Many conservatives argue that our economy can flourish only when the federal government gets out of the private sector’s way. Many progressives counter that in our free market system, there are times when the government needs to step in to protect the common good and ensure there is broad-based economic growth. This debate defines our politics today.
Americans of all political persuasions, however, should agree that quick and decisive government action was necessary between 2008 and 2010 to avoid a second Great Depression and to help our economy recover from the deepest recession since the 1930s. After all, the evidence is clear that three acts of Congress signed by two successive presidents between 2008 and 2010 led to the end of the Great Recession of 2007–2009 and the subsequent economic recovery. Specifically:
- The Troubled Asset Relief Program of 2008 rescued our financial system from almost certain meltdown, saving the U.S. financial system at the brink of disaster
- The American Recovery and Reinvestment Act of 2009 helped us avoid the feared second Great Depression and kickstarted renewed economic growth
- The Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 strengthened the fledgling economic recovery by cutting the payroll tax and continuing extended unemployment insurance benefits
CAP Senior Fellow Christian E. Weller details the top 10 reasons why these three key government interventions in the economy were successful.
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