Financial Crisis and the Economy - Obama Presidency Oral History

As the economic outlook worsened in late 2008 and early 2009, Obama’s advisors began to prepare a slate of “stimulus” measures to drive growth, prevent further job losses, and restart financial lending. They debated how much money the government ought to spend to combat the crisis and how that money could best be spent, and negotiated with members of Congress to ensure that legislation would be ready for Obama’s signature shortly after he took office. 

This effort culminated in the American Recovery and Reinvestment Act (ARRA), which Obama signed in February 2009. Over the following decade, ARRA provided more than $800 billion worth of stimulus to the American economy. It cut taxes, provided fiscal relief to state and local governments, and extended unemployment benefits. But the administration also viewed ARRA as an opportunity to advance their affirmative policy goals, and inserted historic funding for infrastructure construction and maintenance, renewable energy and energy efficiency, healthcare reform, and education. In the project archive, narrators from across the government reflect on the design, negotiation, implementation, and impact of ARRA, while civil society leaders and small business owners describe how it touched their lives and communities.

Beyond ARRA, the administration took other actions to prevent further job losses and boost growth. One early focus of this effort were the “Big 3” American automakers, which were on the brink of bankruptcy following years of poor performance and mismanagement. President Bush had loaned TARP funds to General Motors and Chrysler in late-2008, and the new Obama administration faced difficult decisions about whether to extend further support, how to restructure the companies, and the government’s proper role in their management. Narrators from across the archive reflect on Obama’s decision to “bail out” GM and Chrysler, and the activities of the Presidential Task Force on the Auto Industry. 

Debates about efforts to stimulate growth intersected with debates about the long-term fiscal trajectory of the United States. The federal budget deficit grew rapidly during the recession, and many influential economists, policymakers, and commentators argued that avoiding future economic pain required reducing the deficit over the medium- and long-term. These arguments weighed against efforts to pass additional stimulus spending after ARRA, and surfaced during a series of tense and explosive budgetary negotiations, including surrounding the scheduled expiration of the Bush Tax Cuts in late-2010, the “fiscal cliff” in early-2013, the National Commission on Fiscal Responsibility and Reform, Republican brinksmanship over the raising of the federal debt limit, and in pursuit of a “grand bargain” with Congressional Republicans that would pair tax increases with entitlement cuts. In their oral histories, advisors, officials, members of Congress, and others recount the period’s toxic budget politics, and consider the administration’s relationship to austerity policies and those policies’ impact on the depth and duration of the recession.

While insiders in Washington debated the appropriate policy response to the crisis and recession, economic conditions shaped how Americans lived and worked during the Obama years. Interviews from across the Obama Presidency Oral History collection shed light on these conditions, and reflect on their varied and dynamic political and electoral consequences. Among other issues, narrators discuss the impacts of stagnant or falling wages, rising inequality, high household indebtedness, low manufacturing investment, globalization, and foreclosures and housing inaccessibility, and remember the rise of new political movements like the Tea Party and Occupy Wall Street, which emerged in part in response to these issues.