James Pethokoukis | Looking backward: The nostalgia economics of Barack Obama

When was Barack Obama proud of the American economy?

Certainly not the 2000s, as voters were once again reminded in the president’s Cleveland, Ohio speech yesterday. Obama said the economy of those years was “built on a house of cards” of overconsumption and debt.

But Obama doesn’t think things were going too well before the 2000s, either. Echoing his Osawatomie, Kansas, speech, the president said that during “the last few decades the income of the top 1% grew by more than 275% … [and] big financial institutions, corporations saw their profits soar. But prosperity never trickled down to the middle class.” So the Reagan-Clinton-Gingrich Boom, according to Obama, was a bust.

Really?  From 1981-2000, the U.S. economy grew by an average of 3.4% a year. And from 1979-2000, median household income grew by 30%. What’s more, countries that failed to embrace free-market policies – including lower marginal tax rates and deregulation — grew more slowly than America did during that period. For instance, while U.S. per capita GDP grew by 55% from 1981-2000, French per capita GDP grew by just 39%.

So when, in Obama’s view, was America’s economic Golden Age?

 

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