WEBVTT NOTE From Bad to Worse: Interventionist Bias in Conventional Presidential Rankings 1 00:00:00.000 --> 00:00:06.000 The Ludwig von Mises Institute, teaching the economics of freedom. 2 00:00:06.000 --> 00:00:14.000 Our mission. 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In fact, of course, this is his great legacy. We are no longer in awe 56 00:05:56.480 --> 00:06:04.000 of the office, which is a huge step in the direction of restoring liberty. 57 00:06:04.000 --> 00:06:09.700 In some ways, too, we should also be grateful to Richard Nixon, who started the debunking 58 00:06:09.700 --> 00:06:17.260 process rolling. Those impeachment hearings were the first crack in the now collapsing 59 00:06:17.260 --> 00:06:42.260 The only real tragedy that would come with a Clinton impeachment and conviction would be his replacement with another petty tyrant with the same power and more seeming moral authority. 60 00:06:42.260 --> 00:06:49.300 In the early 19th century, Alexis de Tocqueville marveled at the institution of the presidency 61 00:06:49.300 --> 00:06:53.180 and not for its power and authority. 62 00:06:53.180 --> 00:06:57.380 He wrote that the president had no favors to hand out. 63 00:06:57.380 --> 00:06:59.900 He ruled no one. 64 00:06:59.900 --> 00:07:03.140 There was no money to be made out of the office. 65 00:07:03.140 --> 00:07:09.300 He had a tiny personal staff and only a couple of agencies under his indirect control. 66 00:07:09.300 --> 00:07:12.620 He could not go to war on his own. 67 00:07:12.620 --> 00:07:17.900 Certainly he could not regulate business, direct schools, or tell anyone whom they must 68 00:07:17.900 --> 00:07:20.420 associate with. 69 00:07:20.420 --> 00:07:26.160 For the people, the presidency was largely an honorary position, a figurehead that greeted 70 00:07:26.160 --> 00:07:34.500 foreign dignitaries and made eloquent speeches on special holidays, but otherwise did little. 71 00:07:34.500 --> 00:07:39.860 People cared about him during elections and forgot about him afterwards. 72 00:07:39.860 --> 00:07:45.260 The story of how Tocqueville's America became host to the largest and richest government 73 00:07:45.260 --> 00:07:53.540 in the history of mankind, a leviathan with $1.75 trillion at its disposal every year, 74 00:07:53.540 --> 00:07:59.280 is in large part the story of the rise of the executive state. 75 00:07:59.280 --> 00:08:03.700 This conference will tell that story and I wish I could report to you that the papers 76 00:08:03.700 --> 00:08:09.700 The speakers here will have the ring of familiarity. They will not. 77 00:08:09.700 --> 00:08:15.700 Each one will tell a story that you will not read in the conventional texts of American history. 78 00:08:15.700 --> 00:08:20.700 The text in which the more bloodthirsty and tyrannical the President is, 79 00:08:20.700 --> 00:08:25.700 the higher he is rated on the grand scale of greatness. 80 00:08:25.700 --> 00:08:30.700 We put this conference together because the story of how America lost its vision of freedom 81 00:08:30.700 --> 00:08:40.700 is not told in the conventional histories. For it does not seem at all obvious to us that war and despotism equal greatness. 82 00:08:40.700 --> 00:08:48.700 Presidents ought to be evaluated in terms of how well they guard the freedom that was this country's original promise, 83 00:08:48.700 --> 00:08:55.700 not how slyly they betrayed the vision. We will do so. 84 00:08:55.700 --> 00:09:10.700 A few housekeeping notes. We're going to have a very tight schedule, as you can tell, and so not to cut in on the speaker's time, I'll not be able to introduce most of them, but you will find short biographies of all of them in your registration materials. 85 00:09:10.700 --> 00:09:17.700 Please note that we will also start each session on time to make sure that you get to hear the entire program in good order. 86 00:09:17.700 --> 00:09:23.500 Order. Thank you all for coming, and to those of you who so generously donated to make this 87 00:09:23.500 --> 00:09:30.400 conference possible, a special thank you. You and I will learn an immense amount today 88 00:09:30.400 --> 00:09:37.180 and tomorrow, but it does not end here. The proceedings will become a volume, the first 89 00:09:37.180 --> 00:09:43.900 full-scale revision of the history of the American presidency ever produced. What follows 90 00:09:43.900 --> 00:09:48.420 Charles is the story of the rise of the executive state. 91 00:09:48.420 --> 00:10:01.260 May this conference make a contribution to its decline and fall. 92 00:10:01.260 --> 00:10:05.980 Now we're pleased to begin with distinguished professors Richard Vedder and Lowell Galloway 93 00:10:05.980 --> 00:10:10.060 of Ohio University. 94 00:10:10.060 --> 00:10:14.700 Presidents crave to be President of the United States for a variety of reasons. 95 00:10:14.700 --> 00:10:19.540 They're guaranteed a comfortable life of moderate affluence, they usually are able to command 96 00:10:19.540 --> 00:10:24.760 a lifetime income of millions of dollars in book royalties, lecture and corporate director 97 00:10:24.760 --> 00:10:27.260 fees after leaving office. 98 00:10:27.260 --> 00:10:32.640 A president has a great deal of power, too much of course, but it derives some satisfaction 99 00:10:32.640 --> 00:10:37.500 from being the most important person in the country, if not the world. 100 00:10:37.500 --> 00:10:42.920 Yet there is a third form of compensation particularly alluring, the chances of receiving 101 00:10:42.920 --> 00:10:46.660 eternal recognition in the history books. 102 00:10:46.660 --> 00:10:52.180 The reputation of chief executives with historians, political scientists and other presidential 103 00:10:52.180 --> 00:10:58.180 scholars is important in defining a president's long-term legacy. 104 00:10:58.180 --> 00:11:05.700 Thus modern presidents not only try to appeal to voters, but to a constituency of historians 105 00:11:05.700 --> 00:11:12.420 and other presidential scholars who are influential in interpreting the presidency in future years. 106 00:11:12.420 --> 00:11:19.100 It is our thesis that these scholars generally are dependent on government for their income 107 00:11:19.100 --> 00:11:24.300 and tend to be sympathetic to an expansive role for the state. 108 00:11:24.300 --> 00:11:29.160 Most are politically liberal in the modern American sense of that word, and to persons 109 00:11:29.160 --> 00:11:35.340 with this perspective, a good president is one who actively uses the power of the state 110 00:11:35.340 --> 00:11:48.340 While a president who curtails government and allows markets greater primacy in the allocation of resources and the distribution of income is considered lackluster or mediocre. 111 00:11:49.340 --> 00:11:57.340 Now, this hypothesis is testable. That's an expression, by the way, it's kind of dirty, the words among Austrians, but I'll say it anyway. 112 00:11:57.340 --> 00:12:06.500 There have been a number of surveys of presidential scholars asking them to rank the presidents. 113 00:12:06.500 --> 00:12:10.460 They give a good guide to the reputations of former heads of states among the group 114 00:12:10.460 --> 00:12:15.740 of people who write the history books and the biographies which ultimately impact on 115 00:12:15.740 --> 00:12:18.160 popular opinion. 116 00:12:18.160 --> 00:12:23.020 Also there's some imperfect but useful information about the size of government. 117 00:12:23.020 --> 00:12:26.980 Budgetary data, for example, are available for the U.S. government since the Washington 118 00:12:26.980 --> 00:12:32.820 Administration, and scholars have likewise estimated the size of the national output 119 00:12:32.820 --> 00:12:35.380 going back to the beginning of the Republic. 120 00:12:35.380 --> 00:12:41.100 Accordingly, it is possible to calculate federal governmental expenditures as a percentage 121 00:12:41.100 --> 00:12:45.100 of national output throughout American history. 122 00:12:45.100 --> 00:12:50.780 In our classical liberal rankings that we are about to embark on with you, we calculated 123 00:12:50.780 --> 00:12:58.540 the change in government spending as a percentage of output during the administration of each 124 00:12:58.540 --> 00:13:03.140 president, comparing the year prior to the inauguration of the president with the president's 125 00:13:03.140 --> 00:13:09.380 last year in office. Thus, in his last full year, in 1980, Jimmy Carter presided over 126 00:13:09.380 --> 00:13:17.620 a government that spent 21.2 percent of the nation's output compared with 20.4 percent 127 00:13:17.620 --> 00:13:21.220 in 1976, the year before he assumed office. 128 00:13:21.220 --> 00:13:24.400 So if you subtract the latter figure from the former, 129 00:13:24.400 --> 00:13:26.320 we could conclude that the federal government 130 00:13:26.320 --> 00:13:29.660 grew about 0.8% of gross domestic product 131 00:13:29.660 --> 00:13:32.140 during the Carter presidency. 132 00:13:32.140 --> 00:13:34.600 So that's the technique we used in our first table 133 00:13:34.600 --> 00:13:37.540 and I'll explain how we refine that in a minute. 134 00:13:37.540 --> 00:13:40.460 Two of the presidents, William Henry Harrison 135 00:13:40.460 --> 00:13:42.940 and James Garfield, served as presidents 136 00:13:42.940 --> 00:13:45.340 for such a short time that they're excluded 137 00:13:45.340 --> 00:13:46.640 from our analysis. 138 00:13:47.620 --> 00:13:53.900 Now from a classical liberal or Austrian perspective, increases in government share of output are 139 00:13:53.900 --> 00:14:00.100 considered bad or intrusive on personal liberty, while decreases are considered good. 140 00:14:00.100 --> 00:14:05.900 So in Table 1, we rank the president solely using such a criteria, ignoring any other 141 00:14:05.900 --> 00:14:09.460 factor that might be used to evaluate the president. 142 00:14:09.460 --> 00:14:14.440 We also indicate what the rankings of the president was using three of the conventional 143 00:14:14.440 --> 00:14:16.880 presidential scholar assessments. 144 00:14:16.880 --> 00:14:21.560 One of them, by the way, involved 800 historians about, and another one involved about 800 145 00:14:21.560 --> 00:14:23.440 political scientists. 146 00:14:23.440 --> 00:14:28.520 Before going into the specifics of the ranking, we calculated the correlation between our 147 00:14:28.520 --> 00:14:34.360 libertarian-oriented rankings and those that the historians and scholars did. 148 00:14:34.360 --> 00:14:38.280 And for those of you who know statistics, it's interesting, the correlation coefficient 149 00:14:38.280 --> 00:14:46.580 between our ranking in the Murray blessing assessment is minus 0.35 and was statistically 150 00:14:46.580 --> 00:14:49.480 significant at the 5% level. 151 00:14:49.480 --> 00:14:54.420 Since our rankings are solely based on the size of government, the results support our 152 00:14:54.420 --> 00:15:00.000 initial hypothesis that other things equal. 153 00:15:00.000 --> 00:15:06.940 Presidential historians prefer presidents who expand government, and within the presidential 154 00:15:06.940 --> 00:15:11.820 in the Presidential Scholar Community, there's a lot of agreement between these various rankings. 155 00:15:11.820 --> 00:15:17.740 The correlation between the various rankings is between .96 and .98. 156 00:15:17.740 --> 00:15:22.340 Now given the limitations of time, I will only briefly comment on a few highlights of 157 00:15:22.340 --> 00:15:23.340 the rankings. 158 00:15:23.340 --> 00:15:25.580 The full paper has a lot more detail. 159 00:15:25.580 --> 00:15:31.660 Abraham Lincoln is revered by Presidential Scholars and by most Americans, considered 160 00:15:31.660 --> 00:15:37.160 the greatest president in all three mainstream surveys, greater even than such giants as 161 00:15:37.160 --> 00:15:40.560 George Washington and Thomas Jefferson. 162 00:15:40.560 --> 00:15:47.280 In our black box calculations, however, Lincoln appears as America's second worst president. 163 00:15:47.280 --> 00:15:53.020 Under Lincoln, the government's role in American economic life grew to what were up to then 164 00:15:53.020 --> 00:15:54.960 unprecedented levels. 165 00:15:54.960 --> 00:16:01.500 The country was subjected to hyperinflation, ended links of the currency to precious metals, 166 00:16:01.500 --> 00:16:11.500 It introduced an income tax, as well as such non-libertarian phenomena as military conscription and the suspension of habeas corpus rights. 167 00:16:11.500 --> 00:16:18.500 More importantly, of course, it endured a massive civil war that killed more Americans than any other conflict in our history. 168 00:16:18.500 --> 00:16:25.500 The robust rate of economic growth prevailing in the 1840s and 50s ground to a halt for several years, 169 00:16:25.500 --> 00:16:30.500 and it took the South over a century to regain its relative economic standing. 170 00:16:30.500 --> 00:16:35.500 To Austrians and classical liberals, this is a nightmare. 171 00:16:35.500 --> 00:16:39.500 On moral grounds as well as grounds of promoting free markets for labor services, 172 00:16:39.500 --> 00:16:42.500 Lincoln can be championed for ending slavery, 173 00:16:42.500 --> 00:16:50.500 but such subjective considerations did not enter into our rankings based purely on statistical evidence. 174 00:16:50.500 --> 00:17:20.500 Evidence. Now turning to the 20th century, we diverged sharply from the presidential scholars with respect to virtually every president. For example, Woodrow Wilson ranked sixth in all the cited polls, but he was third from the bottom on our list. On his watch, the income tax was enshrined in the American Constitution, the Federal Reserve was established, and more militant government intervention ensued in the 175 00:17:20.500 --> 00:17:36.500 And from the standpoint of rankings, the most important fact of all, of course, was that the U.S. became embroiled in World War I, beginning the era of extensive American involvement in foreign disputes. 176 00:17:36.500 --> 00:17:42.500 We evaluated Harding and Coolidge highly, placing them in the top ten. 177 00:17:42.500 --> 00:17:50.500 Naturally, they're both in the bottom ten in the list of the presidential scholars, with Harding ranking dead last. 178 00:17:50.500 --> 00:17:59.500 While Harding's administration was marred with scandal, those scandals appeared modest relative to those of the Clinton era. 179 00:17:59.500 --> 00:18:02.500 Incidentally, all those scandals occurred after Harding died. 180 00:18:02.500 --> 00:18:09.500 I mean, you know, the revelation of the teapot don't, all the prosecution, all was after he was dead. 181 00:18:09.500 --> 00:18:16.500 Moreover, taxes were slashed and industrial production during Harding's tragically short 182 00:18:16.500 --> 00:18:26.100 tenure rose 61%. Furthermore, Harding let markets work to end the 2021 depression. Playing 183 00:18:26.100 --> 00:18:34.380 golf and poker and drinking whiskey, Harding allowed, and other things that have come out 184 00:18:34.380 --> 00:18:45.420 in the during the last few months. Monica is not new in American history. Harding allowed 185 00:18:45.420 --> 00:18:49.900 the price mechanism to lower unemployment from the double-digit levels when he assumed 186 00:18:49.900 --> 00:18:54.880 office to less than four percent when he died. Yet given the existence of what Robert Higgs 187 00:18:54.880 --> 00:19:00.100 calls ratchet effects in government spending, the combined exertions of Harding and Coolidge 188 00:19:00.100 --> 00:19:07.680 and Reducing Government, while commendable, did not return to the pre-war norm. 189 00:19:07.680 --> 00:19:11.780 Now Herbert Hoover is a horse of a different color. 190 00:19:11.780 --> 00:19:18.140 No one seems to like Hoover, but we like him even less than the presidential scholars putting 191 00:19:18.140 --> 00:19:21.060 him on our short list of worst presidents. 192 00:19:21.060 --> 00:19:26.960 Aside from being a pre-Keynesian big spender, Hoover interfered in major ways in the labor 193 00:19:26.960 --> 00:19:33.760 Markets, Setting the Stage for the Great Depression. He was a meddling interventionist, a Franklin 194 00:19:33.760 --> 00:19:43.080 D. Roosevelt without the charisma. Now, in the large presidential surveys, Franklin D. 195 00:19:43.080 --> 00:19:52.080 Roosevelt ranks above George Washington, right next to Abraham Lincoln. In our objective 196 00:19:52.080 --> 00:19:58.320 of Evaluation, he was absolutely the worst American president. Roosevelt, more than any 197 00:19:58.320 --> 00:20:03.200 other man, set the stage for the modern American welfare state. We're still grappling with 198 00:20:03.200 --> 00:20:09.760 problems that are part of the Roosevelt legacy, ranging from social security to an anachronistic 199 00:20:09.760 --> 00:20:16.000 laws regulating labor and financial markets. Now, in table two, which you don't have, 200 00:20:16.000 --> 00:20:21.020 we refine these rankings based on size of government consideration using two other ways 201 00:20:21.020 --> 00:20:25.100 of Measuring the Size of Government, and the net effect of all this is to lower our 202 00:20:25.100 --> 00:20:28.300 valuation of recent presidents. 203 00:20:28.300 --> 00:20:32.300 You can read the paper for details when it comes out. 204 00:20:32.300 --> 00:20:37.900 Now, there are arguments for or against any set of our rankings or, for that matter, of 205 00:20:37.900 --> 00:20:40.100 the mainstream scholars. 206 00:20:40.100 --> 00:20:48.700 In Table 3, we present a composite of both our and the mainstream rankings, ordering 207 00:20:48.700 --> 00:20:54.340 Combining the president from best to worst by summing our three rankings from tables one 208 00:20:54.340 --> 00:20:59.140 and two and by combining the rankings shown in the three polls of scholars which are included 209 00:20:59.140 --> 00:21:01.100 in table one. 210 00:21:01.100 --> 00:21:05.500 If you compare our rankings with their rankings, the differences are profound. 211 00:21:05.500 --> 00:21:11.220 Let's for the sake of discussion say that the top one-third of the 39 presidents that 212 00:21:11.220 --> 00:21:19.420 we have in our discussion were good, that the middle one-third were average and the 213 00:21:19.420 --> 00:21:22.500 bottom one-third were poor. 214 00:21:22.500 --> 00:21:30.060 Using that taxonomy, the majority of the presidents considered good by us, using government size 215 00:21:30.060 --> 00:21:36.460 as a measurement of assessment, were considered poor by mainstream scholars, specifically 216 00:21:36.460 --> 00:21:41.980 I'm speaking of Andrew Jackson, Warren G. Harding, U.S. Grant, Zachary Taylor, Calvin 217 00:21:41.980 --> 00:21:46.540 Coolidge, Don Tyler and Chester A. Arthur. 218 00:21:46.540 --> 00:21:52.660 Almost half of the presidents of the mainstream scholars considered good, we assessed as being 219 00:21:52.660 --> 00:21:53.660 poor. 220 00:21:53.660 --> 00:21:59.220 Abraham Lincoln, Franklin D. Roosevelt, Woodrow Wilson, James Polk, Lyndon Baines Johnson 221 00:21:59.220 --> 00:22:02.580 and James Madison. 222 00:22:02.580 --> 00:22:07.940 All six of these present, by any definition, were activist chief executives. 223 00:22:07.940 --> 00:22:12.340 Others on their good list, such as Andrew Jackson and Theodore Roosevelt, also were known 224 00:22:12.340 --> 00:22:15.660 for their aggressive use of presidential authority. 225 00:22:15.660 --> 00:22:20.100 Thus the good presidents, as evaluated by the mainstream scholars, were mostly highly 226 00:22:20.100 --> 00:22:25.820 activist while their poor president list was dominated by relative laissez-faire types 227 00:22:25.820 --> 00:22:30.540 such as Arthur, Taylor, Coolidge and Harding. 228 00:22:30.540 --> 00:22:34.400 Now another way we differ from the mainstream scholars is that we tend to find most of the 229 00:22:34.400 --> 00:22:39.220 good guys in the early decades of the republic. 230 00:22:39.220 --> 00:22:43.260 Well we evaluate the more recent presidents far less favorably. 231 00:22:43.260 --> 00:22:44.740 Why is this? 232 00:22:44.740 --> 00:22:50.340 In the modern era, government spending has tended to grow fairly consistently as a share 233 00:22:50.340 --> 00:22:57.020 of our national output and the most conservative and lazy fairs of presidents, and Ronald Reagan 234 00:22:57.020 --> 00:23:03.260 and in particular comes to mind, have done, been able to do or have done relatively little 235 00:23:03.260 --> 00:23:10.420 about it. In the early years of the republic, this strong upward tendency for government 236 00:23:10.420 --> 00:23:14.540 spending was simply not apparent. 237 00:23:14.540 --> 00:23:22.140 Now any mechanistic procedures for evaluating presidents based on a single criteria is bound 238 00:23:22.140 --> 00:23:41.140 We do not really believe, for example, that Harry Truman is the best of all presidents, although we would agree that such presidents as Franklin D. Roosevelt and Woodrow Wilson are probably about as bad as the rankings indicate. 239 00:23:41.140 --> 00:23:48.140 One important factor that's not included in these rankings that you can measure is price stability. 240 00:23:48.140 --> 00:23:56.140 Most economists, virtually all free market ones, would argue that price inflation is a bad thing. 241 00:23:56.140 --> 00:24:04.140 Five percent inflation annually is worse than one percent inflation, which in turn is worse than overall price stability. 242 00:24:04.140 --> 00:24:13.140 Now, while most economists, with an appreciation of the powers of markets in allocating resources, would agree that inflation is bad, 243 00:24:13.140 --> 00:24:20.140 To add, there is some division of opinion as to what is optimal regarding the purchasing power of money. 244 00:24:20.140 --> 00:24:28.140 Austrian economists tend to look with great disdain on the discretionary creation of money by central banks. 245 00:24:28.140 --> 00:24:35.140 From that perspective, a zero rate of reported inflation is not necessarily good. 246 00:24:35.140 --> 00:24:40.940 Austrians in general applauded the moderately deflationary monetary record of the last third 247 00:24:40.940 --> 00:24:47.300 of the 19th century during the heyday of the classical gold standard, for example, and 248 00:24:47.300 --> 00:24:53.460 would have condemned a sort of a stable price monetary policy in that period had it been 249 00:24:53.460 --> 00:24:58.940 implemented that augmented the monetary growth from increased gold stocks with paper money 250 00:24:58.940 --> 00:25:03.340 creation in order to keep prices stable. 251 00:25:03.340 --> 00:25:12.520 In our Variant 1 in Table 4, which is our preferred rankings by the way, final rankings, 252 00:25:12.520 --> 00:25:18.720 a negative rate of inflation is considered good and the more negative the better. 253 00:25:18.720 --> 00:25:25.900 In Variant 2 in Table 4, we assume that the optimal amount of inflation is zero. 254 00:25:25.900 --> 00:25:32.780 Now in Table 4, we report our rankings of presence with an inflation adjustment. 255 00:25:32.780 --> 00:25:38.420 We took the rankings in table three, based on size of government, added the numerical 256 00:25:38.420 --> 00:25:43.460 rankings based on the rate of inflation, and then ranked the presidents based on the sum 257 00:25:43.460 --> 00:25:45.660 of these two measures. 258 00:25:45.660 --> 00:25:48.780 The lower the number, the better the perceived performance. 259 00:25:48.780 --> 00:25:53.720 In other words, we're putting an equal weight on the size of government consideration and 260 00:25:53.720 --> 00:25:55.780 on the price stability consideration. 261 00:25:55.780 --> 00:25:59.780 One could quarrel with this, but we thought we'd try this and see what happens. 262 00:25:59.780 --> 00:26:05.580 Now turning to the Variant 1, which we believe many Austrians would find preferable. 263 00:26:05.580 --> 00:26:09.660 Joseph Salerno, if he's here, would probably like it. 264 00:26:09.660 --> 00:26:15.060 Six presidents move at least 10 ranks from that reported in our rankings based on the 265 00:26:15.060 --> 00:26:19.500 size of government consideration alone in Table 3. 266 00:26:19.500 --> 00:26:26.660 Harry Truman, for example, goes from first, which we are very uncomfortable with subjectively, 267 00:26:26.660 --> 00:26:34.020 to Tide for 13th, still probably too high, but better. Because of the lifting of World 268 00:26:34.020 --> 00:26:41.360 War II price controls in 1946, the reported inflation rate is probably too high for Truman 269 00:26:41.360 --> 00:26:46.700 and too low because of the price controls for Roosevelt. So there's a little distortion 270 00:26:46.700 --> 00:26:47.700 there. 271 00:26:47.700 --> 00:26:53.340 Now two other presidents fell, fall dramatically on the basis of high inflation. George Washington 272 00:26:53.340 --> 00:26:59.780 goes from 5th to 22nd, which we think may be very unfair, given the particular dubious 273 00:26:59.780 --> 00:27:03.540 quality of the data in that era. 274 00:27:03.540 --> 00:27:08.860 Austrians find price indices abominations in the best of times, and actually there isn't 275 00:27:08.860 --> 00:27:11.860 a consumer price index for the 1790s. 276 00:27:11.860 --> 00:27:17.900 I invented one through a regression technique, which I won't bore you with, but the devil 277 00:27:17.900 --> 00:27:23.140 is in the details, and there's a lot of devil there. 278 00:27:23.140 --> 00:27:25.880 So it may be unfair to Washington. 279 00:27:25.880 --> 00:27:33.060 Bill Clinton goes from being tied for 15th to 27th, which we subjectively view as being 280 00:27:33.060 --> 00:27:36.260 very fair indeed. 281 00:27:36.260 --> 00:27:39.340 Three presidents move up in the rankings substantially. 282 00:27:39.340 --> 00:27:44.660 Polk goes from being tied for 30th to being tied for 16th, that is from being clearly 283 00:27:44.660 --> 00:27:48.860 in the list of bad presidents to being one that might be called roughly average. 284 00:27:48.860 --> 00:27:54.980 The same thing even happens more dramatically to Herbert Hoover who moves from 36 to 18. 285 00:27:54.980 --> 00:28:00.420 Now Hoover moves up because there was negative price inflation to Hoover's age and that kind 286 00:28:00.420 --> 00:28:06.980 of implies we think that Hoover presided over an intelligent monetary policy in that period 287 00:28:06.980 --> 00:28:14.940 and I don't know any economist, even the most root canal sadist and masochist economist 288 00:28:14.940 --> 00:28:17.620 who has that perspective. 289 00:28:17.620 --> 00:28:26.620 and the Keynesian. No one, you know, agrees, you know, loves Hoover. 290 00:28:26.620 --> 00:28:33.620 Lastly, the modern deflation of the Hayes presidency helped him move from 21st to 11th in our rankings. 291 00:28:33.620 --> 00:28:38.620 With either set of inflation-rated rankings, the modern presidents fare poorly. 292 00:28:38.620 --> 00:28:46.620 Using variant one, eight of the 13 worst presidents are from the modern era, which we define as from Coolidge to the presidents. 293 00:28:46.620 --> 00:28:51.620 None of the top ten presidents in either list is from the modern era. 294 00:28:51.620 --> 00:28:57.980 The inflation associated with the era of Keynesian economics leads to relatively low evaluations 295 00:28:57.980 --> 00:29:00.460 of modern presidents. 296 00:29:00.460 --> 00:29:05.740 Now the mainstream scholars, of course, are largely liberal and probably most vote for 297 00:29:05.740 --> 00:29:09.740 Democratic party candidates, for president. 298 00:29:09.740 --> 00:29:15.140 So conventional wisdom would say that the Republican candidates tend to favor smaller 299 00:29:15.140 --> 00:29:20.500 Government and Sound Money. So our classical liberal ranking should be expected to give 300 00:29:20.500 --> 00:29:27.100 higher assessment of Republicans than Democrats. Examining the president since 1860 when the 301 00:29:27.100 --> 00:29:32.980 first Republican was elected, namely Lincoln, we can look at the party affiliation of 24 302 00:29:32.980 --> 00:29:37.540 of the presidents who were either Republicans or Democrats, and I excluded Andrew Johnson 303 00:29:37.540 --> 00:29:42.160 from the list, who was technically not a member of either party at the time of his election 304 00:29:42.160 --> 00:29:44.600 to the Vice Presidency. 305 00:29:44.600 --> 00:29:52.360 And let us arbitrarily give the grade of A to the top eight ranked of all the 29 presidents. 306 00:29:52.360 --> 00:29:54.360 I tend to grade on a curb, by the way. 307 00:29:54.360 --> 00:30:02.440 I'm an old-fashioned scholar that believes you can give grades below A's. 308 00:30:02.440 --> 00:30:06.800 I believe in the principle of scarcity. 309 00:30:06.800 --> 00:30:11.680 We give eight B's to the second eight presidents, eight C's and so on. 310 00:30:11.680 --> 00:30:27.680 So ranking all the Presidents, the mainstream scholars gave the Democratic Presidents a cumulative grade point average, a GPA of 3.0, a B, and they gave the Republicans an average of C minus. 311 00:30:27.680 --> 00:30:35.680 So the mainstream scholars said Democrats are Bs, Republicans are C minus. So much for their bias, pretty clear. 312 00:30:35.680 --> 00:30:42.080 Now, in Figure 2, which we include, we show how our distribution of grades is using the 313 00:30:42.080 --> 00:30:48.200 same grading scale for Republicans and Democrats using the first variant of Table 4 as our 314 00:30:48.200 --> 00:30:49.360 measure. 315 00:30:49.360 --> 00:30:55.080 Our distribution of grades of Republican is almost even across the board, with 3 at every 316 00:30:55.080 --> 00:31:03.720 level except D. The cumulative grade point average is a lowly 1.93, a little below a 317 00:31:03.720 --> 00:31:19.720 The cumulative average is 1.0 or a D. So while it's true that we find the Republicans on average to be better than the Democrats, modern presidents of either political affiliation have tended to be mediocre Democrats, somewhat more so than Republicans. 318 00:31:19.720 --> 00:31:46.920 The four statistically significant instances of upward ratcheting in the size of government which we can't go into the details of how we measure this in this presentation. 319 00:31:46.920 --> 00:31:54.920 But the four statistically significant instances of awkward ratcheting the size of government are associated with the phenomenon of war. 320 00:31:54.920 --> 00:31:59.920 Specifically, the War of 1812, the Civil War, and the two World Wars. 321 00:31:59.920 --> 00:32:08.920 Further, there's a pronounced association between major wars and presidential rankings offered by both mainstream experts in us. 322 00:32:08.920 --> 00:32:27.920 The so-called experts ranking of the four presidents associated with these four wars is on average 5.5. That is, on average they ranked fifth best, with Madison being the lowest at 13. So war presidents did really well with the mainstream scholars. 323 00:32:27.920 --> 00:32:36.420 On the other hand, we rank these four presidents during these four wars at an average ranking of 35.6 in the bottom five. 324 00:32:36.420 --> 00:32:49.920 So more generally, the mainstream scholars liked all war presidents, including presidents who presided over other wars, the Vietnam War, they liked Johnson, et cetera, kind of like McKinley, et cetera. 325 00:32:49.920 --> 00:33:11.920 So, to the extent that presidents try to maximize their historical legacy, the pro-war bias of the conventional historians and political scientists suggests that at the margin, some wars may be fought to enhance presidential reputation, rather than to right wrongs or maximize the national interest. 326 00:33:11.920 --> 00:33:17.360 In making a cost-benefit calculation, whether to engage in war, presidents might consider 327 00:33:17.360 --> 00:33:24.440 the private benefit they receive from a probable enhancement in their presidential reputation. 328 00:33:24.440 --> 00:33:29.680 Wars make presidents look heroic, and everyone loves a hero. 329 00:33:29.680 --> 00:33:35.240 Now should the experts exalt wartime leaders, or should we denigrate them? 330 00:33:35.240 --> 00:33:39.360 We think the weight of the evidence on this issue is on our side. 331 00:33:39.360 --> 00:33:45.320 While it may be inappropriate to assign complete responsibility for the advent of war to the 332 00:33:45.320 --> 00:33:52.660 nation's chief executive, war does not occur in a policy vacuum. It is the culmination 333 00:33:52.660 --> 00:34:00.080 of a series of public policy positions either avowed or pursued prior to its outbreak. Of 334 00:34:00.080 --> 00:34:07.080 course, war impacts on our presidential rankings by increasing the level of federal spending. 335 00:34:07.080 --> 00:34:15.080 However, such surges in spending are not permanent. Or are they? Whatever the reason for government 336 00:34:15.080 --> 00:34:21.680 spending, it diverts resources from the private sector or the economy. In the process, the 337 00:34:21.680 --> 00:34:28.480 public becomes accustomed to a lower level of private consumption. Customarily, this 338 00:34:28.480 --> 00:34:33.880 is regarded as acceptable in the short run in the name of patriotism or some other civic 339 00:34:33.880 --> 00:34:41.320 Virtue. At the conclusion of the hostilities, this period of public sacrifice is over and 340 00:34:41.320 --> 00:34:49.660 there exists what has been called a, quote, peace dividend that may be, quote, spent. 341 00:34:49.660 --> 00:34:54.960 The operative word here is spent. The simplest thing to do with a peace dividend is to give 342 00:34:54.960 --> 00:35:01.440 it back to the people who earned it, to be used in the pursuit of its private consumption. 343 00:35:01.440 --> 00:35:07.060 However, once resources have passed under the control of the central government, it's 344 00:35:07.060 --> 00:35:10.560 often difficult to retrieve them. 345 00:35:10.560 --> 00:35:15.920 To be sure, some of the peace dividend will be returned to the private sector, but much 346 00:35:15.920 --> 00:35:21.200 of it will be retained in the public arena to enhance social spending. 347 00:35:21.200 --> 00:35:28.440 A large pool of public resources is an irresistible attraction for what Manser Olson has called 348 00:35:28.440 --> 00:35:38.440 These are called distributional coalitions in a society to the extent they are able to capture a portion of the peace dividend for their special interest purposes. 349 00:35:38.440 --> 00:35:44.440 The volume of public spending will be maintained at levels that are greater than the pre-war ones. 350 00:35:44.440 --> 00:35:47.440 This is the Higgs Ratchet. 351 00:35:47.440 --> 00:35:57.440 Now, individual happiness is not created in large part through the actions of political leaders. 352 00:35:57.440 --> 00:36:13.440 The dynamic, chaotic market processes of individual human action have far more to do with America's material prosperity and happiness than the behavior of any president. 353 00:36:13.440 --> 00:36:18.440 Yet bad political leaders can have lasting negative consequences. 354 00:36:18.440 --> 00:36:27.440 The half-life of the adverse consequences of ill-conceived and ill-considered political activism is long. 355 00:36:27.440 --> 00:36:31.440 Classical liberal scholars should ponder why this is so. 356 00:36:31.440 --> 00:36:37.440 Why cannot or did not, say a Ronald Reagan, do much to roll back government? 357 00:36:37.440 --> 00:36:46.440 Why was the seemingly moderately promising laissez-faire behavior of the 94th Republican Congress, 95-96, 358 00:36:46.440 --> 00:36:53.160 26, not followed by a really substantial retreat of government, rather than the tepid amounts 359 00:36:53.160 --> 00:36:55.840 observed to date. 360 00:36:55.840 --> 00:37:01.040 Insights by Austrian and public choice scholars on the nature of government, bureaucracy, 361 00:37:01.040 --> 00:37:06.440 special interest groups and so forth can help pave the way to finding answers to these questions. 362 00:37:06.440 --> 00:37:13.960 But one of the special interest groups is academia and its government-funded pro-interventionist 363 00:37:13.960 --> 00:37:20.520 That bias, as demonstrated in the mainstream presidential performance polls, it contributes 364 00:37:20.520 --> 00:37:28.440 to the reluctance of presidents to be decisive in reducing the federal role in our affairs. 365 00:37:28.440 --> 00:37:38.720 In striving to please the academic mandarins evaluating the presidency, modern chief executives 366 00:37:38.720 --> 00:37:43.920 have stimulated the growth of Leviathan and the Nanny State.