Vanity Fair: The Economic Consequences of Mr. Bush

[babylonsister]

The Economic Consequences of Mr. Bush
The next president will have to deal with yet another crippling legacy of George W. Bush: the economy. A Nobel laureate, Joseph E. Stiglitz, sees a generation-long struggle to recoup.
by Joseph E. Stiglitz December 2007


When we look back someday at the catastrophe that was the Bush administration, we will think of many things: the tragedy of the Iraq war, the shame of Guantánamo and Abu Ghraib, the erosion of civil liberties. The damage done to the American economy does not make front-page headlines every day, but the repercussions will be felt beyond the lifetime of anyone reading this page.

I can hear an irritated counterthrust already. The president has not driven the United States into a recession during his almost seven years in office. Unemployment stands at a respectable 4.6 percent. Well, fine. But the other side of the ledger groans with distress: a tax code that has become hideously biased in favor of the rich; a national debt that will probably have grown 70 percent by the time this president leaves Washington; a swelling cascade of mortgage defaults; a record near-$850 billion trade deficit; oil prices that are higher than they have ever been; and a dollar so weak that for an American to buy a cup of coffee in London or Paris—or even the Yukon—becomes a venture in high finance.

And it gets worse. After almost seven years of this president, the United States is less prepared than ever to face the future. We have not been educating enough engineers and scientists, people with the skills we will need to compete with China and India. We have not been investing in the kinds of basic research that made us the technological powerhouse of the late 20th century. And although the president now understands—or so he says—that we must begin to wean ourselves from oil and coal, we have on his watch become more deeply dependent on both.

Up to now, the conventional wisdom has been that Herbert Hoover, whose policies aggravated the Great Depression, is the odds-on claimant for the mantle “worst president” when it comes to stewardship of the American economy. Once Franklin Roosevelt assumed office and reversed Hoover’s policies, the country began to recover. The economic effects of Bush’s presidency are more insidious than those of Hoover, harder to reverse, and likely to be longer-lasting. There is no threat of America’s being displaced from its position as the world’s richest economy. But our grandchildren will still be living with, and struggling with, the economic consequences of Mr. Bush.

Remember the Surplus?

The world was a very different place, economically speaking, when George W. Bush took office, in January 2001. During the Roaring 90s, many had believed that the Internet would transform everything. Productivity gains, which had averaged about 1.5 percent a year from the early 1970s through the early 90s, now approached 3 percent. During Bill Clinton’s second term, gains in manufacturing productivity sometimes even surpassed 6 percent. The Federal Reserve chairman, Alan Greenspan, spoke of a New Economy marked by continued productivity gains as the Internet buried the old ways of doing business. Others went so far as to predict an end to the business cycle. Greenspan worried aloud about how he’d ever be able to manage monetary policy once the nation’s debt was fully paid off.

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http://www.vanityfair.com/politics/features/2007/12/bush200712?printable=true¤tPage=all

[Vanje]

1. Recommended

[Demeter]

2. Actually, the Economy Is in a Depression, Not a Recession

they are just hiding this fact in a bunch of phony numbers. The truth will out if and when an honest Democratic Administration takes over, or the sheep start protesting loud enough that we can't be ignored any longer.

[Vidar]

5. Unfortunately the honest Democratic administration will then be blamed

for the Depression, because they were the first to actually use the word, never mind who caused it. Take a look at Carter's famous "Malaise" speech and its aftermath to see this Republican ad hominem tactic in action.

[CRH]

3. Without splitting hairs, a very concise article of where we have been, ...

-- where we are now, and where we need to go. And, the tough row to hoe for who ever must follow Bush's lasting legacy.

Kick and Recommend:

[libodem]

4. Listening to RW radio this morning

I was informed that it's because we can't drill in Anwar, (those damn radical environmentalists) and the threat of increased taxes is worrying someone, somewhere, so much that the whole thing is tanking. Oh yeah, just my thought, Clenis, must have something to do with it, too.