The figures in the chart above are from the Commerce Department's Bureau of Economic Analysis. It shows the real growth of the Gross Domestic Product (GDP) of the United States from 1996 through the first quarter of 2014 (in 2009 dollars). The red dotted line in the average GDP in the United States (about 3.27% annually). A healthy and growing economy will have an annual GDP at or above that average GDP line.
Note that the economy was doing pretty well in the Clinton years. In 2001 though, probably due to 9/11 and the new wars, the economy slowed significantly to a GDP of only 1.0%. It did rise above the GDP average for 2004and 2005, before starting to drop in 2006 and taking a huge nosedive as the recession hit in 2007 (dropping to a -2.8 by 2009).
The real problem we face now though is that even though Wall Street and corporate profits have rebounded (reaching record levels), the economy as a whole has not recovered. Since the "recovery", the economy has limped along (bouncing between 1.8% and 2.8%) -- and in the first quarter of this year dropped to a worrying -1.0% in GDP growth.
Wall Street celebrated the Republican policies that weakened unions, deregulated financial and other corporations, encouraged job outsoucing to other countries, and lowered taxes on the rich when times were good -- because it allowed them to hog all of the rising productivity and keep more of that new money through subsidies and lower taxes. But as the economy continues to struggle, even Wall Street is starting to realize that those policies may well have been a bad mistake -- and they are beginning to understand that some changes need to be made.
And those changes don't involve more tax cuts for the rich and corporation, and more cuts to government spending. They want to get the U.S. economy moving again, and they are realizing that can only be done by creating millions of new jobs and raising worker wages.
While the U.S. has finally replaced most of the jobs lost in the recession, that still doesn't account for the millions of new workers entering the workforce since the recession. And too many of the new jobs replacing the old ones lost are lower wage and benefit jobs. All of this means that American workers have less money to spend than they did before the recession (even though prices have risen). This is why the economy is struggling (and why Wall Street is now worried this will soon begin to affect their own profit picture).
It would help immensely to strengthen unions and eliminate the tax breaks that encourage companies to ship American jobs overseas, but the biggest and most immediate boost to the economy would be to raise the minimum wage to $10.10 an hour. This would give millions of hard-working Americans new income (which they would spend to increase demand and boost the economy, creating new jobs), and it would also put upward pressure on the wages of millions of other workers making less than the average U.S. wage (which would also increase demand and create new jobs).
It goes without saying that most American workers would benefit from the higher minimum wage, but as Wall Street is starting to understand, that higher wage would also benefit American businesses (as their profits increase by meeting the rising demand). Higher worker wages would be good for everybody -- and it would create new jobs (which would also be good for everybody).
