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The Clinton administration's economic record was by many measures impressive, and the performance of the economy undergirded a national resurgence that seemed to make premature several decades of talk about an American climacteric. Instead, the mid-1990s witnessed a moment of American triumphalism, the likes of which had not been seen, one journalist observed, since the heady days of the Marshall Plan. "The U.S. economy," he reported, "has become the world's beau ideal -- its champion of growth, fiscal responsibility and technical progress." The editors of the New Republic cooed that Clinton was "presiding over what will be seen in future decades as a golden age in American history." Pollsters at the University of Michigan's Survey Research Center found Americans more confident about the economy than at any time since 1952. As the twentieth century approached its close, the United States stood as the world's only true superpower, with unmatched economic and military might, unrivaled influence as a political and economic model, and perhaps the most far-reaching global cultural hegemony in history.
In mid- 1997, the New York Times published in its Sunday magazine a collection of essays by foreign writers entitled "How the World Sees Us" that captured the spirit of the moment. The collection served as a remarkable cultural window on the end of the postwar era, an arresting, matchingbookend complement to the famous 1952 Partisan Review symposium "Our Country and Our Culture" that had seemed to capture the cultural tenor of the postwar era's beginning. The arresting quality of both exercises, the one an embrace of American culture by its own intellectuals, the other an appreciation from afar by an international cadre, was their underlying tone of affirmation. While more than a few contributors took their opportunity to mock American foibles, the message of the New York Times essays was that the United Statesmattered. As Josef Joffe expressed it in the lead essay (entitled "America the Inescapable"), "Whichever heap you choose, America sits on top of it." "America has the world's most open culture," he continued, "and therefore the world is the most open to it. . . . That makes for a universalist culture with a universal appeal. . . . We live in an 'American age,' meaning that American values and arrangements are most closely in tune with the new Zeitgeist." And no small part of America's appeal and impact as world model came from the performance of the U.S. economy.
The statistics of economic performance seemed to support Joffe's characterization of the United States as "No. 1 and soaring." In mid-1997, when he wrote, the stock market stood at an all-time record high; unemployment at 4.8 percent, the lowest level since November 1973; and inflation at around 3 percent, its steady level the past four years. (Each of these numerical indicators of economic well-being would improve further in the next two years.) Meanwhile, serious observers suggested that the most commonly used measure of inflation, the government's consumer price index, overstated reality and noted that the so-called core rate of inflation (omitting the volatile categories of food and energy costs) was at its lowest level in over three decades. Turning a significant fiscal corner, the Congressional Budget Office in early 1998 projected a budget surplus for fiscal year 1998, the first since 1969, and forecast growing surpluses over the next decade.
Economic growth, as measured by yearly change in the real gross domestic product, registered 2.3 percent in 1993, 3.5 percent in 1994, 2.3 percent in 1995, 3.4 percent in 1996, and 3.9 percent in 1997 -- moderate growth by earlier postwar standards of performance but steady nonetheless (and perhaps more impressive if the government's deflators really did exaggerate the rate of inflation and consequently understate the economy's real rate of growth). In June 1997, Fortune magazine declared that the U.S. economy was stronger than ever before in the nation's history. Moreover, what was already the third-longest economic expansion in U.S. history seemed to many economists to be sparking an incipient global boom. "This is an important historical moment," said Jeffrey Sachs, an economist at Harvard; he predicted that, barring a major extraneous shock such as a large-scale war or environmental disaster, "economic growth will raise the living standards of more people in more parts of the world than at any prior time in history."
Not surprisingly, the Clinton administration basked in the reflected light of the economic good news. Robert Rubin, who left the National Economic Council to become treasury secretary, stated in early 1997 that "the most likely scenario far and away is a continuation of solid growth and low inflation as far into the future as you feel comfortable in making this kind of judgment." Shortly after his reelection, Clinton said, "If we can keep interest rates down with the deficit-reduction package and a balanced budget, keep investing in education and technology and keep expanding trade, I'm not sure we'll be as victimized by the business cycle as we have been in the past. We may be able to have much more stable and much longer-term growth than we ever had before." Fed chairman Greenspan told Congress in mid-1998 that the combination of strong growth, low unemployment, and low inflation was "as impressive [a performance] as any I have witnessed in my near half-century of daily observation of the American economy." . . .
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