President Barack Obama and recently coronated Democratic presidential nominee Hillary Clinton touted the Obama economic recovery at the Democratic National Convention last week, despite the fact that the statistics show that the Obama recovery has been horrid. Here are seven facts proving this.
1. The Obama recovery has had a record number of quarters where economic growth has been two percent or lower.
This economic recovery is setting all the wrong records. Obama is the King of slow growth. Clinton will be the Queen pic.twitter.com/BNQ0RWuI70— Scott Ruesterholz (@Read_N_Learn) August 1, 2016
The above graph is compounded by the fact that the Department of Commerce reported on Friday that economic growth was a meager 1.2 percent in the second quarter.
Overall, the real GDP growth rate for the Obama economy has been right at two percent–the worst economic recovery since World War II, according to the Congressional Research Service. There has not been a single year under Obama in which the annual growth rate has been at three percent, which is unprecedented for an American president.
2. The average real GDP growth of recoveries rate prior to the Obama recovery was 4.3 percent. If the Obama recovery had been right in line with that 4.3 percent, the country would be $2.2 trillion richer today, according to Investor's Business Daily. The editors at IBD explain further: (emphasis bolded)
That translates into more than $17,000 per household. (It's worth noting that many of those previous recoveries had suffered a subsequent recession 28 quarters after they started, so Obama is doing worse despite the current recovery's longevity.)
In other words, if Obama's recovery had merely been average, millions of people who are unemployed today would be working and paying taxes instead of worrying and collecting benefits. There would be millions fewer stuck in poverty today, and millions fewer dependent on food stamps and other government programs to get by.
3. The most recent labor participation rate was 62.7 percent, with slightly more than 94.5 million Americans out of the work force. Back in September, the participation rate was 62.3 percent–the lowest in nearly 40 years.
Obama's defenders argue that this is due to a record number of people retiring. This ignores the following key fact:
4. The number of jobs created under the Obama economy has not kept up with the working age population. Obama and Clinton have claimed that there have been nearly 15 million jobs in the private sector created under Obama, and if that number is taken at face value, it doesn't quite come close to the growth of the working age population of 15.8 million at around the same time frame. But the job gap is likely worse than that.
According to Investor's Business Daily's John Merline, Obama and Clinton's 15 million jobs number is based on the number of jobs created since February 2010, when the economy was at "rock bottom." However, Merline writes that the metric for job growth is normally determined from the previous "jobs peak," which was in January 2008. From that point, there has been an estimated 5.6 million increase in private-sector jobs while the working age population increased by over 20 million–creating a job gap of more than 14 million.
5. There has been a decline in business startups and investment. According to Time, there has been a decline of "entrepreneurial activity" from 14 percent in 2014 to 12 percent in 2015, when the four preceding years featured positive growth. In May 2015, The Wall Street Journal's Thomas J. Duesterberg and Donald A. Norman described capital investment as "historically weak," citing the burdensome corporate tax rates and regulations as the reason for the weak amount of investment. This is an important metric since investment is one of the key forces behind economic growth.
6. There has also been a decline of real household family income. According to Conservative Review, the decline went from $57,000 in 2007 to $53,700 in 2014. Naturally, it follows that the home ownership rate has declined to a near 48-year low.
7. There has also been a spike of Americans on food stamps. Conservative Review also used data from the Congressional Budget Office to show that the number of Americans food stamps has increased from 26.5 million in 2007 to 44.5 million in 2016. That is a decline from 47.7 million in 2013, but still much higher than pre-recession levels.
GOP presidential nominee Donald Trump has a bad habit of spitting out stupid tweets, but he did tweet this out, which sums up just how bad the Obama recovery has been: