Repost: The Bush Years Were a Lost Decade

Posted by AzBlueMeanie:

(Reposted from January 4, 2010)

I have written about this several times before, but the Washington Post is just catching up: there was zero net job growth over the past decade. Massive tax cuts for corporations and the wealthy failed to grow the economy and to create jobs, disproving and discrediting the almost religious faith of "supply-side" true believers. Aughts were a lost decade for U.S. economy, workers:

For most of the past 70 years, the U.S. economy has grown at a steady clip, generating perpetually higher incomes and wealth for American households. But since 2000, the story is starkly different.

The past decade was the worst for the U.S. economy in modern times, a sharp reversal from a long period of prosperity that is leading economists and policymakers to fundamentally rethink the underpinnings of the nation's growth.

It was, according to a wide range of data, a lost decade for American workers. The decade began in a moment of triumphalism — there was a current of thought among economists in 1999 that recessions were a thing of the past. By the end, there were two, bookends to a debt-driven expansion that was neither robust nor sustainable.

There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well.

Middle-income households made less in 2008, when adjusted for inflation, than they did in 1999— and the number is sure to have declined further during a difficult 2009. The Aughts were the first decade of falling median incomes since figures were first compiled in the 1960s.

And the net worth of American households — the value of their houses, retirement funds and other assets minus debts — has also declined when adjusted for inflation, compared with sharp gains in every previous decade since data were initially collected in the 1950s.

"This was the first business cycle where a working-age household ended up worse at the end of it than the beginning, and this in spite of substantial growth in productivity, which should have been able to improve everyone's well-being,"said Lawrence Mishel, president of the Economic Policy Institute, a liberal think tank.

The first decade of the new century was an experiment in what happens when an economy comes to rely heavily on borrowed money.

"A big part of what happened this decade was that people engaged in excessively risky behavior without realizing the risks associated," said Karen Dynan, co-director of economic studies at the Brookings Institution. "It's true not just among consumers but among regulators, financial institutions, lenders, everyone."

The experiment has ended badly. While the stock market bubble that popped in 2000 caused only a mild recession, the housing and credit bubble has had a much greater punch — driving the unemployment rate to a high, so far, of 10.2 percent, compared with a peak of 6.3 percent following the last such downturn.

So the next time you hear a Republican or Conservative say that they want to "take back our country" and to return to conservative "free market" and "supply-side" economic policies which created the worst economic catastrophe since the Great Depression, realize that they are ideologues or insane. These are not the kind of people whom anyone should take seriously or ever entrust with our government and the economy ever again.

Republicans and Conservatives should be exiled to wander in the political wilderness for generations to come for the damage they have done.