Outlook 1976: Temporary Economic Prosperity

Thanks to election year politics, look for massive intervention in the economy to produce short-term economic prosperity in 1976.

| March/April 1976

This is a major election year, and the U.S. Bicentennial at that. Ain't no way that the incumbent politicians (Republican and Democratic), who control some very large purse strings in this country, are gonna let this be a bad year economically. That is, if they have anything to say about it.

Look for economic prosperity through economic manipulation. The Good Times will roll in every way that political actions can make them roll during the next few months. Most national politicians will strike fearless poses for fiscal responsibility when in front of the TV cameras while battling furiously behind the scenes for the release (preferably to selected constituents of their own) of every possible slush fund in Washington. Hundreds of thousands of people will volunteer or be conned into laboring day and night for campaign organizations ... which, if nothing else, will keep such individuals from competing for "real" work and—in theory, at least—even relieve the nation's unemployment figures by a fraction of a percent. Revenues for airlines, bus lines, automobile rental agencies, small film companies, printers, and a hundred other mini-industries will be up as politicians, campaigners of all persuasions, speech writers, secretaries, party faithfuls, and flunkies increasingly crisscross the country seeing and being seen, attending caucuses, making deals, spying on the opposition, and passing out banners, buttons, stickers, posters, and funny hats.

Add to that activity the record number of tourists expected to flock to every historic landmark in the United States this year (in some cases because they can no longer afford a foreign vacation). And then tack on the very real (even if very weak) rebound that the automotive and a few other major industries are now making. Then figure in the boost our economy has already gotten from the billions that have been pumped into "saving" New York City, extending and extending once again unemployment benefits for several million people, and otherwise bailing us out of the 1974-75 financial doldrums. Factor in the current artificially depressed prime interest rate (which will hype borrowing and business expansion) and the razzle-dazzle buoyance that's been (again, somewhat artificially) injected into the stock market. And lard on all the other little tricks that the "important" economists and politicians can pull out of the hat during the next few months.

And you get boom times, right?

Well ... no.

Even administration forecasters (who, obviously, have a vested interest in Making Everything All Right Again) are predicting a real growth in the economy during 1976 of only 6.2%, a decline of inflation from last year's 8.7% to (what we would have considered just a few years ago a still-intolerable) 5.9%, and a barely perceptible inching down of unemployment from 1975's 8.5% to 7.7%.

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