U.S. Economy booms in the '90's

 

-Decade ends with a 4% unemployment rate

-personal incomes doubled from the recession in 1990

-higher productivity overall

-After the 1996 Welfare Reform act there was a great reduction of poverty rates

-Wall Street stock exchange stayed over the 10,000 mark from 1999 to 2001

-The North American Free Trade Agreement (NAFTA), which phases out trade barriers between the United States, Mexico and Canada is signed into law by U.S. President Bill Clinton

-The graph above shows the increase in the GDP from the start of the decade all the way through 2002

NAFTA (North American Free Trade Agreement)

NAFTA has positives and negatives

 

-The North American Free Trade Agreement (NAFTA), which phases out trade barriers between the United States, Mexico and Canada

-Initially pursued by politicians in the United States and Canada supportive of free trade


-Led by Canadian Prime Minister Brian Mulroney, U.S. President George H. W. Bush, and the Mexican President Carlos Salinas de Gortari-Signed by the three countries in 1992 and awaited ratification in all three countries.

-Passage of NAFTA was made a serious political priority by President Bill Clinton (George H. W. Bush did not push as much towards passing NAFTA, mostly due to his “fast track” prerogative

-Passed by the House of Represenatives in 1993 after an intense politcal debate, as their was much opposition to the idea

-On the last day of their 1993 session, the senate also passed NAFTA

-Some argue that NAFTA has been positive for Mexico, which has seen its poverty rates fall and real income rise

-Many aruge that NAFTA has been helpful to business owners and elites in all three countries, but has had negative effects on farmers, manufacturers, and assembly industries, who lost work

-NAFTA is also said to have caused an increased level of inequality, and has not worked well or fast enough to produce a converged economy between the three countries

1996 Welfare Reform

 

-Clinton signs Welfare Reform Bill on August 2nd, 1996

-Made provisions on previous welfare laws

-One provision was a time limit. No person could receive welfare for more than five years (consecutive or non-consecutive) Many felt that this time period was needlessly short.

-Another change was that now, the federal government would issue "blocks" of money to states, and then lets the states distribute it under their own legislation. Some states simply kept the federal rules, while others used the money for non-welfare programs



-Many felt the welfare reform would do extremely well in a booming economy, like the one of the 1900's


-Many felt that the amount of money given out was too small


-Since passed, welfare rolls have dropped significantly (nearly 60%)

-Poverty rates for African American families dropped sharply

-The 1996 welfare reform law was reauthorized in the Deficit Reduction Act of 2005

Clinton and the Economy

Turning the economy around

-Created 22 million new jobs

-Moved nearly 8 million people out of poverty

-The number of employees on nonagricultural payrolls went from 109.7-million in January 1993 (when Clinton took office) to 132.5-million in January 2001 (when Clinton checked out). Net gain: 22.8-million new jobs

-According to the U.S. Census Bureau, the number of people living in poverty went from 38-million in 1992 to 31-million in 2000

-The 1990's were full of economic growth, and some argue it was due to the up-cycle of the economy at the time

-Growth also due to advances in technology

-Speculative market drove the economy in the 1990's

-Speculative market is a market where stocks are rapidly bought and sold