You’d never know it by listening to AM talk radio or watching cable news or even reading social media, but based on the leading economic indicators, President Obama’s record on the economy is actually much stronger than Ronald Reagan’s record. Shocking, I know, but it’s true. There’s one factor, however, that’s preventing Obama from fully achieving this status, and we’ll talk about that momentarily.
Recently, Forbes‘ Adam Hartung published a report in which he consulted with Rob Deitrick, CEO of Polaris Financial Partners, regarding the comparative records of Obama and Reagan. In terms of employment, economic expansion and financial investments, the state of the economy has improved more rapidly and more robustly under Obama than it did under Reagan. Yet Reagan, in today’s political mythology, enjoys a status he doesn’t entirely deserve while Obama is regarded poorly in comparison.
1) Where Are The Jobs?
Let’s set the stage. The latest jobs report showed that job creation held steady above 200,000 new jobs per month for most of the year until August when the Bureau of Labor Statistics showed only 142,000 jobs created. Decent, but the streak was still broken. However, unemployment continued to fall, dropping to 6.1 percent, down from around 10 percent at its peak.
Contrast this with Reagan’s record at this stage of his presidency. Rob Deitrick pointed out to Forbes that Reagan’s unemployment numbers peaked higher (around 11 percent) than Obama’s high-water mark, and Obama’s 6.1 percent unemployment figure in his sixth year has bested Reagan by a full year. In Reagan’s sixth year, unemployment was still in the low sevens. Deitrick added that Polaris expects unemployment to drop to 5.4 percent by next Summer — nearly half what it was in 2010.
Now, Republicans might cite the recent decline in the labor participation rate (briefly, the number of people looking for work). Deitrick explained that while Reagan’s jobs numbers benefited from an active baby-boomer generation, Obama’s poor participation numbers can be explained by the massive influx of retiring baby-boomers. Deitrick:
What’s now clear is that the Obama administration policies have outperformed the Reagan administration policies for job creation and unemployment reduction. Even though Reagan had the benefit of a growing Boomer class to ignite economic growth, while Obama has been forced to deal with a retiring workforce developing special needs. During the eight years preceding Obama there was a net reduction in jobs in America. We now are rapidly moving toward higher, sustainable jobs growth.
2) The Obama Economic Expansion
We can’t really gripe about America “not making anything anymore.” For the longest time, we’ve watched as manufacturing jobs were moved overseas to exploit cheaper labor… CONTINUE READING