That the President would be criticized for not having yet restored Clintonian prosperity and budget surplus after the irresponsible, contrived, trillion-dollar nation-building caprice amidst a frenzy of revenue-depleting tax-slashing for the wealthy that ensued is hardly surprising.
Of course, even the most rabid Obama-hater cannot blame him for the international financial crises, although they may well have a laughable go at it, of course.
The evidence on the 2001-2007 expansion provides no support for the claim that the tax cuts generated especially robust economic growth. Rather, examination of a broad range of key economic indicators indicates that the economic expansion that began in 2001 was, on balance, weaker than average. In fact, with respect to GDP, consumption, investment, wage and salary, and employment growth, the 2001-2007 expansion was either the weakest or among the weakest since World War II.
Moreover, the economy’s performance between 2001 and 2007 was weaker, overall, than its performance in the equivalent years of the 1990s, years following significant tax increases. GDP growth was somewhat weaker than in the 1990s, and job creation, investment, and wage and salary growth all were substantially weaker.
- For six of the seven indicators, the average annual growth rate between 2001 and 2007 was below the average growth rate for the comparable periods of other post-World War II economic expansions. Notably, this expansion was among the weakest since World War II with respect to both overall economic growth and growth in fixed non-residential investment. These two indicators should have captured any positive “growth effects” of the tax cuts.
- The labor market also was weaker during the 2001-2007 expansion. Both employment growth and wage and salary growth were weaker during this expansion as a whole than in any prior expansion since the end of World War II.
- The 2001-2007 expansion outperformed the average post-World War II expansion in only one area: corporate profits, which grew much more rapidly than average.