Politics
Generally an administration gets credit or blame for the state of economy during its time. This has caused disagreements about when a recession actually started. In an economic cycle, a downturn can be considered a consequence of an expansion reaching an unsustainable state, and is corrected by a brief decline. Thus it is not easy to isolate the causes of specific phases of the cycle.
The 1981 recession is thought to have been caused by the tight-money policy adopted by Paul Volcker, chairman of the Federal Reserve Board, before Ronald Reagan took office. Reagan supported that policy. Economist Walter Heller, chairman of the Council of Economic Advisers in the 1960s, said that "I call it a Reagan-Volcker-Carter recession. The resulting taming of inflation did, however, set the stage for a robust growth period during Reagan's administration.
Economists usually teach that to some degree recession is unavoidable, and its causes are not well understood. Consequently, modern government administrations attempt to take steps, also not agreed upon, to soften a recession.
Read more about this topic: Recession
Famous quotes containing the word politics:
“Finishing second in the Olympics gets you silver. Finishing second in politics gets you oblivion.”
—Richard M. Nixon (b. 1913)
“I am in politics because of the conflict between good and evil, and I believe that in the end good will triumph.”
—Margaret Thatcher (b. 1925)
“Until politics are a branch of science we shall do well to regard political and social reforms as experiments rather than short-cuts to the millennium.”
—J.B.S. (John Burdon Sanderson)