enact any new programs. […] About the only person who was silent on the deficit projection was Mr. Bush, who took office facing a surplus but who saw spending balloon and the country notch the highest deficits on record.” [Washington Times, 1/8/09]

NYT: President Bush’s Policy Changes Created Much More Debt Than President Obama’s.The New York Times published the following chart comparing the fiscal impact of policies enacted under the Bush and Obama administrations:

[New York Times, 7/24/11]

Recession Added Hundreds Of Billions In Deficits By Increasing Spending On Safety Net While Shrinking Tax Revenue. The Center on Budget and Policy Priorities (CBPP) explains: “When unemployment rises and incomes stagnate in a recession, the federal budget responds automatically: tax collections shrink, and spending goes up for programs like unemployment insurance, Social Security, and Food Stamps.” According to CBPP: “The recession battered the budget, driving down tax revenues and swelling outlays for unemployment insurance, food stamps, and other safety-net programs. Using CBO’s August 2008 projections as a benchmark, we calculate that the changed economic outlook alone accounts for over $400 billion of the deficit each year in 2009 through 2011 and slightly smaller amounts in subsequent years. Those effects persist; even in 2018, the deterioration in the economy since the summer of 2008 will account for over $300 billion in added deficits, much of it in the form of additional debt-service costs.” [CBPP.org, 11/18/10; CBPP.org, 5/10/11, citations removed]

Over The Coming Decade, The Bush Tax Cuts Are The Primary Cause Of Federal Budget Deficits. The Center on Budget and Policy Priorities prepared a chart showing the deficit impact of the Bush tax cuts (orange), the Iraq and Afghanistan wars, the recession itself, and spending to rescue the economy:

[CBPP.org, 5/10/11]

CBPP: Bush Tax Cuts And Wars Are Driving The Debt. According to the Center on Budget and Policy Priorities:

The complementary chart, below, shows that the Bush-era tax cuts and the Iraq and Afghanistan wars — including their associated interest costs — account for almost half of the projected public debt in 2019 (measured as a share of the economy) if we continue current policies.

[Center on Budget and Policy Priorities, 5/20/11]

Republicans Have Opposed President Obama’s Deficit-Reduction Efforts

September 2011: Obama Proposed $3 Trillion In Deficit Reduction, “Republicans Swiftly Responded … With Opposition.” According to the Los Angeles Times: “President Obama on Monday made an aggressive pitch for his $3-trillion deficit-reduction strategy, promising to veto any proposal that fails to raise revenues by asking wealthy Americans to ‘pay their fair share.’ […] His plan for lopping $3 trillion from the deficit is on top of the approximately $1 trillion in spending cuts that he signed into law in August, after reaching a deal with Republican congressional leaders to lift the nation’s debt ceiling. On Monday, Republicans swiftly responded to the president’s proposal with opposition. [Los Angeles Times,9/19/11]

April 2011: GOP Rejected Obama Proposal To Reduce Deficits By $4 Trillion. According to the Boston Globe: “President Obama pledged yesterday to pare the projected deficit by $4 trillion in the next 12 years, vowing to protect the nation’s most vulnerable while pushing again for higher taxes for its richest citizens. […] His call for the end of the Bush tax cuts for incomes above $250,000 for couples reignites a ferocious debate from the fall midterm elections. That element of the speech triggered the most vociferous and immediate opposition from Republicans.” [Boston Globe, 4/14/11]