US Economic Performance by Administration

 

We are about a week away from the US 2024 Presidential Election. Polling seems to show that likely voters are very concerned about the economy and hold each succeeding administration responsible for economic performance (see below). 

The graphic above shows Gross Domestic Product (GDP) performance since 1975 by the various presidential administration. The black line is actual GDP, the dashed red line is the GDP Attractor Path and the dotted and dashed blue and green lines are the lower- and upper-98% prediction intervals, respectively. The model used for prediction is my version of the Atlanta Fed GDP Now model.

The model shows that for most of the period (except briefly in the Reagan administration) the economy performed better than might have been expected from the Attractor Path. The Clinton and Bush II administrations even briefly reached the upper-98% prediction interval. The Trump administration inherited a solid economy from the Obama administration but was clearly affected by the COVID Pandemic. The Biden administration, so far, has almost returned to the upper-98% prediction interval, meaning the economy has performed extraordinarily well.

The best prediction for the future is that the economy will return to the GDP Attractor Path which means that whichever party wins the White House, the administration will face downward pressures on economy growth.

Polling on Economic Performance

A recent CBS poll (here) shows that respondents rated the prior Trump Administration (Jan 2017 to Jan 2021) as better than the current Biden Administration on economic performance. The polling does not seem to reflect the actual data (see above) but the COVID Pandemic hit during the Trump administration and respondents seem to discount the resulting economic shocks.

Update

Current BEA estimates (here) show GDP increasing within the upper-98% prediction interval. The economy continues to perform quite well inspite of pessimistic polling data.