Recently, it has become difficult to look at the U.S. economy and see the source of the financial crisis of 2008. The increase in spending during the fourth quarter of the last fiscal year was at its highest since 2006. In addition — for the first time in 11 years — this January saw consumers’ anticipation of a better economy at an all-time high. Employment, the last obstacle of the U.S. economy, is approaching 0 percent unemployment rate — “the dream unemployment rate.” The American job market is showing the steadiest growth since 2000, and the working wage — which was frozen solid for the past few years — is inclining toward an upward trend. As the economy revives, the government deficit has dropped and is now below the average of the past 40 years. President Obama’s approval rating has made a sharp upward turn, giving him reprieves and a few spare days off for him to play golf back in his home state of Hawaii.
What role did the Obama administration play in the U.S. economy’s triumphant return — the very same economy that almost destroyed global financial systems just five years ago? The super-low interest rates, quantitative easing and unlimited release of money into the market come to mind first. However, considering that former Chair of the Federal Reserve Ben Bernanke, who was appointed by former President George W. Bush, was the one who led quantitative easing, it is difficult to see Obama’s achievement in this. In fact, looking back at American politics after the financial crisis, it is seldom the case of politicians fixing the problem, but more cases of endangering the entire country via the debt ceiling debate, federal budget issue and mandatory medical insurance debacles.
On the contrary, the American private sector was dynamic as ever. Apple, in the middle of the American financial crisis, released the iPhone, perhaps one of the greatest inventions of the 2000s, and led the revival of global IT industries. The technology to harness the crude oil hiding in shale rock ignited the shale gas revolution, reviving American rural cities from economic depression. Facebook, which started as an online friend-finder service, became the world’s most successful Internet-based business. Uber taxi and Airbnb, which are services that allow people to share cars and housing, created a new market called “the shared economy.” Uber taxi is currently embroiled in frictions with other conventional taxi companies all around the world, but its profits are also predicted to be more than $10 trillion.
Neither President Obama nor the U.S. government contributed directly to these creative renovations. It was the adventurous entrepreneurial spirits and the business environment — which welcomes creative technology and ideas — that made venture companies like Google and Facebook into the big global businesses we see today.
Compared to this, South Korea seems to have this obsession that the government must take up the burden of economic growth. President Park Geun-hye emphasized her willingness to commit to the economic revival in her New Year’s address — as shown in the repeated usage of the word “economy” 42 times. Yet, in a country where its economic dependency on foreign trade is nearly 90 percent, there aren’t many things that a government can do. Rather than the government finding solutions to everything, it would be wiser to provide an environment where businesses and ordinary people can situate themselves.
Your analysis is far from complete. You neglected to mention President Obama’s almost 1$ trillion stimulus program in 2009 which included direct spending in infrastructure, education, health, and energy, federal tax incentives, and expansion of unemployment benefits and other social welfare provisions. Perhaps you will recall that he saved General Motors and established stronger regulations for banks.