Summary: “The Great Inflation and Its Aftermath” by Robert J. Samuelson

Summary of "The Great Inflation and Its Aftermath"
The Past and Future of American Affluence
by Robert J. Samuelson

• The Great Inflation of the 1960s and 1970s was an unintended byproduct of an attempt to control business cycles and cut unemployment.
• This persistent inflation, which started under John F. Kennedy, was an ambitious intellectual effort to improve Keynesian economic theory by fostering growth.
• Every president from JFK through Jimmy Carter failed to control inflation or (except Gerald Ford) to identify it as the economy’s greatest problem.
• “Double-digit inflation” caused four recessions: 1969–70, 1973–75, 1980 and 1981–82.
• Ronald Reagan and Fed Chair Paul Volcker used unpopular tactics to control inflation.
• Their actions produced the longest peacetime economic expansion, from 1983 to 1990.
• The “old economy” was stable; the growth-driven “new economy” is in constant flux.
• It creates more jobs, choices, innovative products and higher living standards, but it also leads to shorter job tenures, more bankruptcies and weakened industries.
• Globalization generates prosperity, competition, job migration and bigger markets.
• Studies find no direct correlation between wealth and happiness, though economic growth tends to breed democracy and optimism.

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