September 11, 2007

The Post-9/11 Economic Boom

James Pethokoukis looks at how the American economy has fared since the September 11 attack, an attack that Osama bin Laden later declared was in part intended to help bring down the U.S. economy.

Since September 11, the economy hasn't suffered a single down quarter. In fact, it has notched 23 straight quarters of economic growth. (And despite the subprime mortgage crisis, this is likely to be the 24th straight quarter of growth.) Those numbers are especially amazing when you consider that when the terrorist attacks happened, the Internet stock bubble was in full implosion mode. The economy dipped in the third quarter of 2001 and was slightly negative in two of the previous four quarters.

But it's been nothing but growth since then. Overall, the American economy is, adjusting for inflation, $1.65 trillion bigger than it was six years ago. To put that gigantic number in some perspective, the U.S. economy has added the equivalent of five Saudi Arabias, eight Irans, 13 Pakistans, or 15 Egypts, depending on your preference. And while 9/11 did cause the stock market to plunge, the Dow is 37 percent higher than it was on Sept. 10, 2001, creating trillions of dollars of new wealth for Americans. What's more, the unemployment rate is 4.6 percent today vs. 5.7 percent back then. Not bad at all.

I blame the Bush tax cuts - and Bush's resolute leadership in the face of the Islamist threat - for the economy's resilience after 9/11.

By the way, more good news: All that economic growth makes America more and more able to fund fighting the war on terror.