President Donald J. Trump’s first 100 days in office are over. His next 1,000 days will determine his legacy.
Much of that will rest on how he handles the economy, especially by how ordinary Americans — the “forgotten men and women” who elected him — do on his watch. And he will be compared closely with his predecessors.
Earlier this year, C-SPAN did a survey of 91 historians ranking the 43 presidents, and economic management was one of its 10 criteria. A study by Alan S. Blinder and Mark W. Watson of Princeton University on post-World War II presidents focused largely on real gross domestic product growth. In January, Matt Winkler of Bloomberg did a 14-factor analysis of overall economic performance under the last six presidents.
I used data going as far back as 1945 to compare all 12 post-World War II presidents’ economic performance. I chose six criteria I think best reflect how average Americans did under the different administrations.
The result was clear: Lyndon Baines Johnson won in a landslide, just as he did in 1964.
The three runners-up — Bill Clinton, Ronald W. Reagan, and Harry S. Truman, finished close together, with John F. Kennedy not far behind. Democrats took four of the five top slots, in line with Blinder and Watson’s findings. Three recent presidents — George W. Bush, his father George H.W. Bush, and Barack H. Obama — were at the bottom, which helps explain why outsider Trump won.
When I chose those criteria, I had no idea how the rankings would turn out. Average real GDP growth affects everyone. I picked job growth as a percentage of the workforce, not absolute numbers, to control for labor force growth over time. I also tracked changes in the workforce participation rate, disposable personal income per capita, and household net worth, which includes financial assets and home equity.
And I resurrected an old idea from the 1970s and 1980s, the misery index. Created by economist Arthur Okun, it combines the unemployment rate and the inflation rate in a simple measure of people’s economic well-being. Throughout, I mostly used annual averages or compound annual percentage growth to measure presidents’ effectiveness rather than their longevity.
The president who did best in each of these categories got 12 points and the worst got only one. The point total produced the rankings on the table above.
LBJ was the easy winner. The former Master of the Senate was a great schmoozer and even better arm twister. The Civil Rights and Voting Rights Acts, of course, were monumental achievements. Medicare and Medicaid are enduring parts of his legacy — and still spark controversy —- and he pushed through the big tax cut Kennedy couldn’t get passed before his assassination.
Johnson’s spending on the Great Society and the Vietnam War goosed the economy even more. That helped lift him to the top of our charts in job and personal income growth, and the “go-go” 1960s stock market put him second in household net worth growth.
But the economy overheated, igniting the Great Inflation his successors Richard M. Nixon, Gerald R. Ford, and Jimmy Carter would struggle to contain. And, of course, the social turmoil unleashed by Vietnam caused LBJ to not seek another term in 1968.
Runner-up Bill Clinton profited from the internet’s emergence and one of the greatest stock market bubbles ever. His fights with a mostly Republican Congress during his tenure yielded welfare reform and the last budget surplus we’re likely to see. And he’s the all-time champion in job creation, with around 23 million during his administration.
Ronald Reagan was number one in workforce participation and ranked near the top in decline in the misery index. That happened because the 1981-82 recession occurred early in his term, and Federal Reserve chairman Paul A. Volcker, having broken inflation’s back, cut the federal funds rate from 19.1% in 1981 to below 6% by 1986. Reagan’s own tax cuts, deregulation, and military spending buildup and the 1980s stock market boom did the rest.
Truman unwound World War II wage and price controls and brought 10 million returning GIs into the workforce. Unemployment fell to 2.7% before he left office. (For Truman, some of the data series I analyzed begin in 1947 and 1948.) Yes, the Cold War and Korean War started on his watch, and the additional military spending spurred growth . But altogether, Truman got the postwar boom off with a bang. Yet in his last year he had an all-time low 22% approval rating. Go figure.
Kennedy’s presidency was cut tragically short, but his annualized numbers are very impressive, especially compared with the surprisingly weak Eisenhower administration that preceded him. The “Mad Men” era of the 1960s, over which JFK and LBJ presided, surely was the Golden Age economically for average Americans.
Our most recent presidents were, by these criteria, busts. Under George W. Bush, who ranked dead last, the housing crash led to the financial crisis and Great Recession.
Obama deftly managed the bank rescues that began under Bush while executing the successful auto industry rescue and a moderately helpful stimulus package. Household net worth rose nicely, thanks to the bull market, housing recovery, and low inflation, and job growth was pretty good.
But he and President Bush oversaw a huge exodus from the workforce and the weakest GDP growth of any postwar presidents. I’ll let historians decide how much of that was because of poor economic stewardship and how much the result of technology, globalization, and deindustrialization.
Carter’s and Ford’s rankings were probably hyped by Baby Boom women entering the workforce en masse and by home-price inflation in the 1970s.
Presidents don’t create jobs. They are often at the mercy of Congress and the Fed. Black swans such as the financial crisis and tailwinds like technological revolutions and big demographic waves are beyond their control. So are recessions, and bull and bear markets. Some presidents are lucky and some are dealt lousy hands. But as Truman said, the buck stops here: They’re all held responsible, and sometimes life is unfair.