E C O N O M I C R E P O R T O F T H E P R E S I D E N T

C H A P T E R 1Sustaining a Record-Breaking ExpansionCourtesy of the Max Morath CollectionWe had the largest industrial economy, the largest agricultural economy, the highest percapita income, the highest level of education. It must have been a wonderful time to bealive for most Americans, not for everybody, but for most Americans....I don’t think wecan understand what it was like in 1900 unless you think of optimism, of hope, ofbuoyancy, for the United States everything seemed to be going right.— John Milton Cooper, Jr., in an interview for America 1900,a documentary in The American Experience series on PBSThe policy strategy of maintaining fiscal discipline, investing in peopleand technologies, and opening international markets has borne richfruit, allowing the Nation to exploit new opportunities and reap the benefitsof major scientific and technical advances. The results have been a 20-million-job increase in payroll employment since January 1993, the lowestunemployment rate since 1969, the lowest core inflation rate since 1965, thelowest poverty rate since 1979, rising productivity, significant gains all acrossthe income distribution, and a Federal budget in surplus for 2 years in a rowafter nearly three decades of deficits. The current economic expansion,already the longest peacetime expansion on record, is on the threshold ofbecoming the longest ever. The mood of optimism that prevailed at the dawnof the 20th century prevails today as well.21