CHAPTER 10

Spike the Ball: Truman-Carville-Bartels vs. Limbaugh-Gingrich-Bush*

Over many years of engaging in as much political debate as anybody in Washington, I’ve come to realize that on a lot of issues, the other side has a point. By and large, I think the side that Democrats and progressives are on is better than the side that Republicans and conservatives are on. But who knows? Maybe Republicans have a point on some of these educational issues. Maybe they have a point on crime. (It’ll surprise no one that I occasionally tend to agree with them on things like that.)

We always thought that we had a better point on the economy, but we thought they might have a point, too. It seemed like the best argument we made was that their policies might make for a better economy, but our progressive policies make for a better society. In short, aren’t you willing to give up something in the economy to achieve something for society? For a long time that constituted the underlying progressive, Democratic argument.

I’m very proud to say that in 1996 in We’re Right, They’re Wrong, I actually took a look at economic performance under Democrats and Republicans and concluded that Democrats had not only produced a more just society but, according to my amateur and partisan analysis, actually produced a better economy.

Much as I’m examining the disastrous legacy of the Bush administration today, James Carville circa 1996 autopsied the Reagan economy:

By the time he rode off into the sunset, Reagan had racked up almost $2 trillion in debt. Let’s forget for a minute the fact that $2 trillion of deficit spending was what allowed Reagan to post economic growth. Let’s just look at what a hole that debt put us in. If it weren’t for all the interest we’re paying on the debt he and his Vice President ran up—it’s costing us some $180 billion in interest this year alone—we’d be in the black right now. Let me state that another way: if we didn’t have to deal with the Reagan-Bush debt, we wouldn’t be arguing over how and when to balance the budget. We’d already have a balanced budget. Reagan also promised us economic growth like we’d never seen before. But take a look at the books: We got slower growth in the 1980s than we had in the 1970s. He promised that his tax cuts on the rich would lead to unprecedented growth in our productivity and savings. Wrong. Productivity growth was pathetically anemic, and our savings rate plummeted.¹

More than that, thirteen years ago, we already knew that supply-side economics in particular was, not to put too fine a point on it, a load of crap.

It’s not hard to figure out what went wrong. A handful of goofballs convinced Reagan to experiment with an untested concept called supply-side economics. It was the economic equivalent of jumping off the roof with an umbrella for a parachute—and instead of a busted ass, we got a busted treasury.²

That’s still right, and they’re still wrong. Unfortunately, Reagan’s experiment with an untested theory and its clear, disastrous repercussions weren’t enough to kill the rumor of conservative superiority on the economy.

Although We’re Right, They’re Wrong achieved some commercial success—it did reach number 1 on the New York Times Best Sellers list, I’m proud to say—its impact on the Washington elites could generously be described as minimal. After all, Carville is an uncouth, bigmouthed, partisan hack, a Clinton sycophant who is not schooled in the nuances of policy. And so your humble author had basically moved on. And while I myself considered my argument to be persuasive and correct, I had resigned myself to the fact that it was never going to make much of a dent in the way that the commentariat or the chin-scratchers really thought.

Then along came one Professor Larry M. Bartels of Princeton University, generally considered to be a reputable institution of learning. Mr. Bartels described himself as a person who had not even voted since 1984, in which election he actually voted for Ronald Reagan.

So, in comes Mr. Bartels, a man of pristine academic credentials and so non-partisan in his approach that he hadn’t even voted in more than twenty years. And what did Mr. Bartels determine after exhaustive and relentless study of the U.S. economy under Democratic and Republican presidents? He discovered—well, how do I put this modestly?—he discovered that James Carville was right twelve years ago. It is truly a testament to America that a humble Cajun boy, of very modest academic achievements and limited attention span, could actually have postulated a theory in 1996 that is completely validated by this seminal work.

It has now been stated, clearly and with the weight of Ivy League bona fides, that not only did Democrats build a more just society, they far and away built a better economy. I wish I could take credit for being the originator of this hypothesis, but that would have to go to another Democrat, who was also decried as a bumpkin by the David Broders of that day. That would be former President Harry S Truman. It was Truman who so brilliantly observed that “if you want to live like a Republican, you have to vote like a Democrat.”

What you see is that the Truman-Carville-Bartels position is the economic equivalent of evolution, while the Limbaugh-Gingrich-Reagan-Bush stance is the economic equivalent of creationism.

So, all of you who have listened to their nauseating claptrap about marginal rates, the death tax, regulation stifling economic growth, trickle-down, supply-side, and every other piece of idiotic tripe you had to endure at every boring cocktail party, join me in breaking out a bottle of good champagne and giving yourself a toast, because you don’t just stand for justice—you stand with the facts. Congratulations to the Democratic Party for winning on all measures of both economic growth and social justice.

Democrats Do It Better

The truth is, since 1900 Democratic presidents have dominated on every economic front.

Let’s do a quick rundown of the presidential scorecard. The dissection of more than a hundred years of White House economic policy reveals some startling if not unexpected numbers:

• Since 1900, Democrats saw a 12.3 percent return on the S&P 500 to the Republicans’ 8 percent
• Since 1930, Democrats created 5.4 percent GDP growth. Republicans rang in with only 1.6 percent.³

Do I need to keep going?

Don’t take it from me. I’ll turn the floor over to the good people of the Los Angeles Times, the Washington Monthly, and Princeton University, for a cross section.

In April 2005, Michael Kinsley did a quick rundown of spending, deficit, GDP, and unemployment for the Los Angeles Times. Kinsley started with the 1960 Economic Report and used forty-five years of economic history to debunk the Republicans’ claims to smaller government:

Consider federal spending (a.k.a. “big government”). It has gone up an average of about $50 billion a year under presidents of both parties. But that breaks down as $35 billion a year under Democratic presidents and $60 billion under Republicans. If you assume that it takes a year for a president’s policies to take effect (so, for example, President Clinton is responsible for 2001 and George W. Bush takes over in 2002), Democrats have raised spending by $40 billion a year and Republicans by $55 billion.⁴

Then, in May 2005, Kevin Drum followed up on Kinsley’s math in the Washington Monthly. Drum’s conclusion was essentially “spike the ball.” It’s done. Game, set, match. He wrote:

The results are simple: Democratic presidents have consistently higher economic growth and consistently lower unemployment than Republican presidents. If you add in a time lag, you get the same result. If you eliminate the best and worst presidents, you get the same result. If you take a look at other economic indicators, you get the same result. There’s just no way around it: Democratic administrations are better for the economy than Republican administrations.⁵

FIGURE 1
Macroeconomic Performance under Democratic and Republican Presidents, 1948–2005

FIGURE 2
Macroeconomic Performance under Democratic and Republican Presidents, 1948–2005

Democrats are also indisputably better for social justice. Two words for you: income inequality.

Under Democrats, income inequality declines. Under Republicans, it grows. Back in 2004, Bartels wrote, “My projections suggest that income inequality…would actually have declined slightly over the past thirty years had the patterns of income growth actually observed during Democratic administrations been in effect throughout that period; conversely, continuous application of the patterns of income growth actually observed during periods of Republican control would have produced an even greater divergence in the economic fortunes of rich and poor” [italics added].⁶ Republican policies would create what Bartels calls a “Platinum-Gilded Age.”⁷

In 2008, Bartels came up with a graph to prove it.

FIGURE 3
Real Income Growth Rates by Income Level and Presidential Partisanship, 1948–2005

The body of evidence against Republican economic policy has been a long time in growing. But now we have a damning compendium of commonsense observation, such as that provided by your humble author back in 1996, as well as Ivy League analysis and an unprecedented financial crisis with which to indict the Republicans.

The major economic policies of Republican presidents have all been resounding failures. You can just look back to We’re Right, They’re Wrong if you have any lingering doubts about trickle-down and supply-side economics—keep reading, to the final chapter, The Real Deal, for more of Carville’s thoughts on the history of Republican economic policy.

Clinton vs. Bush

Allow me to introduce you to the perfect case study for Democratic superiority on the economy: Clinton vs. Bush. I may bear a slight bias, but the fact stands: the Clinton economy was stronger on every measure than Bush’s has been. (In four years, when I write my next book, this chapter will chronicle the superior performance of Obama economic policies over Bushian economics.)

FIGURE 4
The Impact of Partisan Turnover on Partisan Differences in Real Income Growth Rates, 1948–2005

Bush Republicans have been trying to tear down the Clinton economy since Bush became the president-select in 2000, courtesy of five thieves in black robes, as my friend Paul Begala rightly refers to them. Their rhetoric falls flat in the face of fact. Just look at the fight I had back in 2000 with Oliver North on MSNBC:

NORTH:…It strikes me that what we’ve got is an economy that in the Marines we would say, “This economy is in a route the wrong way.” What you’ve done is you’re handing to the incoming administration an economy that’s on a downward spiral, contracting, and going to make it more difficult for them.

CARVILLE: Wait a minute, when this administration took office, the unemployment rate was 7.1…. The unemployment rate is 4.6 percent…

NORTH: Today.

CARVILLE: I’m saying where it is. The Dow is at 10,300…

NORTH: Today.

CARVILLE:…400, it went up today. You know where it was when he took office?

NORTH: Today…you guys are stuck in ancient history.

CARVILLE: What are you talking about? Excuse me…

NORTH: We’re talking about today.

CARVILLE:…I’m telling you, put a 10,400 Dow in context, it was 3,200 when we took office. You put a 4.6 unemployment rate, you have to put it in context.

NORTH: James, let’s look at a couple of leading indicators right now. New home starts, down. New car sales, down. Capital investment equipment, down.

CARVILLE: All of this is down from what? Down from what?

NORTH: Down from six months ago.

CARVILLE: But again, they’re still growing. Every blue chip has between two-and-a-half and three-and-a-half percent growth. We were talking about when the Clinton administration took office you couldn’t grow faster than two-and-a-half percent because you would overheat the economy. You know, it’s like it’s OK. Everybody gets it. We get a guy who comes into office. He wasn’t elected. He was selected by five people. And he comes into office and the first thing he starts doing is trashing the best economy we’ve ever had in the history of the United States. If that’s what he wants to say, if that’s what he wants to run, if he wants to be the president of negativism, let him go. I mean, he’s the president-select.⁸

North gave it a go, but it’s hard to argue with numbers, even for Republicans.

At the end of Clinton’s first term, the New York Times was reporting that “In the United States, economic growth was the best in a decade.”⁹ By the end of Clinton’s second term, CNN joyfully announced: “Budget surpluses have surpassed most projections recently as the booming U.S. economy, now in its ninth year of expansion, and big stock market gains have filled government coffers with soaring revenues.”¹⁰

FIGURE 5
Family Incomes by Income Percentile, 1947–2005

It’s no surprise that the Republicans tried to tear down Clinton’s reputation and set some low expectations for the next four years. In fact, it was downright sensible. Unfortunately for the Republicans, there’s no way to set expectations low enough for Bush. Just review the commentary on the U.S. economy in 2008, as Bush was preparing to leave the White House. If there’s a stronger contrast than that between the reporting on the end of the Clinton economy and from the last months of Bush, I don’t know of it. After all, Clinton left us with the largest surplus in U.S. history.¹¹ Bush gave us a recession.

FIGURE 6
Top Incomes by Income Percentile, 1947–2005

Here’s what the experts said early in 2008, while Bush was still denying that the economy was in trouble:

“The economy is now in a recession…. It will last longer and be deeper than the last two recessions, which lasted only 8 months from peak to trough. It could well be longer and deeper than the recession in the early 1980s that lasted 16 months”—Martin Feldstein, Harvard Professor of Economics and president of the National Bureau of Economic Research.¹²

FIGURE 7
Income Shares of Top 5 percent and Top 1 percent, 1917–2005

“I think it is a virtual certainty that the economic situation will feel more like a recession on January 20, 2009, than it does today…. From the perspective of Main Street and the real economy, there is a very large amount of pain left to be felt”—Larry Summers, former Treasury secretary and former president of Harvard University.¹³

It wasn’t just a few Harvard economists, it was all the top minds in economics.

Economists in the latest Wall Street Journal forecasting survey are increasingly certain the U.S. has slid into recession, a view reinforced by new data showing a sharp drop in retail sales last month. “The evidence is now beyond a reasonable doubt,” said Scott Anderson of Wells Fargo & Co. Thirty-six of 51 respondents, or more than 70%, said in a survey conducted March 7–11 that the economy is in recession.¹⁴

FIGURE 8
Income Growth by Income Level under Democratic and Republican Presidents, 1948–2005

In case you needed a few more pieces of evidence, I’ll direct you to not one but two former chairs of the Federal Reserve. There’s Paul Volcker, who described the U.S. economic situation as “the mother of all crises.”¹⁵ Then there’s the inimitable Alan Greenspan, who pronounced that “The current financial crisis in the U.S. is likely to be judged in retrospect as the most wrenching since the end of the second world war.”¹⁶

FIGURE 9
Income Inequality under Democratic and Republican Presidents, 1947–2005

Hold on a second—I’m going to have to ask you to read that again. Alan Greenspan said the current financial crisis will be “the most wrenching since the end of the second world war.”

So, to review, Clinton exceeded all expectations for the U.S. economy to the positive and generated the largest budget surplus in U.S. history—and Bush took us back sixty years and engineered a recession.

FIGURE 10
Projected Income Inequality under Republican and Democratic Presidents, 1947–2005

The Nitty-Gritty

Stick with me through the specifics. I’m going to keep harping on the Bush economy vs. the Clinton economy for just a while longer. I began comparing the two in We’re Right, They’re Wrong, and then Paul Begala and I took a crack at it again in Take It Back. Using hard facts to make Democrats and Republicans look bad wasn’t hard then. It’s only gotten easier over the past few years.

Bush really has driven the economy into the ground. Going back to Bartels for a moment, he produced what may be the single funniest line in modern American political history. He quotes from a study on income inequality from the predictably pretentious British magazine The Economist:

Thanks to a jump in productivity growth after 1995, America’s economy has outpaced other rich countries’ for a decade. Its workers now produce over 30% more each hour they work more than ten years ago. In the late 1990s everybody shared in this boom. Though incomes were rising fastest at the top, all workers’ wages far outpaced inflation.

But after 2000 something changed. The pace of productivity growth has been rising again, but now it seems to be lifting fewer boats…. The fruits of productivity gains have been skewed towards the highest earners, and towards companies, whose profits have reached record levels as a share of GDP.¹⁷

Read that first line of the second paragraph again: “after 2000 something changed.” Bartels gave a very dry, very academic response: “the report provided no hint of what ‘something’ might have changed after 2000.”¹⁸ What a killer line. An unnamed something happened after 2000.

Stock Market

Let’s look at the Standard & Poor’s 500 through December 2006. Under Clinton, it rose a whopping 207 percent. Bush managed to eke out 6 percent by the end of 2006, then there was the summer of 2008 and the stock market crash.¹⁹ You’d think this would be enough to discourage Republicans from ever making a claim about stock market superiority again. Characteristically, they are ignoring the facts. The Republicans continue to claim that the Bush administration saw record highs in the S&P. Let’s look a little more closely at these claims.

The Republican claim is that on July 19, 2007, the S&P 500 hit a “record high.”²⁰ David Leonhardt of the New York Times points out that “the S&P remain[ed] 17 percent below its inflation-adjusted 2000 peak. A share in a mutual fund tied to the S&P 500, in other words, couldn’t buy nearly as much then as it could in early 2000.”²¹ Record high? They didn’t even break even.

Jobs

Clinton created 23 million jobs. Bush created only 5.6 million in his first six years.²² In percentages, jobs increased by 2.38 percent per year under Clinton and decreased by 0.17 percent each year from 2000 to 2004 with Bush.²³ Put another way, Bush had the worst job creation record of the last seventy years—he added only 3.7 million non-farm jobs.²⁴

The other problem is the type of jobs Bush created. Clinton produced full-time jobs, the type with benefits like health insurance. Under Clinton, the number of full-time jobs relative to part-time jobs rose. In the Bush economy, by contrast, job creation generated more part-time jobs. From 2001 to 2004, the ratio of full-time to part-time work declined at a rate of 1.67 percent.²⁵

FIGURE 11
Unemployment Rate

It’s a favorite Republican trick to point to those few times Bush could claim lower levels of unemployment than Clinton. Not so fast, guys. Let’s put this in context. Clinton came into office with 7.3 percent unemployment and lowered it to 4.2 percent. Bush, by comparison, managed to slightly increase the low unemployment he inherited, from 4.2 to 4.5 percent, and now Republicans have the audacity to claim that he did better than Clinton on unemployment.²⁶

Wages/Income

In the Bush economy, incomes stagnated and the cost of living skyrocketed. “Raises” only helped people keep up with inflation.²⁷ Under Clinton, by the way, hourly earning rose by 6.8 percent. With Bush, there was only a 3.9 percent increase.²⁸

Adjusted for inflation, the Bush minimum wage was $2.00/hr less than the Clinton minimum wage, despite the best efforts of congressional Democrats. The June 2007 minimum-wage increase wasn’t really an increase. It only brought the minimum wage closer to its 1997 level. To actually increase the minimum wage, we’d have to raise it above $9.05/hr.²⁹

Income stagnated and even fell under Bush. With Clinton, household income rose by $5,825 annually. Thanks to Bush, it decreased by $1,273. Poverty’s up; health insurance is down. That income gap we started talking about in We’re Right, They’re Wrong is bigger than ever, and it’s going to be one of Obama’s biggest challenges to shrink it again.

Income Gap

Bill Clinton managed to work against income inequality. As one report put it, “Even in the highly inegalitarian economic climate of the 1990s, Bill Clinton managed to produce slightly stronger income growth for families at the 20th percentile (2.0 %) than at the 80th percentile (1.9%), though families at the very top of the income distribution did even better.”³⁰

Under Bush, the income of the top fifth of families grew more quickly than that of the middle fifths and far more quickly than that of the bottom fifth. It was not even really the whole top fifth. It was the top 5 percent of families. That 5 percent enjoyed increases in income somewhere between 66 and 132 percent from the 1980s to 2000s. By comparison, the bottom fifth saw income growth of only 11 to 24 percent in the same states.³¹

FIGURE 12
People Below Poverty Level and Below 125 Percent of Poverty Level by Race and Hispanic Origin: 1980 to 2006

Here’s a table from the U.S. Census Bureau showing poverty rates from 1980 onward. I invite you, dear reader, to examine the decline in the number of people living below the poverty level between 1992 and 2000—3.5 percent. Then turn your gaze over to that span between 2000 and 2005, and you’ll find a 1.3 percent increase. Put another way, Clinton oversaw 6,433,000 people coming out of poverty and Bush put 5,369,000 Americans into poverty in just his first five years.³²

FIGURE 13
Children Below Poverty Level by Race and Hispanic Origin: 1980 to 2006

FIGURE 14
Price of Gasoline, all types, per gallon (3.785 liters)

Look at what happened to children. While Clinton was president, the number of children below the poverty line decreased. Under Bush, it increased.

People are working two jobs, children are sinking into poverty—and the Republicans tried to claim victory. Obama didn’t let them get away with it, but now he’s still left trying to fix the mess they’ve left behind.

Cost of Living

Income may not be increasing, but prices are. Take bread for an example. It’s more than a third more expensive than it was in 2000.³³

Here’s the price of gas from 1992 to 2008. Notice the upward trend that begins in 2000:

Here’s piped gas for utilities, like heat:

FIGURE 15
Price of Utility (Piped) Gas, 100 therms

And here’s fuel oil:

FIGURE 16
Price of Fuel Oil #2 per gallon (3.785 liters)

To get away from the energy theme for a bit, here’s the price of bread:

FIGURE 17
Price of Bread, white, pan, per lb. (453.6 gm)

And now here’s ground beef:

FIGURE 18
Price of Ground chuck, 100% beef, per lb. (453.6 gm)

We’re going to go into this one a little more when we get to young people. Right now the idea is just to give you a sense of how bleak the picture is.

Debt

The result of Bush’s economic policies is rapidly growing personal and household debt. Going back to Daily Kos and a favorite of mine who writes there, Bonddad did some great work on debt in November 2007. He pointed out that “in the fourth quarter of 2001, total household debt was 75.10% of GDP. In the second quarter of 2007 it was 96.82%…. In the fourth quarter of 2001, total household debt was 102% of disposable income at the national level. In the second quarter of 2007 it was 129.62 % of personal income at the national level.”³⁴

The result goes back to the stock market. Bonddad rightly identifies soaring levels of debt as the force behind those early ominous headlines about the Wall Street giants taking huge losses. Think of the hits, one after another, that Citigroup, Merill Lynch, Morgan Stanley, Lehman Brothers, and the other big banks and brokerage houses took in fall 2007. The markets will not recover from this level of debt for years.

So, to sum it up, people are working more, earning less, and facing rising costs in every sector of the economy. Everything from health care to education to the price of bread has risen, and overall growth and wages aren’t keeping up.

Fiscal Responsibility

Finally, let’s look at fiscal responsibility. Bush managed to turn a $62.9 billion surplus into a deficit of $1.5 trillion. Public debt as a percentage of GDP fell 16.4 percent under Clinton, from 49.4 to 33 percent, only to rise back up to 38.5 percent during Bush’s term.³⁵

Need more? Our ratio of public debt to GDP—that is, the amount of debt the government owes relative to what we’re making, the GDP—went up by almost a percentage point each year Bush has been in office. Surprise, surprise, it went down almost 4 percent annually under Clinton.³⁶

So, then, what about trade? Here’s another corner of economic performance where the Republicans would like to have you think they excel. Just ask Rush Limbaugh or Rudy Giuliani. I’m sure they’ll be quick to point out that the trade deficit increased more rapidly under Clinton than Bush. So should we give No. 43 the win? Sure, unless you care about why and how the trade deficit rose during each administration.

Robert Atkinson and Julie Hutto of the Progressive Policy Institute explain:

The trade deficit grew at the rate it did under Clinton for two main reasons: because the first Bush Administration’s recession had cut imports to an artificially low level, and because the economy was expanding rapidly. People were confident, so they were buying a lot of imported goods. Businesses were growing, too, so U.S. factories were importing materials to manufacture their products. Throughout this period, export growth was very strong. In the Bush years, the trade deficit has been a product of a different, and less healthy dynamic: U.S. exports have dipped dramatically relative to imports.³⁷

Clinton’s record on every economic front and, indeed, for the whole of the expansion, exceeds Bush’s by far. Period. Point, set, match. Republican manipulations of the numbers are wearing thin. People know the economy wasn’t as strong under Bush. For any who’d like further evidence, I’d direct them to the nearest newspaper, gas station, or grocery store.

I can anticipate how the critics will feel about my using Democracy Corps numbers, so I’ll give you Gallup instead. In December 2008, Gallup found that 78 percent of Americans were negative about the economy.³⁸

Yet the Republicans keep repeating that everything is fine, like saying that Bush was a success economically will make it so. They are trying their damnedest to mislead people. They tried the same mumbo-jumbo in 2006, and it didn’t work then, either. Republican strategist Frank Luntz told the New York Times right before the 2006 elections, “I don’t know of another election cycle in which the economy was so good, yet the election prospects for the incumbent party looked so bad.”³⁹

Trust Dick Morris to come up with something even better in the lead-up to 2008. He claimed, “Bush’s ratings on the economy are not bad, and he still draws commendations for his battle against terrorism.”⁴⁰

Morris should be used to being wrong, but this may be a new level of incorrect. Morris’s statement flies in the face of every poll on Bush. Media Matters fact-checked Morris with the Newsweek, Washington Post/ABC, and New York Times/CBS News polls. Newsweek’s June 2007 survey showed that 60 percent of respondents disapproved of Bush’s handling of the economy while only 34 percent approved. In the May–June 2007 Washington Post/ABC Poll, 57 percent disapproved and 40 approved. The New York Times/CBS News Poll offered little better news for Bush, with 56 percent disapproving and 36 approving.⁴¹ A year later, in ARG’s June 2008 survey, 71 percent disapproved and only 25 percent approved of Bush’s handling of the economy.⁴²

Of course the most egregious offenders when it comes to economic myths and lies were the Republican candidates. Usually people wait until an event is well in the past to revise it, but these guys attempted to rewrite history as it happened.

Exhibit A: The Republican primary, otherwise known as a caucus of reality-deniers. At the Republican debate in Michigan on October 9, 2007, Mitt Romney claimed that Michigan was alone in its economic downturn and that “the rest of the country is growing and seeing low levels of unemployment.”⁴³

Fred Thompson might have been worse. At the Michigan debate, he said, “I think if you look at the short term, it’s rosy. I think if you look at a 10-year projection, it’s rosy.”⁴⁴ When Maria Bartiromo pressed him, citing the two thirds of Americans who said the country was in a recession or headed for one, Thompson responded with this winner:

Well, I think there are pockets in the economy. Certainly they’re having difficulty. I think there are certainly those in Michigan that are having difficulty. I think you always find that in a vibrant, dynamic economy. I think that not enough has been done to tell what some call the greatest story never told, and that is that we are enjoying a period of growth right now, and we should acknowledge what got us there and continue those same policies on into the future.⁴⁵

McCain similarly toed the Republican Party line, making only a tepid acknowledgment of America’s economic plight. In October 2007, he still said only that the economy was “growing more slowly than anyone would like.”⁴⁶

The sole Republican candidate who seemed willing to own up to the coming crisis was Huckabee. It was Huckabee who warned at the Michigan debate, “I want to make sure people understand that for many people on this stage the economy’s doing terrifically well, but for a lot of Americans it’s not doing so well. The people who handle the bags and make the beds at our hotels and serve the food, many of them are having to work two jobs.”⁴⁷

The Los Angeles Times quoted Don Sipple on November 9, 2007, as saying that “Any economic pain comes out of the hide of the Republican Party.”⁴⁸ That same article included a quote by Bill Whalen, formerly of the 1992 Bush reelection campaign and a fellow at the Hoover Institute. He warned, “What a weak economy does is, it lets the Democratic nominee go out and ask the Ronald Reagan question: Are you better off today than you were eight years ago?”⁴⁹

Latinos in the Bush Economy

I’m just going to take a moment here to revisit a few of these numbers and tables with a special emphasis. Bush likes to make a lot of his supposed success with Latinos, but the truth is, Latinos are a Democratic group, and they’re even more Democratic after this economic crisis. Few Americans did well under Bush, but some fared worse than others. Latinos were particularly hard-hit by the Bush economy.

• The employment-population ratio for Hispanics and Latinos dropped drastically when George W. Bush took office. Under Clinton, there was a 6.6 percent increase. Under Bush, there was a 0.8 percent decrease⁵⁰
• The unemployment rate for Hispanics and Latinos decreased under Clinton and drastically increased while Bush was in office
• Median income for Hispanics and Latinos in constant 2005 dollars increased under Clinton, but decreased under Bush.⁵¹

FIGURE 19
Money Income of Families—Median Income by Race and Hispanic Origin in Current and Constant (2006) Dollars: 1990–2006

Median household income for Hispanics and Latinos sharply decreased under Bush, and sharply increased under Clinton.⁵²

The percentage of Hispanics and Latinos below poverty level decreased by almost 10 percent under Clinton (1993–2000). It increased by 0.4 percent under Bush (2001–2005).⁵³

The percentage of Hispanic children below poverty level decreased by 11.6 percent under Clinton (1993–2000) and increased by 0.3 percent under Bush (2001–2005).⁵⁴

Spike the Ball

The Republicans have nothing left to claim on the economy. They have been weighed, measured, and found lacking by everyone from your author, James Carville, who barely graduated LSU, to Larry Bartels, who teaches at Princeton University, to the American people struggling with Bush’s legacy of a rising cost of living and shrinking retirement.

The only recourse Republicans have left is to lie, and to hide the evidence of economic failure. That’s just what they’ve tried to do. It’s hard to hide grocery stores, banks, and gas pumps, but they’re doing their best to bury the numerical evidence. The good news is, the Democrats—and the American people—aren’t letting the Republicans get away with it this time.

In February 2008, as the mortgage crisis was getting worse and worse and it became clear a recession was looming, the Bush administration took action—by shutting down EconomicIndicators.gov, one of just a few solid sources of information about the U.S. economy available to the public. To give you an idea of how important this one Web site is, the Wall Street Journal described it as “a one-stop shop for those looking for the latest turn of the screw on some of the economic statistics scattered on other, less-than-user-friendly Web sites maintained by the Feds.”⁵⁵

FIGURE 20
Money Income of Households—Median Income by Race and Hispanic Origin, in Current and Constant (2006) Dollars: 1980–2006

Forbes magazine named EconomicIndicators.gov “Best of the Web,” explaining that “this site simply links to the relevant department’s Web site. This might not seem like a big deal, but doing it yourself—say, trying to find retail sales data on the Census Bureau’s site—is such an exercise in futility that it will convince you why this portal is necessary.”⁵⁶

No wonder the Bush administration wanted to shut this site down. It provided the American people with information about the state of the U.S. economy.

On February 13, 2008, Think Progress reported that the Bush administration would shut down EconomicIndicators due to “budgetary restraints.” Sure enough, visitors to the Web site could read that it would stop operating beginning March 1, 2008.⁵⁷ Of course, because it’s Bush, they weren’t really just shutting it down. Bush and his greedy cronies just wanted to start charging anyone who wanted the data a fee.

FIGURE 21
People Below Poverty Level and Below 125 Percent of Poverty Level by Race and Hispanic Origin: 1980 to 2006

Then Senator Chuck Schumer was on the case. He said, somewhat pointedly, “On the brink of a possible recession, the Bush Administration’s decision to shut down the free flow of economic data boggles the mind. Wasteful government spending should be cut, but shutting down an award-winning website that gives Americans easy-to-use economic information during troubling economic times is penny-wise and pound-foolish.”⁵⁸

FIGURE 22
Children Below Poverty Level by Race and Hispanic Origin: 1980 to 2006

Only a week after the Bush administration said it would be shutting down EconomicIndicators.gov, the Wall Street Journal reported that the administration had suddenly found room in the budget to continue the site.⁵⁹ The fact that it even tried to shut this site down is proof of just how aware it was that its economic record was nothing short of dismal.

Bush couldn’t dodge his record. His efforts offer an instructive lesson to future presidents: it is not possible to sweep an entire presidency under the rug. His efforts to do so were, at the least, too little, too late. The mortgage crisis preceded an even deeper, more profound economic crisis as the stock market plummeted and took Americans’ savings and retirement with it in the summer of 2008.

The secret’s out: Democrats are better than Republicans on the economy. And guess what? I don’t mean to shock anybody, but as it turns out, Bush distinguished himself as a particularly remarkable failure within the pantheon of Republican presidents who have wrought economic havoc. Many of Obama’s most effective speeches have been about the economy, and for good reason. The American people are still feeling the devastating effects of the Bush administration and decades of cumulative conservative economic policy, and it’s one of the biggest reasons for Democratic success in 2008—and why they’re ready to keep electing Democrats.

IT’S NOT SUPPLY AND DEMAND

Throughout much of 2008, gas averaged somewhere north of $4 a gallon.

The Washington chatterrati and editorial boards insisted that basic supply and demand were to blame for increasingly high oil and gasoline prices.⁶⁰ Robert Samuelson, in his July 7 Newsweek column, mocked politicians for blaming speculators for the energy crisis. “A better explanation is basic supply and demand,” he informed the reader.⁶¹

Call me a fool, but I’m suspicious of the claim that supply and demand is to blame for rocketing energy costs. I’d have to say that the lack of conservation policy, the weak dollar, out-of-control speculators, and the Bush administration’s idiotic foreign policy might have had more to do with our soaring oil and gas prices.

For any who doubt that it’s probably not just supply and demand, we have recent history as a guide. Let’s take a trip back to the year of 2000, when California was entangled in its own serious energy crisis. Former Governor Gray Davis was being crucified by the media for stating that the state’s deregulation of the energy companies had led to price manipulation. Davis called for price controls and more energy conservation measures.

Vice President Dick Cheney was involved with the Federal Energy Regulatory Commission (FERC) investigation into the debacle from the outset. From its inception, Cheney and the commission mocked claims of price manipulation. Cheney was as bold as to say, “Conservation may be a sign of personal virtue, but it is not a sufficient basis for a sound, comprehensive energy policy.”⁶² And you could guess, he was for more deregulation and increased drilling.

The chattering class was at it back then, too, and they were in agreement with Cheney. They balked at Davis’s charges that Texas energy giants such as Enron would ever try to manipulate prices for their own corporate benefit.⁶³ The entire op-ed-writing, editorial-board-sitting, cocktail-party-attending, pipe-smoking, chin-scratching establishment lined up against Governor Davis, with the lone exception of now Nobel Prize winner Paul Krugman.

Lo and behold, it turns out former Governor Davis (and Krugman) were right. Three years after the crisis, Krugman got to write that “Most independent experts now believe that during 2000–2001, price manipulation by energy companies, mainly taking the form of ‘economic withholding’—keeping capacity offline to drive up prices—added billions of dollars to California’s electricity bills.” That’s also about the time that a March FERC report confirmed there had been “extensive manipulation” of energy prices.⁶⁴

The 2000 crisis had everything to do with market manipulation and energy conservation. So count me as skeptical, Robert Samuelson and the rest of you, if I don’t believe your supply-side shtick. I have an open mind with regard to whether the speculators and conservation and the weak dollar and our asinine foreign policy have everything to do with our recent energy crisis and the price of gas.