A Foundation Of Lies For Conservative Economics

by: Paul Rosenberg

Sat Mar 07, 2009 at 17:13

[TOM] DELAY:  Excuse me, but the economy from 2001 to 2007 was going quite well, thank you, but people were pushing especially Freddie Mac and Fannie Mae into loaning-making loans to people that couldn't afford them.  That caused the housing strike (ph).  And we can all go through that.  But the economy most of the years of Bush was going just fine and we were fighting a war on terror in two different countries and we were keeping the homeland safe and we were not on a spending spree, like Obama is putting us on with his budget.

Economy going quite well, thank you?  Er, not so much (all in constant dollars):

As can be seen above, the economic growth experienced by all income groups during the Clinton years came to a screeching halt when Bush took office.  Incomes stagnated completely, all across the board.  Numbers on the flip.

For those at the top of the lowest quintile, they made less every year of the Bush presidency than they did in 2000.  In facxt, the same is true for the second and third quintiles, too.  And the fourth quintile only showed a higher income in the last two years--2006 and 2007.  Even the top 5% showed three years with lower incomes than they had in 2000.

Isn't it amazing how you never heard about that?  Why do you think people took money out of their homes?  They sure weren't getting more money in their paychecks, that's for sure!

Here's what it would have looked like if the growth pattern during the Bush years had duplicated that of the Clinton years, each year with the same growth rate of the equivalent year of the Clinton era:

And here's the difference in the growth rates:

Those numbers above represent how much money people lost because of how much worse the Bush economy was than the Clinton economy, on a year-by-year basis and a seven-year total.  Eight year totals aren't available yet, so we're covering exactly the period of time that Tom DeLay insisted was so good!  The picture here is quite clear--the housing asset bubble took the place good old-fashioned wage growth.

This wasn't a totally new phenomena with Bush--merely an intensification of what had been going on throughout the era of increasing conservative dominance, as productivity continued to increase, but family income did not:

Those diverging lines in the chart above are the real shape of economic reality in the conservative economic era.  That's what we're trying to dig ourselves out of.

Missing Jobs

Another striking perspective on how bad the Bush economy was comes from looking at job growth compared to the Clinton Era.  There's a lot more data, as it comes on a monthly basis, so for better viewing, just click on any of the charts below, and a larger image will appear in a popup window.  First, here's what actually happened under Clinton and Bush:

As you can see, employment under Clinton grew by almost 19 million jobs, from 119 million and change when he took office in January 1993 to just a quarter million shy of 138 million when he left office eight years later.  In contrast, under Bush, employment grew by less than five million jobs, from 137.8 million to 142.1 million.   If the job growth under Bush had equalled Clinton, here's what it would have looked like instead:

That's well over 10 million more jobs!  In fact, here's here's what the difference in job growth would have looked like on a month-by-month basis:

So, sure, the difference in employment levels skyrocketed over the last year.  But Bush's job-creation was already over 6 million short of Clinton's before things really started going south.  That's what Tom DeLay considered "going quite well, thank you."

And that's exactly what the problem was.  The GOP couldn't tell a disaster when it was staring them in the face.  In fact, they only seemed to really recognize it once Bush left office, and now they could blame it all on the Democrats.  Too bad no one else is buying their story.