Who Creates Jobs? (Dem Presidents Do!)

Rasmussen and Fox TV released a poll that says that 38% of Americans believe a depression (not just recession) is somewhat likely.

More interesting to me, they asked whether private companies, Congress, or the president has the most to do with creating new jobs. I find it amusing when pollsters ask for opinions on something that is purely factual. Only 5% got the right answer and said it is the president.

For the evidence that Democratic presidents create jobs, read on...

It is a simple matter to go to the Bureau of Labor Statistics and look up the number of private-sector jobs each month since 1939.

Do we find a correlation between annual job growth and whether the president is Democratic or Republican? We sure do:

Annual
Job    Party  President
Growth
8.8%   Dem    Roosevelt (1939-war)
3.5%   Dem    Johnson
3.3%   Dem    Carter
2.6%   Dem    Clinton
2.6%   Dem    Roosevelt (wartime)
2.4%   Dem    Truman
2.3%	Rep   Reagan
2.1%	Rep   Nixon
2.1%   Dem    Kennedy
0.8%	Rep   Ford
0.5%	Rep   Bush II
0.5%	Rep   Eisenhower
0.4%	Rep   Bush I

The correlation jumps out at you. Almost every Democratic president has been more successful at creating jobs than almost every Republican president, for as far back as statistics are available.

How does the president make a difference? I can tell you that Bush II has made a difference by vetoing a labor bill and a children's health bill. He has made a difference by having his friends in the Senate filibuster a minimum wage bill (McCain joined on that), an energy bill twice (McCain skipped out on those votes), and a Medicare prescription drug bill (McCain skipped out again). Bush has made a difference by giving breaks to the rich, who don't need it.

Republicans believe in the trickle down theory. They think that if you help the rich and the big corporations, that they will use a portion of the money to hire more people, causing money to trickle down to the middle and lower classes. It has never worked, as the table above shows.

Democrats, you might say, believe in trickle up theory. Help the lower and middle classes. Help the people who spend every dollar of their paycheck.  They will buy more goods -- goods they needed but could not afford without help. Companies will have to hire more people to produce and sell the additional goods. Those new workers will buy yet more goods, extending the cycle. This works.

How about Congress? Do they make a difference? Perhaps some, but not as much as the President. We can make a similar table for each Congress since 1939.

The worst Congress in history for job creation was the 107th (2001-2002), with a Republican president, Republican House, and split/Democratic Senate.

There were five Congresses during which we had a net loss of jobs. Four of the five were under Republican presidents. On the other hand, three of the five were under a Democratic House. Three of the five were under a Republican Senate. The correlation is not good for Congress, but it is for the president.

The 12 best Congresses for job creation were under a Democratic House. On the other hand only 8 of 35 Congresses in this period had a Republican House, so that does not say much.

Average job growth under Republican Houses has been 1.1%/year. The average under Democratic Houses has been 2.5%. For Republican Senates it has been 1.6%, while for Democratic Senates it has been 2.6% (excluding the 107th split Senate).  This makes a Democratic Congress look good, but the difference is not as big as that between Democratic presidents (3.6%) and Republican presidents (1.1%).

Best of all is to have a Democratic president and a Democratic Congress.  When the president and both houses of Congress are Democratic, annual job growth has been 3.7%.

Private companies, of course, are directly responsible for creating the jobs; but the number of jobs they create is going to depend on their budget. If the government follows trickle down theory, it will not do as much to put those companies in a position to be able to add to their payrolls as if it follows trickle up theory.

If you want to end this recession (or depression?), you need to create jobs. To create jobs, we need a Democratic president.

•  Isn't W

  the only president since Hoover (1929-1933) who could "boast" of a negative job growth rate for an entire term (2001-2004)?

  And they tend to "forget" that there were more people unemployed after 8 years of Saint Reagan than before, and more still after 4 years of Bush daddy.

  by Bahrfeldt on Wed Mar 19, 2008 at 03:21:03 PM PDT

•  Here's another metric for you

  It's pretty lonely here, so I thought I might cheer you up.

  According to NBER data, we've had 11 (although it might be 12 in a few months) recessions since 1929.

  The total length of time of those recessions is 158 months.  So we've been in recession about 19% of the time.

  During this period, we've had a Republican president for 39 of those years, and a Democratic president for 30.  So you'd imagine, chance calls for the Democratic presidents to have overseen about 70 months of recession, and the Republican president about 90.

  But no!  In those 30 years, only 38 months have been in recession, for about 10.6% of the time, while the Republicans have overseen 120 months of recession, or about 25.6%.

  So to put it mildly, you have a 150% greater chance of a Republican recession than a Democratic recession.  And if you want to pick the numbers more, you'll see that most of the time there's been a recession under a Democratic president, it's been a carry-through recession started by a Republican administration.

  by Dcoronata on Wed Mar 19, 2008 at 04:21:03 PM PDT