The Gap Between Rhetoric and Reality: Which Party Best Manages the Economy?
On November 10 I watched the fourth Republican debate, which, insofar as fourth things go, was at times as enjoyable as eating your fourth pint of Haagen Dazs, while at others was as intellectually stimulating as the fourth Alvin and the Chipmunks movie, "Road Chip." During the debate, Carly Fiorina was asked how the GOP can defend its economic record when the economy has historically performed better under Democrats. Fiorina avoided answering, but the question is still worth considering. Republicans routinely call Obama a job-killing President, and market themselves as job creators who can grow the economy. Meanwhile, in the last Democratic debate, Hillary Clinton said that the economy does better under Democrats in the White House. Both parties aren’t simply disagreeing on opinion, but rather on verifiable facts. It’d be like debating about the ending of "Inception," not arguing over whether or not Leonardo Dicaprio was still dreaming, but whether or not the film was inspired by a true story. Both parties are talking about the same economy, so who’s right? Both and neither, actually, which is about as helpful as an answer as "I don’t know," "check the syllabus," or "I can’t find the expiration date, let’s just try it and see what happens." To begin, the question itself is not without problems. The President’s actual influence on the economy is limited. Congress and governors, often from the opposing party, share some of the responsibility for how the economy performs as well. Furthermore, external events like oil shocks or technology booms, events outside the President’s control, can directly shape the economy more than his policy ever could.
With those limits in mind, let’s examine the state of the current economy. Republicans would characterize the President’s policies and regulations are "killing the economy." The numbers would suggest something different. Under President Obama’s recovery, unemployment is now at 5 percent, eight million jobs have been added, and debt as a percentage of the GDP has shrunk from 9.8 to 2.5 percent. However, Republican critics, like Jeb Bush in the last debate, could rightfully point out that many of these jobs are lower paying, growth is modest at best and many Americans have left the workforce.
The trouble for Republicans is that, while those charges are true, there’s little evidence to suggest that the economy would be better under Republican leadership. Looking at the economic record from FDR to the present, the Democrats continually outperform the GOP in key economic metrics. Since 1961, the Republicans have held the White House for 28 years, the Democrats for 27. During that time, seventy-one million jobs were added: 24 million were created under Republicans, and 47 million under Democrats. By a nearly two to one ratio, Democrats outpace Republicans on job creation. Bush and Rubio have set the lofty goal of achieving four percent growth, but on that front Democrats have also historically performed better: from 1949-2013, the economy grew at an average of 4.35 percent a year under Democrats compared to 2.54 percent under Republicans. During that same period, the economy has been in recession for 49 quarters: a Democrat has been in the White House for only eight of them. Finally, on debt, Democrats also outperform Republicans: in the past 40 years, only Democrat Bill Clinton was able to pass a balanced budget.
Despite all of this, many voters and candidates don’t see it that way. To many, Obama and Democrats are job killers who overburden the economy with regulations. Tax cuts and Reaganomics, they suggest are the best way to grow the economy. Hearing that Clinton and other Democrats outperformed Reagan on many economic metrics would probably come as a surprise to most Americans: it would be like hearing that Paula Deen was at a "Black Lives Matter" protest, or that Cinnabon's primary ingredients are not lard, self-loathing and despair. The underlying issue is that, beyond candidates not looking to the historical record, Americans can’t even agree what that historical record looks like.
This is a problem. Our history is the thing that tells us not to wear Crocs again in public, not to wear a sexy halloween costume to your church’s fall harvest party and not to go to a nude beach on grandparent’s day. If candidates are expected to debate on which party can best manage the economy, it would help if they could at least agree on basic facts pertaining to how the economy is doing. Otherwise, both parties are operating from two alternative universes, which does not bode well for compromises or policymaking. The troubles get worse: if economic policies can be proposed without data or historical support, then there’s no telling how many unrealistic and radical policies can be proposed. In this election, with both parties’ bases radicalizing, that trend has plagued both sides. Republicans have proposed tax cuts that’d resemble tithing, tax forms that could fit on a postcard and three page tax codes, most of which would explode the deficit. Democrats, rather than run on their historically proven policies that mixed modest targeted tax cuts with free trade and a robust social safety net, have lurched left, proposing ridiculous minimum wage hikes, rejecting the TPP, and calling for punitive policies towards Wall Street. Whether by circumstance or policymaking, the Democrats deserve an A on their past economic record, but in this election, they’re in danger of losing that.
Democrats and Republicans are both right. The economy is doing well, but it could also be doing better. Both parties would be served by remembering the historical record. Agreeing on the basic facts would mean both parties would know exactly what problems they’re trying to solve, and could provide a chance for candidates to propose solutions for those specific problems, rather than peddle tired ideologies that exist separate from facts. Not looking to the history presents it’s own slew of problems: that’s the mistake that leaves us with bad economic policy, three Alvin and the Chipmunks sequels and a world where we are returning regulars at our local Cinnabon.