Explaining Away Competence

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economy

A Krugman blog post got me thinking —

Everyone in the Republican Party knows that Reagan presided over an economy that has never been equaled, before or since. When I was on TV with Rand Paul, he confidently declared

When is the last time in our country we created millions of jobs? It was under Ronald Reagan …

Of course, it’s not true …

Krugman goes on to say there was better job growth during the Clinton years, and President Obama hasn’t done that badly, either. But it isn’t just Republicans who somehow think only Republicans understand the economy. Polls going way back show that The Average Voter thinks that Republicans are better on the economy (and defense, and taxes) than Democrats.

And why do so many people think that, when it demonstrably isn’t true (and it isn’t)? IMO because Republicans declare it to be so, loudly and often, and Dems don’t stand up to them about it.

Last year some Princeton economists came out with a study that showed a rather startling gap between Dem and GOP administrations in how the economy performed, going back to World War II.

“The U.S. economy not only grows faster, according to real GDP and other measures, during Democratic versus Republican presidencies, it also produces more jobs, lowers the unemployment rate, generates higher corporate profits and investment, and turns in higher stock market returns. Indeed, it outperforms under almost all standard macroeconomic metrics.”

As I said, this came out last year, and I don’t recall seeing it at the time. But the differences are not minor. There’s a bar graph at the link above showing substantial differences in economic growth between D and R administrations. But the two articles I found about this, one by Chris Matthews (the one linked above) and the other by Robert Samuelson, both go to great lengths to not give Dems credit for being better on the economy. Samuelson is particularly brilliant —

If Republican presidents were saddled with most recessions, their growth and job creation records would naturally be worse. And that’s what the Blinder-Watson study shows. Since the late 1940s, the economy has spent about 12 years in recession. But 10 of those 12 years occurred under Republican presidents; only two occurred under Democrats. On average, the economy spent slightly more than a year in recession for each Republican term and only three months for each Democratic term.

If only Republicans hadn’t been saddled with those damn recessions!

To be fair, Samuelson explains that Dems focus on job growth while Republicans focus on reducing inflation. But inflation hasn’t been a problem since the 1980s. What’s their excuse since?

Economic policies pleasurable in the present can be disastrous for the future — for example, the inflationary policies of the 1960s. Similarly, the policies that fed the economic booms of the 1990s and the early 2000s spawned overconfidence that fostered the financial crisis.

The financial crisis was caused by the Clinton boom, in other words. It’s always the Dems’ fault.

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13 Comments

12 Comments

  1. Kaleberg  •  Mar 21, 2015 @11:42 pm

    It’s the same driver as the red-state / blue-state paradox in which businesses do better in the blue-state anti-business climate than in the red-state pro-business climate. It is far from new. In the 1960s, Pakistan (East & West) was considered the big pro-business country and India sort of a basket case. Well, India still has its problems, but Pakistan hasn’t turned into Switzerland East as predicted 50 years ago.

  2. PurpleGirl  •  Mar 21, 2015 @11:56 pm

    Kaleberg — Yes, India still has its problem but then again it has a growing middle class of college educated people. And they are finding jobs for those people, both in India and as workers leaving for first-world countries for opportunities. May not be paradise but it’s a more positive situtation.

  3. Dave Empey  •  Mar 22, 2015 @1:21 am

    Purple Girl, I think that was Kaleberg’s point.

  4. chris  •  Mar 22, 2015 @4:42 am

    “The financial crisis was caused by the Clinton boom…”

    To be fair, the repeal of the Glass-Steagal Act, which was done under Clinton, not only aided the eventual financial crisis, but is often claimed to be a direct result of it. While that isn’t defined as a boom, it was a policy change. Yes, I know it was a GOP driven bill, but that shouldn’t relinquish Clinton the responsibility of being the one to sign it.

  5. c u n d gulag  •  Mar 22, 2015 @9:03 am

    Once a meme gets entrenched in our MSM, getting rid of it becomes like trying to tell that last Japanese soldier on some island somewhere, that WWII ended almost 70 years ago, and his Emperor is long dead.

    Nothing you say, nothing you can show that elderly soldier, will convince him that his war’s over.

    And so, in all “Truthiness,” our MSM believes that it knows best, no matter what the numbers may show.

  6. moonbat  •  Mar 22, 2015 @2:00 pm

    Even if the numbers favor Democrats in the economic space, Republicans, especially those who came of age during the Reagan years will never forget how they felt during that time, the emotional lift they received, as well as the booming stock market and yes, positive economic numbers. It just doesn’t matter that the numbers for Democratic administrations are better.

    The approach I take instead,is to try and explain that the two or three generations of liberal rule that preceded Reagan, benefited by the post-war climate where America was the victor, produced an enormous, wide spread prosperity in this country, which Reagan and the conservatives that followed, proceeded to gut and redistribute this wealth, producing the boom Reagan is credited for.

    I boil this down by saying, when you remove regulations, as Reagan did, you inevitably produce a boom and bust economy. There are many examples of this prior to the Great Depression, which was the ultimate bust. The crash in 2009 and the “great recession” that we’ve been in ever since is the bust that followed nearly thirty years of boom. Republicans are quick to take credit for the boom but the bust is always Obama’s fault, even though he was barely in the White House when it happened.

    This usually goes over their heads, since they have no understanding of history, and have been brainwashed into only going back to their hero, Saint Ronnie. But the key concept is that unregulated markets always go boom and bust, there are many examples of this in the 19th century, culminating in the Great Depression, and that thanks to conservatives, we’re back to that model, more or less.

  7. Swami  •  Mar 22, 2015 @6:43 pm

    McCain to Obama on Netanyahu: ‘Get over your temper tantrum, Mr. President’

    McCain, you are a feeble old scumbag! A grade A butt sucker.

  8. c u n d gulag  •  Mar 23, 2015 @11:45 am

    won’t change, regarding PPACA.

    They’ve invested far too much bile, fear, hatred, and bigotry, into making it sound like the end of the country and the world as we know it!

    They’d really look like lying imbeciles to have to pull an Emily Latela, and say, “Oh! NEEEEEEEEEEEver mind!”

  9. c u n d gulag  •  Mar 23, 2015 @11:47 am

    Oooops!

    I did it again, and hit ‘Submit Comment'” instead of copying.

  10. goatherd  •  Mar 23, 2015 @2:19 pm

    For some people, the economic insiders, a boom and bust cycle is just another rigged game, ending with the chance to pick numerous pockets and pick up some bargains. God, I miss the New Deal!

    We are all familiar with the Dunning-Kruger Effect. But there seems to be a related wrinkle in the human mind that makes people easy to manipulate. I think that on some level, a lot of people actually resent competence, especially when that competence seems to be widely recognized. The recognition threatens to undermine and overthrow their personal support narrative, which is that they possess virtues that are both unrecognized and unrewarded. Someone else is hogging the spotlight.

  11. Swami  •  Mar 23, 2015 @3:45 pm

    Once you’ve been infected with Reaganitis it will never leave your system, it’s like hepatitis C. Even when you think it’s in remission you’ll have reoccurrung urges to visit the Ronald Reagan Presidential library just to read Dutch’s love letters to Nancy and maybe experience the thrill of an audio recording of President Reagan chiding Mr. Gorbachev to tear down this wall.
    Oh, I get near orgasmic just thinking of how masterful a leader Ronald Reagan was. Well, at least now Ted Cruz has arrived to chart a course of correction for our nation. Greatness springs eternal!

  12. linusbern  •  Mar 24, 2015 @8:53 am

    The Democrats have it easy though. If Republicans didn’t keep tanking the economy, growth under Democrats wouldn’t be nearly as good.

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