The NYT had a piece today on President Bush's economic legacy. In the second sentence it tells readers that: "Mr. Bush has spent years presiding over an economic climate of growth that would be the envy of most presidents." adding that "Yet much to the consternation of his political advisers, he has had trouble getting credit for it, in large part because Americans were consumed by the war in Iraq." Is that right? Let's check the numbers. Here the ranking of the presidential terms since 1960 by average annual GDP growth: Kennedy-Johnson -- 5.2% Clinton -- 3.6% Reagan -- 3.4% Carter -- 3.4% Nixon-Ford -- 2.7% Bush II --2.6% Bush I --1.9% President Bush's growth record is better than his father's, but it is worse than the record of every other president in the last half century. It's not clear why they would be envious. It is also not clear what his political advisers have to complain about. Later, the article tells readers that: "from a strictly economic perspective, it is difficult to blame Mr. Bush for the current crisis. Even some economists who have been critical of the president, like Bruce Bartlett, who worked in the Reagan and first Bush administrations, say he cannot be held liable for the burst of the housing bubble or problems in credit markets." Actually, from a strict economic perspective President Bush is absolutely responsible for the fallout from the collapse of the housing bubble. Competent economists recognized the bubble and warned of the harm that would come from its inevitable collapse. President Bush absolutely can be blamed for the fact that he chose to ignore the bubble or that his economic team failed to recognize it. The fact that the NYT found a Republican economist who would not hold President Bush responsible for the bubble does not make a compelling case for his innocence. It is also important to note that President Bush was eager to claim credit for the growth created by the expansion of the bubble (and the NYT was anxious to give it), therefore it is difficult to see any reason that he should not be blamed for the recession created by its collapse.
--Dean Baker
