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This is a recurring trend. Republican policies seem to harm the economy while Liberal policies seem to benefit it. A Princeton paper was written on the subject

This is a recurring trend. Republican policies seem to harm the economy while Liberal policies seem to benefit it. A Princeton paper was written on the subject. https://www.princeton.edu/~mwatson/papers/DemRep_BlinderWatson_July2015.pdf https://www.princeton.edu/~mwatson/papers/DemRep_BlinderWats... For the past almost 100 years the economy has done better on every major indicator with a Liberal in office. I suspect it's because the trickle down effect doesn't work.

ams6110 8y ago
Ehh, the reason my parents retired millionaires, despite never having earned an annual six figures combined in their lives, as well as putting two kids through college with no financial aid, was because of being invested in the stock market during the Reagan 80s economy.
- nickthemagicman 8y ago
  Were they doing put options? Didn't Reagan put us into a recession?
  - philwelch 8y ago
    Not really: https://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States#Great_Depression_onward https://en.wikipedia.org/wiki/List_of_recessions_in_the_Unit... In 1980, at the end of the Carter administration, the US was suffering from a bad recession that double-dipped in 1981. From 1982 onwards, the economy grew without a hitch until 1990-91. You could blame that recession on Reagan and Bush, but it didn't happen during the Reagan years.
    - chrisco255 8y ago
      Boy blaming Reagan for the 91 recession (2.5 years after his term) is a stretch. And also, in retrospect, the '91 recession was a blip, in what was largely a booming decade of growth.
      - philwelch 8y ago
        It seemed to work for the Clinton campaign in 1992. I mean, he blamed Bush, but Reagan got lumped in too. And yeah, it was a booming almost-three-decades of growth between 1982 and 2008, with blips in 1991 and 2001.
    - tcbawo 8y ago
      That recession was caused by the Fed. Rates were raised sharply to break inflation.
      - philwelch 8y ago
        I'm generally dubious of blaming large macroeconomic trends on the incumbent President anyway: * The FED has more direct influence and control (although the FED chair is appointed by the President, so I guess you can blame him indirectly) * Congress is responsible for most domestic policies, even the ones championed by the President. * Tons of economic factors are outside of the US government's direct control, especially when it comes to science and technology. (Some of these factors are even outside the control of any American actors: many of the recessions between 1970 and 1990 were at least partly caused by disruptions in the oil market.) * Even factors that you can attribute to government actions are more long-term in focus: ARPANET was established in the Johnson administration and didn't yield macroeconomic gains until the Clinton administration, while most of the economic benefit of the Interstate Highway System was realized long after the Eisenhower administration.
- ofj28 8y ago
  That’s a huge oversimplification that ignores so much Soviet Union was still a thing. Reagan had only just started offshoring to China that would continue through GHW Bush, and Clinton. Germany was still split. Cost of education was a small fraction it is today. Housing costs the same and healthcare. The world economy was vastly different. Your parents retired as millionaires due to right time and place. I make $200k yr. If wages had kept up with inflation, that would be more like $500-$600k/yr today. Shits fucked
bmmayer1 8y ago
This comment has no relevance to the article posted.
jjoonathan 8y ago
There's a fun Mathematica applet exploring this. http://www.demonstrations.wolfram.com/StockMarketReturnsByParty/ http://www.demonstrations.wolfram.com/StockMarketReturnsByPa... Spoiler: it's highly, highly sensitive to parameters. You might choose to lag the time windows for several months to account for a delay in the effect of new policies, or lead to account for anticipation, or use as the underlying "invest or not" determination a time series reflecting laws, who holds the Executive, who holds the Legislative, some combination... but tweak any of these parameters and the outcome will flip wildly. Of course this makes it very easy to reverse engineer a particular outcome if your audience is not familiar with the effect.
philwelch 8y ago
> I suspect it's because the trickle down effect doesn't work. Well, maybe. Or maybe Republican policies are beneficial in the long term, which means they don't start working until after they've left office and don't stop working until the Democrat who replaces them has dismantled them. Or maybe voters tend to vote Republican when they are uncertain about the future, i.e. in periods of instability. Or maybe the President doesn't make a huge difference either way in most cases, and the business cycle got into a rhythm where corrections started happening in a quasi-regular rhythm that seems to coincide with elections with Republican incumbents. (The only point where it seemed to get out of this rhythm, after WWII, was the double-dip recession of the early 80's, which coincided with a Democrat -> Republican party switch that didn't switch back until there was another recession). Or maybe there's been only 15 US Presidents to serve at least a full term in the past 100 years and it's not a meaningful sample size. I'm going to bet that's the one.
- thatjsguy 8y ago
  Pretty sure being able to afford food, a home, and healthcare is much more beneficial to society as a whole than having a poor underclass of laborers. But hey, maybe it’s the stuff you said too.
  - philwelch 8y ago
    I get that we’re deep in a non-sequitur subthread here, but I don’t see how what you said is a meaningful explanation of the theory of recessions coinciding with Republican presidential administrations.
- ptman 8y ago
  Unfortunately I don't have a reference or link, but I'm under the impression that it's generally agreed that for a new president to start affecting the economy takes 1-2 years.
jakelarkin 8y ago
people are greedy. they vote for tax cuts when the economy is doing well.

ams6110 8y ago

Ehh, the reason my parents retired millionaires, despite never having earned an annual six figures combined in their lives, as well as putting two kids through college with no financial aid, was because of being invested in the stock market during the Reagan 80s economy.

nickthemagicman 8y ago
Were they doing put options? Didn't Reagan put us into a recession?
- philwelch 8y ago
  Not really: https://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States#Great_Depression_onward https://en.wikipedia.org/wiki/List_of_recessions_in_the_Unit... In 1980, at the end of the Carter administration, the US was suffering from a bad recession that double-dipped in 1981. From 1982 onwards, the economy grew without a hitch until 1990-91. You could blame that recession on Reagan and Bush, but it didn't happen during the Reagan years.
  - chrisco255 8y ago
    Boy blaming Reagan for the 91 recession (2.5 years after his term) is a stretch. And also, in retrospect, the '91 recession was a blip, in what was largely a booming decade of growth.
    - philwelch 8y ago
      It seemed to work for the Clinton campaign in 1992. I mean, he blamed Bush, but Reagan got lumped in too. And yeah, it was a booming almost-three-decades of growth between 1982 and 2008, with blips in 1991 and 2001.
  - tcbawo 8y ago
    That recession was caused by the Fed. Rates were raised sharply to break inflation.
    - philwelch 8y ago
      I'm generally dubious of blaming large macroeconomic trends on the incumbent President anyway: * The FED has more direct influence and control (although the FED chair is appointed by the President, so I guess you can blame him indirectly) * Congress is responsible for most domestic policies, even the ones championed by the President. * Tons of economic factors are outside of the US government's direct control, especially when it comes to science and technology. (Some of these factors are even outside the control of any American actors: many of the recessions between 1970 and 1990 were at least partly caused by disruptions in the oil market.) * Even factors that you can attribute to government actions are more long-term in focus: ARPANET was established in the Johnson administration and didn't yield macroeconomic gains until the Clinton administration, while most of the economic benefit of the Interstate Highway System was realized long after the Eisenhower administration.
ofj28 8y ago
That’s a huge oversimplification that ignores so much Soviet Union was still a thing. Reagan had only just started offshoring to China that would continue through GHW Bush, and Clinton. Germany was still split. Cost of education was a small fraction it is today. Housing costs the same and healthcare. The world economy was vastly different. Your parents retired as millionaires due to right time and place. I make $200k yr. If wages had kept up with inflation, that would be more like $500-$600k/yr today. Shits fucked

bmmayer1 8y ago

This comment has no relevance to the article posted.

jjoonathan 8y ago

There's a fun Mathematica applet exploring this. http://www.demonstrations.wolfram.com/StockMarketReturnsByParty/ http://www.demonstrations.wolfram.com/StockMarketReturnsByPa... Spoiler: it's highly, highly sensitive to parameters. You might choose to lag the time windows for several months to account for a delay in the effect of new policies, or lead to account for anticipation, or use as the underlying "invest or not" determination a time series reflecting laws, who holds the Executive, who holds the Legislative, some combination... but tweak any of these parameters and the outcome will flip wildly. Of course this makes it very easy to reverse engineer a particular outcome if your audience is not familiar with the effect.

philwelch 8y ago

> I suspect it's because the trickle down effect doesn't work. Well, maybe. Or maybe Republican policies are beneficial in the long term, which means they don't start working until after they've left office and don't stop working until the Democrat who replaces them has dismantled them. Or maybe voters tend to vote Republican when they are uncertain about the future, i.e. in periods of instability. Or maybe the President doesn't make a huge difference either way in most cases, and the business cycle got into a rhythm where corrections started happening in a quasi-regular rhythm that seems to coincide with elections with Republican incumbents. (The only point where it seemed to get out of this rhythm, after WWII, was the double-dip recession of the early 80's, which coincided with a Democrat -> Republican party switch that didn't switch back until there was another recession). Or maybe there's been only 15 US Presidents to serve at least a full term in the past 100 years and it's not a meaningful sample size. I'm going to bet that's the one.

thatjsguy 8y ago
Pretty sure being able to afford food, a home, and healthcare is much more beneficial to society as a whole than having a poor underclass of laborers. But hey, maybe it’s the stuff you said too.
- philwelch 8y ago
  I get that we’re deep in a non-sequitur subthread here, but I don’t see how what you said is a meaningful explanation of the theory of recessions coinciding with Republican presidential administrations.
ptman 8y ago
Unfortunately I don't have a reference or link, but I'm under the impression that it's generally agreed that for a new president to start affecting the economy takes 1-2 years.

jakelarkin 8y ago

people are greedy. they vote for tax cuts when the economy is doing well.