From the NYT via the Rutland Herald:
It is five years into an economic expansion and most Americans are still waiting for their share. Inflation is swallowing pay raises. Businesses are hiring, but forecasters worry that the economy may be about to stall.
“If this is a recovery,” the leader of the political opposition complains, “I can hardly wait for the recession.”
This may sound like the stuff of yesterday’s headlines. But it comes from 1996, when Bill Clinton was president and his rival was Bob Dole, the Republican nominee. The economic expansion in question, which got off to a sputtering start in March 1991, was to become the longest period of uninterrupted growth in the nation’s history.
Now, a little more than five years into an expansion that officially started in November 2001, the economy is showing remarkable parallels to the situation of a decade ago. “It’s striking how similar they are,” said Robert J. Gordon, an economics professor at Northwestern University.
The overall rate of growth has followed a trajectory almost identical to the first five years of the 1990s expansion. Now, as then, corporate profits have surged; the stock market has, too. But just as workers have finally begun to reap some of the spoils of a growing economy, many forecasters worry — as they did a decade earlier — that the expansion is running out of steam.
What is striking, considering these similarities, is how little effect the policy choices of Democratic and Republican administrations seem to have had on how both growth cycles played out.
Few economic forecasters expect the current growth cycle to have the length and vigor of the 1990s boom, which continued for 10 years from trough to peak.
Yet fewer still expected strong growth in the mid-1990s. In early 1996, forecasters polled by the Federal Reserve Bank of Philadelphia predicted that the economy would grow merely 1.8 percent that year. The economy ended up growing at twice that pace.
Average Americans were more pessimistic then than they are now. According to Gallup’s most recent snapshot of public opinion, last month 52 percent of Americans rated economic conditions as either excellent or good. In May 1996, at a similar moment in the previous expansion, only 30 percent did so.
“Consumers don’t expect a slowing economy,” said Richard T. Curtin, who heads the surveys of consumers at the University of Michigan. “According to consumers, we are going to improve.”
Given the parallels, perhaps it is not surprising that the economy is providing the same sort of political ammunition as it did 10 years ago.