Combined with the most recent strong GDP growth figures, it looks like pretty good news for Barack Obama and Hillary Clinton.
So if you were a Republican, what would you say about the economy? If you were Donald Trump, you’d say that it’s a disaster from top to bottom, nobody has a job, cannibal hordes roam the streets, and most Americans have to eat their own shoelaces in order to survive. But here on Planet Earth, it’s a good time to take stock of President Obama’s record and what it suggests for the two parties.
If they were going to be honest, Republicans would have to admit one of two things. First, Barack Obama and Democrats in general have cracked the code on job creation, and we don’t have to debate how to go about it anymore. Or second, the president doesn’t have much effect on the economy one way or another.
The reason I say that Republicans would have to admit one of these two things is that they take as their starting point that with the right set of policies from Washington, we can produce a spectacular economy, yet what they most certainly cannot say is that their economic alternative — a program centered on tax cuts for the wealthy and rolling back regulations on corporations — affords any hope of better performance than what Democrats are offering.
What’s really important is that we don’t have to speculate about how these two sets of ideas might work in practice, because we’ve tested it over the last couple of decades. And the results are in. So far during Obama’s time in office, the economy has created 11 million jobs. If we measure from the trough of the recession about a year into his first term, it’s 15 million. There are other critiques you can make about the country’s economy, but one thing you can’t say is that Obama didn’t bring back jobs.
Let’s look at a couple of charts. The first one shows average job creation for the last six presidents, three Republicans and three Democrats. A quick methodological note: since we don’t yet have job data for November and December, in assigning a figure for 2016 to make Obama’s average I’ve assumed growth in those last two months equal to the average so far this year, which is 182,000 jobs per month. For the second graph, I’ve assumed that that rate would persist through 2017. We obviously don’t know if it will, but right now it’s as good a bet as any. And these data are seasonally adjusted nonfarm employment. So here we go:
So: all three Democrats look good, particularly Bill Clinton, and only Reagan among the Republicans did well. You can argue, however, that what happens in a president’s first year isn’t really due to his decisions — he’s inheriting an economy from his predecessor, the budget for his first year was written before he got into office, and there will be a lag before his policies can really take effect. So another way to look at it is to grade each candidate on a one-year lag (so for instance, Clinton would be scored on job creation from January 1994 to January 2002). Here’s what that looks like:
The biggest differences here are that Carter looks worse and Obama looks better. In the latter case, Obama came into office during the depth of the Great Recession; in his first few months in office the economy was hemorrhaging around three quarters of a million jobs a month. Take that first awful year out, and he’s doing very well.
But it’s important to note that the president among these who offered the purest expression of Republican economics, and the one most closely analogous to what Donald Trump proposes, was George W. Bush. Both Ronald Reagan and George H.W. Bush raised taxes at some point during their presidencies, but Dubya was the one who believed most firmly in the equation of tax cuts + regulatory cuts = glory. And even when we look at numbers that remove the Great Recession from his ledger, he still has the worst record.
Now let’s bring this back to the present. The man Republicans nominated to be their standard-bearer has said many times, “I will be the greatest jobs president that God ever created.” While he has suggested a few additions to ordinary Republican doctrine — like initiating trade wars with gigantic tariffs, which no sane economist thinks would be anything but a disaster — the core of his plan is, as it always is with Republicans, tax cuts for the wealthy and rolling back regulations. And we already know how that turns out.
So perhaps Republicans could argue that the number of jobs is only part of the story, and they’d be right. For instance, wages are still lagging behind what we’d like them to be, the recent jump notwithstanding. But is there any evidence that a Bush/Trump-style set of policies would bring them up? No, there isn’t. Or perhaps Republicans could argue that their program will deliver less precisely measurable benefits, like security. But that’s preposterous, since Democrats favor a whole slate of measures that enhance security — guaranteed health care, paid family leave, stronger worker protections — that Republicans oppose.
No, the essence of the Republican argument is always the same: if we follow Democratic policies we’ll sink into a bottomless pit of economic misery, while if we cut taxes and cut regulations, the economy will erupt in a blinding supernova of wondrous prosperity.
That argument is impervious to facts, because its underpinnings are moral, not practical; Republicans believe that low taxes and weak regulations are a moral good, whether they work or not. We could argue about that. We could argue about whether things would have been even better if we had followed a different set of policies over the last eight years. We could argue about what steps we need to take to make the economy more humane and distribute gains more equitably. We could even argue about whether the administration’s policies make that much of a difference, or whether other forces in the economy over which he has no control are much more important. All of those are important questions.
But we can’t argue about whether this president has on the most basic level been good for the economy, because that question is pretty much settled.