A Subpar Recovery Drags On

The Real Obama Economy: A Subpar Recovery Drags On

01/20/2015 06:41 PM ET

Obamanomics: It's fair to say humility isn't one of the president's virtues, and so it's no shock he took a bow for his self-declared status as savior of the American economy in his State of the Union address. He shouldn't have.
Mission accomplished: that was President Obama's message. Too bad so few Americans agree with him. If things are going so magnificently, maybe the White House can explain why its party took a historic whipping from angry and anxious voters in November.
Is the economy improving? Surely, it is. The dreadful 2% growth rut the U.S. experienced in Obama's first five years of "recovery" appears to have finally ratcheted up to closer to 3% — which should be the average for 2014. Employment has picked up to a clip of about 250,000 jobs a month — a good but unspectacular pace of hiring. The official unemployment rate has dipped to 5.6%. Inflation and interest rates are low.
Meanwhile, mortgage rates have fallen below 3.5% in some markets, and gas prices are low. Obama's slight rise in popularity is almost certainly a function of falling gas prices, and to quote him, "you didn't build that."
How much credit Obama deserves for this modest improvement over the last year or so is debatable at best.
The major — and even in some years the sole — driver of growth in employment and output since 2009 has been the shale oil and gas boom. Those most responsible for America's energy revival have been Floyd Farris, inventor of hydraulic fracturing, and Harold Hamm, the driller who put the technology into action in North Dakota, creating tens of thousands of jobs. Funny, but neither were showcased guests at the State of the Union.
Obama, who has made no secret of his abhorrence of the oil, gas and coal industries, has done almost everything imaginable to stop domestic oil production by regulation, by a virtual drilling moratorium on federal lands and by not building pipelines. He simply can't take credit for the fossil fuels revolution.
More important, there is still so much wrong in this economy that Obama chooses to ignore. And by glossing over the real-life hardships facing the middle class, he insults Americans who are feeling the financial squeeze of this subpar recovery. Let's count the ways the economy is underperforming:
• Wages — they're flat at best. In a typical recovery, wage growth after five years is about 9%. Under Obama, it's closer to 1%, Bloomberg reports.
• We're still nearly 6 million jobs short of where we would be at this point in an average recovery.
• Labor force participation has declined for every age group except for those 60 plus. This is the first time in the modern era that during a recovery younger Americans left the workforce. This is why the real unemployment rate is not 5.6%. When including the broader measure, which includes people who stopped looking for a job and people who can't find a full-time job, the unemployment rate is closer to 10%.
• The national debt is more than $7 trillion larger today than when Obama took office, and the Congressional Budget Office says that the deficit will head back up in a few years. Obama might go down in history as our most fiscally irresponsible president.
Obama's only economic idea is to redistribute wealth via ever-rising taxes from the productive class and the job creators to everyone else. He bashes success and believes government activism is the engine of growth.
The enduring lesson of Obama's slow-motion recovery is you can't redistribute wealth until someone steps up and creates it in the first place.