In the U.S., the economy periodically rises and falls in a business cycle that is measured by fluctuations in real GDP and other macroeconomic variables. The National Bureau of Economic Research (NBER) is the federal agency that determines when the downturn is sufficient to be called a recession.
When the economy falls, the federal government often enacts legislation designed to stimulate the economy or legislation to ease the pain of unemployment. As you can see from these examples, there is very little new under the Congressional stimulus package sun.
When the economy falls, the federal government often enacts legislation designed to stimulate the economy or legislation to ease the pain of unemployment. As you can see from these examples, there is very little new under the Congressional stimulus package sun.
What Is A Recession?
According to the NBER, a recession is a period of significant decline in economic activity spread across the economy that lasts more than a few months; it is normally visible in production, employment, real income, among other indicators. A recession begins when the economy reaches a peak of activity and ends when the economy reaches its trough. Between trough and peak, the economy is in an expansion.The 2008 Recession
According to NBER, employment peaked in December 2007. Between November 2007 and June 2008, other sectors of the economy peaked: real personal income less transfer payments, real manufacturing and wholesale-retail trade sales, and industrial production. However, this recession did not have two consecutive quarters of decline in real GDP.- Start: December 2007
- End:
- Duration:
- Congress: Democrats pushed through tax rebates and other stimulus measures, the Economic Stimulus Act of 2008, February 2008
- Congress: Democrats pushed through a major economic stimulus bill, American Recovery and Reinvestment Act of 2009, February 2009
The 2001 Recession
The NBER determined that a peak in business activity occurred in the U.S. economy in March 2001; this expansion lasted exactly 10 years, the longest in the NBER's chronology.- Start: March 2001
- End: November 2001
- Duration: 8 months
- Unemployment peaked at 5.9% in June 2002
- Congress: In June 2001, Republicans pushed through the Economic Growth and Tax Relief Reconciliation Act of 2001 at a cost of $1.6 trillion over nine years; this included tax rebates for people who filed a tax return for 2000.
The 1990-91 Recession
This recession was investment-related and exacerbated by a spike in the price of oil and restrictive monetary policy. Contributed to President Bush losing to Bill Clinton in November 1992.- Start: July 1990
- End: March 1991
- Duration: 8 months
- Unemployment peaked at 7.8% in June 1992
- Congress: The Gulf War (2 August 1990 – 28 February 1991)
- Congress: In December 1991, Congress passed the Intermodal Surface Transportation Efficiency Act to maintain and extend the nation's transportation system; cost: $151 billion over six years.
- Congress: In April 1993, Congress passed the Emergency Supplemental Appropriations Act, providing $4 billion in emergency unemployment compensation to approximately 1.9 million unemployed American workers
The 1981-83 Recession
Energy prices contributed to this recession which combined high unemployment and high interest rates. The prime interest rate reached 21.5% in June 1982. The most serious recession since the Great Depression.- Start: July 1981
- End: November 1983
- Duration: 16 months
- Unemployment peaked at 10.8% in November and December 1982
- Congress: Surface Transportation Assistance Act (Jan. 1983) expected to create about 320,000 jobs; bill also added up to six weeks of unemployment benefits.
- Congress: Emergency Jobs Appropriations Act (March 1984) provided $9 billion to 77 federal programs to stimulate the economy and create jobs. GAO: "not effective and timely in relieving the high unemployment caused by the recession." (pdf)
The 1980 Recession
Energy prices contributed to this recession, the shortest on record. Combined with record interest rates, it also contributed to President Carter losing to Ronald Reagan in November 1980.- Start: January 1980
- End: July 1980
- Duration: 6 months
- Unemployment peaked at 7.8% in July 1980
- Congressional Action: Unknown
The 1973-75 Recession
The first oil-shock, prompted by U.S. support of Israel, triggered this recession and exacerbated the stock market crash. President Nixon resigned; Gerald Ford became president August 1974.- Start: November 1973
- End: March 1975
- Duration: 16 months
- Unemployment peaked at 8.8% in June 1975
- Congressional Action: Tax Reduction Act (March 1975) provided 10% rebate on 1974 tax liability ($200 cap) and $30 general tax credit for each taxpayer and dependent.
- Congress: Public Works Employment Act (July 1976) provided $4 billion for "temporary, Government-funded jobs"
- Congress: Local Public Works Capital Development and Investment Act (May 1977) authorized an additional $4 billion for state and local governments for local public works.
The 1970 Recession
The decade began with historic labor disputes: almost 210,000 postal employees launched the first mass work stoppage in the history of the U.S. Postal Service. Also in 1970, four railroad unions conducted a 1-day nationwide railroad strike. In 1971, longshoremen strikes closed all major ports on the East, Gulf, and West Coasts. Johnson is president; stagflation enters the vocabulary.- Start: December 1969
- End: November 1970
- Duration: 11 months
- Unemployment peaked at 6.1% in August 1971
- Congress: Public Works and Economic Development Employment Act Amendments for Depressed Rural Areas (August 1971)
- Presidential Action: Nixon imposes wage and price controls (August 1971)
The 1960 Recession
A drop in housing demand led this mild recession. President Eisenhower was in his last year in office. The recession may have cost Republican Richard Nixon the presidency because John Kennedy won a very close race in November 1960.- Start: April 1960
- End: February 1961
- Duration: 10 months
- Unemployment peaked at 7.1% in May 1961
- Congress: Area Redevelopment Act (May 1961) provides loans to proprietorships, partnerships, corporations, governmental bodies, public nonprofit corporations, and state or local development companies
- Congress: Public Works Acceleration Act (September 1962) - $1.9 billion for federal public works projects targeted to depressed areas
The 1957-58 Recession
- Start: August 1957
- End: April 1958
- Duration: 8 months
- Unemployment peaked at 7.7% in July 1958
- Congressional Action: Federal Aid Highway Act (April 1958) - Under this Act and related legislation, federal expenditures for public roads was approximately $2.3 billion in fiscal Year 1959.
- Congress: River and Harbor Act, Flood Control Act and Water Supply Act (July 1958) - $1.6 billion allocated