Many Conservatives act as if we feel from great heights when the recession hit in 2007/2008. They blame the Democrats and Barney Frank for the Housing bubble collapse. This is only partly true, the rest of the blame lies with the GOP as well. From 2002-2006, the GOP controlled The House, senate and Presidency. During that time period, job growth was anemic averaging only 100,000-150,000 a month. Although the Unemployment rate was low, that was due to the rate being low already from the 90’s boom. Employment was just barely keeping up with the population. The wage stagnation began around 2000 and we have never recovered. Why was growth lousy the past decade? The answer is obvious, our deficit spending and debt accumulation.

The economy has been bedridden far longer than we realize — and you can blame lying statistics for at least some of it.

So says Rob Arnott of Research Affiliates, a Newport Beach, Calif., investment management firm with some $50 billion under management. He argues in his monthly newsletter that, contrary to popular belief, the roots of our current malaise predate the financial crisis – and not by a little bit.

Arnott says the U.S. economy actually went off the rails more than a decade ago. What’s more, many of us have failed to realize it because the most widely watched economic indicator, gross domestic product, actually tracks consumption, irresponsible or otherwise, rather than real wealth generation.

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“GDP that stems from new debt — mainly deficit spending — is phony: it is debt-financed consumption, not prosperity,” Arnott writes. “Net of deficit spending, our prosperity is nearly unchanged from 1998, 13 years ago.”

That seems hard to believe. The late 1990s are sometimes remembered as the last time the U.S. economy was consistently doing things like generating wage gains for people other than CEOs, and even the housing bubble-fueled 2000s are widely assumed to have not been a total wash.

Read the rest: Lost decade? We’ve already had one

Here is a chart comparing the job and wealth growth of the 2000’s to that of previous decades.

The deficit spending that began under Bush and that rapidly increased under Obama is what’s causing this anemic wage and job growth. It also doesn’t help we have policies that promote outsourcing and we allow other nations to take advantage of us. The fact is the US peaked economically around 98/99 and we have been downhill ever since. When the Housing bubble popped, the economy’s true rot was exposed. Obama’s policies have made things worse. We must get our fiscal house in order and implement tax and regulatory reform.

Both political parties are to blame for this economic mess. As it stands, we’re entering our 2nd lost decade. Something needs to be done or it’s too late.