Wednesday, February 18, 2009
Year over Year GDP Growth - 1900 to 1960
Depression Era GDP Growth in Perspective
The track record for GDP growth in the first half of the 20th Century was less than stellar. This graph shows Yr over Yr GDP growth per presidential administration from 1900 through 1960. Republican and Democratic administrations are indicated by red and blue line segments, respectively. Averages per presidential term are shown in Heavy horizontal lines covering the respective terms in office. The continuous horizontal line represents the average of GDP growth for the period 1800 through 2007 of 3.77%. The snaky yellow line is a 21 year moving average.
Note that the only periods of GDP growth that were significantly above the long average occurred during the terms of FDR and Truman. FDR term averages are broken into two segments, 1933 - 1940 and 1941 - 1948, though the averages of the two segments are nearly identical. Despite a nasty post-war recession, Truman’s elected term achieved close to the FDR average.
Note, in particular:
1) The roaring 20’s. From a high in 1923, DGP growth slid throughout the decade, then plummeted in 1930.
2) The recession of 1938, brought on by FDR’s scaling back on spending programs, and attempting to balance the budget. This brought him a chiding letter from John Maynard Keynes.