Did Obama Save America?

Did Obama Save America?

I have to admit that this hub was started to get some spirited (and civilized) debate going. Do Obama’s policies lead the US down a path of prosperity or decay? We’ll explore a short overview of Obama’s presidency and answer this question: Did Obama save the American Economy? More importantly, is Obama a hero to conservatives?

Try to put yourself back in the timeframe of the election. A few months before the election in November 2008, a broad U.S. stock index the S&P 500, was down 45%. American home prices were down 22%, retirement accounts were quickly shrinking and people’s assets were disappearing. The collapse of Lehman brothers and Bear Sterns ended two of the oldest and most prominent financial institutions on Wall Street. There was almost unanimous agreement from conservative and liberal economists that we could be heading towards a second great depression unless the government intervened.

The Bush administration quickly created the TARP fund which allowed the federal government to buy up shares of banks, auto makers, mortgage lenders, etc to inject cash flow into these companies and keep them from going bankrupt.

“Now we have the federal government taking over ownership or control of 51 percent of the American economy. This is stunning. Prior to September of 2008, 100 percent of the private economy was private." – Michele Bachmann (R-MN). Of course, not all of us drink the hallucinogenic TEA that Michele and her followers drink. Many of us know that this is not true, but, let’s make sure we understand that Republicans are claiming ‘Republicans’ took over the private sector.

In steps newly elected President Obama. As part of his first order of business, he changed existing laws to reduce secrecy on presidential records and allow more disclosure under the ‘Freedom of Information Act.’ Obama turned to the financial crisis and immediately set up an oversight committee to ensure TARP funds given out by the Bush Administration were accountable and would be repaid. Since then, the government has ended an ownership stake in many of these private sector economies. Further, the financial reform bill ended taxpayer bailouts and forced banks to be accountable so that the American taxpayer would not be endlessly bailing out banks when they repeat their mistakes.

“The stock market goes down every time Obama speaks.” How many times did we hear this from conservatives? If you are happy that your 401k has recovered, you can thank President Obama. Again acting right away, Obama enacted the $787 Billion Stimulus and a series of small business tax cuts. For those of you who do not know, there would have been a similar size spending bill whether even if McCain had won the election. Both parties agreed on the need for a spending bill, the disagreement was to whether it should be 2/3’s tax cuts and 1/3 spending or 1/3 tax cuts and 2/3 spending. Obama’s Bill was the latter. How did the stock market respond?

"No," we're not talking about Steve Jobs. His job is secure, Apple is doing ok. Let's talk about the job picture in the US. The US was losing 800,000 jobs per month when Obama took office. In other words, you take the total amount of new employees being hired minus the people being laid off; there was a net result of 800,000 jobs lost. Take a look at the job growth since (remember when looking at the Graph, Obama took office In January 2009, Stimulus was passed in late February):

Let’s talk about tax cuts. Obama has been a hero to all tax brackets. First, his stimulus gave a tax break to those making less than 250k. He then extended the Bush tax policies giving tax breaks to the wealthy and keeping capital gains rates low. Conservatives have called for this type of ‘trickle down’ policy. Lastly, he enacted a social security payroll tax cut. Through this payroll cut alone, in 2011, those making $50,000 would receive a tax break of about $1000, and those making $100,000 would receive $2000. Obama has taken the opposite approach of conservative presidents like Ronald Reagan. Reagan raised taxes 11 times while in office, including 7 out of his 8 years. Conservatives talk fondly about Reagan cutting taxes and indeed he did. He made massive tax cuts for the wealthiest Americans but raised taxes on the middle class.

With so many accomplishments under Obama’s belt, it is almost forgotten that he put together a series of rules and regulations to keep insurance companies from hurting people. While his Health Care Reform bill was hotly debated, it was a huge win for conservatives and the private sector. There was no competing government option like the plans that exist in most of the rest of the civilized world. The Republican plan (if McCain had been elected) would have been to end insurance from your employer and give money to every American to help pay for a portion of the insurance cost. This would have left people to the whims of the insurance companies and wide open to abusive policies.

Obama has made the largest investment in alternate energy in the history of our country. This comes at a time where we see oil prices continue to climb. Years from now, Obama will be known as the president who ended our dependence on foreign oil. In the meantime, he as increased domestic oil production to the highest level in almost 8 years.

Ok, that should start some good debate. Do you want my real opinion on Obama? I think he has done some decent things but continues to spend way too much money. Cut spending down to a realistic level…which can only happen if we address defense and healthcare spending. If Obama can get our spending under control and start cutting into the deficit, he’ll be the hero conservatives have long awaited for.