George W Bush's name will rank alongside Herbert Hoover for presiding over some pretty terrible things in the US and global economies.
Apart from the destruction of trillions of dollars of value for shareholders in the US and around the world, Bush also passes on perhaps the biggest problem: the huge government deficit.
He took surpluses from President Clinton and tried a bit of the old supply side Laffer Curve rubbish by cutting taxes, especially for the wealthy, right as the US was falling into the tech net recession, which was then compounded by the dislocation caused by September 11.
He can't be blamed for that terrible event, but he can be blamed, along with the inept folk he appointed to his administration, for ravaging America's finances.
He then blew the extra revenue from the easy money boom on the war in Iraq and now the US, confronted by the worst financial crisis since Herbert Hoover's days and with not much room to move in, financially.
The new President of the United States has an early and unwelcome chance to deal with perhaps the biggest headache of his time in office, the monster known as the US budget deficit, which could be the first trillion dollar budget deficit in US history.
The American treasury said this week it will borrow an incredible $US550 billion this quarter to finance government spending, plus fund the rescue programs being put in place to deal with fallout of the financial crisis.
"This borrowing estimate is $408 billion higher than announced in July 2008.
The increase in borrowing is primarily due to higher outlays related to economic assistance programs, lower receipts, and lower net issuances of State and Local Government Series securities," the Treasury said in its statement.
The treasury said that on top of that, it would borrow $US368 billion in the first quarter of 2009. During the July – September 2008 quarter, Treasury borrowed $US530 billion of marketable debt. This was in the last quarter of the 2008 financial year.
So by the end of March next year, the US Treasury will have borrowed nearly $US1.4 trillion.
That is more than double what some US economists were predicting earlier this year, before the credit crisis intensified in September-October.
To put it in a form we can understand here: those borrowings over 9 months more than exceed the size of the Australian economy in the year to June 30, 2008.
US economists now say that figure of $US1.4 trillion will be around what the government needs to borrow in the year to September 30, 2009.
But they stress it could rise as the economy falls deeper into recession and government revenues disappear.
Some US economists say there is now a very good reason to believe the Federal budget deficit for the year to next September will be around $US1 trillion, compared with the Bush Administration's forecast of $US480 billion in July.
The actual deficit for the 2008 year was $US455 billion, so the outcome will be more than double that, if the economy slows further and more jobs are lost.
Tackling that will be a real task for President Obama. It will limit the grandiose plans and mean the President will not be able to do very much at all until the economy starts recovering, sometime in 2010.
Spending more on health care and cutting taxes won't be on the agenda, not with a deficit of around $US1 trillion and such a huge financing program.
Markets will want it cut to limit the upward pressure on interest rates that will come as the economy starts recovering and businesses and individuals start borrowing again.
With the election out of the way, markets around the world have dropped sharply for two days: the Dow is down 928 points, or 10%, as is the Standard & Poor's 500. It's now into deep recessionary mode.
We won't be immune here as bad debts from failed companies hurt the banks and lower commodity prices continue to batter the miners.
And first up with their hands outstretched will be the stricken trio of the US car industry, Ford, GM and Chrysler.
The US Treasury has already said 'no' to a request for a $US10 billion investment for GM to help finance its mooted merger with Chrysler.
The companies are already in line with a total of $US25 billion in low cost loans to help make themselves greener, cleaner and more efficient, but that won't flow until next year, when it may be too late for GM and Chrysler.
Overnight GMAC, the financing arm of GM 51% owned by Cerberus (which owns 79.8% of Chrysler) and 49% by GM, warned that it needs more help financially, especially for it's near bankrupt mortgage lender, ResCap that was a major subprime lender.
It has already cost the parent companies more than $US4 billion in bailouts, with huge write-downs. Now GMAC, which reported a higher quarterly loss of around $US2.3 billion, says it will need help from the federal government, or someone.
GM and Cerberus can't help; they already helped a huge refinancing earlier in the year to keep the company afloat (GMAC is closing its businesses in Australia and seven other countries at the end of this year).
It has applied to the US treasury to be a bank holding company (it has a small banking subsidiary) so it can tap the $US700 billion treasury fund.
Two studies were released this week in the US warning of huge job losses if one or all three local car groups go bust. US parts makers are joining the car giants to lobby.
There will be a long list of business people with their hands held out, hoping for loans or grants, in the months ahead.
The car industry will be at the top of the queue, especially after October's 32% slump in sales, and GM's 45% plunge.
Obama said in a speech in October that funding for automakers should be on the "fast track".
During his campaign, he promised to help keep auto manufacturing jobs in the US with measures such as incentives for building vehicles that use less fuel.
Obama said during his campaign he wanted to put at least 1 million so-called plug-in hybrid vehicles that would get as much as 150 miles per gallon on the road by 2015. He also said he would give consumers who buy the vehicles a $7,000 tax credit.
If he wants to help, it can be done, but GM, Chrysler and Ford have all added to their problems by ignoring efficiency and oil conservation for years. They are now paying the price of remaining in love with the profitable SUVs and pick up trucks, just as they were in love too long with the big cars in the 1970s after the first and second oil shocks.
Chrysler was rescued then, but nothing happened over that time to change attitudes in the industry.
And finally, for the purposes of comparison, take a look at the ASX 200 and the Aussie dollar since 2000 till this week.
We are at least still positive: amid the current pain, it's sometimes easy to lose sight of that performance.
