The Analysis of White House Occupant and Political Polarization in the United States

This paper examines a previously unidentified causal factor – White House Occupant (WHO) or President of the United States (POTUS) – in political polarization and then investigates its impact on legislative productivity and the aggregate economy. Objective pundits would agree that the United States has entered a new phase of “toxically pandemic political polarization” because Congressional Republicans had racial resentment of Obama and they did everything to obstruct his policy agenda; and now, in retaliation and on policy issues, Democrats resent Trump. In view of the changing American electorate, we consider WHO’s or POTUS’s race or gender or perceived religious affiliation or policy positions to be an important causal factor that will contribute to extreme political polarization in the foreseeable future. This is problematic because a WHO could take advantage of a highly polarized and dysfunctional Congress to undermine the democratic principles that American cherish if Congressional members of his/her majority party are unwilling to provide the constitutional checks and balances. We model how political polarization will in turn depress economic growth. In addition to introducing a novel element to the ongoing research on the consequences of political polarization, this paper contributes to the broader literature by asserting that a WHO or POTUS is one of the determinants of political polarization and Congressional productivity; and that the remarkable contraction in Congressional productivity during Obama’s presidency, which we found to be statistically and significantly different from the other three two-term presidents who served in the past four decades supported this assertion. Classification JEL: D71; D73; D74; H11; H73; H77.