The change in America's debt by presidential term
AMERICA'S next chief executive will face calls to deal with the nation's growing debt load; the ratio of gross public debt to GDP now stands at over 100%. Both Barack Obama and Mitt Romney argue that the other's party lacks credibility on fiscal responsibility. Both men have a point. Since the end of the second world war, Democratic presidents have been considerably more successful than Republican presidents at keeping a tight grip on the nation's finances. Democrats have presided over reductions in the debt burden, on net, while Republicans have led in periods with net increases in borrowing. The Democratic edge is partly due to the large post-war consolidation under Harry Truman (accomplished with help from a 90% top tax rate and a few years of rapid inflation). Then followed several decades of bipartisan budget responsibility, helped along by rapid economic growth.
The relatively spendthrift Republican performance is largely down to a sea change in budgeting dating from the late 1970s. Since that time, every single Republican presidential term has coincided with a rise in America's debt-to-GDP ratio. Democrats were the only party to manage debt reduction through this time. Until the presidency of Barack Obama, that is. Mr Romney's response to the allegation that Republicans are the party of debt may be that no postwar president has presided over as large an increase in the debt-to-GDP ratio as Mr Obama. Mr Obama would respond that much of the debt attributed to him is not his fault. He would have a point. The deep recession he inherited likely added some 10-15 percentage points to the debt-to-GDP ratio, according to the Center on Budget and Policy Priorities. Fair or not, the rise in debt over his term will make it difficult for Mr Obama to claim the mantle of fiscal responsibility he might otherwise enjoy as a Democrat.