The Economy as a Campaign Tool

Posted: September 8, 2018 in Uncategorized

First, I am an outright socialist. Completely.  But I don’t think the data I present here is  biased towards the liberal government. What I talk about afterwards is definitely socialist, but the data is the data.

All of my life it has been tossed around that conservative governments are better for the economy than liberal governments.  The Conservative Party definitely focuses on less spending on social services, and other initiatives like environmental protections. Less spending sounds like more saving, so there is a narrative that fits.  But I have never actually investigated if this is true. Is there data that supports the claims?

First, I had to go and find out what are the markers that economists and governments use to measure the strength of an economy. This is a pretty easy to read summary of some of the indicators. Trust me, some were decidedly NOT easy to read.

https://www.moneycrashers.com/leading-lagging-economic-indicators/

Then I went off in search of data, keeping in mind that my understanding of the historical world economy and outside factors that would have impacted the Canadian economy is almost nil.  This is just a very basic exploration to see if there is any kind of visual correlation between government and economic indicators.

First I looked for historical economic data that stretched back as far as I could find in one source.  I decided that trying to piece together information from different sources would surely result in error.  I searched for 3 common indicators that I’ve heard used regularly as by politicians, governments and the media; retail sales, full time employment rate and GDP (Gross Domestic Product). Below I present graphs from tradingeconomics.com that I chose to present here because they are simple and easy to annotate with election results.

Then I looked up which party was in power over the period I could find data for and marked the election results along the bottom to indicate the government in power – red is for the Liberal Party, Blue is for the Progressive Conservative Party.

Historical Retail Sales

Full Time Employment Rate

Historical GDP

Now, I’m no economist, but I see absolutely no consistent pattern.  The worst that things got was around 2008 during the global financial crisis, but I suspect that had more to do with global events than anything an individual government was doing.  Each party has, at some point, claimed they inherited a mess, or offer external reasons for why things are not going so well during their term.  I expect external reasons, or at least bigger reasons than what one government is doing is a big factor in how the overall economy is going.

Make of these findings what you will.  You can argue that my exploration is too simplistic or that the effects of good government on the economy lag or are not measured by these indicators.  You could be right.  I read a lot about leading and lagging indicators and it really sounds like there is a considerable time lag between events and outcomes.

My point simply is, when you’re deciding on which political party to choose, don’t simply listen to what the people with a vested interest in convincing you have to say.  Look for the data. Use many sources of information to make your decisions. I present these graphs from one source, but I did look at several sources of information just to double check that they showed similar results.

Looking for evidence and data is particularly important when you may forgo consideration of other issues (e.g. gay marriage, funding services) based on a possibly inaccurate belief one party will be better for the economy.

The economy is important.  Jobs are important.  People need to survive, and more than that they need to have security.  People also need equality.  Access to health care. Quality education. We tend to sacrifice some needs for others but I’m not convinced we need to.

If you actually believe that we shouldn’t allow gay marriage or that we shouldn’t fund services for the poor, well you will vote based on that and you can take your cold, dead heart and leave my blog page thankyouverymuch.  But if you actually support these issues, but let them go because you believe the government you vote in will be better for  the economy, then please double check that your belief is supported by evidence.

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