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  • The Numbers Don't Lie: Reagan Recovery Far Stronger Than Obama

    The Great Recession lasted 18 months—slightly longer than the recession of 1981—and it might not be fair to compare the two. Unemployment was higher, for example, during the 1981 recession. But Reagan’s approaching centennial brings to mind the Reagan Recovery, and the economic climate of 1983 must be enviable from where President Obama sits in 2011.

    Tomorrow the Department of Labor releases its monthly jobs report, and early reports do not suggest improvement. The numbers will certainly not be anywhere close to those 14 months into the Reagan Recovery.

    A cool interactive chart from the Federal Reserve Bank of Minneapolis allows direct comparisons of every recession since 1948, and forces questions about each recession. Why does the recovery of 1982-1983 zoom off the top of the chart just when the current recovery is settling into a trough?

    President Reagan cut marginal tax rates. President Obama has hit Americans with a mess of concealed taxes.

    President Reagan brooked no nonsense from a striking air traffic controllers. President Obama has strengthened the positions of federal and state employee unions and staged a spectacular auto bailout which preserved the very union contracts that had crippled the industry.

    President Reagan reduced the regulatory burden, freeing businesses to recover. President Obama has done the opposite, taking the opportunity afforded by the recession to increase the burdens of U.S. business.

    President Reagan lightened the federal government’s grip on state governments by reducing its place in their budgets. President Obama has worked tirelessly to control state expeditures from Washington.

    One president freed the American people to drive their economy forward and make up for lost ground.  The other has shackled them with more government and more debt.  The generation that benefited from Reagan’s leadership is not leaving its children the same bequest.

    Kenneth Spence is currently a member of the Young Leaders Program at the Heritage Foundation. For more information on interning at Heritage, please visit: http://www.heritage.org/about/departments/ylp.cfm

    Posted in Ongoing Priorities [slideshow_deploy]

    6 Responses to The Numbers Don't Lie: Reagan Recovery Far Stronger Than Obama

    1. Pingback: » Financial News Update – 02/03/11 NoisyRoom.net: The Progressive Hunter

    2. DrFengzi says:

      Numbers do not lie, but Heritage does.

      Why does Heritage start talking about Reagan from 1982-1983?

      Reagan inherited a 7.2% unemployment from Carter when he took office in January 1981. Two years later it was 10.8% (December 1982), an increase of 3.6%. That was the highest unemployment since the Great Depression. Compare to Obama, who inherited 7.5% unemployment in January 2009, and now (two years later) it is 9.4%. That is an increase in 1.9%. Percentage-wise, Reagan lost almost twice as many jobs when once compares the first two years in office.

    3. Pingback: If this is a recovery, I want the recession back! | Thinklets

    4. Clifton Egle says:

      The liberal have carefully chosen tidbits of the Reagan era and painted a false picture. One of the latests mantras is that Reagan raised taxes. This distortion is based on the raising of social security tax and fuel excise taxes. Yeah, Reagan raised the excise tax on fuel, but consider that before he was elected oil was $60 a barrel. Through negotiations with the Saudies and the elimination of the oil windfall profit tax and deregulation, the cost per barrel dropped below $20 and stayed below $30 until GW’s administration. The excise tax was insignificant when compared to the amount Americans saved on fuel costs. I’d rather pay $1 a gallon for gas with a high excise tax than $2 without an excise tax. The excise tax was used to offset unexpected drops in tax revenue due to porous tax loopholes and abusive tax shelters in the income tax law. Blame Reagan for the bad law, but credit him for the 1986 tax reform which increased tax revenue, but not income taxes per se. The act closed many abuses for which tax “give aways” were not intended, broaden the tax base and reduced perceived tax favoritism. Under Reagan the top marginal rates for individuals dropped from 75% to 28%. As for his increase in the social security tax, blame the administrations before him who gave him an insolvent unfunded program that is politically impossible to dismantle. He had to do something to save it. The Liberal mantra that Reagan raised taxes is myopic and ignorant.

    5. Bobbie says:

      Reagan promoted economic freedom and economic growth and the freedom of the people to build. Obama promotes government oppression. Both clearly evident.

      Under Reagan the free market grew with the people responsible to their own. Under Obama only government continues to grow, diminishing freedom.

    6. steve h says:

      Pathetic misinformation by Heritage. The mess Obama inherited was ten fold worse than the everyday garden variety recession Reagan went through…and it's not even close.

      You speak of taxes that Reagan cut, the debt was nothing compared to what Obama had to deal with. If Obama were to have an across-the-board tax cut of 23% right now (like Reagan did), the mid-term and long-term would look disastorous (more so than it looks now).

      Hosing prices never dropped under Reagan, during the great recession they dropped massively. Consumer credit never dropped under Reagan, they dropped massively during the great recession.
      There was a financial crisis where several banks went under. That never happened under Reagan.

      GDP drop before Obama took over was the worst since the great depression. Reagan had nothing close to compare with.

      The only thing Reagan had to deal with was high inflation. The Fed raised interest rates, and once inflation was under control, they dropped rates and the economy boomed.

      And the funniest thing is Reagan spent his way out of it – government spending grew the entire time under Reagan, which is not the case under Obama.

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