Barack Obama has some reason to crow about the direction the economy has been moving lately. As he said in his press conference on Friday, "as a country, we have every right to be proud of what we've accomplished: more jobs, more people insured, a growing economy, shrinking deficits, bustling industry, booming energy." And it's true that there are some kinds of economic data that look excellent, particularly job creation, which is what I want to focus on for the moment. We've had 50 straight months of positive job growth, since September 2010, which is pretty remarkable. Once we get the December numbers there will probably wind up being around 3 million jobs created in 2014, which would make it the best year since 1999.
So how does Obama stack up against his predecessors in this department? As always, it depends how you look at it. But let's start with just the job numbers. Here's a graph showing every president since Eisenhower:
A few things jump out from this graph. While we don't know what will happen in the next two years, if the current trend holds, with the economy averaging around a quarter of a million new jobs a month, then by the end of his term Obama will have seen 12 million new jobs created on his watch. That would put him short of Clinton, Kennedy and Johnson, and Reagan, but ahead of Nixon and Ford, Eisenhower, and George W. Bush.
Of course, none of those presidents took office in the midst of an economic calamity of the kind we were suffering through when Obama began his term. If you want to be more generous to Obama, you could measure from the trough of the Great Recession, which in terms of jobs was February 2010. The economy has created over 10 million jobs since then, and if we continue the current trend, Obama could claim 16 million jobs between that point and the end of his term.
One problem with these raw job numbers is that they don't take into account changes in population. Creating a million jobs in an economy that has 100 million workers is a bigger deal than creating the same million jobs in an economy with 200 million workers. So let's look at the percentage change:
Here Bill Clinton no longer looks like the most successful; that award would go to Kennedy and Johnson, who saw 29 percent more jobs at the end of Johnson's second term than at the start of Kennedy's first. Right now Obama is a bit under 5 percent from where he was at the beginning of his term, and if the trend continues he'll be at around an 8 percent increase. Once again, better than some but not as good as others.
So what do we learn from this historical context? Only so much. After all, the impact the president's policies will have on the economy is both limited and difficult to unravel. For instance, George W. Bush and Ronald Reagan pursued broadly similar economic policies; both cut taxes (though Reagan raised taxes as well), and both ran up big deficits propelled by increases in military spending. Yet job creation was excellent under Reagan and terrible under Bush.
If nothing else, that tells us that there's no reason to believe the claims Republicans are wont to make about the explosive economic power of tax cuts.
You've probably heard people say, "Bill Clinton created 22 million jobs," but he didn't really create them. His economic policies were similar to Obama's-upper-income tax increases, a shrinking deficit-but he entered office after a recession had ended and was then the beneficiary of a tech boom, while Obama had the misfortune to come into office when the economy was in an extended collapse.
There's one thing we can say for sure, though, and it has to do with the flip side of the Republican insistence that cutting taxes will send the economy humming. They also invariably predict that Democratic policies will destroy the economy and send the country spiraling down into a grim future of penury and despair. Yet that never happens either. And just imagine how disappointed they'll be if at the end of Barack Obama's term the economy looks quite good, and staying the course seems to voters like the wisest option.
