The president of the United States guides the federal government, oversees the implementation of laws enacted by Congress, and recommends legislation to Congress. Since 1921, the president has been required to submit an annual budget to Congress suggesting the proper federal expenditures and revenue streams for the fiscal year. The presidency has also come over time to be seen as linked to the national economy, and presidents are often given credit for good economic performance and blamed for poor economic performance.
The U.S. presidency was partly created for the economic purposes of protecting property rights and economic liberty, promoting economic growth, ensuring the payment of Revolutionary War debts, and improving the financial status of the United States government and American business with European governments and banks. As American history progressed and the American economy became more complex and interdependent, Americans developed higher expectations of the U.S. presidency regarding such issues as the development of the West and a national infrastructure for transportation, inflation, bank failures, stock market crashes, unemployment, international trade, unfair business practices, social welfare benefits, consumer protection, monopolies, and agricultural prices. By the late twentieth century, there was often a direct correlation between a president’s public approval rating and the nation’s economic condition.
A literal interpretation of the U.S. Constitution suggests that Congress, not the president, holds most of the federal government’s powers to influence the American economy. In The Federalist (1787-1788), Alexander
A major purpose for writing, ratifying, and implementing the U.S. Constitution, however, was to provide greater order, uniformity, and direction to the American economy from a new national government, including the presidency. Among the Founders, Hamilton was the most skeptical of laissez-faire capitalism and the most favorable toward British-style mercantilism, in which executive-led, government policies would promote, protect, and subsidize a more self-sufficient, interdependent, and stable economy. In explaining and advocating the creation of the presidency in 1787 and 1788, Hamilton argued that the advantages of a powerful chief executive included the president’s ability to provide “singular accountability,” “energy,” and “unity” in leading the nation toward long-term policy goals and vetoing legislation that threatened property rights and individual liberties.
As President George
Differences about the federal government’s proper role in the economy quickly became a major source of ideological, coalitional, and policy differences among presidential and congressional candidates and within the emerging two-party system. The
Jefferson’s presidency also saw the first major use of economic policy as a foreign policy weapon. To assert U.S. neutrality in the wars between Britain and France and to protest the British practice of “impressing” American sailors into service, Jefferson secured enactment of and vigorously enforced the Embargo
More so than Jefferson and Madison, Democratic president Andrew
During the remainder of the nineteenth century, U.S. presidents often assumed leading roles in promoting the population growth and economic development of the West. Government subsidies of
Responding to these economic grievances, especially those of farmers, the Democratic and Populist Parties nominated William Jennings
McKinley was assassinated in 1901, and Theodore
During the United States’ participation in World War I, Democratic president Woodrow
The Great Depression and the implementation of the
The end of the Great Depression and World War II did not initiate a reduction of presidential powers and responsibilities in the U.S. economy. President Harry S.
The effects of high defense spending during the Vietnam War, the 1964 tax cut, and higher domestic spending through new social welfare programs such as Medicaid and Medicare contributed to high inflation, a weaker American dollar, and slower economic growth by the 1970’s. Consequently, President Richard M.
Elected president in 1980, Ronald
The Reagan administration presided over sharp increases in federal deficits and the national debt. Elected president in 1992 partly because of the effects of the 1990-1991 recession, Bill
Campagna, Anthony S. U.S. National Economic Policy, 1917-1985. New York: Praeger, 1987. Useful survey of economic policies from Wilson to Reagan. Light, Paul C. The President’s Agenda: Domestic Policy Choice from Kennedy to Clinton. Baltimore: Johns Hopkins University Press, 1999. Detailed analysis of presidential tactics and strategies in achieving their domestic policy goals, including tax cuts, budget bills, and deficit reduction. McDonald, Forrest. The American Presidency: An Intellectual History. Lawrence: University Press of Kansas, 1994. Excellent study of the origins of the U.S. presidency and Alexander Hamilton’s influence on this office. Rosenberg, Samuel. American Economic Development Since 1945: Growth, Decline, and Rejuvenation. New York: Palgrave, 2003. Broad study of changes in the American economy since 1945; includes an examination of presidential influence. Stein, Herbert. Presidential Economics: The Making of Economic Policy from Roosevelt to Clinton. Washington, D.C.: American Enterprise Institute, 1994. Examines the similarities and differences among presidents from 1933 to 1993 in developing and promoting their economic policies.
First Bank of the United States
Second Bank of the United States
New Deal programs
Sherman Antitrust Act