So which political party is good at managing the economy?
According to data from U.S. Bureau of Economic Analysis, the U.S. Senate, and the U.S. House of Representatives, since Congress passed the Employment Act of 1946, the Democrats have controlled at the same time the White House, Senate, and House of Representatives 22 times. The average growth in gross domestic product during those years is 3.09%.
The Republicans, on the other hand, have controlled at the same time the White House, Senate, and the House of Representatives seven times. GDP grew on average 2.99%.
Since the Employment Act splits the management of the economy between the President and the Congress, and given the high degree of partisanship expressed regarding how either party manages the economy, I thought it would be interesting to see which party turned in the best performance. Holding constant other factors that impact economic growth, it appears that the Democratic Party has exhibited significant control of government during the economy’s best showings over the period 1946 to 2012.
Specifically, if we study the 14 years with the highest periods of performance, we find that the Democratic Party either controlled the White House and the entire Congress or controlled both chambers of Congress while a Republican held the Oval Office.
For example, the greatest growth in GDP during 1946 to 2012 was 8.7%. Democrats controlled the White House and Congress during this period. Out of the top 14 performing years, Democrats controlled both chambers of Congress and the White House for eight years: 1950 (8.7%); 1951 (8.2%); 1966 (6.6%); 1965 (6.5%); 1962(6.1%); 1964 (5.8%); 1978 (5.6%); and 1968 (4.9%)
While 1984 saw the Republicans controlling the White House and the Senate with a GDP growth rate of 7.3%, the remaining five years; 1955 (7.1%), 1959 (6.9%), 1973 (5.6%), 1976 (5.4%), and 1972 (5.2%), saw Democrats controlling both chambers of Congress while a Republican sat in the Oval Office.
Democrats, for some reason, never hark back to what they could argue as their past economic successes, having allowed the Republicans to tout the Kennedy and Reagan Administrations’ tax policies. Rather than just focusing on their Great Society wins of the 1960s, maybe it’s time to incorporate their economic wins, assuming they even understand why the economy succeeded when they dominated government back then. I doubt that they do.