Believe It: Worldwide Economic Boom

"This is far and away the strongest global economy I've seen in my business lifetime."

--U.S. Treasury Secretary Henry Paulson


James Pethokoukis, who quotes Paulson in a US News article, has the proof to support Paulson’s statement:

 According to Goldman Sachs: "If we and the consensus are correct, then the period 2003-2008 will have been one of the most powerful periods of economic growth globally since accurate data [have] been collectible for much of the world."

 According to the International Monetary Fund the global economy is growing at about a 5 percent annual pace, after growing 4.9 percent in 2005 and 5.4 percent last year. By contrast, the global economy grew at a 3 percent pace from 1980 to 2000 and at 4.7 percent from 1960 to 1980.

 The gross global product is three times as big as it was in 1970, when adjusted for inflation. According to the Federal Reserve Bank of Minneapolis, "The first 60 years of the 20th century saw average annual global growth rates of 2.4 percent, after 1 percent for the entire 19th century, and one-third of 1 percent for the 18th century."

 Since 2000, according to the Tax Foundation, more than half the countries in the Organization for Economic Cooperation and Development have lowered their top marginal rates, reducing the OECD average rate from 45.93 to 42.95 percent.

 The U.S. reduced its top rate by over 13 percent between 2000 and 2006, dropping it from 15th to 21st highest in the OECD rankings. If no other country had reduced its tax rates, the U.S. would stand at 26th, but the strong tax-cutting trend in other OECD countries blunted the U.S. advantage.

 Full repeal of the 2001 rate cuts after a surcharge to fix the Alternative Minimum Tax (AMT) would move the U.S. from 21st to 9th highest—and that assumes the tax cutting abroad comes to a halt. A repeal of the 2001 tax cuts with no AMT surcharge would move the U.S. to 11th highest.