It is hard to believe, but Americans have been suffering the weakest recovery ever. Annual GDP growth is actually slower than the recovery in the Great Depression from 1934 to 1940. President Obama's likely win shows we should expect just more of the same. Obama's desire to increase taxes and regulations will drive investment out of the US to other countries.
Tuesday's economic numbers show just how bad things are. Just 4.2 million people were hired in September. By comparison, only 4.2 million were also hired in both December 2008 and January 2009 at the depth of the recession. Total jobs have increased slightly only because people are afraid to quit their jobs. Indeed, amazingly, quits are lower today than they were during December 2008 and January 2009.
During President Obama's second term, the economy should continue to limp along. A 2 percent growth rate, assuming that we can get back up to that, would leave us well below the average 3.1 percent growth rate that the US had between 1965 and 2007.
If you believe that government spending is the way to create growth, you will be happy with what will happen over the next four years.
Just at President Obama told then Russian President Medvedev to wait until after the election when he would be freer to do what he wants to do. The same is likely to be true on the economy. A massive wave of regulations has been kept on hold until after the election so as not to cause Obama any political problems before the election.
If you believe that government spending is the way to create growth, you will be happy with what will happen over the next four years. But Obama doesn't believe in incentives, and penalizing Americans for working hard and taking risks means that the US rank will slip further behind the rest of the world.