Well, let me just chime in once more and say that our good friend Jacques, a most learned man, has once again done his homework and made a mighty contribution to the thread…

I finally got around to crunching the rest of those numbers (in particular, the deficit numbers). Anyone still interested can read about them here.

Clinton and Obama are both running as adamantly opposed to everything that Bill Clinton did right.

I thought I had been following their policy proposals pretty carefully. I must have missed something.

And on spending, both are saying openly that they will dramatically increase spending if elected.

But they, at least, have put forward plausible proposals for paying for their new spending.

McCain is saying that he will fight to cut spending, and you even appear to agree that he has a solid record as a deficit hawk to back this up.

He used to be a deficit hawk. He seems, however, to have completely caved on that, and, in recent years, has become just another cut-taxes-and-spend Republican.

Also… it’s not clear that the first derivative is the right measure. Look more closely at Jimmy Carter’s growth record: (using year-to-year growth in real per capita GDP)
1976 +3.6%
1977: +4.5%
1978: +2.0%
1979: -1.4%
1980: +1.5%

Carter was not in office in 1976, so Ford gets credit for that year. I was using year-to-year growth in real GDP,
1977 +4.6%
1978 +5.6%
1979 +3.2%
1980 -0.2%
1981 +2.5%
rather than per-capita GDP. So my numbers are a little higher (but not, as far as I can see, in a way that would favour Democrats over Republicans or vice versa).

Done my way, average annual real GDP growth for the Carter years was 3.3%.

If you want to ascribe the first year of each Administration to the previous one, then Ford gets 1977, and Carter gets 1981. This lowers his average to 2.8%

But, if you’re going to do that, you need to apply it to Republicans as well. If you do the same for GHW Bush, his average annual growth rate drops from 3.2% to 2.3%.

Overall, it’s a wash. Democrats still outperform Republicans by a significant margin.

I should take the opportunity to correct the numbers for 1930-2007. I screwed that formula up when I added the GW Bush years. The correct numbers are:

Since 1930, annual Real GDP growth — Republican Administrations: 1.8%
Since 1930, annual Real GDP growth — Democratic Administrations: 4.9%

But, again, that ascribes the Great Depression to the Republicans, which I suppose is unfair.

If you think there’s a fairer way to do this calculation, I’d be happy to hear it. But let’s apply it to the whole time-series, not just cherry-picking particular Administrations. As TWL and I discussed, you can ascribe all sorts of exogenous factors to explain the GDP growth (or lack thereof) in any particular Administration. It’s only when you look at the whole series that a (remarkably consistent) picture emerges.

(All my number come from the Commerce Department’s Bureau of Economic Analysis)

You seem to have an awful lot of faith there. Clinton and Obama are both running as adamantly opposed to everything that Bill Clinton did right. Perhaps they are just lying, but I wouldn’t be sure.

And on spending, both are saying openly that they will dramatically increase spending if elected. McCain is saying that he will fight to cut spending, and you even appear to agree that he has a solid record as a deficit hawk to back this up.

So, why exactly would you expect Clinton or Obama to be better on spending than McCain, when even they would disagree with you?

Last point. On the GDP growth under different administrations — I think it’s important to note that the economic results in the first year or even two of an administration usually have much more to do with the previous administration than with the new one (to the extent that they’re a result of anything politicians do). At the very least you should wait until an administration has passed a budget (eight months in) if not until that budget starts happening (twelve months in) before giving them the credit or blame for the results. And I’d argue that the economy moves even more slowly than that.

This change makes the difference between, for example, giving Jimmy Carter credit for an annualized 2.2% growth in per capita GDP (thanks to the strong growth in 1976 and 1977) or blaming him for a slight loss in per capita GDP due to the strong losses in 1979 and 1981… And again with judging Bill Clinton’s effect on growth, limiting the measurement to his exact term in office gives him none of the blame for the 2000/2001 recession — during most of which George W Bush was trying to get elected and then to get his economic team confirmed by Congress.

Also… it’s not clear that the first derivative is the right measure. Look more closely at Jimmy Carter’s growth record: (using year-to-year growth in real per capita GDP)
1976 +3.6%
1977: +4.5%
1978: +2.0%
1979: -1.4%
1980: +1.5%

The point is Carter clearly presided over a very poor time in the U.S. economy, and you can see economic growth tanking over his term. But simply measuring the total growth wouldn’t capture this at all.

Finally, it seems pretty obvious that the major depressor of real GDP growth through the ’70′s was OPEC — 1973, 1974, and 1979 — the three years of OPEC oil crises — are the only years in that decade to show losses, and they’re quite dramatic, with 4.75% growth from 1972 to 1973 plummeting to a 1.4% loss from 1973 to 1974… While price controls probably exacerbated this effect… it’s hard to argue that the taxing or spending habits of the Nixon, Ford and Carter administrations were to primary driver of GDP growth.

(** Note: all GDP data taken from http://www.measuringworth.com/usgdp/?q=hmit/gdp
Further note: what I’m calling 1979′s real per capita GDP growth is the percentage difference between the rpcGDP in 1980 and 1979 **)

But Jacques, you make a lot of the past GDP figures under Republicans and Democrats – but what of the present candidates and their call for renewed protectionism? … The point of my post was not to look back, after all, but to look forward to campaign themes

I expressed, elsewhere, my disappointment with the Democratic candidates’ pandering on trade policy. And I don’t have much to add to the position I outlined.

But, if you want my prediction as to what a Clinton or Obama Administration’s Trade Policy will actually look like, I think it will look very much like the policy of the previous Clinton Administration.

As to McCain’s economic policy, I’m not so confident. He used to be a Deficit Hawk (and voted against the Bush tax cuts). More recently, he seems to have drunk the supply-side Kool-Aid (Tax cuts today, tax cuts tomorrow, tax cuts forevah !)

Perhaps that’s the pandering that he has to do, to secure the nomination in today’s GOP. Perhaps he actually intends, once in office, to turn the tide of fiscal irresponsibility that has marked the current Administration.

But, the guy who’s said

The issue of economics is not something I’ve understood as well as I should.

and

I’m going to be honest: I know a lot less about economics than I do about military and foreign policy issues.

is not the person I’m going to bet on to turn the tide of the numbers cited above (note to self: must recreate that national debt spreadsheet; it was even more impressive than the GDP spreadsheet).

I will say I agree with Jacques about one thing: it was politically courageous for Bill Clinton to bite the bullet and take Rubin’s advice on deficit reduction. Government borrowing crowds out more productive borrowing, and Clinton deserves credit for at least a portion of the 90′s boom (though I also agree that the tech boom made Clinton’s economy look a lot better than it turned out to be, once the euphoria and overly exuberant stock prices collapsed).

But Jacques, you make a lot of the past GDP figures under Republicans and Democrats – but what of the present candidates and their call for renewed protectionism? We’ve had extensive give-and-take on this in other threads, and I know you and I are more alike than different in our stance towards free trade. The point of my post was not to look back, after all, but to look forward to campaign themes – and I maintain that if the Democratic candidates continue to spout protectionist drivel, they have given John McCain an opening that he can take serious advantage of…

Oh, and just to be clear, I’m not trying to argue that Republicans are better as regards growth. Just that, given how really narrow the fluctuation is in American tax rates and debt, the President just doesn’t have that much power over the economy. He’d have to jack effective rates up a lot, or run up WWII-size debts, before the effect really started showing up.

Can I quote you, next time someone makes the assinine argument that rolling back the Bush tax cuts will cripple economic growth in this country?

Otherwise, GDP growth is basically a function of population growth, new technology, and human capital accumulation.

Of course. The economy, for the most part, merrily chugs along, oblivious to who is in the White House. But, to the extent that it matters at all who is President, the Economy does perform modestly, but significantly better under Democrats.

You can say that’s a 77-year statistical fluke, or try to explain it away as a series of special circumstances in which Democrats (consistently) just got lucky.

But there it is …

Sorry, missed your reply . . . I’m going to argue (cribbing from much smarter people who have made the same arguments) that Rubin was wrong. First, while it is a plausible theory, in reality long-term interest rates don’t seem to track debt very well (they’ve been quite low the last few years, for example). Second, the ’90s growth started before Clinton was succesful at cutting the deficit, so it seems like the two probably weren’t related. And third, debt should, if anything, cause higher short-term growth (though it’s almost certainly bad in the long run) – this is a pretty standard economic result.

Then go to any other administration and see if you can spot an exogenous cause of high/low growth. If so, drop that administration, too. Let me know what you’re left with (this is the problem with a small sample) . . . or provide an actual reason that growth would (prima facie) be higher under Democrats. Because, again, even if you did have enough observations to form a good sample, correlation does not imply causation.

Ryan,

I didn’t say Social Security was a looming crisis. I just said that it would cost a lot – more, for instance, than servicing the last eight years worth of debt. As such, any talk of burdens being punted to future workers should probably start with the major burdens, not the “damn, there’s a pebble in my shoe” burdens.

Or to put it another way: if we want to retire, we should pay for it ourselves . . . by saving. Notice that this is a normative claim, not a positive one. We can totally force future workers to pay for us and it won’t destroy America. We can punt part of the cost of the war to them, too, without any massive economic effects. It will just be wrong.