The economy is on everyone's mind. When you think or talk about the economy, remember this: Democrats are always better for the economy then Republicans. This has been true for at least the past fifty years and probably the last hundred years. What's more, this is true even if you're using Republican definitions of "good".
Let me explain.
Democrats do a better job helping working and middle class families.
Are you concerned about the gap between rich and poor in this country? Princeton scholar Larry Bartels recently published a massive study of the American economy over the last fifty years in his book Unequal Democracy. He demonstrated that under Republican administrations the gap between rich and poor gets bigger and that under Democrats the gap gets smaller.
Why? Bartels is cautious, but offers a possible explanation that is fairly easy to understand. Everyone learns in high school economics that free market systems can run into two kinds of economic problems: inflation and unemployment. Often, policies designed to fight inflation increase unemployment and vice versa. Textbook stuff.
Bartels concludes that due to their ideologies, Republicans prioritize fighting inflation and Democrats prioritize fighting unemployment. So far, so good. But who benefits from disproportionately anti-inflation policies? The people who have lots of money that isn't decreasing in value. In other words, rich people. (Incidentally, if Obama wants to raise your taxes, you're rich).
Who benefits from disproportionately anti-unemployment policies? People who need jobs. Working and middle class people.
Bartels also includes case studies of how Republicans pander to the wealthy through discussion of Bush's tax cuts and failures to increase the minimum wage.
If you care at all about helping working and middle class families, you need to vote for the party that has consistently fought unemployment. The party whose administrations have reduced the income gap. The Democratic party.
Democrats do a better job managing the economy overall.
Perhaps you are a libertarian or conservative who believes that the gap between rich and poor is a natural consequence of the free market economy. Even by that standard - a conservative standard - you are better off voting for Democrats. Michael Kinsley of Slate ran the numbers for the last fifty years using statistics from the annual Economic Report of the President, a freely available and non-partisan source. Alternatively, you could look at Alan Blinder's article in the New York Times, where he explains his similar results.
On inflation, unemployment, and GDP, Democrats did better. The real shocker? Democrats did better while having less government spending overall and while spending more on defense than Republicans. Even by Republican standards Democrats did better.
Admittedly, this is all just correlation. More economic crises, wars, and natural disasters occured during Republican administrations. That could be chance. But I think it's more likely that Democrats regulate markets more effectively. Democrats start fewer wars. Democrats respond effectively to ecological disasters (think FDR's response to the Dust Bowl) while Republicans ignore them (think Bush's response to Hurricane Katrina).
Democrats are better for the stock market.
Let's simplify things still further and assume the only economic indicator you care about is the S&P 500. Since 1929, you would have done twenty-five times better investing under Democrats than investing under Republicans. Even if Herbert Hoover's disastrous presidency is excluded, you would have done six times better under Democrats. Since 1900, Democratic administrations average much better returns per year than Republicans.
Slate's explanation: Republicans fail to effectively regulate markets. Investments in infrastructure and education pay more dividends than tax cuts for the wealthy.
I think that's true, but Tommy McCall's chart suggests an additional explanation.
My take: even "bad" Democratic presidents, like Jimmy Carter, are really just mediocre. Stagflation wasn't that bad compared to the last eight years. On the other hand, bad Republican presidents (Hoover, Nixon, Bush) are really bad - in fact, staggeringly bad. Amazingly bad.
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