Opinion | The Economy Does Much Better Under Democrats. Why? – The New York Times

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What, then, are the most plausible theories?

First, it’s worth rejecting a few unlikely possibilities. Congressional control is not the answer. The pattern holds regardless of which party is running Congress. Deficit spending also doesn’t explain the gap: It is not the case that Democrats juice the economy by spending money and then leave Republicans to clean up the mess. Over the last four decades, in fact, Republican presidents have run up larger deficits than Democrats.

That leaves one broad possibility with a good amount of supporting evidence: Democrats have been more willing to heed economic and historical lessons about what policies actually strengthen the economy, while Republicans have often clung to theories that they want to believe — like the supposedly magical power of tax cuts and deregulation. Democrats, in short, have been more pragmatic.

When Franklin D. Roosevelt first ran for president, in 1932, he did not have a fully coherent economic plan. He sometimes argued that reducing the deficit was the key to ending the Depression. Above all, though, he called for “bold, persistent experimentation.” As he explained: “Take a method and try it: If it fails, admit it frankly and try another. But above all, try something.”

Over time, he and his advisers came to champion the ideas of John Maynard Keynes. In an economic downturn, when companies and households are caught in a vicious cycle of spending reductions, the government needs to step in. The Keynesian approach has shaped Democratic economic policy ever since.

It has made Democratic presidents much more aggressive in responding to crises than Republicans. Not only was Hoover passive in the face of the Depression, but the first George Bush was slow to fight the 1990-91 recession, and the second George Bush was slow to begin fighting the 2007-9 financial crisis. Mr. Obama and now President Biden, when faced with an economic crisis, have been much bolder.

Michael Strain, an economist at the American Enterprise Institute, a conservative think tank, told me that he believed the overall partisan pattern was mostly coincidence. But, he said, “It is certainly a defensible posture that in periods of economic distress Democrats are more concerned about jobs than Republicans.”

The past year has offered another case study. Mr. Trump repeatedly downplayed the coronavirus pandemic, and the country suffered. The economy would have experienced a downturn no matter who was president, but his scattered response aggravated the pandemic and the recession. In some other countries, life is much closer to normal. In the United States, Mr. Trump became the first president since Hoover to preside over a decline in employment.

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