Snap Fact #280 - The Passage and Success of the Obama Recovery Act was a stunning accomplishment! Part 5 of 5

Post date: Aug 19, 2012 3:43:11 PM

Snap Fact #280

The Passage and Success of the Obama Recovery Act was a stunning accomplishment! Part 5 of 5

By most economic indicators, the Economic Stimulus Package was a success. In March 2009, before it was launched, Q1 GDP was -4.9% and the Dow had slid to 6,500. By Q4 2009, GDP was +5% and the Dow had risen to 10,428. Given the complexity of the national and international economies, it would be naïve to think the Obama Recover Act alone was the singular force that halted the downward slide and saved us from the looming depression.

Not all of that success should be attributed to the Stimulus Package, since expansive monetary policy and strong emerging markets also helped boost the economy at the time. At the very least it can be said that the economic stimulus package acted as the catalyst that inspired the confidence needed turn the economy around – and that was it’s very purpose as a short term kick in the butt for the economy. Had the Do-nothing Congress responded in kind the country would be in a robust recovery by now. Once President Obama is given a Democratic 113th Congress we can comfortably predict that the country will come roaring back to life.

The Obama Recovery Act has been caught up in another misinformation myth. The President has often been criticized for punting the stimulus to Capitol Hill. The truth is that while Congress wrote the bill, as it properly should have done, the president dictated its principles and most of its specific content. Its major initiatives on tax cuts, energy, education, health care and the economy came straight out of his campaign agenda. One only has to Google the Presidents campaign speeches to hear how what he campaigned for was what was in the Bill. In actual fact, the final Bill emerged from a list of spending items drafted by the White House. Obama didn’t get everything he wanted. For one example, Republican Senator Susan Collins from Maine killed his plan for a school construction binge. But the president needed her vote. The several necessary compromises that got the Recovery Act passed served notice that after campaigning as a change-the-system outsider, Obama could govern as a work-the-system insider. He was pragmatic enough to recognize that if a bill can’t pass Congress it can’t make any change.