I continue to find it amazing that the media, and President Elect Obama insist that this is the worst economy since the Great Depression. As I wrote previously, we are no where near the economy that Carter handed over to Reagan. But lest my words didn’t convince, check out this great cartoon:
Very true, but let’s also not forget that at that time, the crisis was far from global, and, for this reason and others, there was no need for bailouts and so on… Also, because the financial system was simpler at the time, we didn’t see the type of chain effects that we see now.
Thanks for taking the time to not only visit, but to comment. I do appreciate it.
I must say, I remembered the Carter era as being an economic and energy crisis of larger scale than simply the US. But that said, it could be that the memories I have from my High School days could be faulty. I was concerned that perhaps my view was too US centric. So I went looking.
I recommend if one is interested that they visit
http://www.econstats.com/weo/V021.htm
I think this site could shed some light on the economic conditions starting in 1980. A quick perusal through the numbers there showed that while the US was working through relatively high inflation (and then recovered soon thereafter) so was must of Western Europe and Asia. Of course, Japan then went through there credit crisis, and Germany had to work through reunification issues, but the effect of the “malaise” of the late 70s (as evidenced by 1980 numbers) seems to have been broadly felt.
Of course, I would love to see data from the late 70s, so if you have any sources please share them. More data is always better!
Fair enough, I didn’t remember how bad it was at the time (maybe I was too young). 😉
But I have to say that your figures also show that, in 1980-81, the developed world was not in a deep recession like now (apart from the UK and USA). Growth rates were mostly positive, even discounting the (huge) inflation.
Another point, I think, is that the then massive inflation was mainly linked to extremely high oil prices, especially at a time when our economies were far more oil dependent than now, a fact that Carter tried desperately to fight. But he wasn’t even given the chance. I am not saying that Carter was a great president, but I believe he never had a chance to change things. G.W. Bush, on the other hand, was reelected.
1. Oil prices have been higher (inflation adjusted) now than in the 70s. Yes, barring the recent slide.
2. The way we measured “recession” was different then than now. What the media is calling “deep global recession” today would not have been defined as such in the 1970s. Indeed, the US committee that “calls” a recession rescored their metric in October to “discover” that we had actualy been in a recession since December 2007. Hmmm. That announcement (in addition to media template piling on) was followed auickly by, well, an *actual* (as opposed to “rescored”) recession.
G.W. Bush was re-elected because, well, he took the Clinton recession and turned it around. Among other dubious Clinton legacies.
Carter was not re-elected because, well, sheesh. His recent public displays of inanity are nothing new. Carter did more to extend and solidify turmoil in the middle east than any world leader beyond Arafat. Among other idiotic things he did. Killer Rabbit.
Steve