Economy
During the 1960s, America had its longest, uninterrupted period of economic expansion in history. Big businesses dominated the economy, and the housing and computer industry rose. The federal government took a strong position on the economy and played several economic roles including being a consumer, an employer, a regulator, and a social welfare agency.
Due to spending from the Korean War, JFK inherited a weak economy with high levels of unemployment as he stepped into office in 1961. In his campaign he promised “to get America moving again” and he wanted economic growth at an annual rate of 4-6% and unemployment at 4%.
His first step to achieving this goal was sending Congress an economic growth and recovery package that consisted of 12 measures:
1. Monetary Policy and Debt Management
2. Housing and Community Development
3. Temporary Unemployment Insurance Extension
4. Expansion of United States Employment Service
5. Aid to Dependent Children of the Unemployed
6. Distressed Area Redevelopment Program
7. Distribution of Surplus Food
8. Improvements in the Old-Age, Survivors, and Disability Insurance Program
9. Early Payment of Veterans Life Insurance Dividends
10. Minimum Wage Increase and Expanded Coverage
11. Accelerating Procurement and Construction
12. Government Procurement in Labor Surplus Areas
The next measure JFK took was presenting to Congress a proposal for the tax cut. He said in a news conference in 162 that “It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now… Cutting taxes now in not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus.”
By 1963, JFK had managed to stabilize inflation, have corporate profits at a record high, and have the stock market turn around. However, unemployment was too high at 5.7%.
When JFK was assassinated on November 22.1963, LBJ inherited a strong economy, with inflation for the first two years of his presidency just under 2% and an annual dividend of $4-5 billion in extra revenue to spend. LBJ’s plan to build a “Great Society” included spreading benefits of America’s successful economy to more citizens and federal spending increased greatly. As America’s involvement in Vietnam grew, military spending also grew. Because of LBJ’s commitment to spending on both Vietnam and also his Great Society programs, the government needed money to support LBJ’s decisions. Johnson asked Congress to impose a temporary 10% income tax surcharge which was tied to a $6 billion budget reduction that became a law on June 28, 1968. At this point, nearing the end of LBJ’s presidency, the growth rate was 4% and the unemployment rate was at 3.3%, however inflation was up at 4.7%. The prosperity that America had been enjoying was now over.
Nixon’s approach to the economy was slow and cautious. He ignored advice calling for wage and price controls and relied on minor trimming of federal spending during his first year. By 1970, inflation had reached 6.5%, leading to rising rates of unemployment, deficits growing, and the stock market sagging.
—Economy of the 1960s
Due to spending from the Korean War, JFK inherited a weak economy with high levels of unemployment as he stepped into office in 1961. In his campaign he promised “to get America moving again” and he wanted economic growth at an annual rate of 4-6% and unemployment at 4%.
His first step to achieving this goal was sending Congress an economic growth and recovery package that consisted of 12 measures:
1. Monetary Policy and Debt Management
2. Housing and Community Development
3. Temporary Unemployment Insurance Extension
4. Expansion of United States Employment Service
5. Aid to Dependent Children of the Unemployed
6. Distressed Area Redevelopment Program
7. Distribution of Surplus Food
8. Improvements in the Old-Age, Survivors, and Disability Insurance Program
9. Early Payment of Veterans Life Insurance Dividends
10. Minimum Wage Increase and Expanded Coverage
11. Accelerating Procurement and Construction
12. Government Procurement in Labor Surplus Areas
The next measure JFK took was presenting to Congress a proposal for the tax cut. He said in a news conference in 162 that “It is a paradoxical truth that tax rates are too high and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now… Cutting taxes now in not to incur a budget deficit, but to achieve the more prosperous, expanding economy which can bring a budget surplus.”
By 1963, JFK had managed to stabilize inflation, have corporate profits at a record high, and have the stock market turn around. However, unemployment was too high at 5.7%.
When JFK was assassinated on November 22.1963, LBJ inherited a strong economy, with inflation for the first two years of his presidency just under 2% and an annual dividend of $4-5 billion in extra revenue to spend. LBJ’s plan to build a “Great Society” included spreading benefits of America’s successful economy to more citizens and federal spending increased greatly. As America’s involvement in Vietnam grew, military spending also grew. Because of LBJ’s commitment to spending on both Vietnam and also his Great Society programs, the government needed money to support LBJ’s decisions. Johnson asked Congress to impose a temporary 10% income tax surcharge which was tied to a $6 billion budget reduction that became a law on June 28, 1968. At this point, nearing the end of LBJ’s presidency, the growth rate was 4% and the unemployment rate was at 3.3%, however inflation was up at 4.7%. The prosperity that America had been enjoying was now over.
Nixon’s approach to the economy was slow and cautious. He ignored advice calling for wage and price controls and relied on minor trimming of federal spending during his first year. By 1970, inflation had reached 6.5%, leading to rising rates of unemployment, deficits growing, and the stock market sagging.
—Economy of the 1960s