About the economy and Democrats, Part II

The sign-maker misspelled "middling." (Jamie Squire / Getty Images)

The sign-maker misspelled “middling.” (Jamie Squire / Getty Images)

The initial estimate for first-quarter GDP is out, and — surprise! — it’s lousy. From the federal government’s own report on its data:

“Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at an annual rate of 0.5 percent in the first quarter of 2016, according to the ‘advance’ estimate released by the Bureau of Economic Analysis. In the fourth quarter, real GDP increased 1.4 percent.”

This is the third straight 1Q in which real, annualized GDP growth was less than 1 percent. Oh well, winter’s always a tough time, right?

Actually, it wasn’t always thus. Below are the average 1Q growth rates dating back to the beginning of the federal data set in 1947. I’ve even taken the initial 1Q of a presidency off its books and added it to that of its predecessor, since it’s hardly fair to pin economic performance on a guy who’s still figuring out where all the bathrooms are in the White House, right? Particularly so in the case of Barack Obama, who inherited a terrible recession. So, fear not, that awful January-March stretch of 2009 is on George W. Bush’s ledger, not Obama’s, in this analysis. And yet:

  • Obama: 0.7 percent
  • Bush-43: 1.2 percent
  • Clinton: 2.3 percent
  • Bush-41: 2.1 percent
  • Reagan: 3.0 percent
  • Carter: 3.0 percent
  • Nixon/Ford: 4.3 percent
  • JFK/LBJ: 7.5 percent
  • Eisenhower: 2.6 percent
  • Truman: 5.0 percent

I’m not aware of any structural economic reasons 1Q would have become markedly worse over the past few years. This is, however, in keeping with recent history. In no single quarter during Obama’s presidency has the one-year trailing average of GDP growth matched the long-term average of 3.3 percent. His best mark was the 3.1 percent from 4Q of 2009 through 3Q of 2010. It’s been all downhill since then; only one other time has the one-year average hit even 3.0 percent. He’s averaged 2.1 percent on that score, even if we don’t start counting until after the numbers turned positive.

He fares no better on two-year trailing averages, never once hitting 3.0 percent, much less the long-term average of 3.3 percent. Nor on four-year trailing averages, nor six-year trailing averages. I suppose I could try three- and five- and seven-year averages, but I have a feeling the story would be the same. At this rate, the eight-year average will, too.

Note: There is not a single other president since 1947 about whom I could have written the above. Everyone else, from Truman to Dubya, hit these long-term averages in at least one quarter during his presidency.

Now, as I wrote the other day, presidents get too much credit and blame for the economy’s performance. I’m not changing my tune here — just pointing out that even on their own premises, the left is wrong about how the economy has fared on this Democratic president’s watch. Maybe the facts will at least persuade them that such simplistic slogans and pseudo-analyses about the economy and partisanship really aren’t worth much.

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69 comments
Lil_Barry_Bailout
Lil_Barry_Bailout

Real GDP growth: Yet another thing in which Our President Bush is superior to Obama.

Starik
Starik

@Lil_Barry_Bailout Start a stupid war or two and private and public sector spending will increase rapidly, boosting GDP.  Got to replace all that expended ammunition, worn out and destroyed equipment, expansion of military hospitals and transporting bodies for burial.

Lil_Barry_Bailout
Lil_Barry_Bailout

Obama has spent $600 billion to $1.9 billion more per year than Our President Bush, and has worse economic growth.

Math: How does it work?

Lil_Barry_Bailout
Lil_Barry_Bailout

I have to correct that...Obama has spent $500-$600 billion more per year than W. $600 billion - $1.9 trillion are Obama's deficits. And yes, that includes off-budget spending.

Lil_Barry_Bailout
Lil_Barry_Bailout

And FWIW, Obama spends more off-budget and has far larger off-budget deficits than Our President Bush.

Lil_Barry_Bailout
Lil_Barry_Bailout

About 1/20th of what we've spent on the failed War on Poverty, which hasn't accomplished anything either.

JKToole
JKToole

The largest economic collapses in the modern U.S. that spawned the Great Depression and Great Recession came about following and during Republican administrations.

Lil_Barry_Bailout
Lil_Barry_Bailout

Yes, blame Our President Bush--for not fixing Democrat policies.

RoadScholar
RoadScholar

Let's grade  the repub House. Is negative grade available? Maybe if the repub House members would get their collective heads out of their a$$, then maybe the economy might improve. let's slash some more taxes for the rich and corporations. Let's cut more spending on infrastructure. (have you noticed the backlog of needs that are mounting???)

And why are they being paid if they do nothing...worse than the alleged moochers that are poor.


And bring on Trump who is already contemplating when to drop a A bomb.

lvg
lvg

@RoadScholar Hey - They did some important work today; passing a bill to undo the requirement by Obama that financial investors have their customers best interests  when advising on investments. Cons in the House probably think Bernie Madoff should be a national hero with a holiday  for him.

Lil_Barry_Bailout
Lil_Barry_Bailout

@lvg @RoadScholar

Funny that no Congress before had thought of making that a requirement.  It's almost as if there's more to the story than you're telling us.

Caius
Caius

Note the trend. Laying aside Truman's WWII 5.0 and Ike's post war 2.6 we have the following:


7.5 - 4.3 - 3.0 - 3.0 - 2.1 - 2.3 - 1.3 -  0.7 Appears to be going down, down, down....


This is way past political parties and economic/political philosophy. But I predict both parties/candidates will continue to blame the other party/candidate. And, predictably, I will continue to blame Congress.


My grandpa said as soon as Calvin said "I choose not to run for president in 1928" he knew we were in big trouble.  He was a Coolidge man.


Besides being a man a few words, Calvin was also a seer -  He knew not to be president in the year 1928.

Kyle_Wingfield
Kyle_Wingfield moderator

@Caius Note that these are just 1Q numbers.

That said, there certainly has been something of a leveling off. As I mentioned on a comment further down, there are a number of factors: the recovery of war-torn Europe and Asia; developing markets becoming more industrialized; increased competition in the flatter world economy; fewer technological innovations driving productivity since the IT boom; among others. But I don't think the proper conclusion is to be fatalistic. Rather, it's to realize that something needs to change -- in the economic philosophies of both parties, perhaps, but more broadly than that IMO.

The alternative is to believe the pie is a fixed size, and we'll get ever-smaller slices of it. Our slice may not be as large as it was in the 1950s and '60s, for the reasons mentioned above, but there's no reason the pie can't grow in a way that maintains a healthier trajectory of growth than we've had the past 10-15 years.

Lil_Barry_Bailout
Lil_Barry_Bailout

It's really no mystery.

Too much regulation, too much legal uncertainty, too much unilateral rewriting of laws by an economic know-nothing, too many mandates on job creators, too much net neutrality, too much Dodd-Frank, too much CFPB, too much federal spending crowding out private spending, ad nauseum.

Shorter: Too much liberal fascism.

Lil_Barry_Bailout
Lil_Barry_Bailout

@McGarnagle @Visual_Cortex @Lil_Barry_Bailout

Net neutrality by itself is not a huge drag, but it's emblematic of the entire Obama line of thinking, which holds that more government interference in  free markets is good.

And no one should be surprised that users of bandwidth (the tech companies you cite) like not having to pay for the bandwidth they use, while the companies who build and manage the networks want to be able to do that without interference from your know-nothing Messiah.

Nick_Danger
Nick_Danger

@Lil_Barry_Bailout @McGarnagle @Visual_Cortex 

"...it's emblematic of the entire Obama line of thinking, which holds that more government interference in  free markets is good." 

I agree that Obama doesn't not consider "the benefit of the market" as the holy grail of government policy. 

Rather, he seems more concerned with "the benefit of the people."  It's a difference in focus.

Lil_Barry_Bailout
Lil_Barry_Bailout

Free markets provide greater benefits to more people than any other system.

And if you want to build out telecommunications infrastructure to "benefit the people" go ahead. Liberal fascists prefer to commandeer the property of others and use it for their own purposes.

McGarnagle
McGarnagle

@Visual_Cortex @Lil_Barry_Bailout


"too much net neutrality"


Well now you are just shouting buzz words. If Obama is for it then it must be bad. Well most if not all major  tech companies are for net neutrality. Only the internet service providers are against it because they want to increase rates to customers.



McGarnagle
McGarnagle

@Visual_Cortex @Lil_Barry_Bailout


Net neutrality is not a liberal vs. conservative issue. Its how you view the internet and whether it should be open or restricted.


Why must we have a political slant on every issue.

McGarnagle
McGarnagle

Good stats. At the end of the day, the presidency goes the way of the economy. If Obama has done a poor job then Democratic nominee has no chance. 


But given Trump will be the republican nominee, all bets are off. 

Visual_Cortex
Visual_Cortex

 I’m not aware of any structural economic reasons 1Q would have become markedly worse over the past few years. 

How about an allergy to any new Federal public spending programs finally coming home to roost?

Or maybe a lot of the world's economic players are getting nervous at dealing with a country that could actually elect Donald Trump (or, ok, let's go there: Hilary Clinton) as its President?

just pointing out that even on their own premises, the left is wrong about how the economy has fared

And I'll continue to credit you there; this is a totally healthy discussion to have. 

But I'll also point out that I've never been one to talk about "the Bush Economy" or "the Reagan economy" either. There's plenty of blame/credit to spread around.

Kyle_Wingfield
Kyle_Wingfield moderator

@Visual_Cortex "Or maybe a lot of the world's economic players are getting nervous at dealing with a country that could actually elect Donald Trump (or, ok, let's go there: Hilary Clinton) as its President?"

As far back as Q1 2014?

Kyle_Wingfield
Kyle_Wingfield moderator

@Visual_Cortex If Trump is elected and everything suddenly goes in the crapper starting mid-November, it will be hard to pin that on Obama.

Visual_Cortex
Visual_Cortex

@Jefferson1776 @Lil_Barry_Bailout

I think Obama must have used his Jedi mind trick to make them spend more than they took in?

Or maybe, just maybe, deficit spending became the new normal in all but the most economically splendiforous of times? And that there isn't a soul out there on the national political stage who would seriously suggest all-at-once cutting 600 billion from spending or collecting 600 billion more in new tax revenue?

nah, can't be that.

Visual_Cortex
Visual_Cortex

@Lil_Barry_Bailout @Jefferson1776

And what kind of sane person wouldn't have "ratcheted spending up" after the worst economic collapse since the Depression?

I've asked this over and over and I've yet to meet a halfway intelligent conservative who wouldn't grudgingly accept that a President McCain would've almost certainly tried to stimulate the economy in a somewhat similar fashion.

Only difference being, it wouldn't be remotely controversial.

Nick_Danger
Nick_Danger

@Lil_Barry_Bailout @Nick_Danger @Visual_Cortex @Jefferson1776 

So, you're saying the Congress who tried to repeal the PPACA fifty-eleven times would not attempt to pass a bill they believe in, even against steep odds? 

And did you know that only the Congress can pass a spending bill - not the Preident? 

Actually, I'm sure you do know that, and are just being disingenuous.

Lil_Barry_Bailout
Lil_Barry_Bailout

According to your Messiah, the economy is great, and the government is STILL spending $600 billion more than they take in, snd $600 billion more than what W spent.

Federal spending is not the problem.

Lil_Barry_Bailout
Lil_Barry_Bailout

And yet you give Obama a pass on the entire first quarter of 2009?