30 November 2012

Rumer - Thankful

It's Friday. The weather is getting cooler. You might just want a song that makes snuggling up inside seem all the more delightful. I've just discovered Rumer's voice and I love it.

28 November 2012

Are Family Values Obsolete?

There’s been a change in households that will obsolete the politics of family values. Adjusting to this new reality may prove conservative’s most challenging task because it goes against what they hold most dear.

It seems ridiculous to oppose family values. Who doesn’t love the idea of mothers, fathers, children and grandparents connected through love and respect? But this ideal as a basis for social policy doesn’t hold up to modern realities. Family values suggest simple answers to basic questions. How do we pay for grandma’s retirement and old-age healthcare? Her children do. How do we pay for the children’s education and healthcare? Their parents do.  Family values suggest self-reliant families.

The model of the self-reliant family misses the fact that so many individuals within these families are actually quite reliant. Families have a lot of deadbeats who don’t contribute. Grandparents no longer work and the children don’t yet. But the household is self-sufficient because dad and mom are are working to pay for these folks. At least that's the model in the minds of many. But it's worth teasing that model apart. While the family may look self-reliant, within the family there is rampant dependency, entitlement, and redistribution of income.This transfer of income is becoming more visible as family members form their own households.

Perhaps the least reported change to “normal” households is the percent that contain just one occupant.

“Today, more than 50 percent of American adults are single, and 31 million— roughly one out of every seven adults— live alone. People who live alone make up 28 percent of all U.S. households, which means that they are now tied with childless couples as the most prominent residential type— more common than the nuclear family, the multigenerational family, and the roommate or group home.”
Klinenberg, Eric (2012-02-02). Going Solo: The Extraordinary Rise and Surprising Appeal of Living Alone (Kindle Locations 126-131). Penguin Group. Kindle Edition.

The working poor are even more likely to live outside of traditional family groups. In his book Coming Apart, Charles Murray defines as problematic three groups: single males who are unemployed or only part-time employed, single females who are raising children, and any single adults who report no social affiliation, people he calls isolates (e.g., people who not only live alone but belong to no church group, volunteer group, civics club, sports club, etc., that would connect them to people outside of work). He then estimates that “the percentage of [working class whites] who are problematic in one way or another rose from 10 percent at its low throughout the 1960s to 33 percent in 2007, the last year before the recession.”  That is, a third of the working poor have no traditional family or social support network.
Murray, Charles (2012-01-31). Coming Apart: The State of White America, 1960-2010 (Kindle Locations 3809-3810). Random House, Inc.. Kindle Edition.

Further, knowledge work has scattered us across the country. The children no longer stay in town to work on farms or in the mine. Instead, they head off to college, get recruited to the big city or to another city and then never come back. They aren’t able to easily check in on mom and dad as their parents age and the hours they spend each week with parents – with visits, phone calls, and chat – are less than what they would be if they lived down the street or even across town.

Compounding the problem of support for old parents, the elderly are less likely to have many – or even any – children. Birth rates have steadily dropped for decades. Women with one or two children are less likely to have an adult child able to support them in their old age then women with five or six children; women with no children have a zero percent probability of such support.

It is not just that divorce rates have risen in the last half century. Marriage rates have dropped. All these new realities have contributed to the dramatic increase in the percentage of households with just one person.

What all this means is that the invisible deadbeats within the family have become the visible deadbeats within society. The quiet transfer of income and time that once took place within the family – mom tending to grandma, dad slipping his teenager $20 – has become something played out in the public arena, through government agencies. Family values have given way to public policy. When they lived within the family, they were invisible. Now that they live within the community, these deadbeats show up in government statistics. Curiously, this is reminiscent of the growing formalization of the economy when an increasing percent of transactions evolved from barter and informal trade into cash transactions that could be measured. Now something similar is happening with all social support.

Not everyone who finds themselves in these situations choose to be alone or childless but curiously, these new realities are not seen as tragic by many of the players in them. Everywhere, women with more education and affluence consistently choose to have fewer children.  Also, a surprising portion of people with the resources to do it choose to live along; growing affluence in areas as diverse as Sweden, New York, and China lead to growing percentages of people choosing to live alone.  (Albeit preferably in urban areas where they have lots of opportunities to connect with people they don’t live with but do live near). People seem to prefer enough distance from families so that they have the freedom to define their own lives. The comfort of family can also feel stifling and much of the change from traditional family arrangements seems chosen rather than imposed.

Still, many bemoan the loss of traditional families. Many  conservatives put even more emphasis on religion as a means to support and realize their family values. In light of all this, it is no wonder that Republicans chose a Mormon as their presidential candidate. Probably no American religion has put more emphasis on the family.
“In Mormon theology, humans are given mortal existence and bodies in a state of probation. Marriage and procreation are central to exaltation. ‘We were placed here on earth to progress toward our destiny of eternal life,’ Apostle Dallin Oaks told a 1993 General Conference. ‘To the first man and woman on earth, the Lord said, “Be fruitful and multiply.”…This commandment was first in sequence and first in importance. It was essential that God’s spirit children have mortal birth and an opportunity to progress toward eternal life.’ In Mormonism God is married. Like God, humans can progress to godhood, continuing their progression and procreation in the afterlife. The Mormon heaven is a very domestic concept, and celestial marriage is essential to exaltation.”
Ostling, Richard; Ostling, Joan K. (2009-10-13). Mormon America - Rev. Ed. (pp. 331-332). Harper Collins, Inc.. Kindle Edition.

Families are wonderful and still – for all their flaws – the place we’re most likely to find love and acceptance.  Family values in that sense are not obsolete and never will be. But it looks as though family values are less likely to be a guide for practical policy in the modern world and may instead have to be a guide for the ideal that folks aspire to in the next. Giving up on family values as a basis for public policy may seem defeatist, tragic, or foolish. Perhaps. It seems to me, though, that it would be the start of dealing with reality as it is rather than how we imagine it to be.

Special Holiday Heart Warming Service

27 November 2012

Population Density and "Reasonable Rules" (or why rural areas vote Republican)

Rural areas tend to vote Republican and urban areas tend to vote Democrat. I've often thought that this is for a simple reason. If you live two miles from your nearest neighbor, you're rightfully offended at the thought of your neighbor dictating how loudly you play your music, whether you smoke, and even if you wear pants. By contrast, if you live in an apartment complex with a dozen neighbors within yards of your place in every direction, they have every right to think that they can dictate how loudly you play your music, etc. Population density is a big determinant of what you think is reasonable when it comes to rules and regulations.

This graph seems to support that idea, making increased rates of urbanization one more trend that seems to be working against the GOP.

26 November 2012

No Nude Taxes - The Naked Truth About Deficit Reduction

Two quick points about current negotiations to avoid falling off the fiscal cliff. One has to do with simple math and the other with simple economics. Together they suggest that deficit reduction needs to come from a mix of tax hikes and spending cuts and that neither should be rushed.

Some still cling to the notion that we can erase the deficit through budget cuts alone. This the last gasp of a movement designed to radically shrink government, one that got this far in large part by arm-waving about how tax cuts stimulate the economy. Let's take them at their word and ask by how much the economy would have to grow to compensate for the tax cuts of the last decade.

In the decade from 2000 to 2009, taxes as a percentage of GDP fell from 20.6% to 15.1%. I'll just simplify that to say that taxes fell from 20% to 15% of GDP. 

Our GDP is nearly $15 trillion this year so it's simple enough to calculate how much more GDP should have grown to compensate for such a cut in tax rates.

A 20% tax rate on a $15 trillion economy would have given us $3 trillion in federal revenue.
To get that same $3 trillion in revenue with a 15% tax rate would require a $20 trillion GDP.

In two simple equations:
  $3 trillion in revenue = 20% of $15 trillion
  $3 trillion in revenue = 15% of $20 trillion

Tax cuts would have had to stimulate economic growth by another $5 trillion in the last decade in order for revenues to remain constant. Is that reasonable? Well, the second and third largest economies in the world - China's and Japan's - are $5-point something trillion dollar economies. Every other national economy in the world is considerably smaller than $5 trillion. (The economies of France and the UK combined are roughly $5 trillion.) 

In other words, had tax cuts stimulated our economy by an amount equal to the whole of China's economy, we'd have enough tax revenue to leave rates unchanged. If not, we might have to consider the fact that we'll simply have to raise tax rates back to what they've averaged for the last half century: roughly 18% of GDP - give or take a point or two.

Now what about the contention that raising taxes will be bad for the economy? 

On this, the GOP faithful are right. But so will cuts to government spending. Cut the money investors get in tax returns or that social security recipients or government contractors get in payments and you will contract spending and hence the economy. 

The real issue is that the deficit is not the real issue. Not yet. Like a kid in the kitchen excited about baking bread who keeps hollering, "We have to put it in the oven now!" the voices chirping about reducing the deficit are both right ("We have to cut the deficit!") and wrong about timing. Bread dough has to first be mixed and then let to rise before we can put it in the oven without ugly results. The same is true of the economy: we have to first stimulate it with spending and tax cuts (deficit spending) then let it rise (unemployment falls as the GDP rises) before we put it in the oven (begin to cut spending and raise taxes). To get this order wrong is to go the way of Greece and Spain. Austerity measures in a bad economy don't just make the economy worse; they make the deficit worse as well. As it is with something as simple as baking, so it is with something as complex as a modern economy: sequence is critical.

The right solution to deficit reduction won't just cut spending and raise taxes. It will time these budget changes with certain milestones (e.g., unemployment rate at 7% and 6% and 5% triggering different combinations of tax hikes and spending cuts, for instance). 

23 November 2012

The Ideal Thanksgiving - a Modern Conversation with Historical Figures

Yesterday we had a delightful Thanksgiving meal with a group of people who were politically aware but not politically boorish, both eager to share their own opinions and to hear others. Conversations define Thanksgiving at least as much as the food. (I wonder if somewhere people plan topics the way the rest of us plan courses.)  Anyway, yesterday's delightful dinner got me thinking about which historical characters it would be most fascinating to have for a long Thanksgiving dinner.

Here is my list. It would probably be different next week. And this six I include not just because I think that individually they'd be fascinating but because I think that one thing that made them all distinct was that they were social inventors, able to imagine a different kind of society, and it would be utterly fascinating to hear them observe our current world and then talk among themselves to imagine a new world yet again. We could use people who had the wisdom and talent to reinvent society but had actual experience with it.

Erasmus (1466 - 1536) - adviser to kings, popes, and the one who seemed to approach the Reformation with the most humor and wisdom. Martin Luther was far more critical of the Church but Erasmus seemed more interested in reform than revolution. For this reason alone he would probably be easier to talk to about those times and it would be fun to see how he made sense of today's religious and political world. It wouldn't surprise me that, of all the characters from the 16th century, he would be least surprised and most pleased to see how things had developed.

Ben Franklin (1706 - 1790) was the only founding father to sign all four founding documents (Declaration of Independence, Constitution, Treaty with France to help us win the war of independence and the Treaty with Britain to announce that war's conclusion), but inventor, publisher, and wit. Which of the fascinating founding fathers would be more fun to have? Plus, who better to have turkey with than the man who proposed it be our national bird?

Wilhelm Humboldt (1767 - 1835) Humboldt defined the modern university, a place where knowledge was created through research and shared through teaching. Again, it would be fascinating to have him apply that same genius to the modern world to hear what - if any - recommendations he'd have for University 2.0, an institution as different to us as the modern university would have seemed to his peers.

Nathan Rothschild (1777 - 1836) with his brothers helped to invent the international bond market and by extension international finance. If markets eclipsed the power of monarchs, presidents, and parliaments, the Rothschilds were a big part of that transition. Again, how fascinating would it be to get his opinion about how markets have evolved and how that compares with his own expectations.

William James (1842 - 1910) wrote the first generally accepted psychology text book and helped to invent the philosophy of pragmatism at the dawn of the century of the mind. It would be fascinating to compare what happened in the century with what he had expected.

John Maynard Keynes (1883 - 1946) The man who did the most to define the modern relationship between government and markets. It would be delightful to apply his genius to a more evolved time, to get his take on the current realities to see what he felt would require new thought and what situations he would think affirmed his theories.

This leaves a number of obvious choices off of the list. Jesus was the first person I thought of but at such a meal one really wouldn't want to share time with another five from history.  (Unless it were Paul, who never met Jesus. It would be fascinating to hear various Christians from Paul on down in history talk to Jesus and take personal instruction.) Einstein was wonderfully political and it would be fascinating to hear that dimension of him. Oscar Wilde would have to be a wonderful conversationalist. Jefferson, Kurt Vonnegut, Maria Montessori, systems thinking pioneer Ludwig von Bertalanffy, Thomas Edison, Henry Ford, Charlemagne, Pope Alexander (the Borgia pope), da Vinci, Martin Luther, Marilyn Monroe, Jane Austen, Picasso, Faulkner, Buddha, , Shakespeare  ... the list of other potential candidates goes on.

Given these guests are unavailable, perhaps the thing to do would be to host a costume party instead of Thanksgiving, It is the only hope one has of meeting any of these people.

Who would you have included?

18 November 2012

Robert Stein on How Groucho Marx Would Handle Modern Sex Scandals

Robert Stein, who shares his extensive wisdom and knowledge at Connecting the Dots, shares this story as he shakes his head at the outrage over General Petraeus's behavior.

It brings back a story Groucho relished telling Dick Cavettabout the aphrodesiac rewards and risks of fame in the Marx brothers’ vaudeville days.
Back then, Groucho and Chico were visited backstage in Iowa by a middle-aged Jewish couple, who relayed their admiration and said, “We know you boys are Jewish, and we thought you might like to come to our house Friday night for a traditional Jewish dinner.”
The brothers agreed but, walking around town the day before, Chico recognized the address and they decided to ring the doorbell. The couple’s two pretty daughters were home, greeted them happily and were eventually induced to act out their fandom physically.
When the parents appeared, there was some embarrassment.
“Chico was more accustomed to this sort of predicament than I was,” Groucho recalled, “so I followed his example, which was grabbing up our clothes and high-tailing it out the window. Fortunately, we were on the ground floor.
“In any case, the penultimate thing the parents saw were our two buck-naked rear ends disappearing over the window sill. The ultimate thing they saw was Chico’s head reappearing momentarily, saying, ‘I hope this doesn’t affect Friday night.’”

15 November 2012

The Miracle of Advertising: Or Why are Republicans Still Considered Fiscal Conservatives?

The Republicans have preserved their brand to include a reputation for fiscal conservatism. This is impressive.

Reagan took office promising tax cuts and less government. His was an important reminder that we can't turn to the government for solutions to every problem. He was a big advocate of free markets. 

What was the reality? Well, measuring taxes as a percentage of GDP, he did lower taxes from what they were under Jimmy Carter. In the four years under Carter, taxes averaged 18.4% of GDP. In the eight years under Reagan, they averaged 18.2%. So, not a particularly big cut in taxes, but what about spending?

Under Carter, spending as a percentage of GDP averaged 20.8%. Under Reagan it averaged 22.3%.

Hard to reconcile this with fiscal conservatism. Reagan dropped taxes .2% and raised spending 1.5% of GDP. Unsurprisingly, Reagan created big deficits, hardly the mark of a fiscal conservative.

George W. Bush actually reduced government spending as a percentage of GDP from his predecessor. Under Clinton, government spending averaged 19.8% of GDP. Bush got that down to 19.6%, a drop of .2%. That cut was small but the the cut in taxes was huge. Bush got those down 1.4% of GDP, from Clinton's 19% to 17.6%. Like Reagan, Bush drove up the deficit. Again, not a sign of fiscal conservatism. 

Fiscal conservative is not the right term. Tax cutter is. But as I've argued before: if you merely lower your monthly payment on your credit card but don't actually lower your spending, you hardly qualify as a fiscal conservative. The miracle is, voters still seem to think that it does.

11 November 2012

Amos Oz: Cruelty as a Failure of Imagination

Amos Oz was on Andrew Marr's Start the Week program last week. He told the most perfect story about cruelty as a failure of imagination.

Oz said that in Israel, the taxi drivers all know how to solve the Israeli-Palestinian problem and in a ten minute ride they will tell you. On one taxi ride, Oz was riding with a fellow novelist when the cab driver announced that they should kill all the Palestinians.

"How would you propose doing that," asked the novelist.

"We just kill them," said the cab driver.

"Get more specific," said the novelist. "Are you proposing that doctors kill them by injection, that soldiers shoot them .... What do you propose."

The cab driver was silent for a time, reports Oz, considering this question. Finally, he said, "We'll all have to kill a few."

"Okay," continued the novelist. "Let's say that you are assigned a block in Haifa," a mixed city with Jews and Arabs. "You go door-to-door, asking people whether they are Jews or Arabs. If they are Arab you kill them. Then, as you walking away from your assigned block, you hear a baby crying from the third floor. Do you go upstairs and kill the baby?"

The cab driver was silent for quite some time, pondering this question. Finally, he told the novelist, "You, sir, are a cruel man."

10 November 2012

Reagan's Lingering Shadow Over the GOP

Reagan has become to our time what FDR was to 1980, his example a substitute for confronting current reality. By 1980, Americans had stopped blindly trusting in government programs; Democrats, inspired by FDR's bold example, still did. By 2012, Americans had stopped blindly trusting in unfettered markets; Republicans, inspired by Reagan's bold example, still did.

It was 30-some years from FDR’s death to Reagan’s election. It has now been about 30-some years since Reagan was first elected and something similar has happened both times.

FDR led the country out of the Great Depression with a series of government programs. He proved that government programs could get the economy going and provide retirement and electricity. In the decades of and after his administration, government programs helped to rebuild a Europe devastated by war, eradicated polio, developed an atomic bomb, accelerated the development of computers, radar, and aircraft, and made universities affordable for the middle class. The careful intervention of government experts even took the sting out of recessions.

Generations followed his lead. It’s worth remembering that Nixon – a Republican – authorized the EPA, put in place price controls, and quipped, “We’re all Keynesians now.”

Smart people rarely asked about the wisdom of government programs but instead asked what kind of programs would work best. Government was the default answer to everything from crime to education to the economy. And to be fair, this approach largely worked. The period from about 1935 to 1980 was a time of incredible progress. Incomes went up. A lot. Unemployment went down. A lot. We had an array of new products and possibilities we’d never had before. Being born poor no longer meant a life sentence of poverty. Government welfare could provide you food and healthcare during childhood and government education could help prepare you for a good career.

But then a conservative backlash built up. “What if government programs are no substitute for strong families or markets,” people asked. “What if just leaving people to work out solutions through markets was better than pretending that you could centrally control things through Congress and reams of regulations?”

Reagan was not the first voice in this movement but he put a handsome, genial face on it. And the country was ready for it.  “Government is not the answer,” Reagan said, personal responsibility is. And we believed him. He was, after all, the head of the government.

Cut taxes. Cut government programs. De-regulate. Stop trying to save everyone. Get tough on crime. Make people accountable and stop pretending that bad circumstances are excuses for bad outcomes.

And like FDR before him, Reagan changed the direction of government. His political success emboldened a generation of leaders and policy makers. Even the Democrat Clinton announced, “The era of big government is over.”

And the results were impressive. Capital markets created a tsunami of new ventures, new technologies, and new billionaires. By the end of the 1990s, even ordinary people were making millions in the stock market.

After FDR, few questioned the efficacy of government programs. After Reagan, few questioned the efficacy of markets. The country looked to the market for solutions and accepted its answers the way past generations accepted answers from the church. Through the market, truth was revealed.

As it turns out, Reagan’s approach retained some measure of efficacy about as long as did FDR’s. For our love of great figures in history, our best bet is to trust in our own judgment. We love leaders because they don’t imitate and then we honor leaders by imitating them. Like FDR before him, Reagan’s powerful influence has made his party mindless rather than mindful.

After the 2008-2009 financial crash, Americans no longer mindlessly trust markets. The GOP still does. Most Americans want a balanced budget approach to deficit reduction. The GOP does not. It's tough to win elections when you go against majorities.

In 2000, Clinton left the country with a budget surplus - and taxes as a percentage of GDP were 20.6%. Bush cut taxes - as did Obama. By 2009, taxes were at 15.1% of GDP. GDP would have had to grow to $20 trillion instead of $15 trillion by 2009 in order for the lower tax rates to generate the same revenue as it had at 20.6%. As a percentage of GDP, tax rates had never been below 16.1% and had averaged 18.1% in the 48 years (Obama's lifetime) up to 2008. Even in the face of these facts, the GOP insists that budget negotiations not include discussion of tax hikes. Such an intractable position shows less connection to current reality than an idealization of Reagan's legacy. 

We now face a fiscal cliff that can be avoided only by negotiations between Republicans and Democrats and what the Republican Party needs now is a Clinton-figure. Clinton was not just hated by the Republicans: he unsettled many Democrats with his acceptance of Reagan's distrust of big government and welfare programs. Clinton accepted a correction on FDR’s model and made himself a new kind of Democrat. As yet, no Republican has stepped up to show a similar realization that the Reagan prescription has expired. The Republican who does will be distrusted from all sides but could become as popular as Clinton. And she could save her party from irrelevance.

There is one way that the GOP can imitate FDR or Reagan: they have to stop relying on past policies and develop new ones, policies more grounded in current reality than in past triumphs.

07 November 2012

The Race Gets Tighter

About a century ago, the gap between the two parties was closer to 20% in any given presidential election. Today it is closer to 2%.

Many folks (including this blogger) will opine about what the Republicans' loss means for them but in a time when the political analysts have seemingly sliced the polity so neatly in two, it might simply be that with elections this close one may as well flip a coin. Never has the gap between the parties been closer (in terms of popular vote) than it has in the last handful of elections.

Here's a graph from 1912 to 2012, showing the absolute value of the gap between votes for Democrats and Republicans as a percentage of voters.

The Republicans Only Hope is if Republicans are to Blame

If you are to blame, you have control over change and improvement. If someone else is to blame, you don't.

The Republicans' first reaction to last night's loss is probably best captured by Bill O'Reilly in this clip:

In this narrative, the Republicans are not to blame. This is not just consoling but it absolves Republicans of any need for self-reflection and change. This reaction doesn't bode well for them.

Romney lost by only 2 points in the popular vote. In a country where so many people have decided by April, two percent is not as close as it sounds but it is not an impossible lead to overcome. There are things that the Republicans could have done to close that gap, and those are things for which they should take responsibility.

With the economy in bad shape during the Republican primaries, it was almost as if Republicans felt that they should go for broke on their social agenda. Apparently feeling as though there was no way they could lose, they catered to every odd belief of the far-right. Republicans became extremists.

No country has more of its population in prison and yet GOP debate audiences cheered stiffer sentencing and death penalties.

Tax rates as a percentage of GDP has averaged 18.5% during the last half century until the last few years when it dropped to below 15%. Even so, Republicans refuse to consider raising taxes a single dime.

Unemployment is barely below 8% and yet Republicans talk about austerity measures, cutting government spending by $1 trillion. (The amount by which the budget would have to be cut to balance the budget without raising taxes.)  Excluding "mandatory" entitlement spending, there is only $700 billion in defense and $600 billion in non-defense (a category that includes the Supreme Court and FBI, Homeland Security and Immigration and Naturalization, EPA and NHS, etc, etc.). To cut one trillion out of this total of $1.3 trillion would devastate the government. And, of course, it would mean a massive contraction of the $15 trillion US economy, triggering a recession that would echo Spain's (where austerity economics has been enacted and unemployment is about 25%).

Even with a growing number of women voting, the GOP still refuses to fund contraceptives or support any meaningful maternity leave or legislation that would move towards equalizing pay for women.

With such extremists positions, it is a testament to their appeal that Republicans came within 2 percent of the presidency in spite of all this.

For now, the GOP shows a disconnect from demographic and policy realities as real as Dick Morris's disconnect from polling realities. (With no polls to support the notion of a Romney victory (Romney never lead in even a majority of the polls in any given time period, at best drawing close), Morris asserted his conviction that Romney would win.) Republican pundits showed no real appreciation for reality, relying instead on gut feelings and nostalgia. Until they abandon conviction for a commitment to responding to actual facts, it is hard to see how they could ever take responsibility for their loss. And until they're responsible for losing, they won't have to take responsibility for winning.

02 November 2012

Comparing Presidential Jobs Numbers Before Election Day

The bureau of labor statistics announced that 171,000 jobs were created in October. In addition, they revised numbers for the last two months upwards (August revised up from 142,000 to 192,000 and September up from 114,000 to 148,000.) So essentially, the BLS announced an additional quarter of a million new jobs today, a number much better for the economy than Romney's campaign.

[To play with the question of whether president's even matter to job growth, go to the end of the post.]

So we now have the final number before the election, giving us a basis for comparing Obama to president's dating back nearly half a century. If we just measure from the administration's first full month in office (February after being sworn in) until the October before the election, we get the following ranking of of the last 8 administrations in terms of job growth.

In millions:
Clinton       10.8
Carter         9.8
Johnson       9.1
Nixon         5.2
Reagan       4.6
HW Bush   1.9
Obama        .9
GW Bush   -.3

Here's a graph showing the cumulative numbers of jobs grown during their administrations.

Here Obama looks nearly as bad as Bush. But as Obama repeatedly reminds us, he inherited a very bad economy. Let's examine that, separating out the first year from the rest of their term. And, let's do that for every president.

Johnson   2945
Nixon      1738
Carter      3903
Reagan    -474 
Bush 1     2018
Clinton     2749
Bush 2    -1878
Obama   -4282

As you can see, the recession that Reagan inherited was only one-tenth as bad as Obama's. No president in the last 50 years was greeted with such dramatic job losses as was Obama, totaling 4 million lost jobs in his first year. Here you can see the cumulative job creation or loss during the first year of each administration - Obama's first year numbers dramatically lower than any other. That is a huge hole to dig out of.

So let us assume that Obama was right that a global recession that began the year he before he was sworn in had nothing to do with his policies, and discount the first year of his (and every) presidency. (And in fact, the budget of the first year is inherited from the previous administration.) Subtracting the first year from the job numbers, Obama's ranking changes dramatically.

In millions:
Clinton       8.1
Carter        5.9
Reagan      5.0
Obama     4.5
Nixon        3.5
GW Bush  1.5
HW Bush  -.1

Here is the graph of the cumulative jobs created / lost from years 2 through 4. In this ranking, Obama falls between Reagan and Nixon, two presidents who won re-election by a landslide.

Obama seems the probable winner, but by no landslide. One simple explanation is that nearly half of Americans hold him responsible for job growth during all four years, and slightly more than half hold him responsible for only the last three.

[Do these numbers matter?]

Now it is worth asking a very basic question: does the president really impact job numbers at all? Is this fixation on job growth as a measure of presidential efficacy a modern version of holding the medicine man responsible for rainfall? It is true that the economy is a product of many variables other than the president. For one thing, his policies affect the numbers only to the extent that Congress cooperates. And, of course, economies surge and stumble for more important reasons than presidential policies, reasons as varied but powerful as new technologies (Internet anyone?), global competition (rise of China and Brazil bringing another billion workers into competition with ours), demographics (baby boomers entering or leaving the job market), global financial crisis (the '08 financial crisis), domestic crisis (9-11) and so on.

Even so, it seems that presidential policies matter. There are a lot of men who love alcohol and love their families; the men who love alcohol more than their families have very different lives than the men who love their families more than alcohol. President's who value job growth more than, say, inflation or balanced budgets have very different economies than those who value balanced budgets more than GDP or job growth.

Austerity measures in Europe, their attempts to balance budgets in the midst of a global recession, have been disastrous. The UK went into a second recession; Spain's unemployment is near 25%. David Cameron in the UK and Spain's Rajoy tried to first balance the budget and then grow the economy, valuing fiscal responsibility more than job growth. That's a bad policy and their economies are still suffering because of it.  Neither tax hikes nor cuts in government spending help during a recession. The impact of presidential policies during a time of full employment are less obvious, but probably still greater than zero. I'll leave the reader to decide whether the influence of presidential policies is closer to 5% or 50%.

But the president's actual impact on job growth hardly matters for this simple reason: voters think it does.  For that reason alone, it is worth giving the numbers more than a cursory look.