2008 - Is Bush to Blame for the Economy? - A Future Post-Mortem for Trump
Trump is sounding a lot like Dubya in trying to portray the economy as suddenly going great even though it has largely continued the growth under the Obama era, which Trump heavily criticized.
However, what about Trump's policies? Have they had an impact? Well, yes they will, and that is what should be frightening, because they are reminiscent of Dubya's efforts to juice the economy through a combination of deregulation and tax cuts. They were effective in the short term of allowing the media to focus on the rich (indebted) (remember the Real Housewives of Orange County that began in 2006?) while ignoring the plight of American workers? But, the growth of Dubya's economy was imaginary as it was driven by a housing bubble fueled by cheap credit and deregulation.
Of course, under President Obama, Republicans suddenly discovered the working class that they had previously ignored under Dubya to attack President Obama even as he lead the country from the brink of a Great Depression.
In short, the Trump "boom" is bull and the bull is just starting. Expect stock or housing bubble driven by Trump's deficit busting stimulus and lack of regulation while the working class and middle class secretly suffer as their real wages stagnate and now they lose access to health care, education, and prices began to grow. Then, watch it all come crashing down with Trump blaming everyone for the crisis that he helped create.
http://prospect.org/article/bush-blame-economy
In fairness, Bush, like all presidents, does not deserve all the blame (or credit) for the economy's performance under his watch. By the time that President Bush took office in 2001, recession was already in the cards given the collapse of the stock market bubble. The economy would have faced rough sledding regardless of who was in office. Similarly, the country was facing a large and growing trade deficit in 2001 because of an overvalued dollar.
But President Bush did not take any steps to seriously counteract these real economic problems. His strategy was to give out tax breaks that heavily favored the richest people in the country. He also gave business, including the energy companies, the defense contractors, the drug companies, the insurance companies, and the financial industry, everything they wanted from the government, at the public's expense.
However, the massive handouts to the rich and the corporate lobbies didn't produce growth. For this, President Bush needed the housing bubble. The unprecedented run-up in house prices produced a record construction boom. More important, the $8 trillion housing bubble led to a consumption boom as people eagerly borrowed against their new housing wealth, sending the saving rate to zero.
While President Bush likes to pretend that the crash of the housing-market bubble is a surprise event, like a hurricane, for which we could not have possibly prepared, the reality is that it was an entirely predictable event, which was in fact predicted. President Bush's decision to ignore the growth of the housing bubble and the madness in the mortgage market was one of the most disastrous economic mistakes in the country's history.
