Economic Growth Since 1973: A Closer Look at the American Experience

Abstract

Advocates of orthodox (i.e. neoliberal) economic policy have often pointed to the economic performance of the U.S. as indicative of those policies' superior results. This paper critically examines such claims by comparing U.S. economic performance in the neoliberal era with its prior performance (since 1870, and particularly since 1947); its performance relative to other major industrialized states since 1973, namely Japan, Germany, Britain and France; and considering the changing makeup of its economic activity with an eye to the claims regarding hollow (e.g. the hypertrophy of the FIRE sector). The analysis points to the decay of U.S. growth rates as compared with the pre-1973 period, especially after the turn of the century. It also concludes that the image of the U.S. outperforming other advanced nations, especially when this is considered in more nuanced terms, principally held good for the tech boom years of the late 1990s (1995-2000), and that the composition of U.S. economic activity--as well as the falling trend of U.S. growth, especially since 2007--calls any argument on the basis of superior U.S. growth into question.