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How We’re Doing: A Composite Index of Global and National Trends

July 26, 2009

Index #1: Presidential first half-years 

As the Obama administration completes its first six months in office, a team of Brookings scholars is tracking data for various dimensions of national and international well-being. This first “How We’re Doing” Index serves two purposes: it compares the state of the nation and the world with conditions that prevailed at about the same time in the last five presidents, and it establishes a baseline for future indexes. Our starting point is the American Constitution’s mandate that the government “provide for the common defense, promote the general welfare, and secure the blessings of liberty.” Continue reading below chart »

See also:
» GovWatch—tracking the progress and performance of our institutions in economic recovery
» MetroMonitor—a barometer of the health of America’s 100 largest metropolitan economies
» Darrell West discussing how President Obama compares to the prior five presidents

“Common Defense”

Jimmy Carter (1977)

Ronald Reagan (1981)

George HW Bush (1989)

Bill Clinton (1993)

George W. Bush (2001)

Barack Obama (2009)

U.S. defense budget (billions of constant fiscal 2009 dollars) $383 $428 $502 $416 $395 $697
Number of U.S. military personnel stationed abroad 459,000 502,000 510,000 308,000 255,000 476,000
U.S. defense budget as a percentage of GDP 4.8% 5.7% 5.5% 4.2% 2.9% 4.2%
Number of U.S. military combat fatalities 0 0 23 29 3 212
Number of nations that have tested a nuclear weapon 5 5 5 5 7 8
Armed conflicts worldwide 23 30 34 32 28 26
Civilian casualties due to armed conflicts worldwide 64,000 207,000 97,000 103,000 42,000 25,000
World population (in millions) 4,134 4,438 5,108 5,456 6,115 6,747
Share of global population living on less then $1 a day NA 41.4% 29.8% 27.0% 20.3% 16.1%
Greenhouse gas concentrations in atmosphere (CO2 and equivalents; 470 parts per million is considered dangerous) 361 375 392 400 420 439

“General Welfare”

Jimmy Carter (1977)

Ronald Reagan (1981)

George HW Bush (1989)

Bill Clinton (1993)

George W. Bush (2001)

Barack Obama (2009)

Real GDP growth (annualized for first quarter of presidency) 4.9% 8.4% 4.1% 0.5% -0.5% -5.5%
Unemployment rate 7.2% 7.5% 5.3% 7.0% 4.5% 9.5%
Consumer confidence (Conference Board consumer confidence index in June) 98.2 83.0 117.2 58.6 118.9 49.3
Inflation (six-month change in Consumer Price Index, annualized) 7.3% 9.7% 5.7% 2.8% 3.6% 2.7%
Interest rate on 30-year fixed mortgage 8.86% 16.70% 10.20% 7.42% 7.16% 5.42%
Public debt as a percentage of GDP 27.8% 25.8% 40.6% 49.4% 33.0% 54.8%
Oil imports (as a percentage of U.S. oil consumption) 48.0% 46.2% 50.3% 55.9% 70.6% 78.4%
Percentage of large metropolitan areas with employment declines 11% 20% 7% 13% 37% 97%
Percent of large metro areas with house price declines NA 78% 59% 69% 1% 61%
Federal Reserve balance sheet as a percentage of GDP 7.04% 5.69% 5.69% 6.20% 6.29% 14.51%
Personal savings rate 8.0% 9.8% 7.9% 5.7% 1.9% 4.3%
Life expectancy for people born in year of election 72.6 73.7 74.9 75.8 77.0 77.8 (est.)
Percentage of non-elderly Americans lacking health insurance in year of election 14.1% 12.0% 15.6% 16.8% 16.8% 16.6%

“Blessings of Liberty”

Jimmy Carter (1977)

Ronald Reagan (1981)

George HW Bush (1989)

Bill Clinton (1993)

George W. Bush (2001)

Barack Obama (2009)

Approval rating of the president, as of July 15 62% 60% 49% 45% 57% 60%
Approval rating of Congress, as of July 15 34% 38% 28% 24% 49% 33%
“Satisfied with the way things are,” as of July 15 NA 33% 44% 24% 51% 31%
Satisfaction improvement over six months NA +16% -1% -5% -5% +14%
Approval rating of the president by independent voters, as of July 15 59% 60% 48% 41% 52% 54%
Gap between Republican and Democratic presidential approval ratings 30 44 50 58 59 65


See data sources »

In dealing with a complex world, Obama inherited—but now owns—wars in Iraq and Afghanistan. During his first six months, the U.S. has suffered more combat casualties than his five predecessors at the outset of their terms. The armed services also have grown considerably in cost, eating into the post-Cold War “peace dividend.” Still, there is no rival superpower; none of the major nations are at war or on the brink of war with each other; and the world as a whole is afflicted by fewer armed conflicts than in the recent past, with fewer civilian casualties.

However, the nuclear nonproliferation regime—anchored by the 1968 Non-Proliferation Treaty—is weakening. India, Pakistan, and North Korea have tested the Bomb; Israel is presumed to have it as well; Iran’s ambitions are one of the world’s worst kept—and most dangerous—secrets; and other countries, including U.S. allies, are reconsidering their non-nuclear status. On top of all that, “loose nukes” could end up in the hands of non-state actors like al-Qaeda.

Peace and security depends not just on common defense but on the political and economic stability of individual countries. Conversely, abject poverty is a security challenge as well as a humanitarian one. There has been progress on that front. Despite steady growth in the world’s population, the number and percentage of desperately poor people have declined dramatically, especially in China and India. Yet the economic crisis jeopardizes that favorable trend.

Then there is the ultimate mega-threat of climate change: the concentration of greenhouse gases is creeping upward toward a level that scientists believe will cause the increase in the mean temperature of the planet to trigger a perfect storm of irreversible and catastrophic consequences unless somehow checked or countered.

America’s ability to lead in addressing this daunting global agenda depends on a strong U.S. economy. Like Obama, earlier presidents were handicapped in that regard at the outset of their terms: Jimmy Carter, Ronald Reagan and Bill Clinton faced high unemployment; Carter, Reagan and Bush41 were confronted with high inflation and interest rates; Clinton had to cope with anemic growth and a staggering debt burden; Bush43 took office amidst a recession brought on by the bursting of the dot-com bubble.

Barack Obama can take comfort from low inflation, and low interest rates. Still, his task is unprecedented. The fall-off in productive output, spending, and employment is the worst – by far – since the Depression. Most experts believe the unemployment rate will continue to rise for the rest 2009. Unlike previous recent downturns, virtually no region of the U.S. has avoided job losses. Nearly all American homeowners have experienced significant declines in the value of their homes. Public debt as a percentage of GDP has now exceeded even Reagan-era levels, thanks to recent years of high debt and the massive spending of the stimulus package. The prospect of future deficits looms large, as does the cost of the Federal Reserve’s “pump-priming” which has put nearly three times as much cash into the economy as at any point in the last four decades. Paradoxically, excessive borrowing and spending caused the crisis, but that crisis has led Americans to start saving. Policymakers now believe that the best way out of the crisis is for citizens to borrow and spend again.

Confronted with such ironies, dilemmas, and stresses, how does the public feel its government is doing? Remarkably, so far, so good. Obama’s first six-month job approval numbers are impressive. But he should note that several of predecessors also got the benefit of the doubt—for a while. Moreover, the country remains deeply polarized, and public confidence in Congress—Obama’s same-party partner in governing—is at an all time low. Republican opponents and Democratic skeptics can be counted on to jump on evidence, real or perceived, of government waste, fraud, abuse and stupidity – from banker bonuses to pork-barrel stimulus projects to error-filled tax returns by administration nominees.

The President’s initial accomplishment has been to reestablish public trust and optimism in the U.S. For the first time in six years, there is positive turnaround in the percentage of Americans who think the country is headed in the right direction. That line-item in the Index—the most subjective but among the most important—marks a turnaround that is nearly as high as what Ronald Reagan was able to effect in his first half-year. Obama’s ability to sustain that optimism and trust will depend on his ability to nudge the more objective indicators in the right direction.

The index premiered in the Washington Post‘s Sunday Opinion page.


Sources:

U.S Department of Defense, “National Defense Budget Estimates for FY 2009”, updated September 2009.
http://www.defenselink.mil/comptroller/defbudget/fy2009/FY09Greenbook/greenbook_2009_updated.pdf

Office of Management and Budget, “A New Era of Responsibility: Renewing America’s Promise”, (U.S. Government Printing Office, 2009) http://www.whitehouse.gov/omb/assets/fy2010_new_era/a_new_era_of_responsibility2.pdf

Iraq Coalition Casualty Count
http://icasualties.org

U.S. Department of Defense Personnel and Procurement Statistics
http://siadapp.dmdc.osd.mil/personnel/MILITARY/Miltop.htm

Center for International Development and Conflict Management, “Peace and Conflict 2008”, J. Joseph Hewitt, Jonathan Wilkenfield, and Ted Robert Gerr, authors. http://www.cidcm.umd.edu/pc/chapter03/graphs/figure_3_1.asp

Centre for the Study of Civil War, “Battle Deaths Dataset 2.0”
http://www.prio.no/CSCW/Datasets/Armed-Conflict/Battle-Deaths/The-Battle-Deaths-Dataset-version-20/

Center for Systemic Peace, “Global Conflict Trends, Updated 2009”
http://www.systemicpeace.org/conflict.htm

Population Division of the Department of Economic and Social Affairs of the United Nations Secretariat, “World Population Prospects: The 2008 Revision”
http://esa.un.org/unpp

Shaohua Chen and Martin Ravallion, World Bank Policy Research Working Paper 4703, August 2008

European Environment Agency, “Core Set of Indicators: CO2 concentrations”
http://themes.eea.europa.eu/IMS/Overviews/csi_datasets_overview_public

Intergovernmental Panel on Climate Change, “Climate Change 2007: Synthesis Report”
http://www.ipcc.ch/pdf/assessment-report/ar4/syr/ar4_syr_spm.pdf

Bureau of Economic Analysis, NIPA Table 1.1.1, July 2009
http://bea.gov/national/nipaweb/TableView.asp?SelectedTable=1&FirstYear=2007&LastYear=2008&Freq=Qtr

Bureau of Labor Statistics, Current Population Survey Unemployment Data, July 2009
http://www.bls.gov/cps/

Conference Board Consumer Confidence Index
http://www.conference-board.org/economics/consumerConfidence.cfm

Bureau of Labor Statistics, Consumer Price Index, All Urban Consumers, Seasonally Adjusted
http://www.bls.gov/cpi/

Freddie Mac, Primary Mortgage Market Survey, “Monthly Average Commitment Rate and Points on 30-year Fixed Rate Mortgages since 1971”
http://www.freddiemac.com/pmms/pmms30.htm

Congressional Budget Office, “A Preliminary Analysis of the President’s Budget and an Update of CBO’s Budget and Economic Outlook” March 2009
http://www.cbo.gov/ftpdocs/100xx/doc10014/03-20-PresidentBudget.pdf

Council of Economic Advisors, “Economic Report of the President: A Report to Congress, January 2009”
http://www.gpoaccess.gov/eop/2009/2009_erp.pdf

Bureau of Economic Analysis, NIPA Table 1.1.5
http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=5&Freq=Qtr&FirstYear=2007&LastYear=2009

Bureau of Economic Analysis, NIPA Table 2.1
http://www.bea.gov/national/nipaweb/TableView.asp?SelectedTable=58&Freq=Qtr&FirstYear=2007&LastYear=2009

The Federal Reserve. “Factors Affecting Bank Reserves and Condition Statement of F.R. Banks.” H.4.1
http://fraser.stlouisfed.org/statreleases/h41/

Moody’s Analytics Economy.com
http://www.economy.com/home/products/data_services.asp?src=economy_im_interested_in_data

Energy Information Administration Database
http://www.eia.doe.gov/overview_hd.html

U.S. Census Bureau, Statistical Abstract of the United States: 2009, Table 100. (128th Edition) Washington, DC, 2008.

Centers for Disease Control’s National Center for Health Statistics. “Trends in Health Care Coverage and Insurance from 1959-2007.”

The Gallup Poll: Presidential and Congressional Approval Ratings
http://www.gallup.com/tag/Presidential+Job+Approval.aspx

 

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