Current Economic Recovery Is The Weakest Since World War II
You probably didn’t need a news article to tell you this, but the so-called “recovery” that the Obama Administration likes to point to as evidence of the success of their economic policies is the weakest the nation has experienced in the modern era:
WASHINGTON (AP) — The recession that ended three years ago this summer has been followed by the feeblest economic recovery since the Great Depression.
Since World War II, 10 U.S. recessions have been followed by a recovery that lasted at least three years. An Associated Press analysis shows that by just about any measure, the one that began in June 2009 is the weakest.
The ugliness goes well beyond unemployment, which at 8.3 percent is the highest this long after a recession ended.
Economic growth has never been weaker in a postwar recovery. Consumer spending has never been so slack. Only once has job growth been slower.
More than in any other post-World War II recovery, people who have jobs are hurting: Their paychecks have fallen behind inflation.
You can see the signs all around you, starting with incredibly weak economic growth:
America’s gross domestic product — the broadest measure of economic output — grew 6.8 percent from the April-June quarter of 2009 through the same quarter this year, the slowest in the first three years of a postwar recovery. GDP grew an average of 15.5 percent in the first three years of the eight other comebacks analyzed.
The engines that usually drive recoveries aren’t firing this time.
Investment in housing, which grew an average of nearly 34 percent this far into previous postwar recoveries, is up just 8 percent since the April-June quarter of 2009.
That’s because the overbuilding of the mid-2000s left a glut of houses. Prices fell and remain depressed. The housing market has yet to return to anything close to full health even as mortgage rates have plunged to record lows.
Government spending and investment at the federal, state and local levels was 4.5 percent lower in the second quarter than three years earlier.
And concluding with jobs:
The economy shed a staggering 8.8 million jobs during and shortly after the recession. Since employment hit bottom, the economy has created just over 4 million jobs. So the new hiring has replaced 46 percent of the lost jobs, by far the worst performance since World War II. In the previous eight recoveries, the economy had regained more than 350 percent of the jobs lost, on average.
During the 1981-82 recession, the U.S. lost 2.8 million jobs. In the three years and one month after that recession ended, the economy added 9.8 million — replacing the 2.8 million and adding 7 million more.
Never before have so many Americans been unemployed for so long three years into a recovery. Nearly 5.2 million have been out of work for six months or more. The long-term unemployed account for 41 percent of the jobless; the highest mark in the other recoveries was 22 percent.
Given this, is it any wonder that the President’s numbers on the economy are so low?
And the crisis that touched it off was the worst since the depression. You sort of forgot to mention the cause and effect part of the equation.
Yeah,,,as if all recessions were the same. You can slap a descriptive term on a phenomenon – but that often just hides the underlying reality which may well be that all the things in the category are not the same.
This particular recession was caused by an event that is wholly different than any other recession-causing events since the Great Depression. But you know that….why ignore it when making a point like this?
To take just the obvious – we had an enormous housing bubble burst which left tens of millions of people not only poorer, but financially underwater. How do you imagine any president could have returned the country to its big-consumer-spending ways, such that the recovery would have been quicker and more robust?
Not only worse, but different. Previous post-WW II recessions were mostly caused by changes in the business cycle. This was caused by a massive financial and banking crisis, and those sorts of recessions typically have slower, weaker recoveries.
Recovering from a heart attack takes longer and is more painful than recovering from a minor cold.
Why should it be any different for an economy than for a person?
Given the state of the economy, it’s a wonder that the President’s numbers aren’t worse. For that though, I blame/credit Mitch McConnell. To anybody who’s not a partisan, it’s obvious that the Republicans, while probably not outright trying to make the economy worse, were certainly also not eager to pass anything that might help things improve (too much, or too soon).
3 1/2 years into his term, I don’t even think it’s necessary for the Obama team to even bring up George Bush, and the economy they inhereted anymore. For at least the past two year, Congressional Republicans have to share some ownership for what has (or hasn’t) happened with our economy. (and again, Independent voters, especially of the moderate persuassion, reconginze this).
For me, an irony is that I actually believe that Congress would do more to help the economic recovery in 2013 if Mitt Romney is elected … which would ultimately be good for all of us. But it just feels way too much like giving in to/rewarding the bully (or kid who’s throwing a fit). And also, the reason Congress would probably work better with a President Romney isn’t that he’d be more likely to “unite” people … it’s that the Democrats, while capable of being every bit as partisan as the Republicans, can generally be counted on to actually act like adults if something that may benefit them politically in the short term would likely cause damage to the country in the bigger picture view. (in other words,I can’t imagine the Liberal equivalent of the debt ceiling showdown).
Shocking!
I mean, this was the worst economic catastrophe since the Great Depression, so why would anyone think that the recovery would be weak?
$14 Trillion in wealth and income was vaporized in the 2008 crash and some people have a hard time understanding why the recovery is anemic? Amazing.
Another thing going on here is the end of cheap oil. It has a floor of about $80 bbl and is now rapidly approaching $100 bbl. The new sources are expensive to develop so more drilling won’t lower the price. This is the first recovery without cheap oil.
A Republican-controlled Congress and White House would provide the stimulus to produce jobs (minimum wage ones anyway), but then promptly destroy all of the New Deal safety nets and continue the “War to Get Women Barefoot, Pregnant, and Back in the Kitchen Where They Belong.”
You know what would have helped the recovery? Letting GM and Chrysler go out of business.
DOW @ 13250. It’s interesting that people who worship the market never want to talk about how the stock market loves Obama.
Worst recession in 80 years, hardest recovery in 80 years. Hmm. Surprising?
Let’s remember the audacious demand implicit in Doug’s complaint about Obama’s performance.
This was the worst recession in 80 years.
Obama had a Democratic Congress (but without super-majority) for 2 years.
At the end of those 2 years Congress flipped and Republican leaders are on record saying that they were going full gridlock, that they “could not let Obama succeed.”
So, you have to believe that the worst recession in 80 years could be fixed in 2, with only a slender majority to work with.
Doug can’t be that dumb, so he must be that dishonest.
@john personna:
Evidently, for most Republicans it is really hard to understand.
@Nikki:
Campaign promises can be a useful guide to what candidates want to do if they get elected. But not necessarily predictive of what they’re actually going to be able to do.
Don’t get me wrong, I find much of what Conservatives wish for to be pretty scary stuff. But at the same time, I honestly don’t think it’s going to be “the end of the world” even if the Republicans win all three branches. On the margins they may get some of what they want .. but not all of it. And chances are great that the 2014 mid-terms will reverse things again (in Congress) anyway .
@anjin-san:
I guess in January 2017, You will be writing that Obama had to deal with the Bush recession the entire 8 years that Obama was in office.
I love how Democrats are never to blame for anything that they do. I guess that you cannot have a progressive administration that was to expand entitlements, expand regulations, expand the public sector, and deliver government goodies to core Democratic Party groups at the same time that the public sector grows.
I guess the idea of trying the idea of the Clinton Administration of throwing Congressional Democrats under the bus and not trying any new regulatory or entitlement programs for six years never crossed the minds of Obama’s advisors.
@anjin-san: Or the way the republicans in congress are tripping over themselves to ensure the President’s policies get implemented. Even though they know they would benefit in the 2012 presidential election if they could somehow ensure the economy remains bad, they selflessly worked with the President to enact legislation to turn the economy around. Why, senate minority leader Mitch McConnell himself said, “The single most important thing we want to achieve is for President Obama to be a one-term president.” If that doesn’t show that Mitch is 100% behind the president, then nothing does.
Republicans: “we want power.”
You are sooo right! If you ask my opinion, this is another Great Depression! The aftereffects will linger for years to come. Alot of people that lost jobs will never really recover because technology has taken over to the point that alot of people have been out-sourced. Fewer people are needed to do some jobs now and not all of the population are HIGH TECH people! Years ago, there was “diveversity, work for everyone, but now everything seems to center on advanced technological skills that do not apply to everyone! What a shame. This country will never be the same again!