Jenny Cossola: The economy was on the minds of many Americans during 1983. The year began with the recession still more than just a memory. But by spring, the economic skies began to clear and, as Dennis Galeno recalls, analysts wondered why they ever worried about high interest rates …
Dennis Galeno: "The American consumer rediscovered that old enthusiasm. Factories had to start hiring; builders could hardly put up new houses fast enough; and by the time the year was over, the unemployment rate surprised almost everyone by its rapid improvement.
"While tax cuts helped put money in cash registers, economists outside the Administration gave their anti-inflation awards to Paul Volcker. The Federal Reserve Board Chairman safely confirmed to a new term kept reaching austerity, but $200 billion Federal deficits remained, helping keep interest rates high and the dollar expense of enough overseas to produce the worst American trade performance ever.
"The President's top economist, Martin Feldstein, urged Congress to balance the budget, even if that meant raising taxes. But taxes were not what the President had in mind, and the resulting flap forced Feldstein to fight for his job … "
Chairman Martin Feldstein: "'I support the President's program, and I believe that his fiscal policies in the past three years are an outstanding record of achievement.'"
Dennis Galeno: "Most bank accounts were completely deregulated, giving lots more savers the kind of interest payments only rich people used to get. The stock market broke through to record highs, and the one stock held by the most people, AT&T, was poised to start the new year split into eight pieces, the result of the most sweeping piece of Government intervention Corporate America had ever seen.
"This is Dennis Galeno at the Treasury Department."
Ed Karrens: Although the nation's unemployment picture improved during the past year, there were at year's end more than 9½ million Americans still out of work. But even for some of the working force, there were problems. Ken Robbins reports …
Ken Robbins: "The word 'giveback' became prevalent during labor negotiations, and most unions fought hard to preserve gains they had made in earlier contracts. Bargaining talks didn't always work, and there were strikes. Greyhound was crippled when its drivers walked out after refusing to take pay cuts. Continental Airlines was struck after the company declared bankruptcy, and teachers' disputes kept students away from classrooms in a number of cities.
"There were also some significant agreements. When Chrysler Corporation was able to pay back Government loans that kept the company in business, employees share the wealth when negotiations were began and an agreement was worked out. Eastern Airlines managed to avoid following Continental into bankruptcy and persuaded its employees to agree to a new contract. There were some givebacks, but jobs were saved.
"This is Ken Robbins."