How Much We Lost in the Crash of '08

According to Census Bureau Historical tables, we are just now recovering income lost in the cataclysmic Crash of 2008.  The destruction of family earnings took us back to 1996 levels, undoing all the gains of the Clinton years, ending in the brutal destruction during Bush's last year in office. 

The numbers below really understate the extent of destruction as they only reflect the effect on personal income and don't really reflect the loss of wealth that took place due to crashing home values and stock prices, pensions frozen or lost, and businesses bankrupted.  I broke down the Table Data into the years of the Administrations, giving the first year of each president to his predecessor, since any new policy or budget is not set until after a year in office.  Consider the data below showing change in Mean Income Received by Each Fifth and Top 5 Percent of Families.

 

Administration	Lowest fifth	Second fifth	Third fifth	Fourth fifth	Highest fifth	Top 5 percent
Clinton	23.56%	17.63%	16.66%	15.99%	20.44%	23.66%
Bush	-6.72%	-3.44%	-1.75%	-1.13%	-1.93%	-4.10%
Obama	-5.09%	-3.71%	-2.60%	-1.95%	-0.14%	1.27%
Bush 2001-2007	-2.15%	0.74%	1.80%	2.36%	-0.23%	-3.55%
Bush 2008-2009	-4.67%	-4.15%	-3.48%	-3.41%	-1.70%	-0.56%
Obama 2012	-0.43%	-0.41%	0.25%	0.31%	0.24%	0.17%

Looking at this, we might yearn for the good old days of the Clinton Administration, even though he was sowing the seeds of the destruction to come by deregulating the banks, which set them on the path of becoming weapons of mass financial destruction.  During the Clinton Administration, every income category gained, with the lowest bracket doing the best of all, except the top 5%.

The Bush Administration was a disaster for all income groups, but was particularly bad for the group nearest poverty, they lost nearly twice as much in family earnings as any other group.  The other groups mostly gained marginally until 2008 - 2009 when the roof caved in on everybody.

The Obama Administration has not improved things much, but things have stabilized in the last year which gives some hope, but the banks are still fighting all attempts at regulation, leaving open the possibility of another crash and bailout.