The Economic Wasteland of George W. Bush

Joshua Holland published a brief piece the other day on Alternet which summarized several of the main points of a report by the International Monetary Fund (IMF) and the World Bank.

The global slump is probably going to be worse than predicted, with a one-in-four chance of a global recession, which happens when world economic growth drops below 3.0 percent.

This year's prediction is that global growth will slow to 3.7 percent "amid the still-deepening financial crisis set off by rampant speculation on securities backed by shaky mortgages in insufficiently regulated U.S. financial markets." [My emphasis]

"The financial market crisis that erupted in August 2007 has developed into the largest financial shock since the Great Depression."

While Latin America and other "countries linked to the plummeting U.S. dollar will be hardest hit as the U.S.-led slump spreads around the globe," countries with growing economies, "such as China and India, will suffer the least pain."

Holland concludes by noting that "Economist Dean Baker has said that he could see average American incomes fall by as much as 40 percent before we hit bottom."


But Mr. Holland only presented a part of the picture. Much of the economic stagnation predicted for this year and next is due to the drop in housing prices, which have fallen 10 percent, but are expected to continue to fall further to between 14 and 20 percent.

And no matter that the U.S. government will provide "many billions of dollars in government spending to aid the financial sector, shore up consumer and business spending, and save homeowners from dispossession," the U.S. economy is going to grow by a mere 0.5 perecent in 2008.

Japan's economy will slow down and "The 15-member eurozone will see its growth slow to 1.4 percent." But, China will continue its robust growth: 9.3 percent this year and 9.5 percent next year. Similar growth is expected in India.


It gets even worse. The IMF said "that worldwide losses from the financial turmoil could top 945 billion dollars within two years. Others also have predicted costs around the 1.0-trillion-dollar mark."

What this means for millions of human beings is less food, and more costly food; " ...soaring commodity prices ...have removed staple foodstuffs from the reach of countless people in developing countries, where many citizens spend half their income or more on food alone."

Sub-Saharan Africa is in trouble as is South Asia, "home to most of the world's poor people and the planet's highest levels of child malnutrition.

"Worldwide ... 1.0 billion people lack access to clean water, 1.6 billion people have no access to modern energy sources, and 2.6 billion live without basic sanitation."


"The 'Bush Boom" is an Epic Bust," says Hale Stewart in an article by that title at the Huffington Post. What that means is that the United States is in deep trouble because of the Bush administration's financial policies and programs!

Mr. Stewart does a detailed analysis using data from The National Bureau of Economic Research, the Bureau of Labor Statistics, the Census Bureau, the St. Louis Federal Reserve of U.S., the Federal Reserve's Flow of Funds report and the Bureau of Economic Analysis.

Here's how Mr. Stewart sums up the situation after seven years with George W. Bush at the helm of our government:

1. The weakest job growth since WWII led to a declining median family income.

2. In order to keep spending the U.S. consumer continued to save less and borrow more.

3. At the national level, the U.S. government has issued over $500 billion dollars of net new debt per year since 2002. This has led to an increased reliance on foreign investors to finance our way of life.

4. The trade deficit has continued to expand, although oil is responsible for a fair amount of that increase.

5. In short, the U.S. continues to consume more than it produces.

Then he says, "At some point, we will have to pay the bill. This is the end result of the 'Bush boom,' or 'the greatest story never told.'"


Two specifics worth noting: When Bush took office, the government's total debt was $5,674,178,209,886.86.

The current debt is $9,437,425,175,221.31.

Because of the housing crisis, due largely to the Federal Government's lack of oversight of the financial markets, Mr. Bush plans to borrow close to $200 billion (from foreign investors) to give each taypaying family a few hundred dollars to spend (and thus consume) on foreign products.

The net result of which will put the U.S. deeper in debt, enrich those foreign countries from which we buy most of our products, and thus deepen our reliance on countries like China and Japan and Saudi Arabia for financial stability.


And finally, the "Bush boom" not only broke the bank in our own country but it's devastating impact is fueling the financial crisis around the globe.

Is George worried? Nah, he's feeling fine!

To reiterate: George W. Bush. The. Worst. President. Ever.