IPI Publication Press Release - Longest Economic Boom Is Not Strongest

	IPI Publication Press Release IPI Economic Scorecard Related Publication Title: Different This Time? High Tax Burden Could Help End this Boom, as it Did Last Time Released by Sonia Hoffman on 03/01/2000	Synopsis Full Text Press Release (03/01/2000) Press Release (03/01/2000) Full Text PDF
	Longest Economic Boom Is Not Strongest For Immediate Release. Contact: Sonia Hoffman 1-888-557-4IPI Dallas, TX: The 1990s may go on the record as the longest economic recovery in history of the United States, but it definitely has not been the strongest. In fact, the growth experienced during the past decade has proven less than robust, falling behind other, shorter economic expansions. That’s what Senior Research Fellows for the Institute for Policy Innovation (IPI) say in a newly published Economic Scorecard titled “Different This Time?”. Just take a gander at the following economic comparisons of the 1960s and the 1990s. · REAL GDP in the 1960s powered ahead by 7.5 percent in the first year and then slowed to 2 percent after eight years. Reversing this pattern, the 1990s started off slowly (2.7 percent) and gradually built up a head of steam, growing at a 4 percent clip the last several years. As a result, GDP increased over 50 percent in the 1960s but advanced only 36.4 percent in the 1990s. · INFLATION in both recoveries has actually decreased with strong growth. The 1960s, which began with a boom and then tapered off, experienced initial increases of 1 to 1.5 percent per year, climaxing at almost 5 percent by the end of the decade. In contrast, the 1990s expansion, which started leisurely and slowly progresses, witnessed inflation decelerate from 3.5 percent to 1.5 percent. · EMPLOYMENT grew by 30 percent in the 1960s. And although 2.5 million jobs were created in the past decade, this amounts to only a sluggish 17.6 percent employment increase for 1991 to 1999. · NEW INVESTMENTS in capital, which is critical for any economy’s continued expansion, peaked at 5.3 percent during the 1960s. It has, however, reached a high of only 4.7 percent during the current recovery. · STOCK MARKET corrections in 1968 brought what was a 60 percent jump in the S&P 500 down 15 percent. If a prolonged correction comparable to the 1960s occurs now, then the market’s recent growth (345 percent in last decade) could experience a similar decline. · TAXES at all levels of government take a larger bite out of national income (37.1%) today than they did during the 1960s. In fact, federal, state, and local taxes claimed 56.4 cents out of the next dollar of output produced by private businesses, up from 48.3 cents in 1991. According to the Aldona Robbins, “What must be remembered is that, just as in the 1960s, higher inflation from wrong-headed monetary policy or ever-increasing marginal tax rates that lower returns to workers and investors could again bring the now-longest expansion abruptly to an end.” This information was taken from IPI’s Fourth Quarter Economic Scorecard. Copies are obtainable at www.ipi.org, or by calling 1-888-557-4IPI. The authors are also available for interviews.