Here we have, once again, our favorite meaningless non-correlation plot. Blue dots are points for Democratic presidents; red dots for Republicans. X axis is Tax receipts/GDP in a given year, Y axis is GDP growth for that same year. Operating on the theory that if it's good enough for Econ. Prof. Lazear, it's good enough for an old trombonist, let's twist this to serve our purposes.
The red and blue horizontal lines are averages for the 36 years of Republican presidents and 24 years of Democratic presidents, respectively, from 1950 through 2009. The slanty lines are best fits for Repug and Demo data sets. The vertical yellow line is Lazear's average of Tax/GDP, the magical 18%.
Note the Inconvenient 2009 point, labeled "What the Hell?!? Low Tax/GDP along with NEGATIVE GDP Growth. Don't you love it when a lie crashes and burns?
Some mathechistic stuff:
Demos
Avg. GDP Growth 4.19% St. Dev. 2.36
Slope of best fit line -0.33 Correlation coefficient -0.20
Repugs
Avg. GDP Growth 2.77% St. Dev 2.32
Slope of best fit line -1.17 Correlation coefficient -0.45
Some iron-clad, indisputable conclusions:
1) The average growth of GDP under a Democratic President is 1.4% higher than under a Republican.
2) In 25 years, the level of GDP will be about 30% higher if we elect Democrats than it would be if we were to be stupid and evil (I'm quoting O'Really here) enough to elect Republicans.
3) Never mind that the Standard Deviation of either data set is larger than the difference between their averages. Shhhhhh!
4) Lazear's point is that high Taxes/GDP causes lower GDP growth. Well, the correlation coefficient for Repugs is -0.44. Sadly, this is a weak correlation, but it's more than twice as large as the -0.20 correlation coefficient for Demos. So: if his premise has any validity (Remember, it doesn't) it is valid only when a Repug is in the White House. When a Demo is in residence, the meaningless non-correlation, such as it isn't, crumbles. Damn.
5) Oh. Slopes. For Repugs, -1.17. For Demos, -0.33. That's right, folks, the slope is 3.5 times greater with a Repug. See point 4.
Have I forgotten anything? If so, please don't tell me. I'm sick to the teeth of the whole damned thing.
UPDATE: Here is part 7.2.
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12 comments:
"Can't be much point..." you sure the heck got that right. It's not that folks like Lazear want to have their own opinions. That's not a big deal. It's that they want to have their own facts, facts which, well, don't exist in our reality but only in some reality of pink unicorns and cotton candy trees where they live. Pointing out the facts in our reality is all fine and everything, but since they don't live in our reality -- since they live in some alternate universe where George W. Bush was a great President, Obama is a secret Nigerian socialist cloned from Hitler's DNA, and lack of regulation leads to something other than, well, where we are now -- it's like talking to a friggin' tree. Although I must admit it's cute how they stamp their widdle feetsies and whine "But it's not so! Everybody knows that cotton candy grows on trees!" when you call them on the fact that in this universe that we live in, err... well. No.
- Badtux the Reality-based Penguin
Straw man time!
Actually jzb, your Paul-bot and Ayn Rand-lover pal Penguin doesn't help your case, given that he actually objected to Reagan's slight hikes in Medicare and SS#. Ron Paul is no liberal.
Another thing: the mean lies. Which is to say, yes, average everything out you might get something like this (ie meaninglessness for both GOP and Dem, in regards to the GDP/taxrate claim): yet quite a few periods, like Eisenhower admin. were anomalous. For one, Ike's tax rates were like 90%! Then JFK cut taxes by like approx. 20%, and there was a GDP spike: in fact some GOPers (however f-ed up) use JFK as evidence for supply side; ie cut taxes, boomtown follows (for a while--it's not always going to correlate, even weakly; ie econ. charts are not sociology).
But the GDP is fairly stable between GOP or Dems, tax-ratio aside. I mean if Demos say the 18% is meaningless, GOPers might say the same. Regardless, GDP growth under Reagan was strongest ever recorded--that doesn't mean it's "good" for all (part of the supply sider faith--tho good for the wealthy, and I wager most middle income Mericans), but that's a separate issue, brought out by like your poverty chart. A better comparison would be a little matrix comparing each Pres's score card, more or less, in regards to GDP, and other indicators.
So if you were to do the analysis w/o politics; ie just comparing admins, based on tax rates, Ike would def. be in Demos. AS would, perhaps, Nixon. And Clinton would be among the supply siders, given that his rates (and even Laffer's supposedly meaningful 18 % GDP/tax ratio) were not so different than Reagan's.
Uhm, J, are you sure you're not confusing me with another penguin? Do I have a beard in your universe, like Bizarro Spock? I think Ayn Rand was evil and Ron Paul is an idiot in this universe, but I suppose in Bizarro Universe the Bizarro Badtux might love them. Sayyyyy... what color are the unicorns in the universe you live in, again?
Just wonderin'!
- Badtux the Snarky Penguin
Tuxski, your endless moralistic yaps and silly ad hominems have nothing to do with economics. That's the problem. And you did argue for a gold standard ala Paultards a few weeks ago.
And you didn't note my points, again. JFK's tax cut of Ike-era rates was, arguably supply side. Not about "good or bad" either;more like do the facts prove a case for supply siders? At times, they do. At times, they don't. But if you just average everything, it will most likely be non-conclusive. A better comparison would be Reagan vs Carter, when the GDP had more or less stalled, and taxes were high. Whether you like it or not, Reagan era GDP took off, and that coincided with a tax cut. The distribution issue (was it good for everyone..) separate from the GDP.
Clinton vs Reagan also a good match up, and Clinton did create a bubble (as jzb showed--but there are other factors, ie the innovation of the dot.com boom, etc). But Clinton's tax rates were nothing like Carter's; he was still pretty much a supply sider, and a de-reg type, regardless of what GOP/Dems say. A Demopublican. Party affiliation means little, except to Emo-crats.
I argued for a gold standard a few weeks ago in your universe, perhaps, but not in this one, where as long ago as 2005 I was pointing out on my own blog that "you can't eat gold" and have not changed my mind since. What color is the sky in your universe? I'm guessing mauve with just a shade of puce, am I close?
- Badtux the Snarky Penguin
More like slightly azure, as with the bluing on a .38.
You really don't know what this game's about, just like you don't understand the dispute over GDP/tax ratio. JFK was a supply sider; Ike a tax and spend liberal.
You're right, I don't have a clue, because I live in this universe, not in whatever Bizarro World universe you live in which appears to have its own set of facts that have nothing to do with this reality.
- Badtux the Reality-based Penguin
Hey, GOPer, we got the yr Schwarzenegger vote online, punk
(jzb--remember his gold standard support, Ron Paul, diss of social security, New Deal etc.)
You joined the Demos when, like last month? I was a registered Dem for over 20 years, chump, and actually worked on campaigns. You don't know what this game's about, nor do you know what the facts are (like JFK, cutting taxes for one. And Reagan, however f-ed up as a whole, helped the working class, and supported SS, and Medicare, unlike you). Maybe go back to the Ron Paul site.
There you go again. In *THIS* universe, I've never even been to the Ron Paul site, and have been a critic of the gold bugs for years (example: in 2007, I called the gold bugs scam artists).
It sounds to me like you need to browse my back articles of economics theory, where I explain some of how economics works in this universe. Although, apparently not in your universe, where unicorns are real and I'm a gold bug.
- Badtux the Snarky Penguin
Another problem is your cheesy Radio Shack jargon, which gives you away as an old Reaganite-libertarian now pretending to be one of the hipster Pelosicrats, and defending the great radicals Billy Bob Clinton and BO. Wow
Clinton did some good, but Reagan did more for Medicare and soc/sec.--and let's not forget a Demo-controlled House passed his tax cuts (ie. that is, the ones you continue to ignore). Some Demos. And Clinton helped the GOP get rid of the last remnants of the New Deal.
I'm for Demo policies in general--JKF, even some LBJ--as I said numerous times. That's not synonymous with loving Clintonomics.
And really Lazear's point was more along the lines of "supply side econ., with a GDP/taxrate of 18% outperforms ...non-supply side (presumably Keynesianism), with higher GDP/tax rate." I don't think he meant to include the high-tax admins of Eisenhower, or even Nixon. So in that case, jzb's little charts would be...non-conclusive, though jzb's right Lazear was a bit sloppy in terms of his research.
(and as with the link I included to James, even some moderates or libertarian quacks admit Clinton's success, or near success at the end of his admin--then, his GDP/tax rate was right around 18%, maybe a hair above). .
Are you guys having fun talking past each other?
J, I gotta tell you, you are reading BT all wrong, I read his blog regularly, and on political and economic matters, we line up pretty close. Music - not so much, but that's OK.
And was the tongue-in-cheek nature of this post, like, totally wasted?
I'll have something to say about Reagan and taxes soon.
Cheers!
JzB
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