ESCAPING THE ORWELLIAN WORLD OF OBAMANOMICS
Stephen Moore: First, let me say did any of you see that the other day Hillary Clinton was asked about Barack Obama's economic record. She said, "I would give Barack Obama the grade of A for his handling of the economy."
I thought, "Wow an A, that's with grade inflation, right?"
It reminded me of when I was in college and -- we take basketball very seriously at the University of Illinois -- we had recruited this kid who was a phenomenal basketball player but Lord knows how he got in through the admissions process. After his first semester, he famously had gotten this report card and his grades were one D and four Fs. He was talking to the coach of the team, and the coach, looking at his report card, says to him
"Son, it looks like to me like you're spending way too much time on one subject."
This what I call the Reaganomics versus Obamanomics chart. It is something that all conservatives should throw in the face of liberals when we are debating and it's the growth gap. The way I like to put it is that there's a natural experiment out there that this country has had that over the last 50 years we've had two presidents who've entered office during periods of great economic crisis. The first was Ronald Reagan, and you all remember 20 percent mortgage interest rates and 14 percent inflation and it felt like America was an empire in permanent economic decline. We also remember the $830 billion stimulus bill that didn't create a job, cash refunders, and then the Obamacare bill that was going to reduce healthcare costs for everyone. We had the Fed over the last 6 years print somewhere in the neighborhood of $4 trillion. We had tax increases on the rich. We had three minimum wage increases. In sum, almost every single page of the liberal playbook they threw it all in 2008 and 2009.
Now what this is showing you is that the path of the recovery of these two periods. What's amazing about this is the current recovery has been at an average rate of about 2 percent, just slightly under 2 percent, for the last 7 years and then you can see under the Reagan recovery we grew at about 4 percent. Now the difference between 2 or 4 percent doesn't seem to suggest a big difference, but as Albert Einstein used to say the most powerful force in the universe is compound interest, so the compounding effect of a 2 percent growth rate versus a 4 percent growth rate over 6 years makes a whole heck of a lot of difference.
This does not include the numbers for the third quarter of 2015. Those numbers just came out a week or two ago, so this gap has probably actually grown a little wider because we had such a pathetic third quarter growth rate is that we had had a Reagan-style expansion we would have $3 trillion more GDP today. $3 trillion.
The first time I ever was on TV which was in 1987 when I was working for President Reagan. We did something, as Reaganites, we weren't very proud of. We proposed to Congress the first trillion dollar budget in American history. As fiscal conservatives, we were kind of embarrassed this was the first trillion dollar budget and I'll never forget my boss, Jim Miller, called me up on a Friday afternoon. He said he was supposed to do this TV appearance on the Today Show with Katie Couric, but couldn't do it. He had to be over at the White House, and he asked me if I could go instead; I had never been on TV before.
I was terrified. I spent the whole weekend preparing for this. I read through every single line item of the budget. The federal budget is like the Manhattan phonebook, right? It's like 600 pages. And so I was ready for any question Katie Couric might ask. I mean I knew what the budget was for the Navy, for the ANILA, for the Department of Defense. Anything she'd asked me, I knew the numbers. So, cameras are rolling. The lights come on. It's 7:30 a.m. There's 6 million people watching Katie Couric, and she sort of snarls at me.
She said "Mr. Moore, I see President Reagan is introducing the first $1 trillion budget in American history. I just have one question for you this morning. How may zeroes are there in a trillion?"
I just melted down. It was the worst interview. I just melted down after that. And, by way, how many zeroes are there in a trillion? There's 12, there're 12.
So we have a $3 trillion gap right now. So that's a big number. And one of the ways I like to sometimes we use these big numbers -- and people's eyes glaze over -- but one way of thinking about this is that if we have $3 trillion more GDP today, and we just distributed that evenly to every family in America every family in America would have about $15,000.00 to $20,000.00 more income. The statistic that is devastating to Hillary and others that every Republican should recite every single time they talk about President Obama and Hillary.
It reminded me of when I was in college and -- we take basketball very seriously at the University of Illinois -- we had recruited this kid who was a phenomenal basketball player but Lord knows how he got in through the admissions process. After his first semester, he famously had gotten this report card and his grades were one D and four Fs. He was talking to the coach of the team, and the coach, looking at his report card, says to him
"Son, it looks like to me like you're spending way too much time on one subject."
This what I call the Reaganomics versus Obamanomics chart. It is something that all conservatives should throw in the face of liberals when we are debating and it's the growth gap. The way I like to put it is that there's a natural experiment out there that this country has had that over the last 50 years we've had two presidents who've entered office during periods of great economic crisis. The first was Ronald Reagan, and you all remember 20 percent mortgage interest rates and 14 percent inflation and it felt like America was an empire in permanent economic decline. We also remember the $830 billion stimulus bill that didn't create a job, cash refunders, and then the Obamacare bill that was going to reduce healthcare costs for everyone. We had the Fed over the last 6 years print somewhere in the neighborhood of $4 trillion. We had tax increases on the rich. We had three minimum wage increases. In sum, almost every single page of the liberal playbook they threw it all in 2008 and 2009.
Now what this is showing you is that the path of the recovery of these two periods. What's amazing about this is the current recovery has been at an average rate of about 2 percent, just slightly under 2 percent, for the last 7 years and then you can see under the Reagan recovery we grew at about 4 percent. Now the difference between 2 or 4 percent doesn't seem to suggest a big difference, but as Albert Einstein used to say the most powerful force in the universe is compound interest, so the compounding effect of a 2 percent growth rate versus a 4 percent growth rate over 6 years makes a whole heck of a lot of difference.
This does not include the numbers for the third quarter of 2015. Those numbers just came out a week or two ago, so this gap has probably actually grown a little wider because we had such a pathetic third quarter growth rate is that we had had a Reagan-style expansion we would have $3 trillion more GDP today. $3 trillion.
The first time I ever was on TV which was in 1987 when I was working for President Reagan. We did something, as Reaganites, we weren't very proud of. We proposed to Congress the first trillion dollar budget in American history. As fiscal conservatives, we were kind of embarrassed this was the first trillion dollar budget and I'll never forget my boss, Jim Miller, called me up on a Friday afternoon. He said he was supposed to do this TV appearance on the Today Show with Katie Couric, but couldn't do it. He had to be over at the White House, and he asked me if I could go instead; I had never been on TV before.
I was terrified. I spent the whole weekend preparing for this. I read through every single line item of the budget. The federal budget is like the Manhattan phonebook, right? It's like 600 pages. And so I was ready for any question Katie Couric might ask. I mean I knew what the budget was for the Navy, for the ANILA, for the Department of Defense. Anything she'd asked me, I knew the numbers. So, cameras are rolling. The lights come on. It's 7:30 a.m. There's 6 million people watching Katie Couric, and she sort of snarls at me.
She said "Mr. Moore, I see President Reagan is introducing the first $1 trillion budget in American history. I just have one question for you this morning. How may zeroes are there in a trillion?"
I just melted down. It was the worst interview. I just melted down after that. And, by way, how many zeroes are there in a trillion? There's 12, there're 12.
So we have a $3 trillion gap right now. So that's a big number. And one of the ways I like to sometimes we use these big numbers -- and people's eyes glaze over -- but one way of thinking about this is that if we have $3 trillion more GDP today, and we just distributed that evenly to every family in America every family in America would have about $15,000.00 to $20,000.00 more income. The statistic that is devastating to Hillary and others that every Republican should recite every single time they talk about President Obama and Hillary.
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