GrowthThe most commonly cited economic statistic is the growth of gross domestic product (GDP growth) or even more often and more appropriately the inflation-adjusted measure real gross domestic product (Real GDP). GDP has some drawbacks. It is more a measure of activity than growth - the buzzing around the hive, rather than the size or strength of the hive, or even the well-being of the bees. These drawbacks and the need for more effective accounting, are discussed more completely in Part II. Still, as the most common statistic in the economic game, it is where we need to begin.
Real GDP has been stronger and steadier, and recessions (periods of negative growth) have been fewer, when a Democrat has occupied the White House. Even more stark is the difference using our secondary measure - Net Real GDP. This is simply Real GDP subtracting the federal deficit, including borrowing from the federal social entitlement funds. If deficit spending is pump priming, it is not appropriate to count the water used to prime as a product of the well.
Net GDP corrects for this. See the charts in that section. Democrats have been in the White House for 26 of the 60 years between 1946 and 2005. Real GDP growth has averaged 4.0 during that period. Republicans have been in power the other 34 years, during which time Real GDP growth has averaged 2.8 percent per year. Net GDP, taking into account the federal borrowing, drops Democratic performance to 3.5 percent. The same adjustment for Republicans drops their number to a meager 0.8 percent. More than two-thirds of Republican growth has been borrowed. Since 1980 there has been zero Net Real GDP growth under Republicans.
The difference of a point or two in growth may seem insignificant. But consider that an economy growing at 4.0 percent doubles in size every 13 years, and one growing at 2.8 percent, every 25 years. Growth of 3.5 percent would double an economy's size in 20 years. One growing at 0.8 percent would need 90 years to double in size.
For Real GDP, the chart seems perhaps not to make the point asserted here. The bars seem to be of similar height, and only a couple of gaps distinguish the red from the blue. These gaps are telling, however. Democratic years are consistent.
