presidential spending

I wrote and published this September 20, 2008. People keep bringing up the grand mythology about Republicans being fiscally responsible and as often as not cite Reaganomics as some magical system that we would be fortunate to have back. I would kind-of like to update the charts, but it would be tricky as the Clinton I administration began heavily fudging the numbers and it has escalated ever since.

The Truth Of The Matter:

This ridiculous game that is being played out by the king makers and sold to the masses bothers me. Those six guys controlling the media make it seem like there are stark choices between the two candidates everyone is being shown. They simultaneously ignore true economic fundamentals and foster the impression that Republicans are fiscally conservative and Democrats are kind to the poor.

Daylan Darby, writing for LewRockwell.com in 2006 created a table of the per-person share of the US national debt. I updated it with the latest administration estimates, put it into a spreadsheet, added party affiliations, cost of living and ranked the administrations. The result shows some very interesting things, and does some serious myth-busting.

Selling bonds, or promises to pay back someday, is a popular way to fight wars that aren’t popular enough to get people to pay for them as they go. It also enables rulers to spend on social programs, exploration, bribes or anything else that tickles their fancy. For the first 100 years, presidential administrations paid debts off, with the country more out of debt than in. In the last century, national debt became a sort of executive credit card that would have to be paid off in some distant future. Rulers got credit for bringing all sorts of wonderful goodies home while few observers noticed the credit card bills piling up on the porch.

National Debt Increases

Roosevelt F….1048%…..D
Wilson…………722%…..D
Reagan………178%….R
Bush II………..84%….R
Bush……………54%….R
Ford……………46%….R
Carter…………..43%……D
Nixon………….34%….R
Hoover………..33%….R
Clinton………….32%……D
Roosevelt T…..23%….R
Johnson………..19%……D
Taft…………….10%….R
Eisenhower……8%….R
Truman…………..6%……D
Kennedy………….4%……D
Harding…………-7%….R
Coolidge……….-24%….R

That table does a lot of myth busting. FDR and Woodrow Wilson are held up as great champions of the working stiffs. Who got to pay their whopping ‘credit card debts’? Those bills made darn sure the poor remained poor for a long time. While technological advances and the surge in US worker productivity should have created impressive wealth for the masses, they instead had to make interest payments on the bills their champions ran up for them.

Reagan is the conservatives’ conservative; the Republican’s Republican. He is credited with making the economy run like a well-oiled machine. Yeah, just like the new stepdad who brings home every toy on the planet while running up a credit card bill that is almost double the family’s annual income. Fifteen years later, the conservatives still hold him up as the star of fiscal responsibility. The legend he earned is the complete opposite.

This is the century of the central bank. The Federal Reserve, a consortium of private banks, was given control of our currency. Until then, a dollar was worth a dollar, convertible directly to silver or gold, and technological advances steadily reduced the cost of living. The concept of central banks is as old as central government. So is devaluing the currency. One way an administration can spend without offending the masses with overt taxation is to print more money. Few people notice the dilution of their money, but more dollars obviously make existing dollars worth less. The ones average people are holding go down in value every time the New York bankers spend the output of their printing presses.

Consumer Price Inflation

Roosevelt F…..105%…..D
Truman………..79%……D
Reagan……….64%….R
Johnson………..44%……D
Wilson…………..43%……D
Eisenhower…..31%….R
Carter ………….31%……D
Roosevelt T……30%….R
Clinton…………..29%……D
Ford…………….28%….R
Bush II…………28%….R
Nixon……………25%….R
Harding…………14%….R
Coolidge…………13%….R
Bush……………..10%….R
Taft………………10%….R
Kennedy………….-0%……..D
Hoover…………-43%….R

Not much surprise in who cut the value of the working man’s dollar in half. However there is an eye-opening third place, that star of conservative Republicanism Ronald Reagan, reducing people’s savings and paychecks by a whopping 64%. The conservatives should have reviled him and embraced JFK, who treated our savings, earnings and future with more respect than nearly every Republican of the last century.

My point in adding in the party affiliations here is to say if you want an administration that doesn’t reduce the value of your dollar, you need look somewhere besides these two. Even the average Republican will cut your paycheck by 25% and hit your savings and retirement accounts just as hard with their inflationary monetary policies.

Of course if you really want to be left with the money you work for, you better give up on both the blue jerseys as well as the red ones.