President Obama is the 44th President of the United States. He was elected from the Democratic Party in 2008 at the age of 47.

Setting:  President Obama took office this past January amidst an economic crisis not seen since the 1930’s.  The crisis stemmed from corruption in the financial and banking sectors, where fraudulent and predatory loans were pushed on people who could not afford them.  Over-investment from the 1990’s economic boom, combined with the sudden mortgage crisis caused a recession, as investors retreated from the stock market while their profits were still safe.  The lack of oversight by the SEC (Securities and Exchange Commission) allowed for these predatory practices to take place, and provided the opportunity for investment tycoons such as Bernie Madoff to steal billions from investors.  Coupled with this economic disaster is the involvement of the U.S. in oversees wars in Iraq and Afghanistan, which cost our country about one billion dollars per day.
Campaign Plan:  President Obama campaigned on four primary categories, ending the war in Iraq, promoting energy independence, restructuring our health care system to a government provided service, and cutting taxes for 95% of “working families” while raising taxes on 5% of higher income individuals.  Obama argued that ending the war in Iraq and removing privatized health care would help stimulate the economy by reducing the cost per worker to an employer, thus allowing for businesses to afford more employees, while simultaneously removing the fiscal burden of a war, which would help to pay for the nationalized health care.  On the tax front, Obama claimed that raising taxes on the top 5% of Americans, of which make up over 80% of the total tax revenue, would help to pay for the infrastructure and social works plans that Obama deemed “absolutely necessary.” 

Course of Action:  President Obama has promised the end of primary military action in Iraq by no later than August 31st, 2010.  This action would essentially end the war in Iraq. However, President Obama has stated that around 50,000 soldiers would remain in Iraq in order to help maintain stability and ensure that tyranny does not return.  Most notably, the President has promoted and signed the Economic Recovery and Reinvestment Act of 2009, commonly known as the “stimulus bill.” Totaling $787 billion, this package was designed to stabilize the economy, prevent higher unemployment, create jobs, and invest in the ailing infrastructure of the United States.  Very recently, President Obama presented his budget for the 2009 fiscal year, which is estimated to cost the country nearly $3.94 trillion.  Most of the allocation of funds within the budget are going towards instituting national health care, in the above-mentioned attempt to reduce the cost per worker to employers, thus promoting job growth.

Results:  It is much too early to realize the full effects of the massive increase in federal spending by the Obama administration, and not enough time has passed to see the ultimate outcome of both the stimulus package and the President’s economic plan.  What we find from history is that anytime our government attempts to expand its power and remove incentives from the private sector, overall economic growth decreases, GDP (total amount our country produces in a given year) decreases, and unemployment and inflation increase.  We also can conclude from the President’s economic plan that it is financially impossible for the top 5% of Americans to pay for all of the federal government’s proposed expansionary policies, meaning that either we will experience massive inflation as our government prints more money to attempt to pay for its social works programs, or every American’s taxes will soon be increasing, thus resulting in higher unemployment as businesses margins become diminished.  In just the two months that President Obama has been in office, the stock market has lost more than 20% of its value, and unemployment is fast approaching double digit numbers.




President Reagan was the 40th president of the United States. He was a Republican elected in 1980 at the age of 69.

Setting:  President Reagan entered office in January 1981. During his inauguration speech the Iran hostage crisis was resolved and the American hostages were heading home, marking the first major success of the incoming administration.  Along with a brisk interaction with Iran, Reagan also had to face the Cold War, and our Russian enemy, head on in order to prevent a nuclear war that could destroy the world.Tense global affairs were not the only problems facing President Reagan: as the economy he inherited had high unemployment (7.5%) and was pushing the envelope of hyperinflation (11.83%).  In an effort to promote global peace, Reagan’s predecessor (Jimmy Carter) had drastically reduced defense spending and had gone down the path of complete disarmament of the United States -- an awful idea when your nation is at war with a very powerful and dangerous country like Russia was at the time. 

Campaign Plan:  President Reagan campaigned on the principle of restrained federal government spending, lower taxes, and stronger national defense -- a campaign that, during a time of war and a domestic economic crisis, was extremely effective.  Reagan argued that the government could lower taxes on individuals and businesses, and actually reap a greater amount of tax revenue, because an increase in growth and production would increase GDP, and thus increase the amount of money and goods available to tax.  To illustrate this point it is more profitable for the government to have a 10% tax on a sum of $2 million of production than it is to have a 20% tax on $800,000 of production.  Reagan also knew that in order to control and reduce inflation, his administration would have to practice fiscal responsibility and try to balance the budget.

Course of Action:  Reagan’s first economic plan in office was to cut the marginal income tax by 25% over 3 years, which passed through congress and took effect immediately.  He fulfilled his promise of cutting taxes despite cries from his own economic advisors advocating raising taxes.  Never in the eight years that Reagan was in office did he raise taxes, as he was adamant that his plan would work and that raising taxes would cripple any chances of saving the economy.  While in office, President Reagan cut spending in every area except defense and the war on drugs.  While nearing the end of his second term in office, Reagan successfully negotiated with U.S.S.R. General Secretary Mikhail Gorbachev and gave a famous speech in front of the Brandenburg Gate where he challenged “Mr. Gorbachev tear down this wall!” And although thought to be hollow, that comment was echoed only 29 months later when Mr. Gorbachev allowed the people of Berlin to destroy the wall, ending a great divide and signaling the collapse of the Soviet Union.

Results:  Over the course of the eight years that Ronald Reagan held the title of the President of the United States, GDP grew by an average of 3.4% per year, unemployment fell from the astounding 10.8% in December 1982 to 5.5% in 1988.  Due to the strength of Reagan’s foreign policy, the American hostages were returned home safely from Iran, the Soviet Union and its influences worldwide were toppled, and the framework was laid for the massive expansion in foreign trade that we experienced in the 1990’s.  Renowned economist and Nobel Prize winner Milton Friedman attributed the economic success of the 1990’s to the policies and structure that Reagan established during his tenure.  Reagan never balanced the budget, however, because during his time in office he increased defense spending by over 40% in order to protect America from threats both domestic and foreign, and to stop the spread of communism in weak countries.


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