Vote like a Democrat so you can live like a Republican.

This search for "a mechanism" thing really disturbs me. I really cannot fathom what is so puzzling.

Ezra has actually done better at explaining a bit of this (why people are puzzled) than most, by suggesting that President does not control the rate of economic growth, per se. [Hint: the Parties alternate control, and concentrating income at the top, contrains growth, so there's a catch-up effect available every time a Democrat is elected. It happened to be huge in the case of Kennedy-Johnson, and large for Clinton.]

But, I feel exasperated, too, by the sense that nobody reads the newspaper. It is like the policy events in every Presidency are forgotten. Democrats raise the minimum wage. Why is anyone surprised when that shows up in income for the bottom quintile? Republicans cut capital gains taxes. How can that not show up?

Democrats cut the cost of student loans; Republicans increase the profits of companies providing student loans. How can that not show up?

And, then there are the "leadership" things. Health care cost inflation is significantly lower under Democrats. Ditto, for corporate fraud. How can these things not show up?

California electricity crisis. How could that not show up?

I just don't get it. Why do so many people, especially on the left, not see that the government is economically massive, and affects people's incomes in numerous ways, some of which are pretty immediate?

Poor people spend more money than rich people, even when they're being made slightly less poor. Hence, programs that benefit the poor benefit the economy more than programs that benefit the rich.

And that's not even factoring in the fact that most rich people's money is invested in businesses that make their money selling these to the not-rich.

Standard fiscal/monetary policy under Republicans since Eisenhower has aimed at a higher unemployment rate, "on average", and/or a higher volatility of unemployment, for the obvious reason that that puts downward pressure on wage demands.

Kennedy-Johnson and Clinton sound steadily lower unemployment rates and general economic expansion, with predictable effects on wage rates.

This is not exactly secret knowledge.

Nixon, Reagan-Bush and GWB all pursued basically the same macroeconomic policy, although each in succession amplified a bit.

That the predictable results are achieved should not really surprise.

ezra, i think republicans would argue that the numbers don't tilt against them, but rather for them. it'll all just trickle down eventually, right?

Ethan - the rich got poorer under Republicans, or at least got rich slower than under Democrats.

I used to say I had no problem with rich folks voting Republican if economic self interest is their motivation. Now even that's gone. Now it's down to just suspicion of brown folks, and liking to see sh|t blowed up.

Isn't it kind of clear that Republicans don't care so much about the absolute wealth of the wealthiest, but rather about their relative wealth? What's the point of being lord and master without having serfs to push around?

conisder the possibility that the income trends might be changing the partisanship of the admin and not so much vice versa

I have help for Paul Krugman:

Economies, like human existence in general, are far too complicated and subjective and infinite in their possibilities to bother trying to explain with any tone of authority, but it is very worthwhile to go back and see what actually happened.

Get some sleep, Paul.

Sorry about the bad English.

That's why they pay EK the big scratch.

I thought some more about why the Democrats achieve a higher growth rate, and it occurs to me, that a counterfactual extended Carter-Mondale Administration, or a Gore Administration probably would not have scored as well as Kennedy-Johnson or Clinton did on growth. The reason is that Carter and Gore were advocating a different energy policy, the effect of which would probably depress growth relative to the experience of actual Democratic Presidents.

Personally, I think the Carter or Gore energy policy would have been better than the Republican policy -- we would not now be in Iraq, and the economy would not be, being dragged into the toilet by a huge imported oil bill. But, they also would not have achieved the same level of growth as Clinton.

The Democrats do well on growth because they increase employment -- they reduce the rate of unemployment, and they reduce the rate of underemployment. Johnson's War on Poverty and the macroeconomic expansion of the 1960's brought a lot of people into the modern, productive economy.

Reagan was the one Republican, who came into office after a period of relative economic stagnation, and he did better than other Republicans. Over all 12 years, Reagan-Bush economic performance was a pretty crappy and typical benefit the rich a lot and everyone else hardly at all, but Reagan had a few decent years in there, when the economy was coming out of Volcker's recession.

The difference between Reagan growth and Clinton growth, though, was in how it affected marginal groups. While Reagan's overall growth numbers were very close to Clinton's, Clinton did a lot better on behalf of marginalized groups -- blacks, hispanics, women and people in manufacturing and transportation. Given who the Democrats represent in the country, this should not be surprising.

I remain deeply curious about why people like Klein and Krugman would be surprised that Democrats are effectual.

Last election season 4 years ago, the blogosphere was kicking around a similar graph showing that every single Democratic president beat every single Republican president in job growth since WWII. The worst Democrat (Carter) beat the best Republican (Reagan). G W Bush, of course, is the bottom of the heap.

That graph should be shown in tandem with this one.

One point on the wage growth graph here: it's badly designed. The richest should be on the left and the poorest on the right. Most people are unsophisticated about statistics, and will tend to read a line that climbs as it moves to the right as a good thing. They will interpret the Republicans as "catching up" to the Democrats and about to pass them in wage growth....never mind that this doesn't actually make sense.

If the rich and poor are reversed, then the line for the Republicans looks like it is tanking and that of the Democrats looks like it started high and is moving slightly higher.

Reverse that x axis!

This is basically the table I was talking about. I misremembered that Carter was worst....apparently it was Kennedy.

Someone did a more recent version with different numbers, but the same basic idea. I'm too lazy to go through the source data and calculate for myself.

Maybe the answer to the question is as simple as "John Maynard Keynes (and Henry Ford) were right: If workers have jobs and decent pay, they will buy the products the economy produces, thus boosting the overall economy, and the income of the wealthy along with it. If you keep the income of the mass of consumers stagnant or depressed, then the rich will not get as rich as they would have otherwise." It's as simple as consumer spending being 70 percent of the economy.

I never understood how the changes in the economy of the past forty years, globalization, etc., whatever their implications for specific economic policies, have fundamentally changed this fundamental insight of Keynes. (Globalization has simply internationalized his insight.)

Am I missing something here? How is it more complicated than that? I'm not talking about gaining some kind of academic certainty about cause and effect, but a basic outlook on the world and how it works. And that basic outlook is what matters for politics.

And the result is worth pursuing, because if it's true, it can be a big boost politically to progressive causes and candidates. You can advance populist agendas while simultaneously arguing that your policies are good for the wealthy in the aggregate. That is, everyone benefits.

This would be proven more solidly if it were extended to Europe since World War II and a contrast between social democratic and conservative party control of nations there. I'm pretty certain that those kinds of studies have been done. This would provide a more robust set of variables and results.

Are there noticeable data points reflecting Clinton's signing of NAFTA or welfare reform and GWB's minimum wage hike?

It's a short-run vs long-run thing. The GOP emphasizes long-run supply-side gains that lift all boats, Dems emphasize short-run redistributory and demand-side gains. The powers of the presidency can have some effect in this way.

I would hate to be seen as defending republicans but you are looking a very small data set, could be random.

Also:

I would say that Nixon, and Bush governed more economically like democrats than did Clinton and Carter.

Also:

Accelerating inflation tends to hurt the rich and decelerating inflation tends to help the rich.

And to think I thought it was just a map of South Carolina. I guess you have to read the post and not just look at the pretty pictures.