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Already we have a strong contender for most misleading chart of 2013

010713dumbchart

The above chart comes from the book “Bulls, Bears and the Ballot Box.” It is used in a new Forbes column attempting to make the case that the economy tends to be stronger under Democratic presidents than Republicans — thus liberal economic policies are better than conservative economic policies.

Each president is given some sort of an economic score based on a verity of metrics “including inflation, unemployment, corporate profit growth, stock market performance, household income growth, economy (GDP) growth, months in recession.” And indeed, the US economy has done better under Dems than GOPers, at least according to these multivariable scores.

But what do party labels really tell us? What does this chart tell us? JFK and LBJ cut taxes, Bush I raised them. Clinton cut the size of government, Nixon enlarged it. Spending was lower under Truman than Reagan. And as a bonus, the columnist provides a strange analysis of the Reagan tax cuts that neither Keynesians nor supply-siders would agree with. He also completely forgets about the role of monetary policy during these presidencies.

Enough.

14 thoughts on “Already we have a strong contender for most misleading chart of 2013

  1. “But what do partly labels really tell us? What does this chart tell us? JFK and LBJ cut taxes, Bush I raised them. Clinton cut the size of government, Nixon enlarged it. Spending was lower under Truman than Reagan. And as a bonus, the columnist provides a strange analysis of the Reagan tax cuts that neither Keynesians nor supply-siders would agree with. He also completely forgets about the role of monetary policy during these presidencies.”

    As you do when it suits you: CLINTON RAISED TAXES, which you obviously chose to ignore.

    What nonsense.

    • He did indeed raise income taxes. He also cut Capital Gains taxes. You think that might have had any effect on corporate profit growth and stock market performance, 2 of the chart’s indicators?

      • Money fund assets total $2.7 trillion. Corporations are sitting on $1 trillion in cash. Do you think cutting dividend and capital gains taxes will get that money back to work?

        That said, the chart needs a new title. “Pragmatists run stronger economies than dogmatists.”

    • And the ’90s also happened to coincide with free trade, the Cold War peace dividend, and one of the most productivity-enhancing technology booms in history. Aside from a small minimum wage hike, there was literally NOTHING else in line with left wing economics during the Clinton years but except this tax increase, which didn’t come within a country mile of undoing the Reagan cuts.

      Had Clinton returned to 70% top marginal rates, re-regulated, re-unionized the American workforce, and increased spending instead of cut it, you would have a dispositive case against us. But you didn’t, so enough already.

      • “And the ’90s also happened to coincide with free trade, the Cold War peace dividend, and one of the most productivity-enhancing technology booms in history”

        Blah, blah, blah. The same stupid narrative cribbed off of 1000 wingnut websites. You’res sundering your own argument by even dragging these worn out nostrums into the debate.

        • ” You’res sundering your own argument by even dragging these worn out nostrums into the debate.”

          Heh. Maxie get pissy when actual facts challenge his rantings.

          • “Heh. Maxie get pissy when actual facts challenge his rantings”

            What “facts” would you be referring to?

          • “What “facts” would you be referring to?”

            I’m pretty sure you might recall a dot com bubble that coincided with Clinton’s presidency. Y2K also created the most obviously temporary turbo-boost in modern history. It’s not a “stupid narrative” to point this out, though you obviously find it inconvenient. And so one of your usual tantrums ensues.

          • “I’m pretty sure you might recall a dot com bubble that coincided with Clinton’s presidency. Y2K also created the most obviously temporary turbo-boost in modern history. It’s not a “stupid narrative” to point this out, though you obviously find it inconvenient.”

            Except the dot-com bubble had nothing to do with the employment boom or the surplus. Again, this is a common, but utterly flawed, narrative. There is no way that the tech boom created that level of job growth and tax receipts by itself. Those things could not have driven the macro environment.

            This is one of those memes that people trot out as “proof” without thinking about it.

  2. We should also take into consideration the significant lag time between enactment of economic policies and their effect. Policies put in place in one administration may not show their effects in the economy until well into the next administration (possibly longer).

    Also, not all economic trends are the result of government policies. Trying to correlate the policies of a particular administration with the economic situation during exactly that period of time is fruitless. These things play out over long and varying time periods in conjunction with many other factors that have little or nothing to do with government policy.

    • “Also, not all economic trends are the result of government policies. Trying to correlate the policies of a particular administration with the economic situation during exactly that period of time is fruitless. These things play out over long and varying time periods in conjunction with many other factors that have little or nothing to do with government policy.”

      Someone buy this man a drink!

        • “Considering the rarity of compliments from Max (from what I’ve seen), I think I’ll buy myself a drink.”

          You earned it- it’s the common sense that’s rare around here.

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