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100 year average shows Dow heads south during Republican rule
November 20, 2002 7:44 AM   Subscribe

100 year average shows "stock market prefers Democratic presidents to Republicans" - "President George W. Bush inherited the lousy end of the business cycle...[however]...Slate ran the numbers and found that since 1900, Democratic presidents have produced a 12.3 percent annual total return on the S&P 500, but Republicans only an 8 percent return. [from Slate] Meanwhile, deficit spending [NYT reg. req.] is back in fashion -Guess I'm putting my $ in gold.....
posted by troutfishing (49 comments total)

 
troll
posted by Steve_at_Linnwood at 7:50 AM on November 20, 2002


Theres more reason to put money into Gold. I just recently read Conquer The Crash which uses Eliott Wave Theory to find fractal patterns in stock charts. Most brokerages have an in-house Elliott Wave expert it's a well known and established theory. It's currently showing we are on the verge of a depression with fractal patterns convergence along 3 scales to the present: 1780's, 1929, and 1974. Anyone interested in this or concerned about your portfolio it's at least worth checking out a contrarian view to the talking heads rosey picture view presented in the popular press.
posted by stbalbach at 7:53 AM on November 20, 2002


The Jehovah's Witnesses keep telling me were on the verge of the apocalypse, so I'm putting my money in Bibles!
posted by Pollomacho at 7:57 AM on November 20, 2002


troll

explain.
posted by mcsweetie at 7:59 AM on November 20, 2002


explain

Do I really have to?
posted by Steve_at_Linnwood at 8:01 AM on November 20, 2002


No. Please don't. Stick to the pledge.
posted by liam at 8:03 AM on November 20, 2002


Yeah Steve, you have to explain the troll comment. I thought the post had an interesting take on "common sense" thinking about both party's effect on the economy.
posted by pjgulliver at 8:07 AM on November 20, 2002


100 year study shows that lots of different things can affect the economy in a 100 years, not to mention the constantly changing political positions and definition of repulicans and democrats. I don't have a problem with the post, the study is just ridiculously stupid to me.
posted by Stan Chin at 8:15 AM on November 20, 2002


I disagree, Steve. The links were informative, if not a tad biased. The data contained, is interesting compared to the overwhelming view of how each party performs. While I am not fully convinced, the post certainly was not trollish.
posted by thekorruptor at 8:16 AM on November 20, 2002


Are they perhaps confusing cause and effect here? Why can't the explanation for the correlation be simply when times are good, people tend to vote Democrat, and when they're bad they vote Republican? When the economy is poor, you send in the fiscal conservatives. When you've got a llittle extra, you tend to spend it. I know that's a little simplistic a division of Democrat & Republican, but in a broad sense it's true.
posted by GhostintheMachine at 8:17 AM on November 20, 2002


troll

what is trolling by calling someone a troll? meta-trolling?
posted by zoopraxiscope at 8:21 AM on November 20, 2002


Good point Ghost. What would be interesting would be to see a a statistical link of Federal budget defecits to party affiliation.
posted by pjgulliver at 8:25 AM on November 20, 2002


If the numbers are to be believed, could it be that people are more likely to vote for financially conservative people (cough, Republicans, cough) when times are starting to get difficult?
posted by whatzit at 8:29 AM on November 20, 2002


When the economy is poor, you send in the fiscal conservatives.

could it be that people are more likely to vote for financially conservative people (cough, Republicans, cough) when times are starting to get difficult?

Now that's a theory I'm interested in hearing explained!! Is it just CW or can anyone offer evidence to support such a supposition? I DO know that recent political history is the exact opposite (Raygun - huge spending, tax cuts, and a deficit so big "it's big enough to take care of itself"-RR and Bubba paying down the deficit, balancing the budget, etc. and now Dubya bringing back the bad old days of Raygun.)

Please do tell. I'm very interested in some facts to support it.
posted by nofundy at 8:49 AM on November 20, 2002


financially conservative people (cough, Republicans, cough)

Yeah, I cough too when I hear Republicans referred to as "fiscally conservative."
posted by Loudmax at 8:52 AM on November 20, 2002


Perhaps I should be more specific. Please explain the "fiscally responsible" and "financially conservative" statements regarding the party with supporting evidence also. Thank you.
posted by nofundy at 8:52 AM on November 20, 2002


What would be interesting would be to see a a statistical link of Federal budget defecits to party affiliation.

This link has some excellent economic indicators with partisan breakdowns ranging from the Hoover to the Clinton administrations. If you use increase in the national debt as an indicator and add this measurement for 40 years worth of Democratic administrations, you get a total 40.72% increase in the national debt. If you add the same indicator for 32 years worth of Republican adminstrations, you get a total 40.07% increase in the national debt. If you average these increases by dividing by the number of years the parties have been in power, it appears that the Republicans have increased the national debt more for each year in office than the Democrats. If you remove FDR from the sample of Democrats, the contrast becomes even more striking. The contrast also holds if you remove both FDR and Reagan (the two presidents from each party who increased the national debt the most). Pretty convincing, I'd say.
posted by jonp72 at 8:54 AM on November 20, 2002


Steve, nice attempt at derailing a great thread. Keep up the useless blather, please! Maybe it will convince Matt to create an "Ignore" feature, so I can just check off your username and never see anything you write again. *Dream*

This seems like just one more example of how public perception is much more important in elections than the facts. Unfortunately modern investors now use statistical analyses when planning their futures, even if voters don't. I'm hoping to have some cash saved up to invest 6 months before the 2004 presidential elections, which will hopefully be the bottom of the second U in the W-shaped recession everyone's ranting about.
posted by zekinskia at 9:03 AM on November 20, 2002


Fascinating link Jonp, thanks!
posted by pjgulliver at 9:09 AM on November 20, 2002


I always thought this was true, just from my cursory appraisal of history, so I'm glad somebody's done the math. Roosevelt's New Deal was to rebuild the economy by investing in social services and work programs, not cutting super-rich people's taxes and gutting assistance programs to the poor. Maybe people will finally figure this out. The Republicans are only good for their own stratospheric micro-economies, not for the country as a whole.
posted by judlew at 9:18 AM on November 20, 2002


Totally off topic - This is funny. So sorry, but one political FPP is enough for one day.
posted by revbrian at 9:20 AM on November 20, 2002


Judlew, exactly the point Krugman made in his fascinating portrayal of the recent Republican agenda in his NYTimes Mag article in October.
posted by pjgulliver at 9:21 AM on November 20, 2002


Yes, thanks Jonp.

Funny how all Steve had to write was a single word to get the whole pot stirred up! There's been more posts here about his one word than about the FPP.

Does the FPP show a universal trend? Does it predict the future? Does it even say anything about the conditions existing within the current administration? No, its not even a news post. I find the raw numbers to be fascinating, particularly how when presented many elements can go on the defensive (this works for both sides of the aisle so no troll implied)
posted by Pollomacho at 9:21 AM on November 20, 2002


12.3 percent annual total return on the S&P 500, but Republicans only an 8 percent return.

But either way the return is at least 8 percent , which is better than I get from my current Social Security investment.

Maybe putting SS money into the stock market is a good idea ....
posted by Ayn Marx at 9:37 AM on November 20, 2002


It was briefly mentioned in the article about the economy when both houses of congress had the President's party in the minority, but I'm interested in seeing more stats like that, and also stats about the economy with either major party in power. It would be interesting to see if the party in power in congress has a greater predictive effect than which party had control of the Oval Office.
posted by gyc at 9:51 AM on November 20, 2002


Ayn Marx,

Good try at derailing the thread. I'm hearing deafening silence at refuting the numbers here. I asked nicely too.

Why Social Security can't be invested in the market: It would then be Capitalist Insecurity! :-)
posted by nofundy at 9:52 AM on November 20, 2002


Deficit spending is back in fashion for good reason -- it stimulates the economy. And the economy needs a stimulus right now. Deficit spending on domestic items sure beats deficit spending to pay for war (but it looks like we're about to get both kinds).

As far as the comment about gold (probly said partly in jest, or ruefully), it's interesting that some investors run to gold in hard times, even today. Gold used to have intrinsic value, but goes it still? I'm not sure it does. Gold bugs tend to give the impression that they're wild-eyed conspiracy theorists. No doubt that's an unfairly broad characterization, but, still, that's the impression they give.
posted by Holden at 9:55 AM on November 20, 2002


No. Please don't. Stick to the pledge.

The pledge? As if...
posted by y2karl at 10:24 AM on November 20, 2002


Gold used to have intrinsic value, but goes it still?

Yes. Gold still has value as an invesment tool. For most people its not relevant unless your a bunker mentality type but for people with cash reserves and governments looking for a hedge against signifigant downturns in the economy it's an excellent investment tool.
posted by stbalbach at 10:32 AM on November 20, 2002


Slate was not the first to point this out. I recall hearing about this “trend” over 10 years ago. And from what I have heard from those who study economics, this is one of the most profound patterns linking economics and politics. The data it too extensive to be a statistical anomaly, and the differences are too great to be purely random.

The hard part, of course, is explaining it. It goes against our expectations.

And the first explanation that I usually hear in conversations where this is brought up is the one Ghost offered “Why can't the explanation for the correlation be simply when times are good, people tend to vote Democrat, and when they're bad they vote Republican?” Unfortunately it is also pretty easy to debunk.

Here is an election-by-election breakdown. It shows that several times during recessions people have voted Democrat and several times during boom-years people vote Republican. The list below is very over-simplified, but I think you can get the drift. And of course this ignores all of the other factors that go into elections (like wars!)

Hoover (R) has Great Depression start during his term; people elect FDR (D)
1944: Despite a recession, people elect Truman (D)
1948: Despite another election-time recession, people re-elect Truman(D)
1952: Economy pretty good, people elect Eisenhower (R)
1956: Strong economy, relect Eisenhower (R)
1960: During election-time recession, people elect Kennedy (D)
1964: Good economy, elect Johnson (D)
1968: Good economy, elect Nixon (R)
1972: One mid-term recession, but good election-time economy; re-elect Nixon (R)
1976: Good economy, elect Carter (D)
1980: Election time recession, elect Reagan (R)
1984: Strong election economy, re-elect Reagan (R)
1988: Strong election economy, elect Bush (R)
1992: Mid-term recession, elect Clinton (D)
1996: Strong economy, re-elect Clinton (D)
2000: Strong economy, elect Bush (R)

More detailed information about economic data and presidents can be found at http://www.karlhartig.com/chart/presapprove.pdf

Anyway, getting back to the original point, I have still not yet heard a very convincing argument why this trend is present. And if you say it is because the economy is fairly random anyway, then why are Republican presidents considered good for the economy?

Not trying to troll here. Just thinking about an issue that I have been very interested in.
posted by Tallguy at 11:17 AM on November 20, 2002


I'm not sure this data really proves anything - economics is based on *trends*. Just as a tax cut is not going to immediately turn around the economy, neither are a President's policies unless they're amazingly radical. In fact, I'd say Greenspan has more to do with the current economy than either Bush, Clinton or the party in Congress. Many of the problems and positives in the economy today can be traced back to decisions made during the Clinton, Bush I and Reagan eras.

Further, jud and pj...I may be missing something, but I believe the general consensus was that war-time economic ramp-up was what turned around the Great Depression and that New Deal policies actually prolonged the problem - I don't have the data on me, but it's a fairly popular idea, so I'm sure on my fellow MeFites will have a link on it sometime in the thread.
posted by Kevs at 11:31 AM on November 20, 2002


[2000: Strong economy]

You're kidding right?
posted by revbrian at 11:47 AM on November 20, 2002


I believe the general consensus was that war-time economic ramp-up was what turned around the Great Depression and that New Deal policies actually prolonged the problem

Consensus? Where down at the Heritage Foundation? Yeah the war boosted the economy, but the social programs helped us change the face of this country! Maybe people have just forgotten what the level of poverty was like in this country before social welfare programs? Maybe I'm wrong and people really do think that the New Deal "prolonged the problem"?
posted by Pollomacho at 11:55 AM on November 20, 2002


Tallguy--Interesting list. One small point: FDR was elected in 44, he died in 45 and Truman, as VP, replaced him.

Kevs--Ummm, I'm not sure I did comment about Roosevelt/New Deal...but from what I know, you are right, it was the war spending that led to the boom. However, war spending in 1938-1945 was a radically different proposition that it is today. For one, the US was manufacturing and supplying weapons, food, fuel, etc, to every major allied combatant, not just to itself. Second, the manufacturing was far more labor intense, meaning that the effects of the war build-up were felt by a much greater percentage of the US population than a similar buildup would be now. Think of the tens of thousands of workers, many of who were untrained before the war, engaged in tasks like riveting, etc. Now if defense procurement is upped technical specialist and software engineers may get more work, but the average "working class" American probably doesn't notice the effect as much. Lastly, the war economy coincided with the huge draft. So a large portion of the young males in America were directly employed by the Federal government. Countless more were indirectly employed in defense related activites, such as civilian workers in training compounds in the US, etc. So a large percentage of what traditionally was considered the "workforce" was receiving paychecks from the federal government, while at the same time having their basic necessities meant, meaning that money could be spent or saved as they saw fit. This opened up manufacturing to huge pools of untapped labor, like women and southern blacks who migrated north, further spreading government money around the economy.

So, I view the war buildup not so much as large defense expenditures (which it partly was) but also as a huge jobs program that dwarfed any New Deal program.
posted by pjgulliver at 11:55 AM on November 20, 2002


Revbrian,

I wondered about how to rate 2000. That, of course, is the problem with simple lists like this.

If you go by the stock market, you should certainly say that the bad economy started in mid to late 2000. However, by saying 2000 had a "good economy", I mostly went with the general perception of the economy leading up to the election (notwithstanding the stock market). Surveys of consuer confidence (such as those at http://www.pollingreport.com/consumer.htm) show that most people thought the economy was spiffy in 2000 and those opinions did not really change radically until mid-2001.

Of course, most recessions can only be identified post-mortem. And I understand the data has certainly shown that the economic problems started in 2000. But since people were not generally aware of them, (or aware of how bad they were) these were not a factor at election-time.

I would appreciate it if trained economists can show me the error of my ways. I claim no expertise in this area!

pj, thanks for the correction. Dumb error.
posted by Tallguy at 12:12 PM on November 20, 2002


pjg...exactly. I ministerpreted your reply to Jud. And Pollomacho is right, too - the New Deal did do a lot to alleviate poverty problems.

However, the problem of slow economic growth had very little to do with the New Deal policies. As pj noted, the GD was ended by wartime hiring and exports to the warring nations primarily in Europe. The New Deal was certainly not a bad thing, but the suggestion that New Deal-style policies end depressions has no basis in historical fact. That was the point that I was trying to make; thanks for the further explaining it, pj.
posted by Kevs at 12:20 PM on November 20, 2002


Tallguy - Sorry, didn't mean for that offhand comment to be taken too seriously. My point was more in trolling (in the fishery sense of the word) for other possible explanations.
I guess I just want more of an explanation for why A causes B in this case, because to me the statistics simply suggest a possible connection, rather than prove a causal relationship.
(and just to avoid any apparent party bias here, I'm Canadian so I don't give a sweet damn between Democrat and Republican. They both look the same to me.)
posted by GhostintheMachine at 12:41 PM on November 20, 2002


St Balbach - * wow * - thanks for the links! I knew there were people working on this sort of thing, but had lately forgotten.

JohnP, Tallguy - thanks for the informative posts!

For the record, I doubt that there any sort of simple explanation for this phenomenon. But consider this:

Democrats - in reaction to the devastating accusation by Republicans that the Democratic party is the "tax and spend" party - have lately last 2 decades) become far more fiscally conservative.

So, when Jimmy Carter left office the federal deficit was around 30 billion. When Ronald Reagan left office it was close to 300 billion. Was this all Reagan's doing? Certainly not, but some analysts have suggested that the Reagan era deficits were intentionally run up (by the Reagan adm.) to squeeze spending on social programs [and they did indeed have that effect]. There are nuances to this picture though. George Bush Senior made some honest efforts to come to grips with the deficit he inherited from Reagan. And to be fair, it must be noted that many Republicans in Congress and the Senate remain (and still remain) true fiscal conservatives. But the Republican Party of 2002 is not exactly the party of fiscal repsonsibility anymore, and Republicans on the whole have been gradually moving towards a more "liberal" (deficit friendly) position - but with a twist. They still oppose spending on social programs, but vigourously support military spending: even at the cost of running large federal deficits.

Meanwhile, I would suggest, the Democratic Party now has a claim to the mantle of fiscal conservatism, especially given the recent fiscal prudence of the Clinton Adminstration which brought the federal deficit dramatically down in 8 years. To be fair, even as congressional democrats helped Reagan in incurring the huge Reagan-era deficits, congressional republicans assisted in the fiscal prudence of the Clinton years. But control of the executive branch allows the controlling party to set the overall fiscal agenda. So: Reagan/deficit spending vs. Clinton/fiscal prudence.

It should also be noted that the largest constraint on federal Spending is the interest paid each year to service the Federal Debt (that's the accumulated debt which is carried from year to year, and grows for every year of deficit spending) which now accounts for a large percentage of overall Federal spending. Much of this debt has been incurred to finance wars - this is the fault of both Democrats and Republicans. But with each year of deficit spending, the debt grows and interest payments on the debt eat further and further into discretionary spending, thus necessitating, eventually, either cuts in federal programs or tax increases.

So it goes. Don't count on Social Security for your retirement!
posted by troutfishing at 12:47 PM on November 20, 2002


Ghost,

I agree with you that it would be nice to find a good explanation. And definitely, correlation does not equal causation. But in this case there are statistically strong correlations between two major variables, and the trend goes against expectations. So how to explain it?

And I spent so much time investigating this issue because your "offhand comment" is the one explanation I have heard most often. I accepted it at first, until I really started thinking about the elections. Then it just didn't make much sense.

Of course, there are other trends that go against (US) presidential party expectations. For example, the US has experienced far more casualties from war under Democratic presidents than under Republicans in the last 100 years (although I can't seem to find those numbers anywhere at the moment). But that trend is a little easier explained by random chance. Two wars (WWII and Vietnam) contribute the most casualties by far, and they happen to fall under Democratic administrations. It goes against expected type (at least in the present day), but because of the infrequency of the events, it seems to hold less statistical significance.

The economy, on the other hand, is well studied. And as much as importance as economists seem to place in the minutiae of economic fluctuations, it seems odd that this question is not addressed further.
posted by Tallguy at 12:59 PM on November 20, 2002


Troutfishing, your post reminds me of a pet phrase of Howard Dean, a Democratic presidential pre-candidate and soon-to-be-former governor of Vermont: "borrow-and-spend Republicans."
posted by Holden at 1:17 PM on November 20, 2002


Let's buy into the argument that the Democrats are for the greater whole (poor, elderly, minorities, women) and Republicans are for strong business (white rich men) so the trickle-down effect can eventually help the greater whole.

This would mean that Republican policies would help 10% of America to get richer at the expense of the other 90%. Now, if 90% of people are feeling gloomy about the economy, are losing their jobs, aren't putting much into savings, and so on, wouldn't that pull down the entire country? Wouldn't that affect confidence numbers, which affects stocks, which affects businesses, which affect layoffs?

If we continue our overgeneralizations for the Democrats, we have a party who tax the rich, put handcuffs on businesses in the name of environmental protection and fair markets, and pour government spending into programs like welfare.

This means the top 10% or 20% get angry (the extraordinarily rich and the pretty damn rich) whereas the other 80% or 90% are being taken care of, and feel good about the economy. This makes them feel warm and fuzzy about the economy, which makes businesses feel warm and fuzzy about the economy, which is a good thing.

In an economy where the majority of economic strength comes from consumer spending, you can't focus on the rich. They may have all the money, but their happiness about their bank accounts doesn't translate into a good economy. We all have to feel good about our bank accounts to get real momentum.
posted by jragon at 3:33 PM on November 20, 2002


Interesting post. Brought to mind the comments of a former speechwriter of Barry Goldwater (of all people), who thought that many Republican economic policies were doomed to failure because they ultimately benefit just the few rich at the expense of everyone else. "No matter who is elected, there is never a mandate for iquidate and vacate", I believe he said.

Steve@Linnwood: troll

As usual...those who cannot refute or otherwise contribute....merely call names. But carry on....it speaks volumes.
posted by fold_and_mutilate at 8:12 PM on November 20, 2002


As usual...those who cannot refute or otherwise contribute....merely call names. But carry on....it speaks volumes.

Cheap rhetorical trick. Most politicians know it. Why refute Slate? It's like the politicians that says "My opponent screw goats, why won't he debate me on it, or answer my charges"? Because the moment he even begins taking it seriously, he grants legitimacy to the argument itself, and he's already lost.

This article is simply pure politics. A correlation is obviously not causation (to anyone with even high school statistics) ... and the author doesn't even try to demonstrate causation - she simply says "here's the market over years, here's the presidency over years".

And even in that, she gets it wrong. I understood what the article was all about after reading:
"... and the current stall occurred under GOP presidents." The "current stall", folks, started in April 2000. NASDAQ dived as the dot-com boom exploded. We were already well into a tanking economy when elections happened, and were deep into it when Bush took office.

The premise itself is bogus. The stats backing up the bogus premise are questionable. There is nothing to refute. The woman sold an article. Good for her. Anyone that believes it should probably ask why - with such clear insight into markets - she still has to write articles for a living. Presumably, if she actually believes her own BS, she'll be divesting right now, and re-invest the moment a Democrat gets elected. Yes? What do you think the chances are she actually moved any of her own money based on her conclusions?
posted by MidasMulligan at 11:31 PM on November 20, 2002


Well Midas, jragon made a high altitude summary that pretty well covers it, can you debate on those points? I recognize they are rather fuzzy (due to the altitude) but as general statements are right on target. Since you attack the author of the Slate piece (and the piece itself) and won't discuss cold hard numbers perhaps jragon presents an easier target for you? Will you posit that further enriching the already obscenely wealthy is the correct method for economic growth?
posted by nofundy at 6:04 AM on November 21, 2002


MidasMulligan - thanks, you prompted me to jog my crappy memory and revisit Carol Vinzant's article. Here's her summary paragraph:

"There may be all sorts of explanations for the bias of the economy and the markets toward Democrats. The worst years of the Great Depression occurred under Republican Herbert Hoover, and Democrats got credit for the entire recovery. Democrats had some awfully good streaks of peace and prosperity in the '30s, late '40s, and '90s. These could be chance, or it could be that Democrats more tightly regulate the markets, which gives investors confidence. Democrats are more likely to spread the wealth around through public spending on education or transportation, which may stimulate the economy more broadly. The foundation of recent GOP economic policy—tax cuts—may offer narrower benefits than Republicans claim. High defense spending, another GOP hallmark, may only boost one sector while hurting the whole economy in the form of bigger federal deficits and higher interest rates."

You've gotta admit: Liberally biased, sure, but it could certainly be much more partisan than it is.

Have a sense of humour! I thought the Slate article a bit tongue in cheek. The article doesn't claim to be an empirical, peer-reviewed study, Vinzant doesn't draw any hard and fast conclusions about the purported correlation, and - of course - I'm willing to listen to your logical refutation of the Democrat/Market boost phenomenon - or of the actual numbers cited. But Vinzant and Slate do have some heavy duty backup: "In 2000, the Stock Trader's Almanac, which slices and dices Wall Street performance figures like baseball stats, came up with nearly the same numbers (13.4 percent versus 8.1 percent) by measuring Dow price appreciation. (Most of the 20th century's bear markets, incidentally, have been Republican bear markets: the Crash of '29, the early '70s oil shock, the '87 correction, and the current stall occurred under GOP presidents.)"

And what of the Reagan Era deficit growth?
posted by troutfishing at 6:34 AM on November 21, 2002


Midas,

I don't understand why you think the premise is bogus. Assume for a moment that the president's policies definitely have an effect on the economy. Also assume that since Democrats and Republicans have distinct and different ideas about the economy, that the party of the president might have some impact. How do you propose going about trying prove which policies are better and have had better results? I agree that you don't stop at the stock market or GDP, but you certainly start there. And if you reject those assumptions, why? One way to reject them is to say that presidents have no influence on the economy. In that case, you also give the article some credit, because it starts with an examination of the widely held assumption that Republicans are naturally better for the markets.

Also, I find your argument to be the worst kind of ad hominem reasoning. "Since it is from Slate it must be biased, and if it is biased it must be wrong. Therefore I can safely ignore it."

As I mentioned in my first post, this idea has been around long before this Slate article. A quick google search turned up at least 4 different discussions on the web, and I have been told there is a decent-sized literature in scholarly journals on economics and politics.

My understanding is that they don't all agree, and it depends on the methods chosen. But the findings usually indicate either a tie between the parties (the last link below) or something between a slight edge or a major edge to Democratic presidents (the other three links below). Rarely can you mix the numbers together and turn up a major win for Republican administrations.

And you are right, correlations are not causation. But social research is usually about looking for correlations (first step) and then trying to decide if they mean something (second step) and finally explain the phenomenon if you decide they are in fact linked (third step). It is perfectly legitimate to decide in the second step the correlation is meaningless, but "because it is printed in Slate" does not qualify as a good argument.

http://www.anderson.ucla.edu/admin_dept/media_rel/releases/psc_rv.html
http://arts.bev.net/roperldavid/politics/scores.htm
http://stacks.msnbc.com/news/818242.asp
http://www.frbsf.org/econrsrch/wklyltr/wklyltr98/el98-19.html
posted by Tallguy at 7:30 AM on November 21, 2002


Midas,

Though I disagree with many of your views, I find that you argue from a consistent free-market/libertarian based approach, which I respect. However, can you honestly say that the Republican Party best respects your belief system now? With Bush inflating steel tarriffs, signing a $180 billion farm subsidies bill, etc, etc.
posted by pjgulliver at 7:43 AM on November 21, 2002


Jragon, you summed it up beautifully. Well said.
posted by borgle at 12:57 PM on November 21, 2002


Just as another data point, I've been a fan for some years of Allan Lichtman's performance model, called The Keys to the Presidency, for predicting the next president -- which goes beyond the often-wrong econometric models, though its subjectivity gives rise to neverending discussion. The two economic components are a Short-Term Economy key, indicating an economy in recovery or growth at the time of the election, and a Long-Term Economy key, based on per-capita GDP growth in 4 years exceeding that of the prior 8.

To compare only the 20th century, as in the above stock-market analyses, the STE "key" was won in 23 of 26 elections; 10/12 for the Dems, 13/14 for the GOP. (88% overall, 83% D, 93% R.) The LTE "key" was won in 15 of 26; 8/12 Dems, 7/14 GOP. (58% overall, 67% D, 50% R.) Not conclusive by any means, but it does suggest that the Democrats may be somewhat more proficient at long-term growth, while the GOP is cannier at producing well-timed economic upturns. (Neither factor alone, it should be noted, determines a win. But no party has retained the WH while losing both keys.) In the end, the exceedingly small sample size does make firm conclusions suspect. The one thing we can say is that the Democrats are certainly no worse for the economy, in the long run, than the Republicans -- which is a myth to which some adhere strongly.
posted by dhartung at 7:06 PM on November 21, 2002


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