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Which Presidents Increased Spending the Fastest?

“Can you believe this spending with a REPUBLICAN in the White House????”

I’ve heard it my entire adult life, starting during the Reagan years. I’m not sure how many times Republicans have to increase spending twice as fast as their Democratic predecessors before people get used to the idea that this is what Republican presidents do, regardless of which party controls Congress.

This shouldn’t be a surprise. The Republican Party was born out of the ashes of the Whigs, whose stated goal was to expand the range of things the federal government spent money on. Before the Civil War, most roads were privately owned. Not just privately built; privately owned. Taxpayers didn’t contribute a cent towards them.

Not only did the Republican Party Sovietize the road system, they did the same with railroads and all sorts of other areas of life. Before FDR, it was Republicans who established most new federal departments.

Today, the government has Sovietized the distribution of Covid-19 vaccines and other treatments, a precedent established under the last Republican president.

When you consider the actual records of Republican presidents from Lincoln through Trump, it turns out that Harding and Coolidge were the real “RINOs.”

In the post-WWII era, spending almost always goes up (not counting the obvious decrease right after the war – which led to an economic boom, btw). But I decided to take a look at how fast it went up during the various presidential administrations starting with JFK/LBJ. I used the following methodology:

Measure the increase in yearly federal spending for each president as a percentage of the spending in the last year of his predecessor. For example, spending was $590 billion in the last year of the Carter Administration. It was $1.06 trillion in the last year of the Reagan administration, an increase of $473.4 billion or 80.1%. That comes in at just over 10% per year on average.

You’ll never guess who grew spending at the slowest rate since 1951. Certainly not the Gipper. Nor was it either Bush. No, as a percentage of spending during his predecessor’s last year in office, the president who grew the budget at the slowest rate was Barack Obama.

I broke it all down on Episode 85 of Tom Mullen Talks Freedom. I provide documentation of the outlays and receipts on the show notes page. A summary table is provide below.

Source: https://www.whitehouse.gov/omb/budget/historical-tables/

A few notes:

All spending increases are aggregated for the full term of the presidency and then averaged. Example: to calculate President Obama’s spending increases, 2008 spending is subtracted from the spending during the last year of his presidency (2016) to arrive at an increase of $870 billion over eight years. That total is divided by 2008 spending of $2.9 trillion to arrive at the 29.2% aggregate spending increase. Spending increases for each presidency is calculated in similar fashion.

I combined the presidencies of Kennedy/Johnson and Nixon/Ford as Kennedy and Nixon both served partial terms which were completed by members of their own parties.

Calculations are made for the Trump years 2017-2020 and 2017-2019.

Spending is not adjusted for inflation. All spending is in billions

Of course, regardless of how quickly or slowly it increases, federal spending is always destructive. It’s important to remember the government has failed at every major spending initiative it has undertaken in my lifetime, whether it is military or domestic policy. Vietnam, Iraq, Afghanistan, the Department of Education, the War on Drugs, Covid – it’s always all pain and no gain when it comes to the government. And the price just keeps going up.

Still, it is remarkable that spending goes up so much faster when a Republican is in the White House. The excuse is often made for Reagan that he had a Democratic Congress. But the Republicans controlled the Senate for 6 of Reagan’s 8 years in office, so that claim isn’t even true. The Democrats did have both houses of Congress during George H.W. Bush’s 4 years, but spending didn’t go up as fast during those years. Oops.

The other excuse often brought up in defense of profligate Republican presidents is that Congress “has the purse strings.” This is technically true, but when one looks at the spending proposed by the presidents in question and compares it to what Congress eventually appropriated, there is never much difference.

When an opposition party controls Congress, there is always some demagoguing over financially inconsequential components of the president’s proposal. See “funding Big Bird.” But in general, the executive branch proposes the spending and Congress rubber stamps it. And let’s not forget, no spending can occur without the president’s signature.

There is also some evidence that the combination of a Democratic president and Republican Congress may slow spending increases the most, but comparing spending increases during the first two years Presidents Clinton and Obama were in office (with Democratic Congresses) to spending increases over the remainder of their terms hardly provides conclusive proof.

The record does show that spending seems to grow relatively slowly with a Democratic president and a Republican Congress. And since gridlock in Washington is always good, to the extent we get it, for all sorts of non-fiscal reasons, let’s hope for a Republican landslide in this year’s midterms.

Tom Mullen is the author of It’s the Fed, Stupid and Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty, and the Pursuit of Happiness?

The Electoral College is Vital to Freedom and Peace

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Retiring U.S. Senator Barbara Boxer (D-CA) filed legislation proposing an amendment to the Constitution abolishing the electoral college. She and many across the United States believe the president should be chosen by direct popular vote. This would be a huge mistake. The electoral college is vital to freedom in a republic the size of the United States.

Lest this be taken as a partisan argument for Donald Trump, let me clear the air. I did not vote for Mr. Trump. I understand the aversion many in both parties have for his style and even the substance of some of his policies. I understand the disappointment of Clinton supporters. I’m a libertarian from Buffalo, NY. My team never wins, neither in politics nor anywhere else – believe me, I understand!

But regardless of my reservations about Trump, the manner in which he was elected must be preserved as the only way to preserve a nation this large and culturally diverse.

Michael Moore recently called the system antiquated and only created to protect the dubious “rights” of slave states. Not so. In fact, it was created to protect smaller states from domination by the largest, including slave state Virginia. Let’s remember, the people of the original thirteen states did not have to accept the Constitution. Rhode Island, which passed laws to gradually emancipate its slaves from 1784-87, didn’t ratify it until 1790.

It’s primary reason for holding out was the addition of a Bill of Rights to the Constitution, measures which clarified the restrictions on the power of the federal government, but did not protect slavery. What it did ensure was that larger states like Virginia and Pennsylvania were not able to dictate how Rhode Island governed its internal affairs. The very first clause of the First Amendment, properly understood, prohibited the federal government from establishing a national religion, like the Church of England. Rhode Island, founded in the name of freedom of religion by a man kicked out of Massachusetts because of his religious beliefs, was especially concerned about this.

While some of the particulars are different, the underlying principle remains the same. The United States is a diverse federation of drastically different cultures. Those who believe New York City, Atlanta, GA, Boise, ID and Los Angeles, CA aren’t different cultures just aren’t being honest with themselves. As President Obama is so fond of saying, E Pluribus Unum (out of many, one).

There are some laws the federal government enforces within the states, based on its power to regulate interstate commerce. But the executive who enforces those laws must represent the people of every state, especially given how culturally diverse they are. That’s why we have an electoral college. That is why the people of Idaho, many of whom may find the societal values in places like New York or California abhorrent, agree to abide a chief executive who most likely comes from a place like that – because they and their culture have an equal say in electing him, even if they’re outnumbered.

If the shoe were on the other foot and Midwestern evangelical states had a population advantage, you can bet New Yorkers and Californians would be defending the electoral college to the death.

The beauty of our system is that it allows people with vastly different beliefs and values to live together in one federal republic dedicated to protecting their freedom to hold those beliefs, right or wrong, so long as they do not infringe the rights of others. To transform the republic to a pure democracy and allow a few, cosmopolitan states to rule over people who don’t share their beliefs would truly be tyranny and a threat to domestic peace.

The Constitution guarantees “to every State in this Union a Republican Form of Government,” not a democratic one. The founders were wise in this respect. In the name of diversity, freedom and peace, we should keep the electoral college.

Tom Mullen is the author of Where Do Conservatives and Liberals Come From? And What Ever Happened to Life, Liberty and the Pursuit of Happiness? Part One and A Return to Common Sense: Reawakening Liberty in the Inhabitants of America.

New York Times already pushing Hillary Clinton’s Internet Regulation Plans

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Hillary Clinton hasn’t even won the general election yet, but the New York Times is already pushing her legislative agenda. And while she is likely to meet stiff resistance on headline issues like immigration and health care, regulating the internet is one even her Republican adversaries might work with her on. As Repubican Sen. Marco Rubio warned, the sword cuts both ways.

“Adolescent suicide as likely as death in traffic accident,” reads the headline of the article, which goes on to describe “an accumulating body of evidence that young adolescents are suffering from a range of health problems associated with the country’s rapidly changing culture.” And just what are some of the elements of the culture that have changed in the past two decades?

Is it the huge increase in prescription of behavioral drugs, which all list “suicidal thoughts” among their side effects?

Could it be the trend towards locking up children in those juvenile detention centers called “schools” at earlier and earlier ages and loading them up with homework for the few hours of leisure time left when they get out?

The pressure of government-mandated tests?

No, neither the Times’ Sabrina Tavernise nor the CDC researchers she cites appear to have been curious about any of these likely causes. For them, it’s all because of social media.

“The pervasiveness of social networking means that entire schools can witness someone’s shame, instead of a gaggle of girls on a school bus. And with continual access to such networks, those pressures so not end when a child comes home in the afternoon,” writes Tavernise.

With the plethora of human activity Hillary Clinton aims to tax and regulate, one might not be aware of her plans for the internet in general and social media in particular. Bullet point three on her five point plan to “Created Safer Schools for our Kids” reads:

“Make the Internet a safer space for kids by addressing cyberbullying. While the Internet is essential to helping students learn and communicate, cyberbullying has become a harmful extension of bullying in the classroom. The ease with which demeaning and damaging content can be posted on social media networks like Facebook and Twitter make it difficult for our kids to ever really escape bullying. We need to invest in innovative solutions that allow students, parents, educators, and other adults to make the Internet safer, while respecting First Amendment rights.”

Quite a coincidence, isn’t it, that the New York Times ran a story suggesting a rise in teenage suicides might be caused by something Hillary Clinton plans to regulate? And if you believe that, I have a…

The assault on freedom in the village always starts with the children. It doesn’t take much imagination to anticipate what’s next. First, social media must be regulated to “save the children,” followed by the internet in general to curb the dissemination of false information that “degrades our national conversation.” Or something. Because established media like NBC never disseminates anything blatantly false, right?

So, who benefits from the proposed regulation? For starters, The New York Times and other traditional media benefit. The more their competition is regulated, the less of it there is and the less those competitors can differentiate their content from that offered by traditional media. Limiting competition helps stop the kind of bleeding the Times reported last month while trying to compete with an unregulated, diverse media marketplace.

Government itself benefits, by decreasing the scrutiny unregulated internet freedom subjects it to. President Obama didn’t lament the “wild west media” because he’s concerned about journalistic standards. He did so because for every wild conspiracy theory posted somewhere on the internet, there’s likely three accurate stories on government misdeeds that would otherwise go unreported.

Let’s not forget established social media companies like Facebook themselves. Even if they feign opposition to the initial regulatory proposals that come out, companies like Facebook will eventually embrace and likely help write the regulations that will limit their own activities. Why? Because other existing social media aren’t their most dangerous competition.

Tomorrow’s start-up poses the greatest danger to any established business and for every new regulation, the cost of starting a new business increases. When the cost to launch a start-up goes up, the number of start-ups launched goes down. The established players with existing market share can absorb the cost of increased regulation into their operating expenses. But the company that might have disrupted the whole industry may not be launched at all, if entry costs due to regulation rise high enough.

See how that works?

This is by no means unique to social media or the internet. This is the real story behind the entire regulatory state. When you research the true history of virtually all regulation, whether historically significant like the Sherman Anti-Trust or Wagner Acts or the ones that regulate your light bulbs or toilet bowls, the players and their motivations are virtually always the same.

Unsuspecting citizens generally believe well-intentioned politicians write regulations to protect consumers, especially poor ones, from unsafe products or unfair treatment. In reality, corrupt politicians write regulations to protect special interests, usually wealthy ones, from completely fair competition. And when they can invoke the safety of the children, it always works.

Earth to Washington, D.C.: Russia will never give up ports in Syria and Ukraine

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There are four days to go before the election and voters are up to their ears in the usual cries of “most important election of our lifetimes” and “we’re at a crossroads,” the latter suggesting, as usual, that the very nature of the republic is at stake.

In reality, there are very few policy differences between the two major party candidates. Both are protectionists. Yes, Trump presents his protectionism with the rhetoric of a classic conservative mercantilist, while Clinton tries to sound more like a socialist unionist. But in the end, they are both willing to champion destructive trade policies to appease specials interests.

Both promise to sign family leave legislation, forcing employers to provide this compensation, which they will either subtract from monetary compensation or add to the prices of their products. Neither Trump nor Clinton have said anything remotely suggesting they will rein in government spying or protect civil liberties in general. And they both promise yet another war of some sort in the Middle East, this time against paper-tiger-boogeyman-of-the-month, ISIS.

But there is one significant policy upon which the candidates appear to disagree, relations with Russia. Trump has stuck by his position to attempt to negotiate with Vladimir Putin, despite the ammunition it has given Clinton in portraying him as being influenced by a foreign power and even a Putin “puppet.”

Clinton has maintained the Establishment position: Putin is aggressive, seeks to expand Russia’s borders and the U.S. must remain firm on curbing this ambition, including military intefvention in the Ukraine.

There is only one problem with the Establishment narrative: It has no basis in reality. A quick glance at maps of NATO in 1991 and 2016, respectively/ makes it abundantly clear that it is not Russia that has expanded over the past 25 years. On the contrary, NATO has expanded eastward, breaking well-documented promises to then-Premier Mikhail Gorbachev it would not do so if he acquiesced to the reunification of Germany. Gorbachev kept his promise; U.S.-led NATO did not.

With NATO now literally on its border, Russia has two things left to lose: it’s only two warm water ports in Tartus, Syria and Sevastopol, Ukraine. And guess where the U.S. has focused its latest “regime change” efforts? The $100 prize goes to the nice lady in the second row who said, “Syria and Ukraine.”

Aggression doesn’t get any more naked than this and, in case you haven’t noticed with all the e-mail servers and groping dominating the news cycles, the Russian’s have zero sense of humor at this point. Yes, there are cover stories on both sides for what is going on in Syria and Ukraine, but the bottom line is this: Russia is not going to give up those ports without a fight. And with a GDP roughly the size of Italy’s, they can’t fight a conventional war against the U.S.

Do the math.

The scariest part is the indifference with which beltway elites seem to be treating the overt preparations for war in Russia. That any intervention by the “exceptional nation” might be resisted with force by a major power seems completely beyond the comprehension of the enlightened ones, as evidenced by the stunned reaction to joint Chiefs Chairman Gen. Joseph Dunford’s blunt answer to Republican Sen. Roger Whicker on why a no-fly zone over Syria might not be such a swell idea:

Right now, Senator, for us to control all of the airspace in Syria it would require us to go to war, against Syria and Russia. That’s a pretty fundamental decision that certainly I’m not going to make.

Yes, there are many in the national media pooh-poohing “alarmism” over Russia’s recent moves, writing them off as election-year posturing or mere coincidence. Who ever heard of a world war starting due to major powers butting heads over a tiny country, right?

Maps don’t lie. Whatever Washington and Moscow says or does today, they are both involved in conflicts involving assets the Russians are not going to relinquish, in places the United States have no legitimate reason to be in the first place. This doesn’t end well unless the U.S. changes course, something Hillary Clinton has firmly resolved not to do.

She cannot be allowed to ascend to the presidency. If Trump is too flawed, there is still a chance for peace with Libertarian Party Nominee Gary Johnson.

Isn’t Hillary Clinton’s Syria no-fly zone worse than Donald Trump’s lewdness?

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Unsurprisingly, Sunday’s presidential debate opened with a question on Trump’s “locker room talk” scandal. Neither Trump nor his supporters raised any serious objection. It had to be asked and Trump handled it about as well as anyone could expect to handle his indefensible comments. There is even an argument for it being charitable to Trump to open the debate with it, allowing him to address it and get it out of the way, instead of it hanging over the debate like a Sword of Damocles, waiting to torpedo any momentum Trump might have built later in the evening. John King made exactly that argument for why he opened a presidential debate with a Newt Gingrich scandal back in 2012.

And while the “debate” never got far out of the gutter for long, the two candidates did manage to move on and discuss other issues, one of which is getting surprisingly little emphasis from the media or the public at large: the candidates’ positions on Syria and Russia. Here, we have one of the few genuine issues of substance upon which the candidates fundamentally disagree, one far more important than any idiotic statements either of them may have made when they thought no one was listening.

Clinton has stuck by her position that deposing the Bashar Al-Assad regime in Syria is a foreign policy priority for the U.S. She has not backed away from her support for a no fly zone over Syria, despite Joint Chiefs of Staff Chairman Joseph Dunford’s unqualified statement that it would “require us to go to war” with Russia.

Read the rest at Rare…

Earth to Bill Weld: Trump’s foreign policy is more libertarian than Clinton’s

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Libertarian Vice-Presidential Nominee Bill Weld has a legitimate beef with the media. On Tuesday, the Boston Globe reported Weld “plans to focus exclusively on blasting Donald Trump over the next five weeks.” Weld denied that claim in an interview with Reason, adding, “No, somebody’s making that up,” in reference to a further claim by the Globe that Weld would henceforth be focusing exclusively on red states.

But libertarian talk show host Kennedy wasn’t entirely satisfied with Weld’s explanations, and with good reason. For while the Boston Globe and other media may have exaggerated or even distorted Weld’s statements, they didn’t just make all of this up out of thin air. Weld himself admits he has been less antagonistic towards the campaign of Hillary Clinton, a personal friend, since accepting the nomination.

Weld says he does not want to see Trump gain the White House because his “proposals in the foreign policy area are so wrongheaded that they’re in a class by themselves.” Bill Kristol and other neoconservatives may agree with him, but virtually no libertarians would. On the contrary, many libertarians ignore Trump’s many odious positions and support him precisely because his foreign policy is so much less hawkish than Clinton’s.

Even Weld’s running mate recognizes this. He’s said on numerous occasions, including during an interview with this writer, that he considers Clinton “a major architect of the conflict going on around the world.” He also said during that interview he agrees with Trump that the next U.S. president should sit down and negotiate with Russia, and went as far as to say he is willing to go “all the way down that road” regarding withdrawing troops from Europe, Japan, and Korea.

Weld has on occasion muddied the water on what “foreign policy proposals” consist of, lumping trade policy in with military intervention, possibly to justify his preference for Clinton. But that dog won’t hunt, either, as Clinton is as protectionist as Trump at the end of the day, with only superficial differences in emphasis and rhetoric. The real difference in foreign policy between Clinton and Trump is on military intervention and Trump’s stance most closely aligns with Johnson/Weld’s. If foreign policy is the chief measuring stick, Clinton is the worse of two bad choices for libertarians, not Trump.

To say Libertarians were skeptical of Weld at the party’s convention in May would be an understatement. Presidential runner-up Austin Petersen endorsed Gary Johnson during his concession speech, but refused to endorse Weld, who failed to gain the nomination on the first ballot. Kennedy’s openly hostile interview of Weld crystalized the accumulated frustration with Weld’s many disappointing statements (from a libertarian perspective) since then. Her charge that Weld was merely using the Libertarian Party for personal advancement may have been unfair. To his credit, Weld handled it well.

What is more concerning for libertarians is that Weld may truly believe his positions are libertarian, rather than merely “centrist” or “moderate Republican.” Contrary to Johnson/Weld rhetoric, libertarianism is not merely “fiscally conservative and socially accepting.” It certainly is not a combination of the “best from both sides” of the Democrat/Republican divide. It is a self-contained political philosophy with its own first principles, most of which depart completely from conservatism and progressive liberalism.

Neither Johnson nor Weld have demonstrated a firm grasp of those principles during the course of their campaign, leading them to positions most libertarians outright oppose. And while there is still a strong case for libertarians to support the ticket, Weld needs to come up with a more believable argument on why he’s #NeverTrump, rather than #NeverHillary. His foreign policy argument for Clinton makes no sense at all.

Buffalo News Political Coverage Belongs in the Fiction Section

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Today’s Buffalo News print edition features five articles on the Hillary Clinton campaign, including a front page, feel-good piece about how Clinton’s (almost) nomination has inspired other women. The News also chose to run a Politifact piece that endorses Clinton’s criticism of Trump’s trade policies, a criticism this writer happens to agree with.

The other three pieces could at best be described as neutral/supportive, although one questions whether the media has been too quick to pronounce Clinton the nominee. Nothing in these or any other recent articles the News has run on Clinton, outside of reader letters, can be described as remotely critical. This despite a large constituency within her own party that views Clinton as wholly-owned by Wall Street and a war hawk.

There are also five articles on Trump, including the Politifact article. Four of the five are negative. One is neutral, a reprint from Bloomberg News which reported Trump “distanced himself from his own fundraising estimate of $1 billion.”

Even this article could be construed as an attempt to cast a negative light on what Trump’s supporters consider a positive – that he’s not bought off by powerful special interests, as many on both the right and the left believe of Mrs. Clinton.

There is nothing in the Buffalo News that remotely suggests Trump might be better on foreign policy than Clinton, who has a lot to answer for regarding her role in the chaos raging throughout the Middle East and now spilling into Europe. Neither would readers of solely this paper know Trump set a record for votes in the California primary on Tuesday.

This is what passes for reporting on the 2016 presidential election in Buffalo’s only newspaper.

Make no mistake, this writer has no problem with a newspaper being biased. All media are biased and always have been. But there is a difference between bias and severing all connection with reality. Anyone relying on the News for their understanding of national politics might as well go to the fiction section of the nearest public library.

Full disclosure, I won’t be voting for Trump or Clinton in the November elections. I plan on voting for Gary Johnson.

Buffalonians reading this just started making owl noises, because in the fictional Buffalo News universe, neither Johnson nor the Libertarian Party exists. A search on the paper’s website yielded no headlines – ever – mentioning the candidate’s name, despite Johnson polling in double figures in three polls before his nomination and 16% in the latest poll in Utah. Even the left-leaning Washington Post describes the Libertarian Party as “so hot right now.”

Now, I’m just spit-balling here, but in a year where the candidates in both major parties have record-high negative ratings, wouldn’t a presidential ticket featuring two former two-term governors (of New Mexico and Massachusetts, respectively), nominated by the only third party with ballot access in all fifty states, be at least newsworthy enough for its existence to be acknowledged?

Not to the Buffalo News.

That’s not bias. That’s misleading the public. And it’s a disservice to the good people of Buffalo, who may not be receptive to the messages of campaigns other than Hillary Clinton’s, but certainly have an expectation that their only newspaper will acknowledge they exist.

Unlike Mr. Trump, I would never support any legal action against the News, no matter how poorly they serve the public. As a libertarian, I truly believe in free speech. I don’t even support libel laws if a newspaper outright lies (which I’m not suggesting is going on here). I believe the market can sort this out, when it’s allowed to work.

So, maybe it’s time the Buffalo News had some competition. What do you think? Let us know in the online poll below. Who knows? Perhaps an alternative is waiting in the wings (wink).

Does Buffalo need another voice on politics besides the Buffalo News?

State Department travel alert proves government can’t protect Americans against terrorism

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TAMPA, August 2, 2013 – The U.S. Department of State (DOS) issued a worldwide “travel alert” on Friday to warn U.S. citizens of “the continued potential for terrorist attacks, particularly in the Middle East and North Africa, and possibly occurring in or emanating from the Arabian Peninsula.” DOS also announced plans to temporarily close its embassies in 14 countries in the Middle East and Africa.

While the move is presumably the result of intelligence gathering, the government has not provided any details as to what prompted the precautions. Perhaps it was a tip from its network of informers. It could be information gleaned from its myriad surveillance programs.

What we do know is that the government’s reaction to the intelligence shows just how little it can really do to protect Americans against a terrorist attack. The government’s only answer is to pull its employees out of 14 countries and tell everyone else to “take every precaution to be aware of their surroundings and to adopt appropriate safety measures to protect themselves when traveling.”

Protect yourselves. That’s what Americans have done during every terrorist attack, after government efforts to protect them failed.

Read the rest of the article at Liberty Pulse…

The Bill Clinton Myth Finally Debunked

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clinton Whether you are watching the stock market, the headlines, or merely your 401K account balance, there is not much positive about the economic collapse just getting underway in the United States. With each new negative earnings report, bankruptcy, and ominous unemployment report, it gets a little harder to see any silver lining around the black cloud. However, there is one positive consequence of the economic debacle: The Bill Clinton Myth has finally been debunked.

Most people are familiar with the Myth, but mistake it for history. It’s a wonderful story if you are a Democrat or other variety of government-worshipper. For those who practice that religion, the Bill Clinton years serve as a Golden Age to talk about, write about, maybe even pray about, hoping for their return.

Unforunately, this myth does not even offer the benefits of its more interesting ancient predecessors. While the ancient myths of gods and monsters contained spiritual and philosophical truth underneath their obviously fictional storylines, the Bill Clinton Myth contains no truth at all. Perhaps “myth” is the wrong word, because it gives good myths a bad name.

The Bill Clinton Myth goes something like this. After “mismanagement” of the economy by President George H.W. Bush, which resulted in the recession that coincided with the 1992 election, Clinton took office and “managed the economy” wisely during his eight year presidency. Clinton’s “centrist policies” were just what the economy needed at a time of technological revolution, and his wise stewardship resulted in not only unprecedented growth and low unemployment for the economy, but balanced budgets and even surpluses for the federal government. By the time Clinton left office, the United States was more powerful economically than it had been at any time in its history.

Like the Populist Myth of the 19th Century, this one is a great story, but none of it is true. While even some Republicans begrudgingly credit Clinton with the mythical budget surpluses or the equally mythical prosperity in the 1990’s, they do themselves a disservice in regard to their quest to discredit every Democrat who ever (or will ever) lived.

In reality, there were no federal government surpluses. The lion’s share of the prosperity was a Federal Reserve-created bubble (the dot com bubble) and what real economic growth there was occurred despite Clinton’s policies, not because of them.

It might be necessary to go back and read that last sentence again. It is heresy, as surely as Galileo’s heliocentrism was to the Inquisition. It’s also just as true.

First, the so-called “surpluses” were bogus. As Craig Steiner explains, the appearance of a surplus was merely increased tax revenues from the dot com bubble allowing the Clinton administration to borrow more money from Social Security. While the public debt went down in the last four years of the Clinton presidency, the intergovernmental debt (mostly to Social Security) went up by an even greater amount, resulting in an increase in the national debt in each of those years. These are easily verifiable facts out of the published federal government budgets for those years. Anyone who doubts this can simply look up the budgets from 1997- 2001 and see the deficits for themselves.

Certainly, there were astounding developments in technology in the late 1980’s and throughout the 1990’s. One could look at this decade as a mild version of the technological revolution that occurred at the turn of the 20th century, although the breakthroughs, mostly in computing, were not as paradigm-shifting as the invention of the steam engine or the automobile, much less the telephone or the computer itself. These advances resulted in vast increases in productivity. A whole industry was born, employing people in higher paying jobs and revolutionizing communication, commerce, and production.

All of this happened during Bill Clinton’s presidency, although its roots go back at least as far as the Reagan years, possibly even Carter. But what did Bill Clinton do to cause this technological revolution? Nothing. Microsoft, Oracle, Apple, and the rest of the real new companies that emerged during this technological revolution were children of the free market. Gates, Ellison, Jobs and the rest were all entrepreneurs who took enormous risks based on their superior vision of where breakthroughs in technology could take commerce.

Anyone old enough to remember knows the government had very little understanding of the tech sector and frequently complained it didn’t know how to regulate the new types of products or business processes the tech sector presented. In other words, much of the reason for the explosive growth was the absence of government involvement. Until the lumbering machinations of government caught up, a free market in technology existed that allowed for spectacular innovation and growth.

The most significant action undertaken by the Clinton administration regarding the tech revolution was its anti-trust case against Microsoft. Here, Clinton’s contempt for free markets and property rights came shining through. This particular anti-trust case had a bizarre twist, as it was based upon the ludicrous assertion that Microsoft had some responsibility to build opportunity for its competitors into its own product. As usual, the government tried to “ensure competition” by using its coercive power to cripple the leader, rather than protect the property rights of all.

There was another side to the tech revolution that wasn’t the natural result of free markets: the dot com bubble. This was Pets.com, online supermarkets, and other hare-brained schemes that only got capitalized due to the reckless monetary policy pursued by the bubble-maestro himself, Alan Greenspan.

To be fair, Clinton doesn’t deserve much blame for this bubble. Most politicians demonstrate little understanding of monetary policy, beyond their belief that lower interest rates raises stock prices and higher stock prices equals votes. At one point, Clinton actually made a speech in which he claimed the business cycle had been eliminated.[1] That shows his understanding was as limited as most other presidents’.

Regardless, the dot com bubble had nothing to do with Clinton. It was merely the Fed doing what the Fed does, inflate and distort the economy, regardless of who happens to occupy the White House.

Finally, in addition to the false credit Clinton receives for his imaginary role in the perceived prosperity of the 1990’s, he has somehow escaped all blame for his very real hand in the problems we are facing now. Remember, it was Clinton who appointed FDR II (Franklin Delano Raines) as CEO of Fannie Mae, and then pressured the GSE to significantly increase its loans to riskier sub-prime borrowers.

The Clinton administration bragged it had not only had a hand in the first black CEO of a Fortune 500 company,[2] but also that it had made home ownership possible for millions of Americans that otherwise could not have obtained mortgages. Raines is now the subject of over 100 civil lawsuits and a huge percentage of those mortgages are defaulting. As usual, the government’s results when interfering in markets are exactly the opposite of its intentions.

Contrary to the Clinton Myth, the Clinton presidency had nothing to do with what real prosperity there was in the 1990’s. The Clinton administration was as clueless and impotent as most others while the Federal Reserve blew up an enormous bubble on its watch, sowing the seeds for the mortgage crisis that started the present economic disaster. Economically, the Clinton presidency was an unmitigated disaster, and hopefully it is clear to all but the most fervent believers that his “stewardship of the economy” is a myth.

Lest this be seen as partisan, let me clear the air. There have been two presidents credited with prosperity that seemed to coincide with their years in office during the past 40 years. One was Reagan, a Republican, and the other, Clinton, a Democrat. In both cases, they were falsely credited with prosperity that was mostly an illusion caused by the Federal Reserve. Their policies otherwise failed miserably.[3]

With the Clinton Myth exposed as a fraud, perhaps we can get rid of the entire government religion. Centuries ago, most people of the earth ceased sacrificing animals to bring rain, better crops, or good fortune hunting. They had finally realized there is no cause-effect relationship between killing a goat and the end of a drought. We need to likewise recognize that no politician has ever had any more to do with prosperity than those unfortunate goats had to do with the weather.[4] Freed from this superstition, it becomes clear that only free markets, individual effort, and creativity can create wealth and prosperity.

[1] I recall him making this ludicrous statement, but have not been able to reference it. Perhaps someone can provide the citation in a comment.
[2] The focus by both the Clinton administration and the media on Raines, a political hack who took over a Government Sponsored Entity, was a disservice in that it distracted attention from REAL black executives, like Kenneth Chenault, and Richard Nanula, who had risen to their positions based upon their talent and hard work.
[3] To be fair, Reagan’s rhetoric was admirable. He talked constantly about lower taxes, smaller government, and more personal liberty. However, he failed to implement this ideology to any significant degree, possibly because of a Democratic Congress. More importantly, he ran huge deficits due to defense spending and the growth of entitlement programs on his watch that constituted bigger government rather than smaller.
[4] Actually, the government religion is far more harmful than the ancient religious cults. When the ancients sacrificed a goat, they neither benefitted nor harmed anyone (other than the goat). When government tries to “create prosperity,” it harms everyone in society.