At the Same Point in the Business Cycle
This post looks at the percentage change in real GDP per capita per quarter since the end of the latest recession for the last two recessions. One of these recessions ended in March of 1991, and the most recent one ended in November of 2001. GW’s supporters like to say that the growth rate under GW since the last recession is comparable or better to the growth rate under Clinton at the same point in the business cycle. This post looks at that issue.
Data on real GDP per capita comes from BEA NIPA Table 7.1. Here’s a graph… the X axis shows quarters since the end of the last of the recession, the Y axis shows the percentage change (not annualized) since the last recession.
Now, to some extent, GW’s people have an argument to make. After all, for much of the time, the red curve is higher than the blue curve. That said, the difference at the 23rd quarter out (where we are now for the second recession) is now almost a full percentage point… 11.99% to 11.03% growth in real GDP per capita since the last recession. But more importantly… will the curves reverse themselves again, or will the difference get larger?
GW likes to talk about how things have improved in the last four years, since Q3 of 2003… Coincidentally, the 23rd quarter since the 91 recession was Q4 of 96, four years after Clinton took office. So why don’t we look at just the four years ending in the 23rd quarter after each recession (i.e., 7th quarter since the end of the last recession to 23 quarters out)?
The annualized growth rate in real GDP per capita for the period from Q4 92 to Q4 96 was 2.03%. The annualized growth in real GDP per capita for the period from Q3 03 to Q3 07 was 1.86%. So there is a difference.
But more importantly… GW’s last full quarter in office will be the 28th one after the end of the 2001 recession. The annualized growth rate from the 23rd to the 28th quarter, the last time around, was 3.17%. In other words, the annualized growth rate kicked it up a notch and increased more than than a full percentage point from its growth rate thus far under Clinton.
How many people, other than maybe folks like these, expect the next year to show such a substantial jump in real growth?