Presidential rhetoric and economic leadership.

Wood, B. Dan

The two most important areas of leadership for any president are the economy and foreign policy. Presidential leadership in these two areas is mutually dependent, because foreign policy actions can affect U.S. macroeconomic performance (Wood and Durham 2004). However, this study focuses on direct efforts by the president to provide economic leadership through the use of rhetoric.

Of course, the president has various tools of economic leadership. He can propose legislation that alters taxing or spending, thereby stimulating economic growth. The president can attempt to affect the cost of producer-consumer exchanges by changing regulatory policy. The president can also potentially affect interest rates and the money in consumers' pockets through nominations to the Federal Reserve Board. Yet, all of these tools are constrained by the need for cooperation from other political institutions. Additionally, there can be substantial lags in implementing these tools due to the fragmented nature of the American political system.

In contrast, rhetorical leadership is a tool that the president can apply unilaterally without substantial impediment and delay. The president needs no permission from Congress or the bureaucracy to be a cheerleader for the economy or to tout ongoing programs. The president is an authoritative source of information about the current and future state of the economy with near continuous access to the media and public. As such, presidential rhetoric is a cue for businesses and consumers making decisions on investment and spending. While the president may be tangential to these decisions, the president's economic rhetoric affects the tone under which consumers and businesses make decisions (Wood, Owens, and Durham 2004).

Presidents have strong incentives to use economic rhetoric in their public appearances. Since the Great Depression there has been an expectation that the national government is responsible for the economy. The Employment Act of 1946 institutionalized an activist role for the president, formally charging the chief executive with promoting "maximum employment, production, and purchasing power" (Public Law 79-304). From this point forward, presidents were required to make an annual economic report to Congress detailing the current and future state of the economy, as well as the administration's plans and recommendations for promoting these goals. The mandate for the president to promote a sound economy was reinforced in 1978 through the Humphrey-Hawkins Act, which required the president to establish targets for inflation and unemployment. (1) Presidents usually find it valuable to publicize their efforts on the economy to give a perception of fulfilling these legal mandates.

Additionally, presidents attend to the economy in their public remarks to appear in charge of an issue critical to presidential power and success. Americans hold the president accountable for U.S. economic performance. There are numerous studies showing that macroeconomic performance is a strong determinant of the president's job approval rating (e.g., see Mueller 1970; Monroe 1978; MacKuen 1983; MacKuen, Erikson, and Stimson 1992; Ostrom and Smith 1993; Clark and Stewart 1994; Edwards, Mitchell, and Welch 1995; Wood 2000). Most political actors believe strongly that presidential approval is important to presidential success in Congress and credibility in other areas such as foreign policy (e.g., see Edwards 2003, chapter 1). Therefore, presidents wanting to maintain public approval need to appear to be leading the economy.

U.S. economic performance also affects the electoral success of the president and the president's party. There are numerous studies showing that the electoral success of the president and president's party depends on U.S. economic performance through time (e.g., see Fair 1978; Fiorina 1981; Rosenstone 1983; Kiewiet and Rivers 1985; Markus 1988; Erikson 1989; Erikson, Bafumi, and Wilson 2001). Indeed, virtually all forecasting models for presidential elections include variables that measure economic performance (e.g., see Lewis-Beck and Rice 1992, Table 6.1; see also the March 2001 special forecasting issue of PS: Political Science and Politics). In every presidential election since 1960 when the unemployment rate was declining, the incumbent or incumbent's party won the presidential election, but when the unemployment rate was stable or increasing the incumbent or incumbent's party lost the presidential election. There is also evidence that congressional elections depend on macroeconomic performance (Lewis-Beck and Rice 1992). Therefore, presidents who value electoral success want to give the public perception of leading the economy.

As a result of these various incentives, modern presidents speak regularly about the economy in their public appearances. However, political scientists know little about variations in this behavior. What determines how often presidents talk about the economy? When do presidents talk about the economy? Are there variations across presidencies in propensity to talk about the economy? Economic leadership implies presidential rhetoric that is independent of economic conditions and election year posturing. Presidents should speak often and optimistically about the economy to help establish a favorable tone for economic activities. Which presidents have spoken more often and more optimistically about the economy after controlling for economic conditions and election year effects? This study addresses these questions with empirical data.

Data

To have a systematic understanding of the president's rhetorical leadership of the economy we need a systematic source of data. Accordingly, I developed measures of the frequency and tone of presidential remarks on the economy extending from Presidents Truman through George W. Bush.

In developing these measures, an electronic file was created containing the entire Public Papers of the Presidents from 1945 to 2002. (2) The Public Papers is a comprehensive record of all public remarks by the president for every day of each presidential administration. Using this electronic file, I then applied PERL (Practical Extraction and Report Language) to extract from the Public Papers every unique sentence spoken or written publicly by the president containing key words relevant to the president's economic rhetoric)

Specifically, I created a file containing all sentences in which the president used the phrases "the economy" or "our economy" for a general measure of economic rhetoric. I also created files to capture more specific dimensions of the president's economic rhetoric including talk about unemployment, inflation, and the federal deficit. For unemployment, I extracted every sentence in which the president used the word "unemployment." For inflation, I extracted every sentence in which the president used the word "inflation." For the federal deficit, I extracted every sentence in which the president used the word "deficit." (4) These sentence files required considerable cleaning, because references to the key concepts were sometimes off topic. For example, the president sometimes spoke about "the economy" of Latin America or other unrelated topics. Similarly, references to unemployment, inflation, and the defcit sometimes referred to other concepts or arenas. Using human coders, I identified all instances in which presidential rhetoric was off topic and excluded these sentences from the measures. After cleaning, I had files containing only valid references to the key dimensions of the president's economic rhetoric.

Next, I used PERL to list every unique word in the sentence files for the purpose of creating a dictionary of optimistic and pessimistic words when the president spoke about the economy. The words were first sorted by frequency of use. Then, human coders were used to identify the positive and negative words. Specifically, the human coders assessed each word intuitively, and then evaluated the proportion of correct "hits" from the previous sentence files when using the identified words. Every unique word was evaluated in constructing the dictionary, and every unique word was validated using both machine and human analysis. Based on the frequency of hits, I concluded that the resulting dictionary had very high reliability and validity. However, it was still not perfect in evaluating the tone of presidential remarks.

Having developed dictionaries of optimistic and pessimistic words, I used PERL again to extract every optimistic and pessimistic sentence from Public Papers of the Presidents pertaining to the economy, unemployment, inflation, and the federal deficit. Some error remained even after validating the dictionary as discussed above. Therefore, human coders were again used to read each sentence to verify that presidential optimism and pessimism were accurately coded. Based on this repetitive combination of machine and human coding, I obtained near perfect validity in defining the tone of presidential remarks on the economy.

Finally, I aggregated the counts of sentences spoken by the president on the economy into monthly intervals from May 1945 through April 2002. The resulting eight time series consist of 681 monthly observations on the frequency and tone of presidential remarks on the general economy, unemployment, inflation, and the federal deficit. These data were used for the following analyses.

When Do Presidents Talk about the Economy?

Presidential rhetoric as a tool of economic leadership should be both responsive to economic conditions and proactive. Presidents should talk regularly about economic issues to provide a sense of concern about the economy. Presidential leadership of the economy should entail more than election year rhetoric attempting to woo voters or forced by the electoral competition. Additionally, presidential leadership requires active promotion of plans for the economy, especially when there are problems to be addressed.

We can gain an initial sense of how presidential attention to the economy has varied through time by graphing the measures discussed above. Figure 1 contains the time series of the frequency of presidential remarks on the economy generally, as well remarks on unemployment, inflation, and the federal deficit. The vertical scale of Figure 1 measures the count of the number of sentences the president spoke on each of these dimensions during each month. The scales of the four graphs in Figure 1 are different, to capture the peaks in presidential attention. However, the four series are numerically comparable with the average monthly number of presidential sentences on the economy, unemployment, inflation, and the federal deficit at 15.31, 13.60, 21.68, and 15.08, respectively.

Visual examination of the graphs in Figure 1 suggests some interesting variations through time. In particular, the general economy graph shows sharp increases in presidential rhetoric corresponding roughly with the Ford and Clinton administrations. The unemployment and inflation graphs suggest an increase in presidential rhetoric associated with problems corresponding with the period of stagflation of the 1970s and 1980s. And presidential talk about budget deficits initially accelerated beginning in the 1970s with the start of large budget deficits, but increased sharply during the Clinton administration.

We can better understand how the frequency of economic rhetoric has varied across presidencies by calculating averages for the data in Figure 1. Table 1 reports the average number of sentences spoken monthly by each president on the economy, unemployment, inflation, and the federal deficit. With some deviations, the results show a clear pattern of increasing presidential use of economic rhetoric through time for three of the four measures. However, the pattern for inflation suggests that the intensity of presidential rhetoric followed the changing severity of the problem. There does not appear to be any partisan bias to presidential talk about the general economy, inflation, and the federal deficit. Both Democratic and Republican presidents spoke often about these issues. However, the presidential averages for unemployment suggest that after accounting for trends and the outlier Ford administration, Democrats were more likely to talk about unemployment than Republicans.

Does presidential rhetoric on the economy change in response to changing economic and political conditions? Do presidents really differ in the frequency of their remarks on the economy after controlling for economic and political conditions? If so, which presidents placed greater emphasis on the various dimensions of U.S. economic performance? To explore these questions, I ran multiple regressions of each dimension of the president's economic rhetoric on lagged measures of economic growth, unemployment, inflation, the federal deficit, a dummy variable for election years, and dummy variables for each presidency. (5)

Economic growth was measured as the quarterly percent change in real gross domestic product (GDP) as reported by the Bureau of Economic Analysis. (6) Unemployment was taken as the monthly change in the civilian unemployment rate as reported by the Bureau of Labor statistics. Inflation was measured as the annualized percent change in the consumer price index for urban consumers as reported by the Bureau of Labor Statistics. The federal deficit was measured as the quarterly federal deficit as a proportion of GDP as reported by the Bureau of Economic Analysis] Each of these variables was lagged one month to give presidential rhetoric time to adapt to changing conditions.

The election year dummy variable was coded one for the first 10 months of each presidential election year. We should expect presidents to talk more about the economy during presidential election years. As discussed above, the electoral fortunes of the president and his party depend on macroeconomic performance. Furthermore, the competition during election years is likely to challenge the president on his economic leadership, spurring more public remarks during this period. As presidents attempt to woo economic voters and stave off political opponents, we should see increased presidential rhetoric on the economy.

The presidency dummy variables were coded one for months of each presidency and zero for all other months. In testing for statistical differences in the intensity of presidential rhetoric across presidencies, the omitted dummy variable category was assigned to the median president. This enables a statistical test for whether each included president differed in the frequency of his remarks from the median president. Note that the median president for the four measures was different across measures. Kennedy was the median president in frequency of attention to the general economy and federal deficit. Johnson was the median president in frequency of attention to unemployment. Truman was the median president in frequency of attention to inflation.

Table 2 reports coefficients from the regression analyses. The numbers in parentheses are t statistics calculated using Newey-West (1987) robust standard errors.

Consider first whether the frequency of presidential remarks responds to actual economic conditions. Our expectations for presidential responsiveness to economic conditions are ambiguous. On the one hand, when economic conditions are good, presidents should "crow" more often about the soundness of their economic policies. On the other hand, when economic conditions are bad, presidents may want to register concern and talk about what the administration is doing to address economic problems. As a result of these ambiguous expectations, it is unclear how the frequency of presidential remarks should respond to changing economic conditions.

These ambiguities are partially confirmed by the results near the bottom of Table 2. In the first column of Table 2, the analysis of rhetoric about the general economy contains all four measures of U.S. economic performance. However, none of the effects is statistically significant, suggesting that the frequency of presidential remarks on the general economy is not driven by U.S. macroeconomic performance. Presidents talk steadily about the economy when conditions are both good and bad.

In the second column, the analysis for unemployment shows that the frequency of presidential remarks is also not driven by actual unemployment. The coefficient for changing unemployment is negative and statistically insignificant. Thus, low unemployment results in presidential remarks about as readily as does high unemployment.

In contrast, the third column reveals a statistically significant response in the frequency of presidential remarks on inflation as a function of higher prices. Each 1 percent increase in the inflation rate produces roughly two additional presidential remarks per month about inflation. Thus, presidents talk more about inflation when the inflation rate is high, and remain relatively quiet when the inflation rate is low.

Finally, in the fourth column, each 1 percent increase in the federal deficit as a proportion of GDP produces a statistically significant increase of five additional presidential remarks per month. Thus, presidents register more concern about the federal deficit when the deficit is high, but do not talk as much about this issue when the deficit is low.

Now consider the election year effects near the bottom of Table 2. The results show that presidents consistently spoke more often about the various dimensions of the economy during election years. They spoke an average of about six additional sentences per month on the general economy during election years. Presidents spoke about six additional sentences per month on unemployment, 10 additional sentences per month on inflation, and three additional sentences per month on the federal deficit. These are large effects relative to the averages reported in Table 1, suggesting that significant changes in presidential remarks on the economy occur as a result of election year incentives.

Controlling for actual economic conditions and election year effects, do presidents differ significantly in the frequency of their remarks on the economy, unemployment, inflation, and the federal deficit? The dummy variables for each presidency in Table 2 enable a test for whether each president differs significantly from the median president.

Concerning remarks about the general economy, the first column shows that Presidents Truman, Eisenhower, Johnson, and Nixon referred to the economy significantly less often than the median president, Kennedy. Presidents Ford, Carter, Reagan, and George H. W. Bush were statistically indistinguishable from the median president. Only Presidents Clinton and George W. Bush placed significantly greater emphasis on the general economy than the median president. (8) Indeed, President Clinton spoke around 23 more sentences per month on the general economy than the median president. This evidence shows that after controlling for actual economic conditions, any trend toward increasing rhetorical leadership of the economy through time is dominated by recent presidents. Indeed, we could easily argue that these results show that President Clinton took his leadership mantra "It's the economy, stupid!" very seriously. We shall return to a discussion of President Clinton's rhetoric on the economy in a subsequent section.

Concerning presidential remarks on unemployment, the second column of Table 2 shows that Presidents Truman and Eisenhower paid significantly less attention to this issue than the median president, Johnson. Presidents Nixon, Reagan, and George H. W. Bush were statistically indistinguishable from the median president in their frequency of remarks on unemployment. And, Presidents Kennedy, Ford, Carter, and Clinton spoke significantly more often about unemployment than the median president. These results again suggest a partisan bias in presidential attention to unemployment. After controlling for election year effects and levels of unemployment, Democrats placed significantly greater emphasis on unemployment than did Republicans.

On the issue of inflation the third column of Table 2 shows that, after controlling for inflation and election year effects, only President George H. W. Bush fell significantly below the median president, Truman, in the frequency of his public remarks on inflation. Presidents Eisenhower, Kennedy, Johnson, and George W. Bush were statistically indistinguishable from the median president. And Presidents Nixon, Ford, Carter, Reagan, and Clinton were significantly above the median president in the frequency of their remarks on inflation. Of course, inflation was not a serious problem during those presidencies falling at or below the median presidency. In contrast, inflation was a very serious problem during four of the five presidencies giving significantly more attention to inflation. Indeed, Presidents Ford, Carter, and Reagan spoke substantially more about inflation than any other president. The high frequency of their remarks suggests that presidents adapt their rhetorical leadership to prevailing issues of great concern to voters and the economy.

Concerning presidential rhetoric on the federal deficit, the fourth column of Table 2 shows that Presidents Eisenhower, Johnson, Nixon, Ford, and George W. Bush spoke significantly less often about the federal deficit than the median president, Kennedy. Presidents Carter, Reagan, and George H. W. Bush were statistically indistinguishable from the median president. Yet, it was during the Reagan and second Bush administrations that the federal deficit grew so large. After controlling for the size of the federal deficit and election year effects, President Clinton was the only chief executive to fall statistically above the median president. President Clinton spoke an average 35 more sentences per month on the federal deficit than the median president. Of course, eliminating the federal deficit was a major policy focus of the Clinton administration, and once this was accomplished in 1997 the president frequently touted the success of his efforts. Overall, these results suggest strong rhetorical leadership on the federal deficit by President Clinton, and relative disregard for the problem by earlier presidents. In summary, the results in Table 2 show that presidents consistently talk more about economic issues during election years. The intensity of presidential rhetoric does not respond consistently to changing economic performance. There is some evidence that presidential rhetoric responds to changing inflation and the deficit, but not to economic growth or unemployment. On unemployment, there is a partisan difference across presidencies in rhetorical emphasis. Controlling for actual levels of unemployment, Democratic presidents speak more often than Republicans about unemployment. Concerning inflation, Presidents Ford, Carter, and Reagan spoke far more often about inflation than other presidents. Inflation was particularly serious during their presidencies, suggesting that presidential rhetoric adapts to serious problems. Concerning the deficit, President Clinton was the only president to place great rhetorical emphasis on the deficit. More generally, the economy, jobs, and the federal deficit were overriding policy foci of the Clinton administration, which spoke more frequently on all economic issues than any other presidency.

How Do Presidents Talk about the Economy?

The preceding analyses tell us when presidents talk about the economy, but provide no evidence concerning what presidents say when they talk about the economy. Rhetorical leadership requires that presidential remarks contribute toward a positive tone for the economy. The president's rhetoric should inspire confidence in businesses and consumers. The relative optimism of presidential remarks should be positive regardless of economic conditions. Furthermore, presidential optimism on the economy should be consistent throughout an administration, and not just a function of election year campaigning.

In evaluating how presidents talk about the economy, I coded the same data used in the analysis above for the relative positive, neutral, or negative tone of each presidential remark. The specific technology for coding was discussed above. To measure the relative optimism of presidential remarks I took the difference between the number of positive and negative remarks by the president for each month of the time series. Figure 2 reports measures that capture the changing tone of presidential remarks on the economy, unemployment, inflation, and the deficit.

Again, visual examination of the graphs shows some interesting variations. Following the 1982 recession, President Reagan appeared more optimistic about the general economy than earlier presidents. However, President Clinton was far more optimistic than any other president about the general economy. Concerning unemployment, we see considerable pessimism during the Ford and early Reagan administration recessions, but substantial optimism following each recession. We also observe greater optimism about unemployment during the entire Clinton administration. On inflation, there was a substantial dip in presidential optimism following the Arab oil embargo of 1973-1974, but afterward presidents were generally optimistic in their public remarks through the period of high inflation of the 1970s and early 80s. On the federal deficit, there was pessimism during the Kennedy, Ford, and Reagan administrations, but very significant optimism during the first Clinton administration.

We can provide a sense of how the tone of economic rhetoric has varied across presidencies by calculating averages for the data in Figure 2. Table 3 reports the average optimism of monthly remarks by each president on the economy, unemployment, inflation, and the federal deficit. The results in the first column show that presidents from Truman through Carter were mainly neutral or negative in the average tone of their public remarks on the general economy. Presidents Reagan and George H. W. Bush were somewhat positive in their public remarks on the economy. However, President Clinton was extremely positive on the economy, using an average of 14 more positive than negative sentences per month. President George W. Bush was significantly negative in his remarks on the economy. (9)

[FIGURE 2 OMITTED]

The averages for unemployment in the second column of Table 3 show that only Presidents Johnson, Carter, and Clinton were significantly optimistic in their public remarks about unemployment. Again, President Clinton's relative optimism was much larger than for any other president. As above, these results suggest a partisan bias for unemployment, with Democrats far more optimistic about unemployment than Republicans.

The averages for inflation in the third column of Table 3 show that only Presidents Nixon, Carter, and Clinton expressed significantly greater optimism on inflation. Note that even though the analysis in Table 2 shows that Presidents Ford and Reagan also talked a lot about inflation, the average tone of their public remarks was not significantly positive. President Carter was far more optimistic about inflation than any other president, averaging around eight more positive than negative comments per month. The averages for the federal deficit show that presidents from Truman through Reagan were negative on the deficit, with Presidents Kennedy and Ford significantly negative. Only Presidents George H. W. Bush and Clinton expressed significant optimism about the federal deficit. Of course, it was during these administrations that efforts began to address the growing deficit problem. President Clinton was significantly more optimistic on the deficit than any other president.

While interesting, the descriptive results in Table 3 do not control for election year effects or actual economic conditions during each presidency. If the president is truly exercising rhetorical leadership of the economy, then we should expect presidential remarks to be significantly optimistic regardless of prevailing economic or political conditions. Positive economic remarks may just be due to election year efforts by presidents to woo voters and stave off challengers. Positive economic remarks may also simply mirror the current state of the economy such that presidential assessments are no more optimistic than conditions warrant. To control for these conditions, I performed multiple regressions on the variables used in the previous analyses with the monthly tone of presidential rhetoric on each economic dimension as dependent variables. Because our primary interest is in assessing presidential optimism directly after controlling for these effects, I suppress the regression intercept and report the average levels of optimism for each president. (10) Table 4 contains the statistical results.

First, consider how economic conditions affect the relative optimism of presidential remarks. In the first column, the analysis of presidential remarks on the general economy includes all four economic variables. Presidential optimism on the general economy is unresponsive to changing economic growth and unemployment. However, presidential optimism changes significantly in response to inflation and the federal deficit. Each 1 percent increase in the rate of inflation reduces presidential optimism on the general economy by about half a sentence per month. Each 1 percent reduction in the federal deficit as a proportion of GDP results in about half a sentence more optimistic presidential remarks per month. While statistically significant, these are obviously not large effects.

In the second column, the analysis for presidential remarks on unemployment shows that rhetoric becomes significantly less optimistic as the unemployment rate increases. Each 1 percent increase in the unemployment rate produces an average 6.6 sentences fewer optimistic versus pessimistic remarks per month. In the third column, the analysis for inflation shows that the relative optimism of presidential remarks does not change with the rate of inflation. Finally, the analysis in the fourth column shows that presidential remarks on the federal deficit grow significantly less optimistic as the federal deficit grows large.

Now consider the election year effects near the bottom of Table 4. The first two columns show that during election years, presidents are significantly more optimistic about the general economy and unemployment than during other years. They make roughly two more positive than negative remarks per month on the general economy and three more positive than negative remarks per month on unemployment during election years. The third column shows that the tone of presidential remarks on inflation during election years is unaffected by the level of inflation. And, the fourth column shows that presidential rhetoric on the deficit is significantly less positive during election years, suggesting that large federal deficits might be a recurrent campaign theme.

Controlling for actual economic conditions and these election year effects, which presidents contributed more toward a positive tone for the economy through their public remarks? The analysis in Table 4 shows that Presidents Truman and Eisenhower were not significantly optimistic on any dimension of U.S. economic performance. President Johnson was optimistic on unemployment, but not on the general economy, inflation, or the deficit. President Kennedy was pessimistic in his public remarks about the general economy, unemployment, and the federal deficit, and neutral on the issue of inflation. Thus, the early presidents in our sample did not exercise rhetorical leadership of the economy in their public remarks.

Controlling for actual economic performance and election year effects, presidents from Nixon through Clinton became progressively more optimistic in their public remarks about the general economy. Each of these presidents "talked up" the economy more than had their predecessors. Our earlier analysis showed that President Clinton talked most frequently about the economy, and the analysis here also shows that he also talked most optimistically.

Concerning presidential remarks on unemployment, the results in the second column of Table 4 again show a partisan bias beginning with the Johnson administration. Regardless of actual levels of unemployment, Democratic Presidents Johnson, Carter, and Clinton showed significant optimism about U.S. unemployment. In contrast, Presidents Nixon, Ford, Reagan, George H. W. Bush, and George W. Bush were neutral in their remarks on unemployment. Our earlier analysis showed that Democratic presidents consistently spoke more frequently about unemployment, and the analysis here shows that Democratic presidents also consistently spoke more optimistically about unemployment. Again, optimism on unemployment was significantly higher during the Clinton administration, with an average 13 net positive remarks per month.

On inflation, the third column of Table 4 shows that after controlling for actual economic performance and election year effects, seven of the 11 presidents were statistically neutral in the relative optimism of their public remarks on inflation. However, Presidents Nixon, Carter, George H. W. Bush, and Clinton were significantly optimistic. The earlier analysis showed that President George H. W. Bush spoke less often about inflation than other presidents, but the analysis here shows that his limited public remarks tended to be optimistic. President Clinton spoke more often about inflation than eight of the 11 presidents, and the analysis here shows that his remarks also tended to be optimistic. The earlier analysis showed that Presidents Nixon, Ford, Carter, and Reagan all spoke more frequently about inflation during the high-inflation era of the 1970s and 1980s. However, Table 4 shows that remarks by Presidents Ford and Reagan were generally neutral. In contrast, President Nixon made an average of seven remarks per month on inflation, with a net of 3.4 more positive than negative remarks. Remarkably, President Carter made an average 52 remarks per month about inflation, with a net of eight more positive than negative sentences per month. Thus, the analysis in Table 4 suggests that President Carter exercised significantly more positive rhetorical leadership on inflation than other presidents.

Finally, consider the results for presidential rhetoric on the deficit reported in the fourth column of Table 4. Controlling for election year effects and the actual deficit, the results show that all presidents except Clinton were either neutral or pessimistic in their public remarks about the federal deficit. The earlier analysis showed that President Clinton made an average of 35 public remarks on the deficit during each month of his presidency. The analysis here shows that substantially more of those public remarks were positive than negative. The combined evidence from Tables 2 and 4 suggests President Clinton was the only president in our sample to exhibit strong rhetorical leadership on the federal deficit.

In summary, the results in Table 4 show that presidents have been increasingly optimistic in their public remarks about the economy through time. This may suggest that presidents have increasingly recognized the importance of economic leadership to presidential success. Or it may reflect the evolution of presidential institutions for dealing with the economy. However, when considering the relative optimism of presidential remarks on specific dimensions of U.S. economic performance, there are systematic differences across presidencies. When talking about unemployment, Democratic presidents have consistently been more optimistic in their public remarks than Republicans. When talking about inflation and the deficit, there has been no partisan bias, but some presidents clearly exercised greater rhetorical leadership than others.

Three Cases of Rhetorical Leadership of the Economy

I have used quantitative evidence to show when and how presidents from Harry S. Truman to George W. Bush talked about the economy. In this section, I provide specific details on what some presidents said during economic crises. During a crisis, rhetorical leadership becomes especially important as economic decision makers look to the chief executive for guidance about the direction of the national economy. Presidential leadership of the economy requires meeting the economic challenges of the time with policies, concern, and confidence. Therefore, I focus on presidential rhetoric during the worst economic crises since World War II.

President Carter and Inflation

President Carter served during the worst inflationary period of the modern era. Inflation had been a persistent problem starting with the Nixon administration. The Arab oil embargo in late 1973 contributed to a large spike in inflation that peaked in December 1974. However, at the start of the Carter administration, inflation was down to 5 percent. From Carter's inauguration through late 1978 inflation resumed its rise to almost 8 percent due to excess demand, a wage-price spiral, and high energy prices. However, another large oil shock began on December 25, 1978 when the Iranian Revolution against the Shah of Iran resulted in cessation of Iranian oil exports. Panic in the oil markets led to sharply increased prices that filtered into the U.S. economy. In 1980, as a result of the Iran/Iraq War, Iran's oil production again fell significantly and Iraq's crude oil production fell by 2.7 million barrels per day. The combination of these events resulted in crude oil prices more than doubling from $14 in 1978 to $35 per barrel in 1981.

Through this period the U.S. inflation rate increased sharply to peak in January 1980 at 14.6 percent. The economy also slipped, with economic growth initiating a decline in mid-1979 and moving into recession early in the 1980 election year. Additionally, beginning in mid-1979, unemployment rose from 5.7 percent to 7.5 percent by January 20, 1981. Rampant inflation and these consequent changes in the economy presented a major challenge for the Carter administration.

Of course, it is widely believed by scholars and the public that President Carter did not live up to these challenges. Experts ranking the presidents do not place President Carter high among other presidents (e.g., see Cohen and Nice 2003, 115-17). He was turned our of office in 1980 under a wide perception that he was a weak economic and foreign policy leader. President Carter was perceived as weak on foreign policy because of his failure to retrieve the American hostages from Iran. On the economy, the misery index was at its highest during the 1980 election year. (11) Yet, the president proposed and Congress had passed various inflation control measures and initiated a comprehensive energy plan for reducing U.S. dependence on foreign oil. Furthermore, the analysis in Table 4 suggests that the president exhibited strong rhetorical leadership on inflation, unemployment, and the general economy.

Was President Carter a weak leader as scholars and the public have concluded, or did he exhibit strong rhetorical leadership as the analysis in Table 4 suggests? During the worst of the inflationary crisis from December 1978 to January 1981, President Carter made an average of 92 public remarks per month on inflation. The tone of these remarks was decidedly optimistic, with a net of seven more positive than negative remarks per month. These numbers suggest that President Carter responded to the inflationary crisis with optimism intended to inspire confidence in the American people. What specifically did he say through this period?

On January 23, 1979 in his State of the Union message, President Carter alluded to inflation 14 times. In spite of recently higher prices and the oil shock, he struck a decidedly positive tone. Here are some excerpts from that speech.

 Tonight, there is every sign that the state of our Union is sound.
 Our economy offers greater prosperity for more of our people than
 ever before. Real per capita income and real business profits have
 risen substantially in the last 2 years. Farm exports are setting
 an all-time record each year, and farm income last year, net farm
 income, was up more than 25 percent.... In our economy, it is a
 myth that we must choose endlessly between inflation and recession.
 Together, we build the foundation for a strong economy, with lower
 inflation, without contriving either a recession with its high
 unemployment or unworkable, mandatory government controls....
 Together, we've already begun to build the foundation for confidence
 in our economic system. During the last 2 years, in bringing our
 economy out of the deepest recession since the 1930's, we've created
 7,100,000 new jobs. The unemployment rate has gone down 25 percent.
 And now we must redouble our fight against the persistent inflation
 that has wracked our country for more than a decade. That's our most
 important domestic issue, and we must do it together.... We know that
 inflation is a burden for all Americans, but it's a disaster for the
 poor, the sick, and the old.... Three months ago, I outlined to the
 Nation a balanced anti-inflation program that couples responsible
 government restraint with responsible wage and price restraint....
 This budget is a clear message that, with the help of you and the
 American people, I am determined, as President, to bring inflation
 under control.... I call on Congress to take other anti-inflation
 action.... American workers who enlist in the fight against
 inflation deserve not just our gratitude, but they deserve the
 protection of the real wage insurance proposal that I have already
 made to the Congress.... A strong economy and an effective
 government will restore confidence in America.

President Carter's 1979 State of the Union acknowledged inflation as the most important problem facing his presidency, and discussed specific plans to combat the problem. His speech attempted to enlist a sense of unity among Americans in the fight against inflation.

Throughout 1979 President Carter made speeches, held news conferences and town meetings, and made various other public remarks that focused on inflation. Representative comments from these events follow.

Message to the Congress Transmitting the Annual Economic Report of the President, January 25, 1979. "My administration's major domestic priority is to reduce the rate of inflation, while maintaining economic growth.... Last October I announced an anti-inflation program which can aid significantly in the effort to reduce inflation.... The elements of my anti-inflation program are mutually supportive and designed to mount a sustainable attack on our long-run inflation problem.... My anti-inflation program will support the health of our economy in 1979."

Speech before the Georgia General Assembly, February 20, 1979. "And as President I pledge to you that I am determined to bring inflation under control.... We've set forth now an anti-inflation program that recognizes the basic causes of inflation and attacks this problem on a broad front."

Remarks and a Question and Answer Session at a Town Meeting, March 24, 1979. "The point is I'm doing all I can as head of our Government to control inflation. ... But I am absolutely determined and I am absolutely convinced that if we work together we can bring inflation under control."

Energy Address to the Nation, April 5, 1979. "Our Nation's energy problem is very serious--and it's getting worse.... As Government controls end, prices will go up on oil which has already been discovered, and unless we tax the oil companies, they will reap huge and undeserved windfall profits. We must, therefore, impose a windfall profits tax on the oil companies to capture part of this money for the American people.... The actions and plans that I have announced tonight will move us away from imported oil and toward a future of real energy security. These actions will give us a better life."

Remarks to the Iowa State Association of Counties, May 4, 1979. "But the knowledge that we can deal with these special problems, using proven, sometimes ancient principles which our ancestors would understand very well, gives me confidence that we can control the enormous, overall problems of energy and inflation."

Remarks and a Question and Answer Session by Satellite to an Annual Convention in Las Vegas, Nevada, May 23, 1979. "It's going to get better in the near future, but we cannot abandon a permanent commitment to control inflation because we have a temporary disappointment for a few months after it was initiated."

Remarks at a News Conference, May 29, 1979. "All of these factors working together will have a long-range, beneficial effect in controlling inflation.... So, we have a good, sound, anti-inflation program."

Labor Day Statement by the President, August 30, 1979. "The most: serious challenge is inflation which erodes the paychecks of all working Americans. Working together, we can forge a long-term partnership that will reduce inflation and keep it down."

White House Statement on Actions by the Board of Governors of the Federal Reserve System, October 6, 1979. "The administration believes that the actions decided upon today by the Federal Reserve Board will help reduce inflationary expectations, contribute to a stronger U.S. dollar abroad, and curb unhealthy speculations in commodity markets."

Remarks on Announcing Candidacy for President in 1980, December 2, 1979. "With calm, strong, and effective leadership, with a prosperous and expanding economy, with inflation and energy shortages behind us, with people believing again, we can set our course for the kind of future about which we have all dreamed."

In spite of his optimism, President Carter's public approval rating dipped to a low of 29 percent in mid-1979. Inflation was increasing steadily through this period and reached a high of 14.6 percent in January 1980. Rising energy prices and inflation were crisis conditions for the U.S. economy. However, President Carter's annual State of the Union message on January 23, 1980 did not deal primarily with the economy. Rather, it dealt mainly with recent foreign policy events that pushed the economy lower on the public's agenda. On November 4, 1979, Iranian militants had stormed the U.S. embassy in Tehran and taken approximately 70 Americans captive. This act triggered the most profound foreign policy crisis of the Carter presidency and was an ordeal lasting through out the 1980 election year. Additionally, on December 21, 1979, Soviet troops moved into Afghanistan, initiating an invasion that led to Soviet occupation of that country for the next 10 years. Foreign policy events substantially displaced presidential attention to domestic issues. Nevertheless, the president did attend to the pressing issue of inflation near the end of his message. Here are some of those remarks.

 The crises in Iran and Afghanistan have dramatized a very important
 lesson: Our excessive dependence on foreign oil is a clear and
 present danger to our Nation's security.... At long last, we must
 have a clear, comprehensive energy policy for the United States.
 As you well know, I have been working with the Congress in a
 concentrated and persistent way over the past 3 years to meet this
 need. We have made progress together.... The American people are
 making progress in energy conservation. Last year we reduced overall
 petroleum consumption by 8 percent and gasoline consumption by 5
 percent below what it was the year before. Now we must do more....
 With these energy and economic policies, we will make America even
 stronger at home in this decade--just as our foreign and defense
 policies will make us stronger and safer throughout the world....
 We move into the 1980's with confidence and hope and a bright vision
 of the America we want....

One month after the president's 1980 State of the Union message, inflation began a decline that continued until 1983. However, inflation remained above 12 percent throughout the 1980 election year. During the election year, the president continued the fight, with new policies intended to address the problem, and continuing optimism. Following are excerpts from President Carter's election year remarks on inflation.

Remarks at the President's News Conference on a New Anti-Inflation Program, March 14, 1980. "Just a few hours ago I described the basic elements of this program, to intensify America's battle against inflation.... I must tell you very frankly that the results will not be immediate. We can expect several more months of very high inflation. But toward the end of this year the inflation rate will begin to drop, I think drop substantially.... The final point I'd like to make before I take your questions is that our Nation is strong and vital. We are similar to a superb athlete who has simply gotten out of shape. The American economy has an underlying strength and resiliency. With discipline and restraint and with a willingness to accept, perhaps, some aching muscles at first, our economy can perform again like a champion."

Remarks to the National Conference of State Legislatures, March 28, 1980. "We expect substantial reductions, in the near future, we hope, in interest rates and inflation rates--certainly, I hope, by the end of this year. I would like to see it done before the first week in November if possible. [Laughter] And I think next year we intend to see additional help.

Remarks and a Question and Answer Session with Editors and Broadcasters of Harte-Hanks Communications, April 23, 1980. "I believe that we will see, during this summer, substantial reductions in the inflation rate, and we are already seeing fairly good trends downward in the interest rates."

Remarks at a Carter/Mondale Campaign Rally, May 29, 1980. "We have moved strongly on a broad-based front since the second week in March with an anti-inflation program, which is very successful, to cur interest rates and inflation.... My prediction to you--and you watch what I say and see if I'm accurate--is that during the summer months and toward the end of this year, we'll have a sharp reduction in the inflation rate.

Remarks to the National Association for the Advancement of Colored People, July 4, 1980. I've taken the dangerous and the difficult steps to control inflation and to cut down interest rates, and these measures are working.... The inflation rate is coming down also very rapidly, and I predict to you that later on in the summer you'll see the inflation rate reach fairly low levels.

Remarks to the World Bank Group and International Monetary Fund at the Annual Meetings of the Boards of Governors, September 30, 1980. "We've adopted a strong anti-inflation program of fiscal and monetary restraint.... The program will reduce inflation."

Throughout the 1980 election year the inflation rate was declining sharply. The decline continued until September 1983 when it bottomed at 2.75 percent. Unfortunately for President Carter, inflation did not come down fast enough to produce the perception that his economic plans were working. His reelection failure in 1980 is widely perceived by scholars and the public alike as a failure of presidential leadership. Of course, President Carter proposed and implemented specific policies to fight inflation. He advocated those policies vigorously through economic rhetoric. The optimistic tone of his remarks suggests a strong effort at rhetorical leadership. However, ultimately he was unable to inspire public confidence and establish a favorable tone for the economy.

President Reagan and the 1982 Recession

President Reagan served during the worst recessionary period since the Great Depression. The country had also experienced a recession during the 1980 election year, but economic growth had turned positive in the last quarter, and the economy continued growing over the next year. In February after the election, President Reagan proposed and Congress passed the Economic Recovery Tax Act of 1981. This legislation implemented massive personal and corporate tax cuts and reductions in government spending. The program was based on supply side economics: Tax cuts were supposed to allow people either to spend more on goods and services or to invest in businesses, thus leading to higher economic growth.

However, the Federal Reserve Board had substantially increased interest rates in the fight against inflation. Through the first two years of the Reagan administration inflation continued its sharp decline. However, a result of the high interest rates was a reduction of the money supply, business investment, and consumer credit. Recession was the inevitable result. In late 1981 the economy saw a dramatic reversal, with economic growth again turning negative and remaining negative over the next 15 months. At the bottom of the recession, annualized real economic growth dipped to -6.56 percent. By December 1982 unemployment had reached 10.8 percent, with over 11 million unemployed, the highest rate since the Great Depression; 17,000 businesses failed, the second highest number since 1933; farmers lost their land; and many sick, elderly, and poor became homeless (Wolf 1999). These weak economic conditions constituted a considerable challenge for the Reagan administration.

Of course, it is widely believed that President Reagan lived up to these challenges. By election time in 1984 the recession had ended and unemployment was down to 7.3 percent. He was reelected in 1984 by the largest electoral margin since the 1964 Johnson landslide. President Reagan has generally been considered a strong leader who inspired confidence and optimism. The phrase "The Great Communicator" has often been used to describe President Reagan's leadership, suggesting a strong rhetorical presidency. However, the analyses in Tables 2 and 4 provide a mixed review of President Reagan's rhetorical leadership of the economy. The quantitative results show that controlling for actual economic conditions and election year rhetoric, President Reagan spoke more often and more positively about the general economy than President Carter. However, he did not speak as often or as positively about specific economic conditions such as unemployment, inflation, or the deficit. What specifically did President Reagan say about the economy through this period?

On January 26, 1982, in his State of the Union message, President Reagan alluded to the economy seven times. His remarks on the economy were not lengthy, but were decidedly positive even in the face of the recession. Here are some excerpts from that message.

 Late in 1981 we sank into the present recession, largely because
 continued high interest rates hurt the auto industry and
 construction. And there was a drop in productivity, and
 the already high unemployment increased. This time, however, things
 are different. We have an economic program in place, completely
 different from the artificial quick fixes of the past. It calls for
 a reduction of the rate of increase in government spending, and
 already that rate has been cut nearly in half.... Already interest
 rates are down to 15 3/4 percent, but they must still go lower.
 Inflation is down from 12.4 percent to 8.9, and for the month of
 December it was running at an annualized rate of 5.2 percent. If we
 had not acted as we did, things would be far worse for all Americans
 than they are today.... A year ago, Americans' faith in their
 governmental process was steadily declining. Six out of 10 Americans
 were saying they were pessimistic about their future. A new kind of
 defeatism was heard. Some said our domestic problems were
 uncontrollable, that we had to learn to live with this seemingly
 endless cycle of high inflation and high unemployment.... The
 economy will face difficult moments in the months ahead. But the
 program for economic recovery that is in place will pull the economy
 out of its slump and put us on the road to prosperity and stable
 growth by the latter half of this year. And that is why I can report
 to you tonight that in the near future the state of the Union and
 the economy will be better--much better--if we summon the strength
 to continue on the course that we've charted.

Contrary to the president's predictions, economic growth remained negative for all of 1982, and unemployment did not return to pre-recession levels until October 1984. As conditions worsened, the tone of President Reagan's public remarks grew more cautious. The president consistently cast blame on prior administrations and policies for the nation's economic woes. His rhetoric was often a mix of realism about the poor state of the economy, combined with optimism that administration policies would effectively address the problems. Following are excerpts from various speeches, news conferences, and public appearances that illustrate the tone of President Reagan's remarks during the recession.

Remarks on United States Agricultural Policy to Representatives of Agricultural Publications and Organizations, March 22, 1982. "Our recovery program was passed too late to avert the present painful slump brought about by past pump-priming and those 21 1/2-percent interest rates. There's no quick fix for the economy or for our farmers.... Some farmers will not make it through this difficult period of readjustment. But I think the vast majority will. And they're going to discover a better environment to conduct their business and realize a meaningful profit."

Remarks at the Legislative Conference of the National Association of Realtors, March 29, 1982. "This administration holds no patent on recession. We didn't invent sky-high interest rates and inflation or the tragedy of unemployment. Those problems were in place long before we took office.... Our program has already begun to work.... These economic gains are early harbingers of recovery, signs that have strong implications for future prosperity."

Remarks at a Question and Answer Session with Students at St. Peter's Catholic Elementary School in Geneva, Illinois, April 15, 1982. "Question. Mr. President, when do you think there will be more jobs for people? The President. More jobs for people? The answer to that has to be making it possible for the economy to expand, and by that I mean with this great unemployment, we're down now to where many industries are only working at a fraction of their capacity to produce. And this has been, I think, because the government over the years has been taking an increasing amount out of the earnings of the people and the gross national product."

Remarks at the Opening Ceremonies for the Knoxville International Energy Exposition (World's Fair) in Tennessee, May 1, 1982. "Now, we still have a long way to go before our economy is back in shape. And this recession is causing great pain to too many of our people. But there was a thing called the misery index that was created in the 1976 Presidential campaign.... Well, in the 1980 campaign, they didn't mention the misery index, because it had risen to 20.8 percent. I'm happy to tell you the misery index is now currently 9.8 percent."

Remarks and a Question and Answer Session in Los Angeles at a Meeting with Editors and Broadcasters from Western States, July 1, 1982. "Historically, whenever the economy hit a slowdown or recession in the past, the hounds of big government started their ritualistic baying, and there were demands for all sorts of pump-priming, make-work programs, public-service jobs, increased spending, and bigger deficits. You remember how we were always told with those deficits not to worry about the debt; we were told that we owe to ourselves. Well, during our present economic troubles we've managed not only to stifle the calls for government spending and expansion or intervention, but we've actually attacked the root causes of the recession by reducing taxes, dramatically slowing the rate of growth in Federal spending, and cutting and streamlining hundreds of Federal regulations, and getting a firm hand on inflation."

Remarks at a News Conference, July 28, 1982. "Back-to-back decades of red ink spending have brought our economy to its knees. Long years of runaway inflation, interest rates, and high taxes had robbed people of their earnings and weakened every family's ability to pay its bills and save for the future. The American people understand that we need fundamental reform--reform that goes beyond promises and gives them real protection for their earnings. They want this government to draw the line and to pass without delay a constitutional amendment making balanced budgets the law of the land."

Address to the Nation on Federal Tax and Budget Reconciliation Legislation, August 16, 1982. "There's an old saying we've all heard a thousand times about the weather and how everyone talks about it but no one does anything about it. Well, many of you must be feeling that way about the present state of our economy. Certainly there's a lot of talk about it, but I want you to know we're doing something about it.... I'm sure you've heard that 'we're proposing the largest single tax increase in history.' The truth is, we're proposing nothing of the kind. And then there's the one that 'our economic recovery program has failed, so I've abandoned it and turned to increasing taxes instead of trying to reduce Federal spending.' Well, don't you believe that one either."

Address to the Nation on the Economy, October 13, 1982. "In recent days all of us have been swamped by a sea of economic statistics--some good, some bad, and some just plain confusing.... The value of the dollar is up around the world. Interest rates are down by 40 percent. The stock and bond markets surge upward. Inflation is down 59 percent. Buying power is going up. Some economic indicators are down; others are up. But the dark cloud of unemployment hangs over the lives of 11 million of our friends, neighbors, and family.... Now, I don't pretend for a moment that, in 21 months, we've been able to undo all the damage to our economy that has built up over more than 20 years.... We've still got a long way to go before we restore our prosperity. But what I can report to you tonight, my fellow Americans, is that at long last your government has a program in place that faces our problems and has already started solving them.... We can do it, my fellow Americans, by staying the course."

Remarks and a Question and Answer Session during a United States Chamber of Commerce Teleconference on Job Training Programs, November 19, 1982. "While we've made solid progress against the disease that crippled our economy--the runaway inflation, taxes, and interest rates--unemployment remains far too high. It is unacceptable.... We can take action to lower structural unemployment and to promote more savings and investment--the keys to stronger growth, more jobs, and a higher standard of living.... Now, one such initiative, the Job Training Partnership Act, is the subject of this meeting today."

Throughout 1982 President Reagan's remarks offered a mixed message. He consistently acknowledged the poor economic conditions and shifted blame to earlier administrations and policies. His early rhetoric was often rooted in classic "free market" and "anti-tax" ideologies for which he was so famous. However, as economic conditions worsened, President Reagan offered new economic prescriptions such as the 1982 tax increase, a balanced budget amendment, and the Job Training Partnership Act. He also consistently expressed confidence that his administration's policies would be effective. His message on the future economic outlook was positive. However, his typical remarks on unemployment were very guarded. Indeed, a look at the unemployment graph in Figure 2 shows that the president was more negative on unemployment than any other point in the history of the series.

By the end of 1982, economic growth had turned positive and inflation was below 4 percent. However, unemployment was at its worst level since the Great Depression and continuing upward. In spite of renewed economic growth and reduced inflation, American economic confidence was very low and President Reagan's job approval rating had fallen to 35 percent in January 1983. These were the conditions surrounding President Reagan's 1983 State of the Union message. The message was devoted almost entirely to the economy.

 As we gather here tonight, the state of our Union is strong, but
 our economy is troubled. For too many of our fellow
 citizens--farmers, steel and auto workers, lumbermen, black
 teenagers, working mothers--this is a painful period. We must all
 do everything in our power to bring their ordeal to an end.... We
 have a long way to go, but thanks to the courage, patience, and
 strength of our people, America is on the mend.... The problems
 we inherited were far worse than most inside and out of
 government had expected; the recession was deeper than most
 inside and out of government had predicted. Curing those problems
 has taken more time and a higher toll than any of us wanted.
 Unemployment is far too high.... This recovery will bring with
 it a revival of economic confidence and spending for consumer
 items and capital goods--the stimulus we need to restart our
 stalled economic engines.... The inflationary expectations that
 led to a 21 1/2-percent interest prime rate and soaring mortgage
 rates 2 years ago are now reduced by almost half.... So, interest
 rates have tumbled, paving the way for recovery in vital industries
 like' housing and autos. The early evidence of that recovery has
 started coming in.... No domestic challenge is more crucial than
 providing stable, permanent jobs for all Americans who want to
 work. The recovery program will provide jobs for most, but others
 will need special help and training for new skills. Shortly, I
 will submit to the Congress the Employment Act of 1983, designed
 to get at the special problems of the long-term unemployed, as
 well as young people trying to enter the job market.... We who
 are in government must take the lead in restoring the economy.

One month after the president's 1983 State of the Union message, unemployment statistics began to improve. However, the unemployment rate required another 15 months to return to pre-recession levels. During this period as the economy improved, President Reagan's public comments mirrored the increasingly positive news about the economy and unemployment. He touted the success of his policies and applauded the economic expansion. He also frequently cautioned that unemployment is a lagging indicator that is unlikely to improve as rapidly as the rest of the economy. Here are some excerpts from his remarks over this period.

Remarks and a Question and Answer Session with Reporters on Domestic and Foreign Policy Issues, February 4, 1983. "Today, millions of Americans can take heart. Unemployment has finally started down. This dip in unemployment, coming just after the word of higher retail sales, higher auto sales, is one more sign that America is on the mend."

Radio Address to the Nation on Employment Programs, March 5, 1983. "Recently, the figures for industrial production, housing starts and sales and new orders for manufactured durable goods have all been good news. Just this week the index of leading economic indicators, a harbinger of what's to come, registered the biggest single jump in 33 years.... As you know, the unemployment rate dropped in January and then held to that level in February. I've said before, unemployment always lags behind the rest of the recovery. But the rate will be heading downward. The other economic indicators are too encouraging for it to hold out much longer."

Remarks at the National Conference on the Dislocated Worker in Pittsburgh, Pennsylvania, April 6, 1983. "The leading economic indicators, and you probably know, are positive, and I can tell you, so am I. January's surge was the largest in 33 years. The indicators are up for February as well. The double-digit inflation of 1980 has been knocked down to 0.4 percent in the last 6 months, the lowest 6-month rate in nearly 22 years. And the prime interest rate, which was 21.5 percent when we took office, is down to 10.5 percent today, and we're not finished with it yet. Housing starts and permits are at the highest level since September of 1979. Unemployment, while still painfully high, has decreased to 10.3 percent from a 10.8-percent peak in December."

Remarks at a Fundraising Dinner Honoring Former Representative John M. Ashbrook in Ashland, Ohio, May 9, 1983. "Now, all of us hope, of course, that the unemployment situation will ease much more quickly than current predictions suggest. But if past recessions were the rule, unemployment will remain a lagging indicator in an otherwise brightening economy so the unemployed will be among the last to feel the benefits of the recovery."

Radio Address to the Nation on Economic and Fair Housing Issues, July 9, 1983. "In recent weeks, even the gloomiest critics have had trouble denying that things are getting better for you and your families. The number of people working is up 1.l million from last December. Unemployment remains too high, but it's coming down--9.8 percent in June, as announced yesterday. We're seeing strong economic growth, and we're seeing it while inflation is at its lowest level in a decade--3 1/2 percent over the last year. This sharply lower inflation and the first decent tax cut since the 1960's are allowing families to keep more of their own earnings to spend or save. Contrary to propaganda blasts you hear, America is heading in a better direction today than before."

Remarks at a White House Luncheon for Hispanic Leaders, August 5, 1983. "In fact, just this morning we received new and dramatic evidence of the ongoing economic recovery--great news for all Americans. Unemployment for July is down to 9.3 percent, total unemployment, from 10 percent last month. The number of unemployed declined by 556,000, and the number of employees on payrolls rose by 487,000. And that means that the economic recovery has added 1.7 million new jobs to the economy since last December."

Remarks at a Fundraising Dinner of the Republican National Hispanic Assembly, September 14, 1983. "The cumulative effect of all our economic efforts is now being felt. That's why they don't call it Reaganomics anymore. [Laughter] As they say down at Cape Canaveral, we have liftoff. Our economy is lifting off, and it's because of the policies that we've been passing over the past 2 1/2 years."

Remarks at the Biennial Convention of the National Federation of Republican Women in Louisville, Kentucky, October 7, 1983. "But you know that the best clue that our program is working is our critics don't call it Reaganomics anymore. [Laughter] Unemployment, which, tragically, is often the last indicator to turn around in a recovery, is on a downward path."

Radio Address to the Nation on the American Family, December 3, 1983. "If we strengthen families, we'll help reduce poverty and the whole range of other social problems. We can begin by reducing the economic burdens of inflation and taxes, and we're doing this. Since 1980 inflation has been chopped by three-fourths. Taxes have been cut for every family that earns a living, and we've increased the tax credit for child care. Yesterday we learned that our growing economy reduced unemployment to 8.2 percent last month. The payroll employment figure went up by 370,000 jobs.

President Reagan's remarks on the economy continued along this trajectory during the 1984 election year. As economic conditions continued to improve he highlighted favorable economic statistics in comparison to those of earlier administrations and times. He also increasingly touted the success of his administration's policies in overcoming economic problems.

The preceding evidence suggests that President Reagan's remarks followed the path of the economy. His remarks were cautious during the worst of economic times, especially on the persistent unemployment. His remarks throughout the crisis were laced with optimism about the ultimate success of his policies and the future. As the economy improved through 1983-1984, his caution disappeared and remarks became ever more positive along all economic dimensions. By the time of the election, President Reagan was perceived by many as a strong economic leader. The favorable momentum of the economy fed the increased public perceptions of strong economic leadership, ultimately resulting in a reelection landslide in November 1984.

President Clinton and the Deficit

President Clinton served during the longest economic expansion in U.S. history. However, at the start of the Clinton administration, there was reason for concern about the economy. There had been another recession in 1991. At the start of the Clinton administration the recession had technically been over for more than a year. However, the employment situation had again lagged significantly behind the economic recovery. Unemployment peaked at 7.8 percent in July 1992 and remained near this level at election time in November.

Another cause for concern about the economy was that the government faced serious financial problems. The federal debt as a proportion of GDP was at its highest level since the 1950s, when government was paying down the large debt for World War II. The annual federal deficit that was adding to the federal debt was at its highest level since World War II. Interest payments on the federal debt were consuming a large proportion of the federal budget, crowding out important programs. Financing the large deficits placed the federal government in direct competition with private investors for money, thereby raising interest rates and putting a damper on U.S. economic growth.

Presidential candidate H. Ross Perot was partially responsible for raising the visibility of the federal government's financial problems. Running as an independent Reform Party candidate, he frequently focused infomercials on the federal debt. These spot-ads included Perot's colorful graphs and interesting humor. Perot was also the first third-party candidate to participate in the presidential debates, where he also raised this issue. Perot polled 19 percent of the popular vote in the 1992 election, suggesting much dissatisfaction with politics as usual.

While Perot raised the visibility of the federal debt and deficits, the public remained far more concerned about the general economy and unemployment. In August 1992 prior to the election, the Gallup Most Important Problem Survey showed that 31 percent of respondents viewed the economy as the most important problem facing the nation, with unemployment ranking second at 18 percent. Only 5 percent of Americans viewed the federal deficit as the most important problem facing the nation. Government finances were in serious trouble, but Americans were not overly concerned about the deficit going into the new administration.

President Clinton did not make the federal deficit a major campaign theme in the 1992 election. Nevertheless, he focused heavily on the deficit after his inauguration. The fourth graph of Figure 2 shows the sharp increase in presidential rhetoric beginning in February 1993. Table 1 reveals that the president made an average 50 remarks per month on the federal deficit across his entire administration. He spoke more frequently about the deficit than any other president before or after. Table 1 also shows that President Clinton spoke more about the deficit than about any other economic issue during his administration. The president made a strong effort to exert economic leadership, and the deficit was a major focus of his administration. So what specifically did President Clinton say about the economy and federal deficit over this period?

In his inaugural address of January 20, 1993, President Clinton emphasized the challenges ahead in making America more prosperous, while at the same time making government more accountable for its financial and economic obligations. Here are some excerpts from that speech.

 Raised in unrivaled prosperity, we inherit an economy that is still
 the world's strongest but is weakened by business failures,
 stagnant wages, increasing inequality, and deep divisions
 among our own people.... We know we have to face hard truths
 and take strong steps, but we have not done so; instead, we have
 drifted. And that drifting has eroded our resources, fractured
 our economy, and shaken our confidence. Though our challenges are
 fearsome, so are our strengths.... We must do what no generation
 has had to do before. We must invest more in our own people, in
 their jobs, and in their future, and at the same time cut our
 massive debt. And we must do so in a world in which we must
 compete for every opportunity. It will not be easy. It will
 require sacrifice, but it can be done and done fairly, not
 choosing sacrifice for its own sake but for our own sake. We
 must provide for our Nation the way a family provides for its
 children.... We must do what America does best: offer more
 opportunity to all and demand more responsibility from all. It
 is time to break the bad habit of expecting something for nothing
 from our Government or from each other. Let us all take more
 responsibility not only for ourselves and our families but for
 our communities and our country."

One day after his inaugural address President Clinton released a message to the leadership in Congress through his director of communications that pursuant to the Balanced Budget and Emergency Deficit Control Act of 1985, he had made a technical adjustment that prevents across the board reductions in accounts such as national defense that could "undermine the credibility of economic and budget estimates." The previous Bush administration had in three successive years adjusted such accounts to make the federal deficit appear less serious. The message also stated "President Clinton will soon put before Congress a real economic program aimed at reducing the deficit and providing long-term economic growth." While these quick actions were not broadly publicized, they do highlight the immediate priority the new president placed on the economy and deficit reduction.

President Clinton made stimulating the economy and deficit reduction his primary domestic policy initiative in 1993. In pursuing these objectives, the president campaigned vigorously for a legislative proposal that would both generate jobs and at the same time reduce the federal deficit. Here are some characteristic remarks by the president during the period in which the president was "going public" on his economic package.

Remarks before Employees of the Office of Management and Budget, February 3, 1993. "Just today we got the news about the economic indicators for the month of December being the best in 10 years and yet the disturbing prospect that a lot of new jobs are not being created.... So we have this anomalous situation where the economy seems to be growing but employment is not.... But the general path we have to follow is clear, because if we don't do something about investment, we won't have the kind of high-wage jobs that will shape a good future for ourselves and our children. If we don't do something about the deficit, it will eventually overwhelm our ability to borrow money at affordable rates and to have any money left in the public purse to take care of people in need and to invest in our future."

Remarks at a Televised Town Meeting in Detroit, February 10, 1993. "There's been some good news and bad news since I won the election. The good news is that productivity of American firms is up. People are buying houses because interest rates are down. Consumer confidence is up since the election. I like that. People think things are going to be better.... There's been some bad news. With all these economic improvements, we aren't generating new jobs. And the deficit of this country is about $50 billion a year bigger than I was told it was going to be before the election.... So we have to do two things at once that no Government in your country's history has ever done. We've got to increase investment in jobs and reduce the deficit, and we're going to do it."

Remarks before Business Leaders, February 11, 1993. "But I think every one of you know that today we face a crisis which, while quieter, is every bit as profound as those we have faced in our past.... In August the Government said that the deficit was going to be bigger than we had anticipated.... Now I have a choice. I can do what has been done by people in both parties for the last several years and has certainly been done by administrations unwilling to give up the rhetoric of low taxes and less Government, even though costs were exploding: I can sort of deny the problem and finesse the numbers. Or I can tell you what I think is the truth. I think I should follow the latter course. I believe that given the size of this deficit, given the burden it will put on today and tomorrow in terms of higher interest rates, given the fact that we also have a plain investment deficit in the education and training of our people and the investment in our infrastructure and those things that are critical to building high-wage, high-growth jobs, we have to take even more dramatic action than I had previously thought to increase investment for jobs and incomes, restrain unnecessary Government spending, raise revenues in a fair way, and reduce the national debt so we can have long-term growth."

Address before a Joint Session of Congress on Administration Goals, February 17, 1993. "Our Nation needs a new direction. Tonight I present to you a comprehensive plan to set our Nation on that new course.... I well remember 12 years ago President Reagan stood at this very podium and told you and the American people that if our national debt were stacked in thousand-dollar bills, the stack would reach 67 miles into space. Well, today that stack would reach 267 miles.... We have to cut the deficit because the more we spend paying off the debt, the less tax dollars we have to invest in jobs and education and the future of this country. And the more money we take out of the pool of available savings, the harder it is for people in the private sector to borrow money at affordable interest rates for a college loan for their children, for a home mortgage, or to start a new business."

Following his February 17 speech to Congress announcing the administration's legislative proposals, the president continued his public campaign for a jobs and deficit reduction package. He spoke at town meetings, news conferences, radio addresses, live television talk shows, and other events, rarely missing a chance to plug his plan. The urgent nature of his public remarks was consistently similar in tone to the preceding remarks.

In spite of the president's cry for action by Congress, the negotiations over the economic stimulus and deficit reduction packages were fierce (e.g., see Quirk and Hinchcliffe 1996). In trying to marshal the necessary votes to pass the legislation, President Clinton often went public to apply pressure on Congress and specific members involved in the negotiations. When those efforts seemed ineffective, he made a major televised address to the nation on August 3, 1993.

 This week, Congress will cast a crucial vote on my plan for
 economic recovery. In a comprehensive economic plan, there
 are always places for give and take, but from the first day
 to this day, I have stood firm on certain ideas and ideals
 that are at the heart of this plan. Tonight I can report to
 you that every one of those principles is contained in the
 final version of the plan: first, the largest deficit reduction
 in history, nearly $500 billion, with more spending cuts than
 tax increases. Rather than the games and gimmicks of the past,
 this plan has 200 specific spending cuts, and it reduces
 Government spending by more than $250 billion.... Why must we
 take extraordinary action now? Well, this chart shows you why.
 America faces a choice. We can continue on the path of higher
 deficits and lower growth, or we can make a fundamental change
 to improve our Nation's economy by adopting my economic plan.
 Now, it won't be easy, and it won't be quick. But it is necessary.
 Without deficit reduction, we can't have sustained economic
 growth.... At this exceptional moment of promise, why are so many
 in Washington so reluctant to take action? Why is it so hard for
 so many in this city to break the bad habits of the past and take
 the steps we all know we have to take? ... I need your help. I
 need for you to tell the people's representatives to get on with
 the people's business. Tell them to change the direction of the
 economy and do it now, so that we can start growing again,
 producing jobs again, and moving our country forward again.

On August 10, 1993 President Clinton signed the Omnibus Budget Reconciliation Act, which implemented his plans for the economy and deficit reduction. The legislation passed in the House of Representatives by only two votes, and Vice-President Al Gore cast the single deciding vote in the Senate.

It is unclear whether President Clinton's public remarks affected the legislative outcome. However, the president's rhetorical efforts made Americans significantly more aware of the pressing nature of the federal deficit. Evidence from the Gallup Most Important Problem Survey demonstrates the effectiveness of the president's remarks in raising public concern. In August 1992, the proportion of Americans viewing the deficit as the most important problem facing the nation was 5 percent. By February 1993 this proportion had doubled to 10 percent. Then by September, shortly after passage of the legislation, the proportion had tripled to 15 percent. Interestingly, as the intensity of presidential rhetoric on the federal deficit declined, the proportion seeing the deficit as a significant problem also declined in subsequent months, to an average of only 3 percent by January 1984.

The preceding evidence shows that President Clinton's public remarks on the economy during his first term were driven by perceptions of a crisis in federal government finances. Upon entering office, he sensed a problem with federal finances that threatened the economy. He had campaigned on the promise of promoting a sound U.S. economy. Therefore, he formulated plans to address the fiscal crisis, and then worked hard to convince Americans and Congress of the urgency of the crisis. Ultimately, President Clinton was perceived as a strong rhetorical leader who exercised effective leadership of the economy. The large federal deficits had turned into a small surplus by 1997. Between 1998 and 2000, the federal debt was reduced by $363 billion, the largest proportional three-year reduction in American history. With lower interest rates, the economy expanded for a record 115 months with average economic growth of around 4 percent. During this period the economy produced 22 million jobs, and the unemployment rate steadily declined to under 4 percent near the end of his administration.

Conclusions and Implications

This study has examined the use of presidential rhetoric as a tool of economic leadership. I have used complete and systematic data drawn from Public Papers of the Presidents measuring the frequency and tone of the presidents' public remarks along four economic dimensions. Using these measures, I provided explanations for when presidents talk about the economy, as well as how they talk about the economy. I also gave a descriptive assessment of which particular presidents appeared to exercise greater rhetorical leadership after controlling for election year politics and actual economic conditions. These quantitative assessments were supplemented by specific cases of presidential leadership during three periods of economic crisis.

The analyses showed that over time, presidents have increasingly assumed the role of rhetorical leader of the U.S. economy. Modern presidents speak more often about the economy than their predecessors. Much of this change has resulted from the challenging economic conditions facing each presidency. However, controlling for economic conditions and election periods, Presidents Clinton and George W. Bush spoke more frequently about the economy than all other presidents. Modern presidents also speak more optimistically about the economy than their predecessors. Beginning with President Nixon, presidents made progressively more optimistic than pessimistic remarks. President Clinton was far more optimistic than any other president. Regardless of this outlying effect, rhetorical leadership of the economy has become more intense and positive through time.

Why has rhetorical leadership of the economy evolved? Presumably, presidents have become increasingly aware of their responsibility for providing economic leadership and its importance to public approval and elections. Presidents are legally charged with promoting a sound economy, and this legal obligation was reinforced in 1978 with the passage of the Humphrey-Hawkins act. Businesses and consumers look to the presidency for cues about the future direction of the national economy. Presidents have also increasingly recognized that they are held accountable for U.S. economic performance. Thus, presidents have had growing incentives to talk about the economy and contribute toward a favorable economic climate.

There has been an upward trend in the frequency and optimism of the president's remarks on the economy through time. However, superimposed onto this trend are variations resulting from election cycles, changes in the economy, and cases of exceptional presidential leadership. During election years, presidents consistently talk more frequently about the economy, unemployment, inflation, and the federal deficit. They also consistently talk more optimistically about the economy and unemployment. Presidential responsiveness to election year incentives implies that they are especially concerned with the impact of their remarks on public approval and voting. Accordingly, an examination of the specific content of presidential remarks during election years shows that presidents consistently tout their economic records.

The trend of increasing rhetorical leadership of the economy is also interrupted by partisan variations in the content of economic rhetoric. Democratic presidents talk more frequently and more optimistically about unemployment than their Republican counterparts. Again, the electoral incentive may be important here, because the core electoral constituency of Democrats consists of those more likely to be unemployed.

Also superimposed onto the trend of increasing rhetorical leadership of the economy are variations resulting from changes in economic performance. Generally, the intensity of presidential remarks on the general economy is unresponsive to economic conditions. However, the frequency of presidential remarks about specific economic conditions such as inflation and the federal deficit increases as conditions grow worse. The analysis also shows that presidents talk more optimistically about the general economy when inflation and the deficit are improving. They also talk more optimistically about unemployment and the federal deficit when these conditions are improving. Thus, presidents adapt their public remarks about the economy with a measure of realism about actual economic conditions.

The analysis also suggests some exceptional cases of presidential economic leadership. President Carter was distinct in the frequency and tone of his public remarks on inflation. He spoke more often and more positively about inflation than any other president. President Clinton was unique in the frequency and tone of his public remarks on the deficit. He spoke more often about the deficit than any other president, and was also the only president to speak optimistically about the deficit. More generally, the analyses reveal that President Clinton spoke more often and more optimistically about the economy, unemployment, and the deficit than all other presidents. Obviously, President Clinton's mantra "It's the economy, stupid!" was something he believed and practiced.

The analyses reported here provide a more systematic understanding of when and how presidents talk about the economy. The obvious question that remains is whether presidential rhetoric on the economy really matters. Does the president's rhetoric affect actual economic outcomes? Prior research suggests that presidential rhetoric can affect what people think is important (Cohen 1993; Hill 1998). Presidential rhetoric may also affect what the media reports (Wood and Peake 1998; Edwards and Wood 1999). However, prior research also suggests that individual speeches by the president rarely change what people think (Edwards 2003). Of course, it could be argued that the economy is different from most issues. The economy and economic welfare are perpetually among the most important issues to Americans. The president is the premier economic and political actor in the U.S. system with media access on this important issue. Therefore, what the president says about the economy should matter. Further research should help resolve this question.

TABLE 1
The Average Frequency of Presidential Remarks on the Economy,
Unemployment, Inflation, and the Federal Deficit, 1948-2002

President Economy Unemployment Inflation Deficit

Truman 5.85 5.32 10.83 2.33
Eisenhower 4.51 3.41 3.49 2.14
Kennedy 13.65 16.24 4.68 6.06
Johnson 7.98 10.65 7.23 4.18
Nixon 6.64 7.71 20.35 1.79
Ford 23.30 29.20 61.40 12.73
Carter 11.92 26.60 75.44 9.42
Reagan 16.57 14.73 36.95 24.22
G. H. W. Bush 16.17 5.94 7.19 18.29
Clinton 38.85 26.45 18.01 50.00
G. W. Bush 30.75 4.33 2.33 0.75

Note: The numbers in the table are the average number of
sentences per month by each president directed
at each issue.

TABLE 2
The Determinants of the Frequency of Presidential Remarks
on the Economy, Unemployment, Inflation, and the Federal
Deficit, 1948-2002

President Economy Unemployment Inflation Deficit

Truman -9.23 -5.08 -2.83
 (-3.80) (-2.84) (-1.00)
Eisenhower -10.55 -6.38 -1.12 -4.55
 (-4.78) (-4.29) (-0.43) (-2.42)
Kennedy 7.46 2.62
 (2.76) (0.89)
Johnson -7.88 -1.21 -6.12
 (-3.16) (-0.47) (-2.79)
Nixon -8.85 -1.77 6.92 -13.14
 (-3.14) (-1.03) (2.12) (-4.49)
Ford 5.50 18.80 39.68 -12.28
 (1.13) (3.59) (3.60) (-2.33)
Carter -3.91 16.68 51.86 -7.18
 (-1.04) (3.74) (5.03) (-1.80)
Reagan -0.83 4.78 24.84 -3.19
 (-0.23) (1.81) (4.93) (-0.54)
G. H. W. Bush -1.24 -3.84 -4.26 -7.98
 (-0.31) (-2.16) (-1.37) (-1.17)
Clinton 22.90 16.46 10.60 35.01
 (7.57) (7.54) (4.03) (7.35)
G. W. Bush 16.77 -3.96 -3.55 -5.69
 (3.49) (-1.25) (-1.40) (-2.48)
Economic growth -0.13
 (-0.56)
Unemployment -0.53 -2.67
 (-0.25) (-0.92)
Inflation -0.05 2.27
 (-0.20) (3.23)
Surplus/deficit -0.60 -4.91
 (-1.10) (-4.02)
Election year 6.30 5.77 9.98 3.32
 (3.89) (2.89) (2.81) (1.66)
Constant 14.57 8.69 -0.56 8.91
 (6.29) (6.57) (-0.17) (4.84)
N 647 647 648 648
[R.sup.2] 0.51 0.28 0.40 0.42

Note: The numbers in the table are coefficients and t statistics
from a regression of the frequency of each dimension of the
president's economic remarks on the variables in the left side
of the table. Newey-West robust standard errors are used for
calculation of the t statistics.

TABLE 3
The Average Tone of Presidential Remarks on the Economy,
Unemployment, Inflation, and the Federal Deficit, 1948-2002

 Economy Unemployment Inflation Deficit

Truman -0.57 0.25 0.58 -0.32
Eisenhower -0.09 0.15 -0.16 -0.22
Kennedy -2.18 ** -0.74 -0.06 -1.65 *
Johnson -0.15 2.61 ** 0.32 -0.02
Nixon -0.92 0.02 3.03 ** -0.32
Ford -1.93 * -0.67 -0.50 -2.97 **
Carter -1.67 * 3.48 ** 7.64 ** -0.15
Reagan 1.22 * -0.06 0.51 -0.65
G. H. W. Bush 1.73 * 0.54 1.33 1.10 *
Clinton 14.36 ** 13.78 ** 3.90 ** 3.51 **
G. W. Bush -2.58 0.00 0.50 -0.17

Note: The numbers in the table are the differences between the
number of positive and negative sentences each month by each
president directed at each issue.

* Indicates statistical significance at the 0.05 level for
the hypothesis that the coefficient equals zero.

** Indicates statistical significance at the 0.01 level.

TABLE 4
The Determinants of the Tone of Presidential Remarks on
the Economy, Unemployment, Inflation, and the Federal
Deficit, 1948-2002

President Economy Unemployment Inflation Deficit

Truman -0.35 -0.67 0.68 0.35
 (-0.51) (-1.50) (1.46) (1.12)
Eisenhower -0.46 -0.15 -0.18 0.20
 (-1.11) (-0.46) (-0.90) (1.10)
Kennedy -2.28 -0.95 0.04 -1.41
 (-2.16) (-1.74) (0.12) (-2.36)
Johnson 0.03 1.49 0.32 0.24
 (-0.04) (2.60) (0.67) (1.08)
Nixon 2.11 -0.21 3.40 -0.63
 (2.41) (-0.51) (3.79) (-2.58)
Ford 3.51 -1.07 -0.01 -3.90
 (2.20) (-0.45) (-0.00) (-4.10)
Carter 3.78 2.82 8.35 -0.53
 (2.82) (1.96) (3.74) (-1.41)
Reagan 5.05 -0.77 0.77 -1.91
 (3.88) (-0.70) (1.05) (-2.28)
G. W. Bush 5.39 0.25 1.57 -0.07
 (4.55) (0.46) (2.89) (-0.06)
Clinton 15.58 12.96 3.98 3.25
 (14.51) (8.73) (7.23) (4.20)
G. W. Bush -1.33 0.99 0.75 0.03
 (-0.57) (0.52) (1.75) (0.14)
Economic growth (0.10)
 (1.32)
Unemployment 0.03 -6.62
 (0.04) (-4.28)
Inflation -0.56 -0.09
 (-6.49) (-0.88)
Surplus/deficit 0.56 -0.40
 (2.82) (-2.09)
Election year 2.37 2.78 0.70 -0.88
 (4.36) (3.37) (1.27) (-2.66)
N 647 647 648 648
[R.sup.2] 0.64 0.44 0.24 0.18

Note: The numbers in the table are coefficients and t statistics
from a regression of the tone of each dimension of the president's
economic remarks on the variables in the left side of the table.
Newey-West robust standard errors are used for calculation of
the t statistics.

(1.) This legislation required the president each year to set numerical goals for key economic indicators over the subsequent five years. The president was also required to report, with the annual budget, projections of federal spending and revenues that were consistent with maintaining full employment. Presidents since Carter have generally ignored the mandate to set specific goals (for a discussion, see Frendreis and Tatalovich 1994).

(2.) The file was constructed by combining the full text of the Public Papers from 1945 through 1999 extracted from a CD-ROM from Western Standard Publishing Company with the full text from the Weekly Compilation of Presidential Documents downloaded from the Web through http://www.OrigioalSources.com. The resulting file for content analysis of the president's public rhetoric consisted of around 340 megabytes of ASCII text.

(3.) PERL is a public domain open access code software package for logical manipulation of text. It is a high-level programming language deriving from the ubiquitous C programming language and to a lesser extent from sed, awk, the Unix shell, and at least a dozen other tools and languages. See http://www.perl.com for a complete description, example applications, as well as free access to the program and source code.

(4.) I considered adding more key words and phrases for each dimension. For example, the word "unemployed" could have been added to the unemployment dimension. The phrase "higher prices" could have been added to the inflation dimension. And the phrase "budget imbalance" could have been added to the deficit dimension. However, a check by human coders showed that there were very few instances where the president used these words that were not captured by the primary words and phrases.

(5.) Because these are count data, I also ran the analyses using negative binomial regression. The results are substantially similar to those reported below. To keep interpretation of the results simple, I report the multiple regression results.

(6.) This is reported seasonally adjusted in chained 2000 dollars.

(7.) For the two quarterly measures, I entered data from the most recent report for the intervening monthly periods. Of course, this would be the most recent data available to presidents when assessing the economy.

(8.) Regarding George W. Bush, the dataset contains only 13 months of his presidency.

(9.) Note that the analysis contains only 13 months of the George W. Bush presidency. The negativism over this period corresponds with the 2001 recession, as well as the administration's effort to "talk down" the economy to justify a large tax cut.

(10.) Note that [R.sup.2] can be incorrect when models do not contain an intercept. To check for this, I compared the results for each model to the same model omitting the median president. There were no major differences in fit for the alternative specifications.

(11.) The misery index is the sum of the inflation and unemployment rates.

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E. Dan Wood is professor of political science at Texas A&M University and has published numerous articles in the American Political Science Review, American Journal of Political Science, and Journal of Politics. AUTHOR'S NOTE: This article was prepared for the Conference on Researching the Public Presidency at Texas A&M University, February 27-28, 2004.