Transcript Economy of the 1990s

Economy of the 1990s
1990 Budget
Enforcement Act
• Created caps for discretionary spending
and created “pay-as-you-go” rules for
certain taxes and certain entitlement
programs.
• This Act raised taxed and was signed by
President George H.W Busch.
1990s Early
Recession
•
•
•
•
•
This recession lasted from July 1990 to March 1991.
It was the largest recession since that of the early
1980s.
Help contribute to Bush’s re-election defeat in 1992.
Was mainly attributed to the workings of the business
cycle and restrictive monetary policy.
This recession showed the growing importance of
financial markets to the American and world
economies
1992 Presidential
Election
•
•
•
This campaign was important because of the presence
of three major candidates as well as the emphasis of
economic issues to the campaign.
The federal budget deficit and national debt were
important campaign issues.
Busch lost to Bill Clinton because he failed to address
concerns about the nations economy like Clinton.
1993 Omnibus Budget
Reconciliation Act
• Better known as the Deficit Reduction
Act of 1993.
• It was President Clinton’s first budget.
• The fiscal year 1994 budget proposed
the highest peace-time tax increases in
United States history, cut appropriation
spending, and renewed the framework of
the Budget Enforcement Act of 1990
1994 Midterm
Elections
• The Republican Party gained the
majority of seats in the house for the first
time since 1954.
• This was caused by a rise in U.S GDP,
high unemployment, and continued
inequality starting at the beginning of
Clintons presidency .
• Also popular discontent with state of the
nation’s economy helped give the
republicans the edge they needed.
1995-96 Government
Shutdown
•
•
•
From November 14 through November 19, 1995 and
from December 16, 1995 to January 6, 1996 the U.S
Government was shut down due to budgetary disputes
between Congress and the White House.
The shutdown started by a dispute between
Democratic President Bill Clinton and Republican
Speaker Newt Gingrich over domestic spending cuts
in the fiscal year 1996 budget.
This resulted in a bipartisan agreement to balance the
budget in seven years time.
1997 Balanced
Budget and Taxpayer
Relief
Act
• The Balanced Budget Act(spending bill)
and the Taxpayer Relief Act (tax bill)
enforced the elimination of the annual
budget deficit by 2002.
• Both Bills were passed by Congress by a
large majority and signed into law by Bill
Clinton prior to the August 1997
congressional recess.
New Economy
• during the 1990s, the national debt
increased by 75%, GDP rose by 69%,
and the stock market as measured by
the S&P 500 grew more than threefold
Dot-Com boom
• From 1994 to2000 real output increased,
inflation was manageable and
unemployment dropped to below 5%,
resulting in a soaring stock market