Ranking Presidents – Fiscal Responsibility

A couple weeks ago, I tried to rank Presidents by growth rates. This week I try to produce a similar ranking by fiscal responsibility.

I’m going to try to stick to the numbers as much as possible, but no doubt some people won’t like the numbers I pick. Nevertheless, I think in principal we can all agree (until the numbers come in)… in a time of national debts, a President who shrinks government spending and manages to bring in more revenue is fiscally responsible. One who bloats the government and brings in less revenue is fiscally responsible.

We begin with size of government, just to get a feel for where an administration’s priorities sit. One measure of government that the President has a fair amount of control over is the number of civilian federal employees per 100,000 people. The data, which goes back only to 1962 (and thus doesn’t include Ike), is graphed at this post and summarized in the table below…

As we see, Clinton posted the biggest drop, followed by Nixon/Ford, GHW, Carter and GW. Only Reagan and JFK/LBJ posted increases. In JFK/LBJ’s case, it was to fight a war. In Reagan’s – I’m not entirely sure. But he sure talked a good game about shrinking government, didn’t he?

But what about all expenditures? Well, this post looked at (among other things) Federal Outlays as a percentage of GDP. Yes, Congress has a big say in this figure, but the President is the one who submits the budget to Congress, often has the support of a majority of the members of Congress, and wields a veto pen. The table below summarizes outlays as a percentage of GDP.

As we see in the graph above, Clinton was, by a very large margin, the biggest cutter of spending. And if you think that was a function of the dot com boom, or Newt Gingrich, wander over to the original post and look at the graph… outlays began dropping dramatically the year the man took office, so unless the tech boom started in 1993, or Newt had a time machine, the spending cuts in the Clinton era appear to be due to… Bill Clinton. The next biggest spending cutter was Ike, although by the end of his term the trend had reversed itself. Reagan managed to cut spending as a percentage of GDP too… by 0.23% a year. The rest of the Presidents increased spending. Nixon/Ford was the least spendthrift of these, followed by Carter, then GHW, then GW and JFK/LBJ. Of course, GW still has time to build on his spending record.

But spending isn’t a big deal if it leads to more growth, or its matched by revenues being generated. This post referenced above also shows what receipts as a percentage of GDP look like. The table below summarizes the changes seen during each administration:

As the table indicates… Clinton increased revenues as a percentage of GDP. (Once again, I invite readers to check out the graphs in the aforementioned post… this trend began immediately upon his taking office – in other words, its due to Clinton’s tax hikes and other policies, not the Republican Revolution or the tech boom or any other event that came later.) Carter came in second. JFK/LBJ came in third, but they saw a slight decrease in tax revenues. They were followed by Nixon/Ford, Reagan, Ike, and GHW. Bringing up the very, very distant rear was GW. (Didn’t GW tell us recently how his tax cuts raised tax revenues?)

Another way to look at tax revenues is through real revenues per capita… a graph and a summary table are available here.

Which brings us to the overall measure of fiscal responsibility… the surplus or deficit. Together with the graphs of receipts and outlays, you can find a graph of the evolution of the surplus or deficit as a percentage of GDP here. A summary table appears below:

(Note – because the surplus jumps from positive to negative, an annualized growth could not be computed. Instead, the graph shows the change in the surplus or deficit as a percentage of GDP divided by the years in the term.)

And to make it easy, here’s a ranking:

Clinton is the clear winner – tops in increasing revenue and cutting spending, followed distantly by History’s Greatest Monster. Ike came in third. These were the only three fiscally responsible administrations… all others increased the deficit. Reagan did so by the least, followed by Nixon/Ford. JFK/LBJ were next, but GHW was virtually tied. Bringing up the rear… GW.

Of course, running a deficit is OK if its going to lead to rapid growth. But that doesn’t seem to be the case. JFK/LBJ ran up a big deficit and also produced commendable growth rates. However, Clinton, topped both sets of rankings, and Carter also did a good job by both measures. Ike did well on fiscal responsibility, not so much on growth. Reagan and Nixon came in the middle of the pack by both measures, and the Bush Presidents were Bush leaguers either way. (Clearly data on economic growth and data on fiscal responsibility has Bush Derangement Syndrome!!! Fortunately the wars in Iraq and Afghanistan are going swimmingly, Osama has been jailed, the dollar is strong and the poverty rate is dropping precipitously or GW’s approval rating would be about 30% and his legacy would be one of failure.)

Note… the original (i.e., “.gov”) source of the data going into each of these charts is linked to from the predecessor posts linked to above.

Next set of comparisons… Personal Income.