The Worst U.S. Presidents for the Economy: A Look at the Damage Caused

Outline of U.S. with a man with empty pockets inside main

There have been 46 U.S. presidencies to date (2023), and it can be difficult to determine which one was the worst for the economy. However, there are a few contenders that stand out as having had a particularly negative impact on the economy. My contention is that 5 rise to the top of the bottom: James Buchanan, Andrew Johnson, Herbert Hoover, Richard Nixon, and G.W. Bush.

President Buchanan – Failed to Regulate the Banks

A president who had a significant negative impact on the economy was James Buchanan. He who served for one term, from 1857 to 1861and preceded President Lincoln. Buchanan is often remembered for his handling of the financial crisis that led up to the Civil War, known as the Panic of 1857. 

The Panic of 1857 occurred in the United States and was an economic crisis caused by a sharp drop in the value of land and related speculative investments. It was exacerbated by President James Buchanan’s mismanagement of government finances, which included increasing public debt and overspending on infrastructure such as canals and railroads.

He also failed to regulate the banking system through sound fiscal policy. This led to a contraction of credit lines, particularly in states heavily dependent on agricultural production as prices rapidly collapsed. 

Additionally, Buchanan attempted to provide assistance to affected banks by issuing federal bonds but these had little effect at regulating the economy or preventing further financial losses.

Andrew Johnson – Failed Economic and Social Policies

Another candidate for bad-for-the-economy president is Andrew Johnson, who served as president from 1865 to 1869. Johnson is remembered for his vetoes of legislation that would have provided economic support to the former slaves, which is believed to have held back economic progress in the South. Not to mention civil rights for the next 100 years!

In addition, Johnson’s policies are thought to have contributed to the financial crisis that led to the Panic of 1873, which was one of the worst economic crises in American history. Yes, we’ve had a lot of “Panics”.

The Panic of 1873 was an economic crisis in the United States that began with a severe drop in railroad construction and then spread to other industries. It was exacerbated by President Andrew Johnson’s mismanagement of government finances. He raised public debt, expanded the internal revenue system with higher taxes, and failed to regulate or monitor the banking industry. 

These actions led to a major depression worldwide and particularly in the U.S. as unemployed workers flooded into cities leading to increased inflation and further contraction of credit lines. 

Additionally, Johnson attempted to provide assistance to affected banks by issuing federal bonds but these had little effect at regulating the economy or preventing further financial losses.

Herbert Hoover – Unsuccessfully Faces Economic Depression

One president who is often cited as the worst in terms of economic performance is Herbert Hoover, who served as the 31st president of the United States from 1929 to 1933.

Hoover, a Republican, took office just months before the stock market crash of 1929, which marked the beginning of the Great Depression. The crash was followed by a series of economic disasters, including bank failures, business bankruptcies, and high levels of unemployment.

Hoover’s response to the crisis was widely seen as inadequate and misguided. Instead of pursuing aggressive measures to stimulate the economy, Hoover took a hands-off approach, believing that the market would eventually correct itself. 

He also resisted calls for the government to take a more active role in addressing the crisis, such as through the implementation of public works projects or the expansion of social welfare programs. Hoover believed that it would be a mistake for the federal government to provide direct aid to citizens. In his opinion it would create a disincentive to “pull yourself up by the bootstraps”.

Hoover’s lack of action was seen as a major factor in the severity and duration of the Great Depression. Many people, including prominent economists and political leaders, criticized Hoover for his failure to address the economic crisis.

One of the main criticisms of Hoover’s approach was that he focused too much on balancing the budget, rather than taking bold action to stimulate the economy. Hoover’s efforts to reduce government spending, including cuts to social welfare programs, were seen as counterproductive, as they only served to further depress the economy.

In addition, Hoover was criticized for his support of protectionist trade policies, which some believed exacerbated the economic downturn. Hoover signed the Smoot-Hawley Tariff Act in 1930, which raised tariffs on a wide range of imported goods. This led to a trade war with other countries, which further disrupted global trade and hindered economic recovery.

Another factor that contributed to Hoover’s poor economic record was his handling of the banking crisis. As banks failed and people lost their savings, Hoover resisted calls for a government-led bailout, instead advocating for voluntary measures such as a “bank holiday” to allow banks to stabilize their finances. These measures proved ineffective, and the crisis only deepened.

In the end, Hoover’s presidency was marked by economic decline, high levels of unemployment, and widespread suffering. His failure to effectively address the economic crisis contributed to his defeat in the 1932 presidential election, and he was succeeded by Franklin D. Roosevelt, who implemented a number of bold policies aimed at reviving the economy and improving the lives of ordinary Americans.


Richard Nixon was Responsible for a New Word: Stagflation

The second president who belongs on this list is Richard Nixon. His time in office saw stagflation, where inflation rose while at the same time growth stagnated, hence the hybrid term. This is  an unfortunate combination that leads to decreased investment and reduces GDP growth significantly. 

Nixon also imposed wage and price controls which ultimately failed, leading to further economic distress.

In an effort to combat stagflation and the budget deficit, President Nixon implemented a series of policies. He increased taxes in order to reduce government spending and introduced measures such as the temporary Wage-Price Freeze.

The policy was intended to lower inflation rates by freezing wages and prices at their existing levels. This measure was temporarily put into place for 90 days, though it had a mixed effect on the US economy over the long term and was ultimately unsuccessful in halting the stagflation President Nixon faced. 

President Nixon also enacted the Emergency Petroleum Allocation Act.  This was a policy implemented  to try and reduce the United States’ reliance on foreign oil. 

The act put caps on domestic oil prices, allocated production quotas for refiners, and required that all petroleum products be sold at market-based prices. 

The effect of this policy was mainly felt as an attempt to rein in inflationary pressures on the U.S. economy by limiting demand for higher-priced fuel sources. While it was successful in reducing gas prices in the short term, it had minimal effect in mitigating stagflation over the long term.

Additionally, Nixon sought to increase international trade opportunities with China and Russia while reducing tariffs on imports. However, his overall economic policies had little effect on reversing the stagnation of the US economy.

George H.W. Bush – Read My Lips, But Don’t Believe Them

Finally, George H.W. Bush’s one-term tenure was certainly not stellar in financial matters.

President Bush made a number of economic mistakes that significantly affected the country’s economy. He failed to recognize the rising budget deficit, increased taxes and decreased spending on government programs. These decisions resulted in lower growth rates and higher unemployment rates. 

His decision to break a 1988 campaign pledge not to raise taxes was met with widespread criticism from both the public and the media. 

“Read my lips, no new taxes!”

He also allowed his predecessor Ronald Reagan’s military buildup to take precedence over domestic programs and initiatives, further contributing to an economic downturn during his time in office.

Tough Times for Not-Tough-Enough Presidents

These American presidents led their respective countries through difficult times economically and stand as cautionary tales for future administrations hoping to protect their citizens from economic hardship. 

It is important for politicians going forward to learn from these examples on how best (or worst) not to manage an economy if they aim for sustainable long-term growth rather than short-term gains at the cost of prolonged suffering by their constituents.

Overall, it is difficult to definitively say which U.S. president was the worst for the economy, as each president faces unique challenges and circumstances. However, all the above are contenders for the title due to the significant negative impact their policies had on the economy.

Teach and Thrive

A Bronx, NY veteran high school social studies teacher who has learned most of what she has learned through trial and error and error and error.... and wants to save others that pain.