Closing The Book On The Bush Legacy

Thursday's annual Census Bureau report on income, poverty and access to health care-the Bureau's principal report card on the well-being of average Americans-closes the books on the economic record of George W. Bush. 

It's not a record many Republicans are likely to point to with pride.

On every major measurement, the Census Bureau report shows that the country lost ground during Bush's two terms. While Bush was in office, the median household income declined, poverty increased, childhood poverty increased even more, and the number of Americans without health insurance spiked. By contrast, the country's condition improved on each of those measures during Bill Clinton's two terms, often substantially.

The Census' final report card on Bush's record presents an intriguing backdrop to today's economic debate. Bush built his economic strategy around tax cuts, passing large reductions both in 2001 and 2003. Congressional Republicans are insisting that a similar agenda focused on tax cuts offers better prospects of reviving the economy than President Obama's combination of some tax cuts with heavy government spending. But the bleak economic results from Bush's two terms, tarnish, to put it mildly, the idea that tax cuts represent an economic silver bullet.

Economists would cite many reasons why presidential terms are an imperfect frame for tracking economic trends. The business cycle doesn't always follow the electoral cycle. A president's economic record is heavily influenced by factors out of his control. Timing matters and so does good fortune.

But few would argue that national economic policy is irrelevant to economic outcomes. And rightly or wrongly, voters still judge presidents and their parties largely by the economy's performance during their watch. In that assessment, few measures do more than the Census data to answer the threshold question of whether a president left the day to day economic conditions of average Americans better than he found it.

If that's the test, today's report shows that Bush flunked on every relevant dimension-and not just because of the severe downturn that began last year.

Consider first the median income. When Bill Clinton left office after 2000, the median income-the income line around which half of households come in above, and half fall below-stood at $52,500 (measured in inflation-adjusted 2008 dollars). When Bush left office after 2008, the median income had fallen to $50,303. That's a decline of 4.2 per cent.

That leaves Bush with the dubious distinction of becoming the only president in recent history to preside over an income decline through two presidential terms, notes Lawrence Mishel, president of the left-leaning Economic Policy Institute. The median household income increased during the two terms of Clinton (by 14 per cent, as we'll see in more detail below), Ronald Reagan (8.1 per cent), and Richard Nixon and Gerald Ford (3.9 per cent). As Mishel notes, although the global recession decidedly deepened the hole-the percentage decline in the median income from 2007 to 2008 is the largest single year fall on record-average families were already worse off in 2007 than they were in 2000, a remarkable result through an entire business expansion. "What is phenomenal about the years under Bush is that through the entire business cycle from 2000 through 2007, even before this recession...working families were worse off at the end of the recovery, in the best of times during that period, than they were in 2000 before he took office," Mishel says.

Bush's record on poverty is equally bleak. When Clinton left office in 2000, the Census counted almost 31.6 million Americans living in poverty. When Bush left office in 2008, the number of poor Americans had jumped to 39.8 million (the largest number in absolute terms since 1960.) Under Bush, the number of people in poverty increased by over 8.2 million, or 26.1 per cent. Over two-thirds of that increase occurred before the economic collapse of 2008.

The trends were comparably daunting for children in poverty. When Clinton left office nearly 11.6 million children lived in poverty, according to the Census. When Bush left office that number had swelled to just under 14.1 million, an increase of more than 21 per cent.

The story is similar again for access to health care. When Clinton left office, the number of uninsured Americans stood at 38.4 million. By the time Bush left office that number had grown to just over 46.3 million, an increase of nearly 8 million or 20.6 per cent.

The trends look the same when examining shares of the population that are poor or uninsured, rather than the absolute numbers in those groups. When Clinton left office in 2000 13.7 per cent of Americans were uninsured; when Bush left that number stood at 15.4 per cent. (Under Bush, the share of Americans who received health insurance through their employer declined every year of his presidency-from 64.2 per cent in 2000 to 58.5 per cent in 2008.) 

When Clinton left the number of Americans in poverty stood at 11.3 per cent; when Bush left that had increased to 13.2 per cent. The poverty rate for children jumped from 16.2 per cent when Clinton left office to 19 per cent when Bush stepped down.

Every one of those measurements had moved in a positive direction under Clinton. The median income increased from $46,603 when George H.W. Bush left office in 1992 to $52,500 when Clinton left in 2000-an increase of 14 per cent. The number of Americans in poverty declined from 38 million when the elder Bush left office in 1992 to 31.6 million when Clinton stepped down-a decline of 6.4 million or 16.9 per cent. Not since the go-go years of the John F. Kennedy and Lyndon Johnson administrations during the 1960s, which coincided with the launch of the Great Society, had the number of poor Americans declined as much over two presidential terms.

The number of children in poverty plummeted from 15.3 million when H.W. Bush left office in 1992 to 11.6 million when Clinton stepped down in 2000-a stunning decline of 24 per cent. (That was partly because welfare reform forced single mothers into the workforce at the precise moment they could take advantage of a growing economy. The percentage of female-headed households in poverty stunningly dropped from 39 per cent in 1992 to 28.5 per cent in 2000, still the lowest level for that group the Census has ever recorded. That number has now drifted back up to over 31 per cent.) The number of Americans without health insurance remained essentially stable during Clinton's tenure, declining from 38.6 million when the elder Bush stepped down in 1992 to 38.4 million in 2000. 

Looking at the trends by shares of the population, rather than absolute numbers, reinforces the story: The overall poverty rate and the poverty rate among children both declined sharply under Clinton, and the share of Americans without health insurance fell more modestly.

So the summary page on the economic experience of average Americans under the past two presidents would look like this:

Under Clinton, the median income increased 14 per cent. Under Bush it declined 4.2 per cent.

Under Clinton the total number of Americans in poverty declined 16.9 per cent; under Bush it increased 26.1 per cent. 

Under Clinton the number of children in poverty declined 24.2 per cent; under Bush it increased by 21.4 per cent.

Under Clinton, the number of Americans without health insurance, remained essentially even (down six-tenths of one per cent); under Bush it increased by 20.6 per cent.

Adding Ronald Reagan's record to the comparison fills in the picture from another angle.

Under Reagan, the median income grew, in contrast to both Bush the younger and Bush the elder. (The median income declined 3.2 per cent during the elder Bush's single term.) When Reagan was done, the median income stood at $47, 614 (again in constant 2008 dollars), 8.1 per cent higher than when Jimmy Carter left office in 1980.

But despite that income growth, both overall and childhood poverty were higher when Reagan rode off into the sunset than when he arrived. The number of poor Americans increased from 29.3 million in 1980 to 31.7 million in 1988, an increase of 8.4 per cent. The number of children in poverty trended up from 11.5 million when Carter left to 12.5 million when Reagan stepped down, a comparable increase of 7.9 per cent. The total share of Americans in poverty didn't change over Reagan's eight years (at 13 per cent), but the share of children in poverty actually increased (from 18.3 to 19.5 per cent) despite the median income gains.

The past rarely settles debates about the future.

 The fact that the economy performed significantly better for average families under Clinton than under the elder or younger Bush or Ronald Reagan doesn't conclusively answer how the country should proceed now. Obama isn't replicating the Clinton economic strategy (which increased federal spending in areas like education and research much more modestly, and placed greater emphasis on deficit reduction-to the point of increasing taxes in his first term). Nor has anyone suggested that it would make sense to reprise that approach in today's conditions. But at the least, the wretched two-term record compiled by the younger Bush on income, poverty and access to health care should compel Republicans to answer a straightforward question: if tax cuts are truly the best means to stimulate broadly shared prosperity, why did the Bush years yield such disastrous results for American families on these core measures of economic well being?

 --National Journal researcher Cameron Joseph contributed.