State of the Economyby Representative Carolyn B. Maloney
Posted on 2016-01-12
MALONEY. Mr. Speaker, last Friday, the Bureau of
Labor Statistics released the monthly jobs report for December. It was
another in a long, uninterrupted string of good reports. The report
showed that the economy gained 292,000 private sector jobs last month
and that the unemployment rate fell to 5 percent.
During 2015, the economy added nearly 2.7 million jobs. Nevertheless, many of my colleagues across the aisle continue to talk as if the recovery under President Obama has been lackluster. They seem to forget the economic meltdown that occurred under the leadership of the prior administration. But the millions of Americans who lost their homes, their jobs, they haven't forgotten.
Let's look at how far we have come in the period after President Bush left office. The truth is, the record is pretty impressive. First, a reminder of where we started. Back in January of 2009, when President Bush left office and President Obama was sworn in, the economy shed nearly 820,000 private sector jobs in January in 1 month alone. As former Fed Chairman Ben Bernanke described it, we were facing the worst financial crisis in global history, including the Great Depression.
Between the end of 2007 and the second quarter of 2009, real GDP fell by 4.2 percent. Around $17 trillion in household wealth evaporated during the Great Recession. To put that number in some perspective, $17 trillion is about equal to our entire gross domestic product, the sum total of all the goods and services produced by the entire economy of the United States for all of 2014. That is a great deal of money to lose. In fact, it would be almost enough to pay off our entire national debt.
In July of 2009, there were about seven unemployed workers for every single job opening in the country, meaning that no matter how hard most unemployed people tried to get a job, six out of every seven of them were going to be just out of luck. You may recall that back then our colleagues across the aisle were adamantly opposed to extending jobless benefits.
By October of 2009, the unemployment rate had reached 10 percent. Housing prices were falling. Lending was frozen. The stock market had cratered. Businesses were failing. People all over the country were losing their jobs, their homes, their savings, and their hopes. It was a pretty terrible time for millions of Americans.
[[Page H289]] Now, much has changed. 2014 and 2015 were the strongest 2 years of job creation since 1998 to 2000, when Bill Clinton was President. The private sector is powering the economy forward. Our businesses have added 14 million jobs over a record 70 consecutive months of job growth. Wages have finally begun to rise. Nominal average hourly earnings for all private employees have now risen 2.5 percent over the past year. The ratio of unemployment seekers to job openings has fallen from 7 to 1 to 1.5 to 1. That is about the lowest this ratio has been since early 2007.
Since the start of the Obama administration, our real GDP has increased by 14 percent. The U.S. auto industry, which was on death's door when President Obama took office, is now healthy, thriving, and enjoyed record sales in 2015. Our auto industry is now exporting and creating even more jobs. Oil and gas prices are low. Mortgage rates remain low. Inflation is simply not a factor. The dollar is strong, and housing prices are back up to where they were in 2007.
All of this recovery was not an accident, not a stroke of good luck. Things certainly would have been quite different if we had only listened to the counsel of our colleagues across the aisle. They vehemently opposed efforts taken by the Obama administration to stimulate the economy, and they opposed actions by the Federal Reserve that turned out to be very critically important.
What would have happened without these actions by the Federal Reserve and the Democrats in Congress? The recession would have lasted twice as long, according to a recent study by highly respected economists Alan Blinder and Mark Zandi. The Blinder-Zandi study found that without these actions, the unemployment rate would have reached nearly 16 percent, and we would have lost twice as many jobs, more than 17 million. It is a bit scary to even think about.
So the facts show that we have had a very strong recovery. Are we done? Absolutely not. There is much more work to do to ensure the recovery reaches everyone. Big challenges remain. Many families are struggling to make ends meet, to make the mortgage payment, to save for their children's education. We need faster wage growth, accessible child care, and higher education that is affordable to all families. It is time to pass comprehensive immigration reform and to protect Americans from gun violence.
I am excited about the opportunity to make real progress on these issues this year, and I look forward to working in a bipartisan way to continue to focus on the challenges facing middle class families.