As of
December 2007, the economy of the United States began to fall into a recession, the countrys
greatest economic challenge since the Great Depression.
Addressing the
troubled economy (referred to as the Great Recession) became a major issue of the 2008
presidential election campaign, especially in the wake of Lehman Brothers Holdings filing for
bankruptcy on September 15. Democratic candidate Barack Obama and Republican candidate John
McCain outlined their ideas to voters in keeping with their respective political
parties.
The September 15 crisis and subsequent government acquisition of
mortgage companies Freddie Mac and Fannie Mae played a role in voters turning to the Obama
campaign, as McCains expertise was in national security and the Obama campaign made the economy
a focus.
After winning the 2008 election, President-Elect Obama made economic
recovery his immediate priority and spoke on the issue during his inaugural address. Congress
began work on a recovery bill to be ready for review after Obamas inauguration.
On February 17, 2019, President Obama signed into law the American Recovery and
Reinvestment Act of 2009 (ARRA). With reference to Keynesian economic theory that recessions can
be alleviated through federal spending, the Recovery Act focused on government spending to
create new jobs and to recover job lost in the recession. The Acts $787 billion expenditure
planned funding for education, aid for the unemployed, infrastructure, health care, and tax help
for families.
The Obama administration also provided loans to the automotive
industry, allowing car companies like General Motors and Chrysler to restructure. Subsequent
economic reforms to protect consumers and to strengthen financial regulations included the
passage of the Dodd-Frank Act in July 2010.
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