by the Council of Economic Advisors

About the author: The Council of Economic Advisors was established by the Employment Act of 1946 to provide the president with objective economic analysis and advice on the development and implementation of a wide range of domestic and international economic policy issues. The following viewpoint is excerpted from the council’s January 2001 report to then President Bill Clinton.

Over the last 8 years [from 1993 to 2000] the American economy has transformed itself so radically that many believe we have witnessed the creation of a New Economy. This [viewpoint] presents evidence of fundamental and unanticipated changes in economic trends that justify this claim. In the 1990s, after two decades of disappointing performance, the economy enjoyed one of its most prosperous periods ever. Strong and rising growth in real gross domestic...