Show Me The Money

Anyone who's gone through my recycling bin and meticulously pieced together my shredded bank statements knows I don't have a lot of credibility on this issue, but I want to say this once:

Barack Obama is a better investment than John McCain.

A while back, Kevin Drum posted this piece based on a paper by Princeton economist Larry Bartels, showing that 95 percent of the country does better economically with a Democrat in the White House than a Republican. Here's part of what he wrote:

Under Democratic presidents, every income class did well but the poorest did best. The bottom 20% had average pretax income growth of 2.63% per year while the top 5% showed pretax income growth of 2.11% per year.

Republicans were polar opposites. Not only was their overall performance worse than Democrats, but it was wildly tilted toward the well off. The bottom 20% saw pretax income growth of only .6% per year while the top 5% enjoyed pretax income growth of 2.09% per year. (What's more, the trendline is pretty clear: if the chart were extended to show the really rich — the top 1% and the top .1% — the Republican growth numbers for them would be higher than the Democratic numbers.)

I thought it was pretty eye-opening. You should follow the link and see the charts and read the whole thing.

A couple of weeks ago, a friend at work forwarded me this graphic, from The New York Times:


Now that... even having read Drum's post three years ago, my mind still boggled a little bit. If I invested $10,000 in the S&P Index only through Democratic administrations, I'd have 30 times that amount of money now (over 39 years)? And over the other 39 years, if I'd invested it in solely Republican administrations, I'd have only five times my investment? And that's only if you don't count Herbert Hoover? Ulp.

There's more to this chart at the Times. It's a really informative graphic, making 80 years of economic rises and falls easy to grasp at a glance. The rest of it illustrates the yearly averages of the six Democratic Presidents (ranging from 6.5 to 8.2, with the exception of economic superstar Bill Clinton at 15.2), and the seven Republican administrations (four did better than the Democratic average, but the other three--Nixon, Bush, and the generously weeded-out Hoover--saw considerable shrinkage instead of even low growth).

Viewed as an investment, Democrats are a safe, steady, solid-yield choice. Republicans are a lot riskier. There are promises of big rewards (though none as big as Clinton's), but there's also the risk of failures like Nixon and Bush.

And considering there's not a lot of daylight between Bush's economic policies and McCain's... well, I know where I'd put my money.

Rob