Reagan's "Miraculous" Growth

Growth is, at best, a rough measure of the economic health of a country's people. For example, the BP oil spill added to the country's GDP, as does somebody getting sick and going to the hospital. Obviously, oil spills and sicknesses are not good for people. So it's best to look at what you're actually trying to measure rather than a rough proxy. For example, the Human Development Index brings together a number of different metrics, including growth, to form a more accurate measure of the welfare of a country's people.

In the US, economic growth has varied widely over the past forty years, yet the poverty rate has remained pretty much the same:

Actually, transfer payments lower the poverty rate, and the countries with the most generous welfare programs have the lowest poverty rates:

Another sensible explanation that economists offer for historic poverty rates is the historic minimum wage:

That giving more money to poor people through transfer payments or increasing wages leads to lowering poverty rates is tautologous. I would be very interested to see any evidence that transfer payments increase poverty rates.

The financial problems of GRIPS (I = Ireland) are the result of the bursting of a housing bubble, which these nations are not able to deal with because they don't have controls over their own currencies: they can't pay their debts by printing more money, similar to states in the US. The current financial maladies of the US are due to the bursting of an $8 trillion housing bubble. Americans didn't suddenly wake up one day and become pessimistic and lazy welfare queens and decide to start a recession.

In terms of popularity, Reagan was middle of the pack compared with the rest of the postwar presidents:

No comments:

Post a Comment