The Truth about the Economy & Presidents - Election 2024

So in an election year the GOP loves to tell the lie that they are the best party for the economy. THEY ARE NOT. 

The Economic Truth.

Every Republican president from Reagan, to both Bush presidents, to Trump have caused a recession, increased the deficit and instituted policies that increased inflation. 

1. Ronald Reagan (1981–1989)

• Recession: Reagan inherited a severe recession in 1981-1982, which was triggered by high inflation (from the 1970s) and efforts by the Federal Reserve to curb it by raising interest rates. The recession ended in late 1982, and economic recovery followed.
• Deficit: Reagan’s policies, particularly large tax cuts (Reaganomics) and increased defense spending, led to significant deficits. The national debt tripled during his presidency.

2. George H. W. Bush (1989–1993)

• Recession: The U.S. entered a recession in 1990-1991, partly due to the savings and loan crisis and oil price shocks from the Gulf War. This recession contributed to Bush’s loss in the 1992 election.
• Deficit: Bush inherited large deficits and despite his famous "no new taxes" pledge, he raised taxes in 1990 to reduce the deficit. However, the national debt continued to rise.

3. George W. Bush (2001–2009)

• Recession: Bush’s presidency saw two recessions. The first was the mild recession following the dot-com bubble burst and the 9/11 attacks (2001). The second, more severe one was the Great Recession (2007-2009), caused by the housing bubble burst and the financial crisis.
• Deficit: The Bush administration saw a sharp rise in the national deficit, especially after the 2008 financial crisis and the wars in Iraq and Afghanistan. Bush also enacted significant tax cuts, which contributed to rising deficits.

4. Donald Trump (2017–2021)

• Recession: Trump’s presidency saw the sharp economic contraction due to the COVID-19 pandemic in 2020, which caused the most severe downturn since the Great Depression. However, prior to the pandemic, the U.S. economy was growing steadily.
• Deficit: The Trump administration enacted large tax cuts (Tax Cuts and Jobs Act of 2017), which significantly increased the deficit. The deficit further exploded in 2020 due to COVID-19 relief spending.

Democratic Presidents Constantly Clean up the GOPs Mess.

Democratic presidents Bill Clinton, Barack Obama, and Joe Biden implemented policies to stabilize the economy and address the challenges left behind by previous administrations. 

1. Bill Clinton (1993–2001)

• Inherited Mess: Clinton inherited a sluggish economy from George H. W. Bush, marked by slow growth and significant deficits.
• Balanced Budget: Clinton, along with a Republican-controlled Congress in the mid-1990s, implemented policies that resulted in a balanced budget and even budget surpluses by the late 1990s (1998-2001). This was the first time in decades that the U.S. had achieved such fiscal balance.
  • Key Policies:
    • Clinton raised taxes on the wealthy through the 1993 Omnibus Budget Reconciliation Act.
    • He also enacted spending cuts and signed welfare reform into law.
    • The economy grew strongly in the late 1990s, driven by the dot-com boom and favorable macroeconomic conditions.
• Deficit to Surplus: By the end of his presidency, Clinton left office with a projected $236 billion surplus.

2. Barack Obama (2009–2017)

• Inherited Mess: Obama inherited the Great Recession, the worst economic downturn since the Great Depression, caused by the financial crisis of 2007-2008 under George W. Bush. The economy was in freefall, with banks collapsing, massive job losses, and the housing market in shambles.
• Economic Recovery: Obama passed the American Recovery and Reinvestment Act (2009), a stimulus package aimed at rescuing the economy through infrastructure investment, tax cuts, and aid to states. The Affordable Care Act (Obamacare) also helped reduce healthcare costs and deficits over time.
  • The economy slowly recovered, with steady job growth and a rebounding stock market. By the end of his term, unemployment had dropped from a high of 10% in 2009 to under 5% in 2016.
• Reducing the Deficit: Although the deficit skyrocketed in Obama's first year due to recession-related spending and stimulus measures, it was significantly reduced during his second term.
  • The annual deficit shrank from $1.4 trillion in 2009 to $585 billion by 2016.

3. Joe Biden (2021–present)

• Inherited Mess: Biden inherited an economy severely impacted by the COVID-19 pandemic and the associated mishandling under Trump. The pandemic caused mass unemployment, business closures, and a significant contraction in economic activity in 2020.
• American Rescue Plan: In early 2021, Biden passed the American Rescue Plan, a $1.9 trillion relief package that provided stimulus checks, expanded unemployment benefits, aid to small businesses, and vaccination funding. This helped stabilize the economy as it emerged from the pandemic.
  • Inflation Reduction Act (2022): Biden also signed this into law, focusing on reducing the deficit, lowering inflation, addressing climate change, and incentivizing domestic manufacturing.
• Economic Growth: Despite inflation challenges (driven by global supply chain issues, the war in Ukraine, and COVID-19 aftershocks), the U.S. economy has seen job growth and a lower unemployment rate under Biden. The Inflation Reduction Act and the Infrastructure Investment and Jobs Act are designed to promote long-term growth.
• Deficit Reduction: As of 2023, Biden’s policies have significantly reduced the deficit, with the administration reducing the annual deficit by $1.7 trillion over two years.

Key Points of Contrast

• Clinton is remembered for balancing the budget and leaving a surplus, largely due to both tax increases and economic growth.
• Obama is credited with saving the U.S. from the Great Recession, stabilizing the financial system, and creating a long period of economic recovery.
• Biden has focused on addressing the immediate impact of the pandemic, while trying to create long-term economic incentives through infrastructure and climate-related initiatives.

In contrast, Republican administrations often pursued tax cuts that contributed to increasing deficits, with economic downturns occurring due to recessions, financial crises, or pandemics.

Conclusion

Yes, Clinton and Obama played significant roles in fixing the economic messes they inherited, and Biden has implemented policies aimed at stabilizing the economy after Trump's handling of the pandemic. Each Democratic administration demonstrated fiscal prudence or focused on recovery measures, leaving the nation in better economic standing than they found it.

Inflation Facts.

From 1981 to 2024, inflation trends have varied significantly across different presidencies, influenced by both domestic policies and global events. 

In terms of keeping inflation down, the best-performing presidencies for inflation control were:

1. Bill Clinton (1993-2001): Clinton oversaw one of the longest economic expansions with low inflation, averaging around 2-3% during a period of strong growth.
2. Barack Obama (2009-2017): Inflation was kept low throughout his presidency, with cautious fiscal policies and Federal Reserve support maintaining price stability.
3. Ronald Reagan (1981-1989): Inflation dropped dramatically under Reagan, although much of the credit goes to Federal Reserve Chairman Paul Volcker’s aggressive anti-inflation measures.

Inflation has proven more difficult to manage in the recent period, particularly due to the pandemic and global disruptions during Biden's term, although efforts have been made to bring it under control.

The Details.

1. Ronald Reagan (1981–1989)

• Inflation Control: When Reagan took office, inflation was in double digits due to the stagflation of the 1970s. The Federal Reserve, under Paul Volcker, implemented strict monetary policies (raising interest rates) to combat inflation.
• Outcome: Inflation dropped from around 13.5% in 1980 to about 4% by the end of Reagan’s presidency.
• Key Factors: The drastic interest rate hikes slowed the economy, leading to the 1981-1982 recession, but inflation was brought under control.

Best for Inflation? Yes, inflation was sharply reduced during Reagan’s term, although the Federal Reserve was the primary actor.

2. George H. W. Bush (1989–1993)

• Inflation Control: Inflation remained relatively low during Bush’s presidency, averaging around 4-5% per year.
• Key Factors: The economy entered a mild recession in 1990-1991, partly due to the Gulf War and oil price shocks, but inflation remained stable.

Best for Inflation? Moderate success, as inflation stayed low, but economic growth was sluggish.

3. Bill Clinton (1993–2001)

• Inflation Control: Inflation during Clinton’s presidency was consistently low, averaging around 2-3%.
• Key Factors: The 1990s saw strong economic growth, low unemployment, and productivity gains, especially driven by the tech boom. Clinton’s fiscal policies (balancing the budget, reducing deficits) also helped maintain price stability.

Best for Inflation? Yes, Clinton’s presidency was a period of economic stability with low inflation, especially compared to prior decades.

4. George W. Bush (2001–2009)

• Inflation Control: Inflation was relatively moderate during Bush’s presidency, averaging around 2-3% during his first term. However, inflation began to rise toward the end of his second term, reaching over 5% in 2008 due to rising energy prices and the financial crisis.
• Key Factors: The Great Recession brought deflationary concerns in 2008-2009, and the Federal Reserve intervened with monetary stimulus.

Best for Inflation? Mixed, inflation was low for most of his presidency but spiked before the 2008 financial crisis.

5. Barack Obama (2009–2017)

• Inflation Control: Obama inherited the Great Recession, which brought deflationary risks rather than inflation. Inflation remained very low during his presidency, averaging around 1-2% annually.
• Key Factors: The slow recovery from the recession, along with accommodative monetary policies from the Federal Reserve, kept inflation in check.

Best for Inflation? Yes, inflation was consistently low during Obama’s presidency due to cautious fiscal and monetary policies.

6. Donald Trump (2017–2021)

• Inflation Control: Inflation was relatively low for most of Trump’s presidency, staying under 2% until the pandemic hit in 2020. In 2020, supply chain disruptions and economic fallout from COVID-19 began causing inflationary pressures.
• Key Factors: Trump's tax cuts and deregulation spurred growth, but his trade policies, particularly tariffs on China, contributed to rising costs for certain goods.

Best for Inflation? Mixed. Inflation was low pre-pandemic, but the response to the pandemic (massive stimulus and disrupted supply chains) laid the groundwork for later inflation spikes.

7. Joe Biden (2021–present)

• Inflation Control: Biden took office during a period of sharp inflationary pressure as the economy recovered from the pandemic. Inflation soared in 2021-2022, peaking at over 9% in mid-2022, the highest in 40 years.
• Key Factors: Global supply chain disruptions, the war in Ukraine (which affected energy prices), and pent-up demand after COVID-19 lockdowns drove inflation higher. Biden's Inflation Reduction Act (2022) and Federal Reserve interest rate hikes have since helped reduce inflation, which has come down significantly by late 2023, but it still remains a concern.

Best for Inflation? Struggled initially with high inflation due to external shocks, but recent efforts have helped bring inflation down to more manageable levels.

Research - Learn the Facts.

When it comes to the economy don't listen to the pundits or your favorite political candidate in a vacuum. Do your research and fact check. The media is supposed to be doing that, but since most of American media is owned by corporate oligarchs their reporting is always skewed when it comes to the economy. Why? Republican  tax cutting for the rich and corporations/businesses always favors them. But they do not favor the average American citizen. They never have. Trickle down economics doesn't work.

Supporting Social Programs is Not Socialism.

The narrative that social programs harm the economy is false! This argument is frequently used by some Republicans to justify cuts to programs like Social Security, Medicare, Medicaid, and others aimed at reducing poverty. However, there’s significant evidence suggesting that social programs can have positive impacts on both individuals and the economy. Here’s why the argument against social programs is misleading:

1. Social Programs Can Spur Economic Growth

Social programs like unemployment benefits, food assistance (SNAP), and healthcare subsidies put money in the hands of individuals who are likely to spend it. This boosts demand in the economy, particularly during downturns.

• Multiplier Effect: Low-income individuals typically spend most of what they receive on necessities like food, rent, and healthcare. This consumption drives demand for goods and services, which in turn helps businesses thrive and supports job creation.
  • For instance, every dollar spent on food assistance (SNAP) generates about $1.50 to $1.80 in economic activity, according to the USDA and Congressional Budget Office (CBO).
  • Programs like unemployment insurance allow people to maintain some level of consumption even during economic hardship, preventing a deeper recession.

2. Poverty Reduction Enhances Workforce Participation

Social programs, especially those focused on reducing poverty and improving access to education and healthcare, help people become more productive members of society.

• Education and Workforce: Investments in education, like Pell Grants and early childhood education programs, create a better-trained workforce that contributes to long-term economic growth.
  • For example, Head Start programs, which provide early childhood education, have been shown to improve children's cognitive and social development, which translates to better employment outcomes in adulthood.
• Healthcare and Productivity: Access to healthcare through programs like Medicaid and the Affordable Care Act (Obamacare) allows people to stay healthier, reducing absenteeism from work and increasing productivity. A healthier workforce is a more productive workforce.

3. Long-Term Fiscal Stability

Critics argue that social programs lead to deficits, but many programs are funded in a sustainable manner or could be made so with minor adjustments (e.g., lifting the cap on Social Security contributions). Meanwhile, cutting programs that serve millions of people can result in more long-term costs.

• Preventative Costs: Programs like Medicaid and food assistance can prevent larger expenses later, like emergency room visits or the long-term costs of untreated illnesses and malnutrition.
  • For example, investing in preventive care under Medicaid saves states money by reducing expensive emergency care and managing chronic diseases.
• Social Security and Medicare: These programs are funded through payroll taxes and are critical for seniors’ economic security. When people have a reliable income in retirement, they are less likely to rely on emergency social services, and they contribute to the economy through consumption.

4. Cutting Social Programs Can Hurt Economic Recovery

During economic downturns, cutting social programs can actually exacerbate the situation. When social safety nets are weakened, people fall into deeper poverty, which depresses demand in the economy and slows recovery.

• The Great Recession: During the 2008 financial crisis, social programs like unemployment insurance, Medicaid, and food stamps played a crucial role in cushioning the blow for millions of Americans. They helped prevent even deeper recessions by keeping money circulating in the economy.

5. Income Inequality Stifles Economic Growth

Cutting social programs often increases income inequality, which hurts the economy in the long term. Studies show that widening income inequality can slow economic growth, reduce social mobility, and decrease the opportunities for large segments of society.

• Countries with strong social safety nets tend to have more equal income distribution, which leads to stronger consumer demand and greater overall economic stability.

6. Social Programs Create a More Stable Society

There’s also a social and economic argument for stability. Programs that reduce poverty and support vulnerable populations help prevent social unrest and reduce crime rates.

• Crime Reduction: Research has shown that reducing poverty through welfare programs correlates with a decrease in crime, which in turn reduces costs for law enforcement and the justice system.

7. Republican Presidents Often Target Social Programs, But the Deficit Grows from Other Policies

While Republicans often cut social programs under the guise of reducing deficits, these same administrations typically implement large tax cuts (often benefiting the wealthy and corporations), which contribute significantly to the deficit. This is a clear case of fiscal policies working against the argument of cutting spending to reduce the national debt.

• Examples:
  • Reagan’s tax cuts in the 1980s contributed to the national debt nearly tripling during his presidency.
  • George W. Bush’s tax cuts in 2001 and 2003, combined with the Iraq War, ballooned the deficit.
  • Trump’s tax cuts in 2017 added nearly $2 trillion to the national debt, and while they provided temporary economic boosts, the cuts disproportionately benefited the wealthiest Americans.

Conclusion: Social Programs Are Essential for a Healthy Economy

Social programs do not harm the economy—in fact, they help build a more resilient, equitable, and prosperous society. While critics may argue that they are expensive, these programs often generate economic activity, provide stability, and create a healthier, more educated workforce. Cutting these programs, as often proposed by Republicans, can lead to greater inequality, economic instability, and higher long-term costs.

Election 2024.

Do your homework, this article has done some of it for you. Dig deeper if you question my facts. Don't just accept on face value what any candidate running for office or trying to maintain their office says, nor the headlines in newspapers who profit from republican policies. 

Also, when you vote, consider your neighbor. Consider the greater country as a whole. Policies that cut social welfare programs while increasing funding for policing don't help society. We must deal with the root cause for what increases crime and close those gaps. That doesn't happen by giving tax cuts to the wealthy while putting heavy burdens on the poor. As a nation, this country should be doing everything possible to ensure the next generation isn't living in poverty. And it is well within our remit to do so. So, don't vote republican because you always have and always will. Look overall at the candidate's policies and how those policies impact the nation overall. Then vote in a way that uplifts all of us, not just some of us.

Please Note.

Tanya Owens is politically independent. In the past Tanya was a registered Republican for over 20 years, however she has always voted for the best candidate regardless of party. In this election, Tanya will continue to vote in a way that is best for ALL American citizens and not just the few. Our laws should protect and uplift our citizens, not bind and repress them. Tanya is voting for FREEDOM. Are you?

P.S. "Special thanks to my AI assistant for helping organize the facts for this post."