Bush Latest GOPer to Show Democrats Better for the Economy
By Jon Perr Sunday Jan 25, 2009 6:30am
On Friday, the New York Times provided a jaw-dropping analysis of the dismal state of the economy under George W. Bush. Just days after the Washington Post documented that Bush presided over the worst eight-year economic performance in the modern American presidency, the Times charted his historic failure in expanding GDP, producing jobs and fueling stock market growth. As it turns out, Bush is just the latest Republican to confirm the maxim that Wall Street and the economy overall almost always do better under Democratic presidents.
As the Times revealed (article here, charts here), the only bright spot for the first MBA president's economic mismanagement was the low inflation rate during his tenure:
During his administration, the country grew at the slowest overall pace of any recent president, whether measured in gross domestic product or employment. The last president to preside while the stock market did worse was Herbert Hoover...
...President Bush's administration was marked by a recession that began two months after he took office and another downturn in his final year of office. In the end, the economy during his term added enough jobs to employ only 14 percent of the added number of working-age Americans, the lowest proportion of any postwar administration. Employment grew at a compound annual rate of only 0.3 percent, half the 0.6 percent rate that his father had recorded in what had previously been the worst post-World War II performance.
For the investor class so fond of perpetuating the myth of Republicans' superior economic stewardship, the collapse of the stock marketing during the Bush recession must be particularly galling. The Standard & Poor's 500 spiraled down at annual rate of 5.6% during Bush's time in the Oval Office, a disaster even worse than Richard Nixon's abysmal 4.0% yearly decline. (Only Herbert Hoover's cataclysmic 31% plunge makes Bush look good in comparison.)
As it turns out, as the New York Times also showed in October, the Democratic Party "has been better for American pocketbooks and capitalism as a whole."
To make its case, the New York Times asked readers to imagine having put their money where its mouth is. Contrary to Republican mythology, Americans fare better - much, much better - under Democratic administrations:
As of Friday, a $10,000 investment in the S.& P. stock market index would have grown to $11,733 if invested under Republican presidents only, although that would be $51,211 if we exclude Herbert Hoover's presidency during the Great Depression. Invested under Democratic presidents only, $10,000 would have grown to $300,671 at a compound rate of 8.9 percent over nearly 40 years.
(For the eye-popping chart of the S&P's performance under each of the presidents from Hoover through Bush 43, visit here.)
As the broader record shows, the best path to prosperity is to elect Democratic presidents.
The superior performance of Democratic presidents covers virtually the entire spectrum of economic indicators. As Elliott Parker of the University of Nevada, Reno detailed in a 2006 paper, since 1949 Democratic administrations have done better than Republican ones when it comes to unemployment (5.2% to 6.0%), job creation (-.0.4% decrease in unemployment, compared to 0.3% increase), GDP growth rate (4.2% to 2.9%), and even corporate profits as a share of GDP. And to be sure, he found the Dow benefits from Democrats in the White House.
There's no shortage of studies to show that stock market returns are higher under Democratic leadership. (As it turns out, Wall Street's performance is also better when Democrats control Congress.) In 2000, Pedro Santa-Clara and Rossen Valkanov of UCLA's Anderson School of Business concluded that "that the average excess return in the stock market is higher under Democratic than Republican presidents - a difference of 9 percent per year for the value-weighted portfolio and 16 percent for the equal-weighted portfolio." As the New York Times noted of UCLA study in 2003:
"It's not even close. The stock market does far better under Democrats...
...Professors Santa-Clara and Valkanov look at the excess market return - the difference between a broad index of stock prices (basically the Standard & Poor's 500-stock index) and the three-month Treasury bill rate - between 1927 and 1998. The excess return measures how attractive stock investments are compared with completely safe investments like short-term T-bills.
Using this measure, they find that during those 72 years the stock market returned about 11 percent more a year under Democratic presidents and 2 percent more under Republicans - a striking difference."
In 2002, Slate similarly concluded that "Democrats, it turns out, are much better for the stock market than Republicans":
Slate ran the numbers and found that since 1900, Democratic presidents have produced a 12.3 percent annual total return on the S&P 500, but Republicans only an 8 percent return. In 2000, the Stock Trader's Almanac, which slices and dices Wall Street performance figures like baseball stats, came up with nearly the same numbers (13.4 percent versus 8.1 percent) by measuring Dow price appreciation. (Most of the 20th century's bear markets, incidentally, have been Republican bear markets: the Crash of '29, the early '70s oil shock, the '87 correction, and the current stall occurred under GOP presidents.)
According to almanac editor Jeffrey Hirsch, the presidential party figures are among the most significant he's found. If the stock market were random, we'd expect such a result only one-quarter of the time. "I don't know why people are convinced Republicans are good for the stock market," Hirsch says.
Why? Because Republican water carriers like Larry Kudlow and Donald Luskin continue - with great success - to perpetuate the myth that the regulation-free policies of the GOP that so benefit them personally somehow help the American people overall. (In an example of legendarily bad timing, McCain adviser Luskin took to the pages of the Washington Post the day before the September Wall Street implosion to defend Phil Gramm's assessment of the economy, calling America "a nation of exaggerators.")
In defense of his bungled economic management, President Bush on his way out the door boasted of "52 months of uninterrupted job growth," an unimpressive performance which in any event now seems like a distant memory (Even more comical, the National Republican Congressional Committee apparently still believes "Thanks to Republican economic policies, the U.S. economy is robust and job creation is strong.")
As George W. Bush exits the stage and Barack Obama takes it, it is worth remembering the words of Harry Truman, as true today as when he uttered them generations ago:
"If you want to live like a Republican, vote Democratic."
(This piece is crossposted at Perrspectives.)
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of trickle-down economics before no one in the MSM or GOP every references it again?
The references will continue as long as the media reports the talking points without the facts that refute them.
Do you think the difference is determined by Dem ideology being better for the economy than the Repub ideology?
OR
More interestingly, based on my observations, do you think the reason the Repubs do worse is because they never actually act on their ideology? I mean, they seem to treat the govt as a private coffer for themselves and their cronies and never actually get around to governing, their professed conservative ideology being merely lip-service to get elected.
you're doing some pretty clean thinking.
Hypocrites all up the line, they wail on the inability of government to help THE PEOPLE... yet use government programs and coffers to line the pockets of THEIR PEOPLE. They shout NOW about fiscal responsibility, but where were they when THEY started spending A BILLION DOLLARS A WEEK on the occupation of Iraq. Compassionate Conservatives ALL... yet the imprisoned HUNDREDS of Muslims who never got to face specific charges or get access to legal help.
Modern American Republicans should hang their heads in shame because they allowed their leadership to make such a mess of things.
Republicans "know" the government steals your money, and, when they get elected, they set out to prove it!
n/t
that's after they cooked the books.
You should see the numbers before.
Kevin Phillips: Washington's Great "No Inflation" Hoax
yep. these idiots (professors) believe that massive debt accumulation is somehow economic growth.
its just delayed taxation, or worse.
Under normal circumstances, I'd agree wholeheartedly that the economy does better under Democrats. There is much more focus on jobs, education, benefits, and help for a lot of people to become productive citizens.
But I'm worried about what's coming.
I KNOW Obama is risking his presidency on the hope that his administration's plan will be successful, but Warren Buffet, maybe his closest economic advisor and chief author of Obama's plan, says he just doesn't know if the plan will work to pull America out of its collapse. To be absolutely fair, we don't know of any plan that will work better, and I doubt that anybody does. The relationship of the parts to the economic whole are still not understood, much less lend themselves to human direction. And the problems are world-wide. It's all a gamble with tactics that have worked in narrower circumstances than we find ourselves today.
I really and truly hope Obama plans for the worst behind the scenes as well as going forward with his hopeful plan.
I guess my point is that if Obama's plan works, yes, a government with Democrats at the helm will certainly be better for the economy in a lot of different ways. But we certainly need to keep our eyes and ears open, in case this plan doesn't work. Let me say that it isn't my intention to throw a stink into the pot. I do always look at the worst case scenario I can imagine in almost all situations and plan for that contingency, and it's served me well through my life.
Whenever anybody talks about anything touching on the economy lately, I'm motivated to do that again...
Lets face it, too many people realize now how much of the economy was based on hooey. How can you restore confidence in a system that was exposed as a sham? We need a new system OR to radically lower our general expectations of what the 'norm' is.
and it is interesting to point out, that the economy of any nation, has very little to do with the government of the day. Even so called expert economists talk about cycles so that blows the partisan talk out of the water really. If it's a cycle, it doesn't matter who the pretend gov't is. The economy continues "despite" who is in power, not because of them. The most a gov't is supposed to do, is tax and spend, not stimulate.
IF you hear a right-wing outlet discuss this, this is how it'll be framed:
Dem presidents benefited from the administrations and policies of the preceding Repub presidents;
Repub presidents suffered from the administrations and policies of the preceding Dem presidents.
Bush is Abraham Lincoln! Bush is Churchill! Bush is the return of Jesus Christ!
Who cares about the economy? Jobs creation? The national debt?
Under the GOP, the cronies get rich and the rest get crumbs. That's what Republicanomics is always about: elitism and classism, not the overall wealth of the country. I mean, why get wealthy if you can't also be holier-than-thou snooty?
Like evil father, like idiot son.
the view that such differences as exist between the Pukes and the Dims are notional and nominal, and only on the margins, at best?
Yes, but he did keep Americans from harms way. Well, there was that little incident in September, 2001. Oh yeah, and those anthrax attacks. I suppose we need to consider the nearly 5000 dead and 30,000 wounded in that little Iraqi adventure. But no real harm on domestic soil. Oooh, forgot about the more than 2000 drowned in New Orleans. Wait, if it's under water wouldn't that technically be not on domestic soil? Oh well, never mind.
...using the "economy as a sports car" analogy...
At this point in history I dont think it matters if democrats are better "race car drivers" or not.
The fact is that Bush got the keys to the old (not so economical) family car we know as the "economy", and never put air in the tires or checked the oil after 9/11. (and just floored it) ...He ran over a lot of "things" (on his little joy ride through the middle east) and now the car is all dirty and fucked up and needs to be junked. (Dick Cheney took a crap in the back seat even)
Obama might be the best (untested) driver there ever was, but I don't think his pit crew is gonna get the old pig running.
How about a natural gas converter... and a solar panel on the roof (for the new music system and GPS on board...) and fill in all the crack and pot-holes on the road to make it easier on the suspension. A new FLAMIN' PAINT JOB would be a good idea (to keep the paint shops open and people workin'...) and a new muffler with a heat re-cycling system...
THEN... let's challange the Chinese to a race: MOST ECO-FRIENDLY MACHINE WINS!
Obama's problem is going to be American's need to start walking. This is a problem because while its a great answer, no one is going to like it.
Better buy horses, too. I lived in an isolated place for 8 years that was 25 miles one way from the closest grocery market. Some people live in places where they must have fuel-powered transportation or they won't survive unless they're totally self-sustaining. That means water, meat, vegetables, heating materials, medical supplies, etc. We'd all better lean toward survivalism...
but I dont think China will play by the rules.
Check out this American company...we may already have a big lead on the rest of the world! ...(sometimes I can be optimistic)
http://www.blacklightpower.com/
all the "invest in green power" people keep not saying, is the cost. The economies around the globe are decimated, and while spending on green industries is a great idea, the costs associated with it are going to be crazy. "Green" foods are more expensive. Solar power is crazy in price. Alternative fuels will cost more than gas/oil. Will the world afford them? Will the average person that is already out of work and broke, be able to pay extra for food that he can't afford now?
nope, and that's what the elites are counting on. afterall, they need a way to realize their planetwide 80-90% cull rate.
http://seattlepi.nwsource.com/fun/mallard.asp
debt load, you mean. That's the ONLY thing that's trickled down in the Reagan trickle down model these idiots pay homage to.
Their policies left NO INCENTIVE to reinvest in production, expansion or the general populace.
Without incentive the only economic pointers that actually improved in their economic model were executive pay, bonus and stock dividends.
The rest of us were left with shrinking wages, unaffordable health care, mounting credit use for food and consumables, and the GRANDDADDY of all economic backstabs, EXPLODING mortgages.
No wonder they despise the capital gains tax.
It's been a 50 year Ponzi scheme with the least able to afford it being the one's who foot the entire bill.
Phil Gramm is a fucking criminal, the Enron loophole and the repeal of Glass-Steagal were the final straws that ultimately broke their scheme.
And yet, we saw a full decade of funds extraction from this economic ponzi scheme before it all finally collapsed.
I really hate Phil Gramm.
is because we just witnessed the largest tranfer of wealth in humand history from the hands of the many to the hands of the few. Essentially, the US was Africa, and "Europe" (ie, the ruling class) swooped down upon us like India and Africa, dismantled our financial and socio-economic infrastructure, and sold it to the highest bidders.
Bush kept inflation safe.
The impact of a decade of rampant, unmonitored, unregulated speculation geared to maximum short-term gain in real estate development, house "flipping", energy market manipulation, financial instrument ponzi schemes has been increasingly evident for years. This "data" has been in existence while the Administration has trumpeted that "the economy is fundamentally sound" and a national media that is either openly complicit or simply inept has failed to place the facts before us.
Read Frank Rich in today's NY Times. He has presented a rock solid assessment of what an arrogant, delusional, aristocratic power elite has created over the past 8 years - and defines our own complicity in this game of monopoly that has been substituted for a productive economy.
Unfettered "free-market capitalism" ends up feeding the greed with their hands on the wheels of finance. And it gives capitalism a bad name by pretending that capitalism is about accumulation of personal wealth rather than a means of enabling a flow of funds into improvements and expansion of production. Republican approaches to macroeconomic policies and practices have been proven to generate massive disruptions of the engines of production while moving existing wealth into the coffers of the wealthy. For them, the rest of us are "collateral damage."
It's official now, America is being ruled by Oligarchy
Making the rest of us Laurelgarchy
Why is:
"the economic record of President George W. Bush was LARGELY a DISAPPOINTING one."
journalism? And why would:
the economic record of President George W. Bush was DISASTROUS for the NATION.
be partisan flame baiting?
I can visualize the NYT writer at tea time, pointing his little finger out and stating, "Well, yes old chap. You know Bush was _largely_ disappointing." Which I guess implies there were quite a minority of good things about Bush.
is employees of large MNCs accusing employees of other large MNCs of bias and illegitimacy, to create the lowest possible amount of advertising revenue that allows middle managers to keep their jobs.
"In regard to giving and getting money, the observance of the mean is liberality; the excess and deficiency are prodigality and meanness, but the prodical man and the mean man exceed and fall short in opposite ways to one another: the prodigal exceeds in giving and is deficient in giving; whereas the mean manexceeds in getting and is deficient in giving...
"There are also other dispositions in relation to mone, namely, the mode of observing the mean called magnificense (like the magnificent man being different from the liberal, as the former deals with large amounts and the latter with small ones)..."
Aristotle The Nicomachean Ethics.
Repukes always leave debts because they only look out for themselves and the rich. I used to say this to them who were alway harping on how wonderful everything was back in Saint Ronny's time, even when he was putting America in defecit. If a bank is stupid enough to lend you a million bucks (who knew that would really happen later) and you buy a house and new car and all that shit but can't really pay for it, does that make you a millionaire.
Of course like all good Repukes they would just say I was a downer and should learn to enjoy myself more.
It needs to be noted that that "low inflation rate" under Bush excludes the rise in gas prices.
Look it up.
is consumer goods, not in important stuff needed for either sustained investment or mere survival.
This analysis should not only damn the GOP, but Adam Smith's theory of the "Invisible Hand." Smith's theory asserts that when individuals seek to maximize economic benefit for themselves, their community benefits as well. It appears that in practice, the Invisible Hand is less than optimal.
So let's celebrate so-called Tax and Spend Democrats, and deride the Deregulate, Borrow and Fritter Republicans. They are epic fail.
anwaya
Apparently there's no "community" in the Invisible Hand. That was just thrown into the word-stew to look good. If there's ANYTHING we've learned through the Bush years, it's that those who "maximize their economic benefits" certainly don't share -- they keep it all. Furthermore, they hide it away so it can't even be taxed and benefit "the community" that way.
What kind of naive economist would leave human greed and rapaciousness out of any theory or hypothesis of economics, while encouraging unfettered freedom for "the market"? The same kind of blinders were in place with the Republicans' programs with "no oversight" -- they did not take human greed and rapaciousness into account. Maybe it was intentional and they knew exactly what they were doing to basically enrich and empower themselves. If they didn't, they certainly must have learned it quickly since it was so obvious to everybody.
you're not a huge asshole that's out to screw everyone else over, an attitude that became normalized sometime in the 1980s.
Trickle down economics works great as the only thing that trickles down is the debt. We are all socialists now.
As a biologist, this historical "win" for dems brings me little comfort. Instead, it tells me that we're all colluding in a global environmental/economic Ponzi scheme.
At some point we're going to have to realize that the goal of constant growth (as traditionally measured) is simply not sustainable.
Nature abhors disequilibrium. In any normal biological system growth and proliferation are counterbalanced and ALWAYS return to homeostasis. From viruses and cells to organs, organisms, and populations, nature will correct for resource abuse.
It's time to redefine success. I say we start by redefining growth, or our herd will be culled by Mother Earth sooner than we can imagine.
[Deleted. Banned spammer-Sitemonitor]
Lies, damn lies and statistics.
Clinton and Coolidge presided over their respective roaring 90's and 20's. One a democrat and one a republican.
In the 1920's and during the last decade, stock and housing bubbles occurred. One under a republican and the other under both a democrat and republican, Clinton and Bush Jr.
From 1966-1982, the stock market was flat. Johnson, Nixon, Ford, Carter and Reagan were President during that time. A 25 year Bull market began in the DOW while Reagan was President and ended while Bush Jr. was President.
The nasdaq rose to 5,000 under Clinton and lost 45% of its value during the last year of his presidency. The DOW lost a similar percentage in the last year of Bush Jr.'s presidency.
The phase of the long term economic cycle matters more than which party is in the White House.
Every boom ends in a bust, republican or democrat.
the DOW wasn't the only measure of the economy.
While the DOW was flat, however, they were paying our fairly generous dividends, and also splitting their shares. It wasn't the end of the world.
Why is:
"the economic record of President George W. Bush was LARGELY a DISAPPOINTING one."
-------------------
Maybe for the same reason Hoover and Roosevelt's were. Every boom ends in a bust.
the DOW wasn't the only measure of the economy.
While the DOW was flat, however, they were paying our fairly generous dividends, and also splitting their shares. It wasn't the end of the world.
-----------------
I never said the DOW was the only measure of the economy. My point was that games can be played with the numbers to get whatever result one wants.
The nasdaq fell 45% in Clinton's last year in office and the DOW fell 45% or so in Bush Jr.'s last year in office. Both occurred as a result of burst bubbles. Both bubbles occurred under the umbrella of a credit bubble. The credit bubble burst along with the housing bubble this decade, and along with the stock bubble in 1929.
Had Kerry beaten Bush in 2004, both bubbles would have burst under him as President.
It is propaganda that either party is better for the economy.
Rather you love him or hat him Bush has to be the easiest president in history to make fun of. There has been an outpouring of art work done in relation to George Bush based on a wide variety of issues. I compiled the funniest images of Former president Bush from artists around the world at, Best of Bush. There are some truly inspired funny animations there there is even one with him smoking a glass water pipe. In the end how would you define Bush's presidency, comedy or tragedy, I mean if you had to pick one:)
Sunflower Pipes
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