Do Republican governors really do better on the economy?

August 29, 2012

One weird theme in Tuesday night's Republican National Convention speeches was GOP governors like John Kasich (Ohio) or Mary Fallin (Okla.) bragging about how great their economies are doing. "When we came into office we were 48th in job creation," Kasich said. "You know we're we are today? We're fourth in America -- fourth in job creation and number one in the Midwest."

This is supposed to signal the success of Republican policies, but is sort of off-message at an event dedicated to emphasizing the dismal state of the economy after Obama's first term in office. So can those two claims be squared with each other? Are states with Republican governors really doing better?

It's tough to say. On the one hand, there's very little good data on the latest crop of GOP governors, given that they were only elected in early 2011. One can look at monthly unemployment data in the following chart.

So…yeah, not much difference. Let's zoom in.

So unemployment rates in Republican-governed states was ever-so-slightly higher and then the two converged as the recovery proceeded. But the differences here are tiny. At its height, the gap between the two groups was 0.22 percentage points, which turned into a 0.082 higher rate in Democratic states in April. That's a swing of 0.32 percentage points in favor of Republican states.

That's not much at all, especially considering all the regional factors that likely played a much larger role. It's also not especially meaningful given that unemployment rates at the state level are highly subject to swings due to population changes. If unemployed people move to a state in search of work, its labor force grows and adds an unemployed person, so the unemployment rate grows. But if anything that reflects economic health in that state. So let's look just at the number of works on nonfarm payrolls in each state, and how that changed from month to month. Did payrolls grow faster in Republican-governed states? Well, no, as the chart below shows.

Unfortunately there's not a lot of other data available in regular intervals at the state level. Personal income growth is reported quarterly. It also shows no real difference between Democratic-governed states and Republican-governed ones.

All of which is to say: we live in one economy. Its growth rate and unemployment rate is determined by the Federal Reserve, the value of the dollar, federal budget and tax policy — basically everything but the party affiliation of state governors.

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