Before the presidential candidates go toe-to-toe in their first debate, personal finance website WalletHub asked -- which party is historically better at leading the country to economic growth and prosperity?
It was Hillary Clinton who said "The economy always does better when there’s a Democrat in the White House" when she was in Phoenix earlier this year.
Our partners at Politifact rated that claim as half true. According to quarterly Gross Domestic Product data dating back to 1947, Democrats do have more GDP growth than Republicans, however the current growth in the economy under President Barack Obama is lower than the Republican average.
But overall, which party is better for the economy?
The number crunchers at WalletHub compared the performance under both Democratic and Republican control spanning from 1950 to 2015. They, too, looked at GDP growth, but also at annual poverty rate change, and change in national debt as a percentage of GDP, among other metrics. WalletHub analysts converted all dollar values to 2015 terms, except for real GDP, which was calculated by the U.S. Bureau of Economic Analysis in “chained 2009 dollars.” S&P 500 yearly growth was also adjusted by each given year’s inflation rate.
Overall, the study found the economy does best with a Democrat in the White House and a Republican-led Congress.
That mix was best for income, the S&P, less poverty, and national debt as a percentage of GDP. However, under a Republican president and Democratic-led Congress, trade and income equality fared better, according to the survey.
Here are some more highlights from the study:
- In the past 66 years, real GDP has grown fastest under Democratic control of both the executive and legislative branches of government, at an average of 4.21 percent per year, and most slowly under a Democratic presidency and divided Congress, at an average of 1.97 percent per year.
- The stock market has performed best under a Democratic presidency and Republican Congress, with the S&P 500 producing an average annual return of 17.03 percent, and worst under a Republican presidency and divided Congress, with an average annual return of 3.28 percent.
- The annual unemployment rate change has had the highest decrease (0.85 percent, on average) under a Democratic presidency and divided Congress and the highest increase (0.26 percent, on average) under a Republican presidency and Democratic Congress.
- The annual poverty rate change has had the highest decrease (0.64 percent, on average) under Democratic presidency and Republican Congress and the highest increase (0.18 percent, on average) under a Republican presidency and divided Congress.
- The annual uninsured rate change has had the highest decrease (1.23 percent, on average) under a Democratic presidency and divided Congress and the highest increase (0.34 percent, on average) under a Republican presidency and divided Congress.
- The change in annual national debt as a percentage of GDP (adjusted for inflation) has had the highest decrease (1.52 percent, on average) under a Democratic presidency and Republican Congress and the highest increase (2.98 percent) under a Democratic presidency and divided Congress.
