Every one knows that when it comes to the economy, Republicans suck big time. They plunge us in to a depression or near depression every time they get in power. The only Republican that didn’t destroy the economy was Eisenhower and we had very high taxes on the rich in the 1950s.
Thursday 11 August 2016
The US’s slow recovery from the 2008 recession is due to Republican policies on the local, state and federal level, according to a new study published by the left-leaning Economic Policy Institute (EPI).
The new report comes as the slow pace of recovery has emerged as a key battleground between Republican candidate Donald Trump and his Democratic rival Hillary Clinton, who will set out her economic policy on Thursday.
The EPI report blames the lackluster pace of recovery on Republican-led budget cuts in 2011 following the row over the US debt ceiling, the unwillingness of local officials to spend money when Republicans in Congress were advocating cuts in spending, and the refusal to expand Medicaid in 19 states.
The report comes as the Republican party once again calls for the reining in of government spending and reductions in the deficit.
“Given the degree of damage inflicted by the Great Recession and the restricted ability of monetary policy to aid recovery, historically expansionary fiscal policy was required to return the US economy to full health,” writes Josh Bivens, research and policy director at EPI.
“But this government spending not only failed to rise fast enough to spur a rapid recovery, it outright contracted, and this policy choice fully explains why the economy is only partially recovered from the Great Recession a full seven years after its official end.”
This economic recovery has been the slowest over the past four business cycles. For example, the employment recovery from the trough of the Great Recession to its pre-recession peak took 51 months. Following the recession in the 1980s, employment recovery took 11 months. In the early 1990s it took 23 months, and in the early 2000s it took 39 months.
The US government would have had to spend an additional $1tn in 2015 alone to match the spending that followed the 1980s recession, Bivens said. While such spending might run up the US deficit – something Republicans in Congress are opposed to – it would also have led to “several years of full employment” and the Federal Reserve increasing interest rates.