As far back as I can remember it has been “common knowledge” that our country’s economy is better during business-friendly Republican administrations. This is presumably due to the GOP’s policies of lower taxes, less regulation and reduced social spending. But on closer examination the record often indicates otherwise.
A 65-year study by the Woodrow Wilson School of Economics at Princeton University completed in July of 2014 indicates the U.S. economy has performed better by most measurements under the Democrats. Over the study period, national income (GDP) growth averaged 4.35% annually under the Democrats and 2.54% under Republicans. Over this same period private-sector job creation grew 1.6 times faster under the Democrats. Federal indebtedness also grew faster under the Republicans.
If you question these figures look them up for yourselves. It’s not that hard.
During the 2016 presidential campaign Republican attack dogs criticized President Obama for the lagging economic growth during his administration. But after inheriting the worst economy since the Great Depression our economy began to perform significantly better under Obama than in the previous eight years under the Republicans. Unemployment also began to drop early in Obama’s second term. And the economic growth begun under Obama has continued under Trump. But Trump inherited this healthy economy, he didn’t create it as he claims.
I would not be so presumptuous as to suggest that the higher economic performance under the Democrats is entirely due to their superior economic policies and leadership. Economic performance is often influenced by outside factors such as demographic shifts, world energy price fluctuations, wars, interaction with foreign economies and our own (supposedly) independent Federal Reserve policies. But no matter how we view them, the numbers have mostly favored the Democrats.
Republican icon Ronald Reagan was a disciple of economist Milton Friedman and his supply-side economics, where taxes are arbitrarily reduced to stimulate economic growth. This increased activity is supposed to produce enough new taxable revenue to cover the losses from lowered taxes. Sound a little complicated and iffy? It is. Reagan’s Vice President George H. E.W. Bush called it “voodoo economics,” a conservative pipedream.
I voted for Ronald Reagan twice, and would probably do so again if given the same choices. But his economic growth figures were not as rosy as advertised compared to his predecessor Jimmy Carter. Reagan averaged a 3.64 percent annual GDP growth compared to Carter’s respectable 3.32 percent. But Reagan’s results appear rather puny when compared to some other Democrats or to Eisenhower. And in his eight years Reagan actually doubled our national debt. He left the biggest deficit of any president since World War II. How did this come about?
Reagan observed that the Soviet economy was faltering badly, partially from U.S. containment policies begun in 1946. And to his everlasting credit he raised U.S. defense spending, which forced the Soviets to increase theirs to keep up. This soon bankrupted the already failing Soviet economy and hastened the USSR’s collapse.
But Reagan made one error. He failed to ask Congress for the additional tax revenue to cover his increased defense spending. He naively suggested that Congress should cut social spending to make up the deficit. Cut social spending, Congress’s pork, its very mother’s milk? I ask you, which is worse for our long-term economy: “tax and spend” Democrats or “borrow and spend” Republicans?”