Stimulus Package Case Study
Position Statement
President Bush and President Obama’s Stimulus Packages: Were They A Success
In 2008 President Bush put into action a bi-partisan stimulus package called the Economic Stimulus Act of 2008. Its focus was on cutting taxes in order to increase American’s disposable income, and inspiring them to spend more money in the open market. Bush’s primary vehicle to stimulate the economy was tax cuts, often referred to as the “Bush Era Tax Cuts”, to both households and businesses. President Obama signed a stimulus package in 2009 called the, American Recovery and Reinvestment Act of 2009. Obama’s approach had more aspects than President Bush’s, and included tax cuts, increase …show more content…
Both have helped to impact the economy positively. Since the stimulus packages were put into effect unemployment has reversed. Per the U.S. Bureau of Labor Statistics the current unemployment rate is 8.3%. It had peaked at 10% before beginning to decline. While this is higher than it was both prior to the Obama and Bush stimulus packages they have slowly gotten the unemployment rate moving in the right direction. Also, since 2008 GDP per capita has begun to recover. These are two key indicators of the living standards of Americans. One issue facing the effectiveness of these packages is trying to prove these results were caused by either stimulus package. One could argue, as a result of increased government spending in Obama’s stimulus package, coupled with decreased tax revenue from both Obama and Bush’s stimulus packages, the U.S. National Income continues to fall. In other words our National Debt continues to rise. However, the increased spending has been a relatively small percentage of the U.S. budget deficit, accounting for around 2% of expenditures (Porter, 2012). While the National Debt has increased, according to Porter (2012) it is in large part due to emergency spending as a result of the lagging economy. For example, increased spending on unemployment
President Bush and President Obama’s Stimulus Packages: Were They A Success
In 2008 President Bush put into action a bi-partisan stimulus package called the Economic Stimulus Act of 2008. Its focus was on cutting taxes in order to increase American’s disposable income, and inspiring them to spend more money in the open market. Bush’s primary vehicle to stimulate the economy was tax cuts, often referred to as the “Bush Era Tax Cuts”, to both households and businesses. President Obama signed a stimulus package in 2009 called the, American Recovery and Reinvestment Act of 2009. Obama’s approach had more aspects than President Bush’s, and included tax cuts, increase …show more content…
Both have helped to impact the economy positively. Since the stimulus packages were put into effect unemployment has reversed. Per the U.S. Bureau of Labor Statistics the current unemployment rate is 8.3%. It had peaked at 10% before beginning to decline. While this is higher than it was both prior to the Obama and Bush stimulus packages they have slowly gotten the unemployment rate moving in the right direction. Also, since 2008 GDP per capita has begun to recover. These are two key indicators of the living standards of Americans. One issue facing the effectiveness of these packages is trying to prove these results were caused by either stimulus package. One could argue, as a result of increased government spending in Obama’s stimulus package, coupled with decreased tax revenue from both Obama and Bush’s stimulus packages, the U.S. National Income continues to fall. In other words our National Debt continues to rise. However, the increased spending has been a relatively small percentage of the U.S. budget deficit, accounting for around 2% of expenditures (Porter, 2012). While the National Debt has increased, according to Porter (2012) it is in large part due to emergency spending as a result of the lagging economy. For example, increased spending on unemployment