Ranking Presidents – Personal Income Issues
I’ve had posts in which I tried to rank Presidents by Economic Growth and by Fiscal Responsibility. This post ranks Presidents by something closer to income – how the average American fared economically during each President’s tenure.
One measure of how well Americans are doing is real median income. A graph real median income and how it has changed over time is available here. A summary of the growth rates is shown below:
What do we see? Well, JFK/LBJ came out tops, followed by Clinton, then Reagan, and in fourth, Ike, with a big gap between each one. The rest of the Presidents all had negative growth… GW was the least offensive of these, followed by Nixon/Ford, then GHW, and Carter brought up the rear. Despite Carter’s dismal performance, on average, the Democratic Presidents did better than the Republican Presidents.
But while that shows how much income for the representative American earner has changed over time, it’s not an end-all be all measure. It would be nice to know how much this person takes home after taxes. And because some Presidents drove up the debt (cough cough, Reagan, cough, GW), a smart person knows that they have to pay more in taxes some time in the future in order to pay for that debt. Thus, it would be nice to have the change in real disposable (i.e., after tax) median income less that person’s future tax obligations. Since that isn’t available, we do the next best thing – we look at real disposable per capita income and subtract off the change from one year to the next in the real national debt per capita. A graph of that series is available here, and changes over the term of each President are shown below:
By this measure, the top three are Clinton, Carter, and JFK/LBJ. Reagan follows at a distance, then Nixon/Ford, then Ike, with the Bush leaguers way at the bottom. It goes without saying that Democratic Presidents outperformed Republican Presidents by this measure.
What about the folks at the bottom, namely the poor? Here’s a graph showing poverty over time. A summary (leaving out Ike, for whom there was only two years of data) appears below:
JFK/LBJ (think War on Poverty) did by far the best job of reducing poverty, followed by Clinton, followed distantly by Nixon/Ford. Reagan broke even. Poverty increased by 2.2% a year under GW, almost 2.45% a year under Carter, and 3.3% a year under GHW. On this measure as well, on average, Democrats did better than Republicans. Under Democrats, poverty decreased. Under Republicans, it increased.
Unfortunately, none of these measures by themselves is a good summary of what’s happening on the income front. The first measure looks at the average individual, but doesn’t take into account taxes or future taxes. The second does take into account taxes and future tax obligations, but being an average, is skewed toward high income individuals. The third only looks at the poor.
So a good ranking of how well people fared should take into account all three of the above measures. Here’s my way of creating that ranking…
1. for all presidents except Ike, weighted sum of rankings = [(rank by measure 1/8) + (rank by measure 2/8) + (rank by measure 3/7)]/3
2. for Ike, weighted sum of rankings = [(rank by measure 1/8) + (rank by measure 2/8)]/2
(The difference, of course, is because Ike can’t be ranked by the third measure.)
The lower the weighted sum of rankings, the better. Results are shown below:
JFK/LBJ and Clinton were essentially tied for first, with Reagan coming a distant third. Nixon/Ford came next, with Ike at about the same level. Carter followed – one can give GW the benefit of the doubt and say he was about as good as GW at this particular measure. The elder Bush brings up the rear.
Not surprisingly given that Democrats outperformed Republicans on economic growth, on average Democrats also did better when it came to increasing personal income.
Next post: Jobs…