WASHINGTON — It seems every four years in the United States it boils down to one question for voters: how’s the economy doing? Even during COVID-19, the pandemic’s impact on jobs and finances remains a major issue, according to a recent poll. So when it comes to Democrats and Republicans, which political party handles the economy better? A new study finds it may actually be better for Americans when both parties hold power.
Analysts at WalletHub have released their review of how the U.S. economy has fared since 1950 under both parties. Looking at times where one side controls the White House and Congress and times where the government was split, analysts find the best scenario for economy emerges when a Democrat is President, but Republicans control Congress.
The study looks at several key factors including the state of the stock market, unemployment, the national debt, home and gas prices, and even the level of income equality across America. Researchers also examined how each administration since Dwight D. Eisenhower has affected the nation’s fortunes.
How each political party tends to impact the economy
While the study finds a divided government actually produces the best results, analysts say each party has its strengths and weaknesses when it comes to handling the economy. In fact, only two measures rank as better for America when both branches are under Democratic rule. These were improving GDP and job growth.
For Democratic presidents, the report reveals they tend to have better results when it comes to raising home values, increasing healthcare coverage, raising wages, and boosting the performance of the S&P.
For Republican presidents, they historically do a better job at winning the international trade battle and lowering the country’s gas prices. GOP presidents also succeed at fixing a topic which is usually a talking point of the Democratic party, leveling out income inequality.
In Congress, researchers find it’s more of a toss-up on certain issues. Both parties get mixed results on lowering unemployment, improving health insurance, relieving consumer debt, and raising property values. A Republican legislature was found to be better for lowering the national debt, decreasing the poverty rate, and wage growth. Meanwhile, Democratic Congresses tend to help more with trade and tackling wage gaps.
Which President did it best?
Over nearly 70 years, 12 men have occupied the Oval Office. While the study doesn’t crown any winners and losers, it does show which commander-in-chief oversaw losses and gains for the American people.
When looking at the stock market, Republican Dwight D. Eisenhower sits at the top. Ike saw the country get a nearly 16-percent annual return from the S&P 500 during his presidency. This just edges out President Clinton’s eight years in office (15.46%). It turns out President Eisenhower also oversaw the largest drop in the national debt, in terms of its percentage of the GDP.
Overall, GDP rose the most under Democrat Lyndon B. Johnson (5.1%) and unemployment fell the most under fellow party member Bill Clinton (-0.44%).
If you’re asking how the current administration is doing, President Trump’s performance compares very favorably to the last few Oval Office holders. In comparison to his predecessor, President Obama, the Trump administration has seen a higher return from the S&P 500, more economic growth, and added less debt to the country’s GDP (0.51%). The final number is a major change from Barak Obama’s time in office. During those eight years, the annual national debt grew by 4.55% in relation to GDP, the highest for any White House in the study.
So when it’s time to cast your vote, history shows it’s usually best when both major parties get a chance to lead, together.