Comparing Presidents, the National Debt with Recession Thrown On
I had a post this morning looking at the evolution of real debt per capita and debt as a percent of GDP over time, focusing on changes by Presidential administration.
The graph, which went back to 1952, showed that all the Presidents in the sample except St. Ronald the Reagan, GHW, and GW managed to decrease the debt. It was suggested that perhaps this was due to business cycles. Regular readers this was also given as a possible reason for an earlier series of posts in which it was shown that for whatever reason, growth in real GDP per capita tends to be higher under Dem administrations than under Rep administrations. Regular readers know I also went through a whole series of posts showing that even taking the business cycle into account, that wasn’t the explanation.
So I want to address the issue when it comes to debt as well… but I really don’t want to have to write a whole bunch of posts on this one issue. I figured I’d do something a bit different this time… I took one of the graphs from the earlier post on debt, and I added in periods for which there was a recession (in black).
Periods for which there was a recession:
Real GDP per capita since 1952
I tried to put a black bar in wherever there was a recession during the fiscal year – hopefully I didn’t screw up. (Recall… fiscal years ran through June until 1976, and through September thereafter.) I realize that in some years, the recession lasted all year, and in some years, it was over quickly, but this was the best I could do on a graph.
Assuming I didn’t screw up, it really doesn’t look like recessions are the reason debt increased under the 3 fiscally irresponsible presidents. Granted, all three of them had recessions early in their term, but they kept driving up the debt long after the recession ended. Besides, JFK/LBJ and Nixon/Ford both had recessions early in their terms, and managed to decrease the debt.
BTW… Data on debt comes from OMB Table White House OMB Table 7.1 – the figure used was debt held by the public. Where the debt was made “real” and “per capita”, inflation was calculated from CPI figures and population came from BEA NIPA Table 7.1. CPI figures used were average for the fiscal year, and population figures were for the quarter the fiscal year ended. (Note that the fiscal year ended in June until 1976, and in September thereafter.)