View Full Version : The Worst Steward of the Economy in American History

07-22-2011, 10:58 AM
While the debt ceiling dance continues in Washington D.C. and the Republicans in the Senate are going wobbly, they need to understand they are dealing not only with an intransigent party in the White House but also someone that is the most incompetent president in modern history, and the worst steward of the American economy since the nation's founding.

The Obama sycophants often resort to the White House pre-packaged line that Obama inherited the worst economy since the Great Depression, as a means of deflecting responsibility onto George Bush.
In 1980, when gold prices set the record, the United States was in the throes of a recession with annual inflation running at 13.5%, the unemployment rate was 7.5%; the annual GDP growth was a minus 0.27%, and the bank prime interest rate was over 18.5%. The flight to gold was overwhelming as no one had any confidence in the policies of Carter and the Democrats in Congress.

That was the landscape of the country when Ronald Reagan assumed office in January of 1981.

The job facing Reagan was the most daunting since the Great Depression -- and far worse than what Barack Obama inherited in 2009 -- as the combination of extreme inflation (the highest annual rate in the nation's modern history), unemployment (which peaked at 10.8% in 1982), and virtually no one able to pay the exorbitant bank interest rates were major obstacles that had to be overcome in order to revitalize the economy. The price of gold reflected that dilemma.

However markets react not only to the actual circumstances at hand but to confidence in leaders and what is perceived as future positive or negative factors. Because of Reagan's policy pronouncements and belief in the free markets combined with the passage of his economic growth agenda, by the end of his first 12 months in office the price of gold had declined to $377.50 per ounce (equivalent of $936.78 today). This remarkable drop of nearly 60% from the previous all-time peak just 24 months before came about despite the fact that America was still in the throes of excessive (but declining) inflation and extremely high unemployment.

By August 1983 (28 months into President Reagan's first term) the price of gold was at $401.75 or $910.48 per ounce in 2011 dollars (down 61% from 1980 peak). Inflation had been reduced to 3.2% (from 13.5%); the unemployment rate was at 9.2% (down from a high of 10.8% in November of 1982); annual GDP growth in 1983 was 4.52%, the highest in the previous four years. In the final year of Reagan's first term GDP grew by an astounding 7.19% and the unemployment rate had been reduced to 7.6%). Yet the average annual federal government budget deficit over those years was kept at 4.2% of GDP despite the overwhelming debacle facing the country in 1980-81.

The contrast between Ronald Reagan's first term and that of Barack Obama is stark and indicates a deliberate effort by the current president to destroy the American economy as he will have added over $5.5 trillion to the national debt in an effort to transform the United States into his vision of a socialist utopia. By comparison Reagan added $1.35 trillion (inflation adjusted to 2011) over his first term while saving the American economy.

http://www.americanthinker.com/2011/07/the_worst_steward_of_the_economy_in_american_histo ry.html