The Obama Economy - From Quora

When conservatives talk about what Obama “did to this country,” what specifically are they talking about?

Valerie Rhea, lives in The United States of America

Answered Wed · Upvoted by Richard Redmond, lives in The United States of America

As an economist, I tend to look at Obama through a purely economic lens.

Most modern presidents since WWII achieved fairly similar economic performance…some years better than others, some years worse - but overall performance doesn’t vary as much as many might think, especially when you look at US presidents serving eight year terms…yes, there are all sorts of upticks and downturns, but every recession triggers a recovery, and growth tends to average out to a pretty stable result. Still, as we’ll see, if a president consistently underperforms the average, the compounding effect can be quite dramatic.

Since WWII, the US economy increased by an average of about 3% per year as measured by real GDP growth rate. To me, this is a convenient scorecard to judge a president’s economic performance: Clinton, Reagan and JFK all exceeded this number, while Obama, Bush and Truman were below.

Sadly for Obama, his GDP growth performance is arguably the worst of any US peacetime president since WWII. The data reveal an average growth of about 1.9% over his eight years, although I find this number a bit unfair - his initial year reflected the policies of his predecessor, and his final year reflected the hopes of a people awaiting the next administration. If you average the remaining six years of the Obama presidency, his average real GDP growth was about 1.5%, and that indeed is the lowest performance for any US president since the Great Depression.

Overall GDP growth rate doesn’t reveal the whole story. In a growing nation, GDP will expand a certain amount just because of population growth…add people to the country, and you tend to get more economic activity. Economists therefore sometimes further qualify performance by looking at GDP growth rate per capita - and by this measure, Obama’s performance is truly dismal. In fact, Obama’s first term, at -0.5%, stands as the worst four-year result for any year period since the Great Depression. This means that the Obama economy under his first term didn’t even grow at the rate suggested by population growth. Per-capita GDP growth over Obama’s full eight year term was under 0.5%, and this also stands out as the worst result for any president in the last seventy years.

Of course, Obama’s results aren’t hard to understand - he ran an anti-business administration where high taxes, regulatory overreach and new mandates like Obamacare had a crippling impact on economic growth. As a result, Obama got anemic job growth, and many American companies saw great incentive to move jobs offshore. As has been pointed out, the labor force participation rate dropped to post-depression lows under Obama, and federal handouts such as food stamps skyrocketed.

To give Obama the benefit of the doubt, it’s as though he ran his administration on the premise that his form of social justice was more important than prosperity, and this is exactly the result he achieved.

Now, to bring it back to the real impact on the average American…

Over an eight-year term, a president hitting the average 3% growth would see the American economy grow by about 27%. Yet, Obama’s average of 1.9% means that the US economy only grew by 16% over eight years - about 11% less than the average US president achieved. When you do some math on this, this means that the true “cost” to America of the Obama presidency was about $2 trillion. That’s about $25,000 for every American family.

So that’s how I look at “what Obama did to the country”. Yes, you can critique his policies and talk about the class warfare, erosion of the rule of law, the economic dislocation, his many scandals and so on. But in concrete, practical terms, his administration cost the average US family about $25,000 compared to what we might have expected from a merely average President, and that’s enough for me to be unhappy with his performance.

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