Jobs, jobs, jobs. Democrats vs. Republicans - who does it best?

Jobs, jobs, jobs. Democrats vs. Republicans – who does it best?

Posted by Admin October 19, 2024 Jobs

It’s time to update my analysis of unemployment trends during Democratic and Republican administrations to illustrate the contrasting impact that D and R Presidents can have on the economy. I can’t say this often or loudly enough. Democrats are better than Republicans at steering the American economy. I have the receipts. It’s not even close. And I honestly don’t understand why anyone would even question it.

Biden has targeted job creation as one of his major policy objectives, and it infuses every aspect of his domestic agenda. Yet polls continue to question Dems’ ability to handle the economy and rate Republicans higher on running the economy. So let’s look at the numbers.

Since 1948, there have been 7 Republican Presidents: Eisenhower, Nixon, Ford, Reagan, GHW Bush, GW Bush, and Donald Trump. There have been 7 Democratic Presidents during the same time period: Truman, Kennedy, Johnson, Carter, Clinton, Obama, and Biden. So there are plenty of statistics to establish which party does the best job of creating jobs and directing the economy in America. If Republicans were really better than Democrats at running the economy, there should be evidence, right?

I use unemployment statistics as a proxy for the health of the economy, specifically, the unemployment rate published by the Bureau of Labor Statistics for every year since 1948. By using January numbers, I allow each President at least one year to establish an economic footprint, and I apply a consistent, non-seasonal benchmark to compare each administration.

The chart at the top shows the BLS-published unemployment data for January of every year since 1948. We can compare the change in the unemployment rate over each President’s term in office, and thereby extract a trend in employment during each administration. This will illustrate the impact each President’s administration has had on the American economy.

Since 1948, with the single exception of Jimmy Carter, every Democratic President has seen the economy improve and unemployment drop significantly during his administration. Carter had to deal with the oil crisis of 1979 and never recovered. By contrast, with the exceptions of Gerald Ford and Ronald Reagan’s first term, every Republican President has presided over an economy that has seen consistent increases in unemployment. Reagan benefited from a strong recovery after the Carter oil crisis years during his first term, but in his second term, unemployment showed a consistent increase. And of course, while unemployment improved under Ford, he was in office for too short a time to effectively assess his impact. Ford’s economy may also have benefited from the immense national relief at no longer having Tricky Dick as our Chief Executive.

UNEMPLOYMENT BY PRESIDENTIAL ADMINISTRATION, 1948-2021

President	D/R	Start Jan	End Jan	annual change %
Truman	D	1949	1953	-0.61
Eisenhower	R	1954	1961	0.25
Kennedy	D	1962	1964	-0.1
Johnson	D	1965	1969	-0.33
Nixon	R	1970	1975	0.51
Ford	R	1976	1977	-0.4
Carter	D	1978	1981	0.37
Reagan	R	1982	1989	-0.6
GHW Bush	R	1990	1993	0.66
Clinton	D	1994	2001	-0.35
GW Bush	R	2002	2009	0.08
Obama	D	2010	2017	-0.79
Trump	R	2018	2021	0.64
Biden	D	2022	2024	-0.15

Based on a linear regression of the data for each President over the past 75 years, the average Republican President saw unemployment go up by 0.16 percent per year, while Dem Presidents saw unemployment numbers drop by an average of 0.3 percent each year.

Obama’s performance is especially striking. After inheriting the economic mess that W handed to him (2 unfunded wars, massive tax giveaways, and a Wall Street collapse), Obama was able to bring unemployment down from 9.8 to 4.7 percent over his 8 years in office.

Trump inherited a strong economy and seemingly kept unemployment low during his first 3 years, but was killed by his mismanagement of the COVID pandemic in his final year. In comparison, Obama governed through 2 potential pandemics, the H1N1 flu outbreak in 2009 and also the scary Ebola outbreak in 2014. (Remember how badly Obama mishandled the deadly Ebola crisis that killed . . . wait for it . . . 2 Americans??) Yet the Obama administration still managed to preside over the strongest economic recovery of the past 75 years.

A 2010 article by govs comparing historical Dem and Republican handling of the US economy used a different indicator but came to the same conclusion. And even offered a theory to explain it.

The fundamental divide between Republicans and Democrats on economic theory is between John Maynard Keynes and Friedrich Hayek. You don’t have to know any thing about economic theory to know that Keynes believed that the government is a fundamental intractable partner in the nation’s economic well being and Hayek believed that it isn’t.

Since Democratic Presidents generally employed Keynesian economic policies during that period, and Republican Presidents generally employed Hayek policies, we are able to compare how the nation’s workforce, and its economic well being, fared under each economic theory.

Biden was handed a similar COVID-stoked economic catastrophe. Bidenomics has created another strong economy with a clearly improving unemployment trend. Biden’s unemployment numbers have shown consistent improvement, but have suffered from the fact that most of the improvement came in the first year, so Biden’s first benchmark was already low. It is very difficult to show consistent improvement when the unemployment rate is already below 5 percent. Simply maintaining a low unemployment rate would be considered an overall success, let alone reducing it further.

While unemployment is only one aspect of the overall economy, it is a strong indicator of the success or failure of the economic impact of the presidency. It’s pretty clear that Democratic economic policies have been far more beneficial to Americans’ pocketbooks than Republican policies, at least since the end of WWII. A pattern has emerged where Republican Presidents leave office with an economic disaster that the next Democratic President has to clean up. The good news is that we’ve been able to do that consistently. Spread the word.