Five Facts about the Finances of the Presidents

Economists estimate that George Washington’s net worth, if updated for changes in the value of a dollar since the Revolutionary War, would be approximately $525 million. George was very wealthy, mainly because he held so much land in an area of the country that is incredibly valuable today. The first president owned 8,000 acres in Northern Virginia.

George was no Mitt Romney, however. He earned quite a large wage, too. George Washington’s salary accounted for about two percent of the budget of the federal government in 1789.

Abraham Lincoln narrowly avoided bankruptcy. In his 20s, Lincoln purchased a grocery store. When his partner died, Lincoln assumed all of the debts of the failed store. Ultimately, he had to sell his last possession – a horse.

The richest President of the 20th century was not FDR, as I had expected, but LBJ. LBJ’s father lost everything. At the time of his death in 1969, LBJ had an inflation-adjusted wealth of $98 million. Most of it was in Texas land.

JFK may have ultimately been worth as much as $1 billion, but he never inherited his father’s fortune and some of his own wealth was tied up in trusts.

Four More Facts about the Federal Deficit

The United States had a debt of $40 million after the end of the Revolutionary War. The 13 sates owed another $25 million.

The Office of Management and Budget has great data on historical budgets since the Revolutionary War. Though today’s deficit (2012 est.) is about 8.5 percent of GDP, this is hardly the highest in the 20th century. In 1943, annual federal deficits were equal to thirty percent of GDP.  The highest peacetime budget, save for the years from 2008 to 2011, was in 1980, when the deficit was six percent of GDP.

The reason that today’s deficits are so high is because receipts by the federal government (by percentage) have never been lower, save for in 1949 and 1950.

Business shouldered a lot of the expense for the war. Corporate income taxes were 39.8 percent of the budget in 1943, which was the highest percentage in the 20th century. Today, the opposite is true. In 2009, individual income taxes reached 6.62 times the share of corporate taxes. This is the highest ratio in the 20th century.