Economic Growth In The 1970's

During this time, the Conservative government was said to have pursued mainly Keynesian economic policies, which centrally focused on reducing inflation. Their aims were to maintain growth, stability and a Keynesian system. However, some techniques used caused a rise in unemployment and higher interest rates. Therefore in terms of whether it was a ‘Golden Age’ for the economy; it depends on whose view the opinion is coming from.

The economy began to recover in 1983 and was surging in 1984. Unemployment and interest rates dropped, allowing more Americans to buy homes and cars (Moss & Thomas, 2013, p. 236). Inflation dropped to four percent, the lowest since the early 1970s. Americans were earning more money, and oil prices were dropping, making fuel more affordable (Moss & Thomas, 2013, p. 236). “Economic growth generated 18 million new jobs and tripled the price of stocks by 1990” (Moss & Thomas, 2013, p. 236).

that had begun in the late 1890s. Economists at the time argued that this recession was

The late 1990’s into the early 2000’s was a time of great economic success that took a turn for the worst as the war against terrorism began. In America, the economy was at its peak especially on Wall Street until September 11th 2001. The attacks that occurred on September 11th deeply affected America. The attacks caused the Dow to drop tremendously along with causing the recession to deepen. America was led into of the biggest government spending periods in a long time. The cost to fund the war along with to rebuild the economy held a toll on all Americans. America had to dig itself out of a hole. Unlike the economy, technology was on the rise. Many new inventions such as wireless internet, mobile devices, and new forms of social media were created.

Conte & Karr (2001) report the economic growth of the 1980’s in the United States sees President Regan cutting taxes and slashing social programs. President Reagan also

There were many critical issues with Reaganomics, which was intended to help expand the economy, but it eventually became the downturn during 1981 through 1982 (Foner 832). For example, the wealthiest American families benefited the most from the economic expansion because they had spent most of their income not on productive investments and charity, but on luxury goods and corporate buyouts (Foner 832). Whereas, the poorest 40 percent of the population’s incomes have declined, especially those with wives who did not work outside of their homes (Foner 832). Foner states that the 1980s was remembered as a decade of misplaced values because buying out companies generated more profits than actually running them or

In 1982, investments and banks failed leading in a recession; the worst recession since the 1930’s during the Great Depression. Unemployment skyrocketed to 11 percent as compared to the usual unemployment rate which is normally 8 percent or under. Fortunately enough, a fall in oil prices prevented the double-digit inflation rate similar to that of the late 1970’s by lowering it to 4 percent. The policies of ‘Reaganomics’, mainly centered around cutting government spending and tax cuts, are what improved and

Life in America began to undergo great economic and social changes during the 1980s under the Reagan Administration. During this period of time, stagflation began to distress the US economy, leaving millions of Americans to fall victim to homelessness and poverty. The unemployment rate had reached its highest peak since the Great Depression, creating a major crisis for low-income families and other individuals concerning living conditions. The introduction of Reaganism into society primarily focused on reducing the growth of government spending through the modulation of federal income tax and reduction of government regulation to diminish inflation. Despite all attempts for economic recovery, the US struggled to bounce back from the 1970s recession and in time led to the significant rise in urban poverty. Uniquely, an American film director from the 1980s by the name of John Carpenter produced a science-fiction film, They Live, that served as a powerful and eye-opening depiction of his own personal views of Reaganism (Reaganomics). He essentially depicts our world to be controlled by powerful elites who have created a repressive society that we are unwilling brought to live and build in. He also clarifies how the majority of Americans during the 1980s were focused primarily on materialism and how an individual’s “success” was measured by the amount of money they possessed. Carpenter’s major criticisms of 1980s America included the impact of consumerism in America as well as

During the 1950’s we see an economic boom in America. A large amount of this growth has to do with the money made by Corporations with Military Contracts making goods and supplies for the United States Military. With the Cold War beginning the push for new invention in aviation, rocket propulsion, energy, and even automobiles was at the forefront of national defense. Industrial giants like Boeing, General Dynamics, and Raytheon received 60% if their income from the Defense Department. Ten percent of the domestic (GDP) was from military spending. With fears of falling behind the Soviet Union, gaining any edge in innovation was important. The government even funneled millions of dollars into American Universities for scholarships and research

Economically the United States had its highs and lows. One would have not wanted to be an American during the time period of the

Leading up to the year 1981, America had fallen into a period of “stagflation”, a portmanteau for ‘stagnant economy’ and ‘high inflation’. Characterized by high taxes, high unemployment, high interest rates, and low national spirit, America needed to look to something other than Keynesian economics to pull itself out of this low. During the election of 1980, Ronald Reagan’s campaign focused on a new stream of economic policy. His objective was to turn the economy into “a healthy, vigorous, growing economy [which would provide] equal opportunities for all Americans, with no barriers born of bigotry or discrimination.” Reagan’s policy, later known as ‘Reaganomics’, entailed a four-point plan which cut taxes, reduced government spending,

When Ronald Reagan took the leadership of the United States in 1981, Reagan inherited an economy that was in really terrible shape— worst American economy, in fact, since there was the Great Depression of the 1930s. Americans had loved a prolonged period of widespread prosperity from the beginning of World War II to the end of the 1960s, but that long boom—built humongous on the absolute supremacy of American industrial production, temporary consequence of the destruction wrought on other major industrial power Germany, Britain, France, Italy, Russia, Japan, during the World War II—had ran out of steam by the early 1970s. The economy began sagging under the weight of a multitude of new structural

One of the ways that the cold war affected the U.S. economy was in the 1980’s when President Roald Regan attempted to end stagflation while also increasing military spending. In the 1970’s under President Jimmy Carter the phenomena of stagflation occurred and continued into the 1980’s. Stagflation is what happens when the economy is experiencing stagnation and inflation at the same time. Due to inflation workers demand higher wages, the worker receives the higher pay but then inflation rises keeping the economy in an unusual cyclical pattern of idle growth. To combat this Regan opted to use ‘Reaganomics’ or what it is also known as trickle-down economics.

At that time though tax rates were 70% higher; presently the United States has the lowest tax rate of the leading economies (Sachs). The economy at that time was an effective mix of big business and activism in government, this combination worked to reduce the gap between rich and poor (Sachs). Then the 1970’s hit and things began to fall apart in the face of new challenges. It was in the 1970’s that globalization first hit with the introduction of Japanese cars to compete with the three major car dealers in America, inflation began to rise (Sachs). Rather than examining ways to become more competitive in the face of globalization, government looked inward and decided that is was the problem and not the solution to a problem (Sachs). The government failed to recognize the key role it played in correcting the economy before.

Evidence of this period can be seen from the dramatic increase in GDP from 15.7 percent to 26.4 percent between 1920 and 1950 then reaching 46.5 percent in 1984 (Course-reader 26: Banting 1986b:2; Bakker 1990:429, Table 2.1 ). There was a general fear that if the economy would land in another economic crisis if reforms were not made. Even capitalist supporters believed that market could simply not survive without some degree of state intervention and regulation (Course-reader 24:Savage and Robins 1982: ix). The fall of the Keynesian (the Keynesian crisis) era was instigated by the inflation caused by the 1973 Arab oil embargo and the subsequent increase in oil prices by the Organization of Petroleum Exporting Countries (OPEC). This fall in the Keynesian era was accompanied with capital flight, decline in profits and De-industrialization in the economy.