Category: Think Tank

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

3 Responses to “Presidents and the U.S. Economy: An Econometric Exploration”

  1. Carl C says:

    For many years, I’ve read that economic growth is better when the Presidency and Congress are held by opposite parties. There are various stories that explain why. One hypothesis, is that consumer and businesses, anticipating gridlock in Washington, stop waiting for government to solve __insert_favorite_social_problem__ and just move forward as best they can. Ostensibly, this includes greater investment or spending.

    “On the spending side, much of the D-R growth gap in the United States comes from business fixed investment and spending on consumer durables. And it comes mostly in the first year of a presidential term.”

    The above observation would fit the ‘gridlock’ hypothesis if Democrats were more likely to preside over a divided government. But, I don’t know if that’s true, or in fact if the gridlock relationship is real.

    Is there actually a correlation between gridlock and growth?
    Are Democratic presidents more likely to preside over divided government?
    And if so, do you know of any papers out there that explore the relationship?

  2. Grunschev says:

    Carl – you only need to read down to page 9 (which refers you to table 3 on page 47) to see the answer. I find it interesting that Democratic presidents do much better with Republican congresses than vice versa. The only time Democratic presidents under perform Republican presidents are when congress is divided.

    The results are very similar to the way the federal deficit performs. Deficits are much, much worse under Republican presidents than Democratic ones. Again, it doesn’t matter who controls congress.

    Bottom line, anybody who truly wants a better economy and lower deficits needs to vote for Democratic presidents. Voting for Republican presidential candidates means you want slower economic growth, more recessions, and more government debt. But we all know most R voters are “voters of faith” who can’t be swayed by the actual data. Either that, or they’re eternal optimists: “This time it will be different!”

  3. Alan Harvey says:

    The economy does better across the board. I produced a general audience study of this in 2009, covering the pre-crisis period 1948-2006. The data are compelling. More charts, easier to read, straightforward text. Unemployment, Employment, Investment, Corporate Profits, Real GDP, Federal Borrowing, Net Real GDP. Link is to PDF excision.