Economics and Politics in 1994:
Economics:
US Economy in 1994:

• Low Inflation Rate: caused consumer spending and real disposable income to rise due to
  the decrease in the price of goods.



• Unemployment trended downward from 6.7 to 5.4 percent over the year: caused more people to have jobs and earn more money to buy more luxury type items such as expensive purses and shoes.

• Discount Rate Rose: (discount rate is the interest rate the Fed charges for loans to banks)
  people were more likely to get loans, which raises spending trends in households.
  


• Medical Costs Rose: caused some consumers such as the elderly to concentrate on medical expenses instead of unnecessary spending.
  
  
• Sizable Trade Deficit: made it more dificult for the Fashion Industry to get products overseas which caused an increase in the total cost of goods.
  


• Stagnation of Family income in lower Economic groups: made it harder for lower classes to spend money on fashion products, instead they had to spend money on necessities.
  




• Labor Productivity grew by 4.9 for manufacturing (the largest gain in 7 years): gave businesses the ability to spend more on producing goods, lowering prices and causes consumers tend to buy more inexpensive items.
  



• Gross Domestic Product Grew 4.1 Percent (the largest in 10 years): A major indicator of a healthy economy, this meant consumers were more willing to spend money on fashionable items.
  


• “The country is in the midst of profound economic change. We're going from an essential blue-collar economy and relative easy affluence to a time where we're in an international economy and the blue-collar jobs are disappearing, and where in many homes there is more anxiety and more and more the middle class depends on education.”




• Lower class families are less likely to make spontaneous purchases of material goods such as fashion accessories and expensive clothing.

(Source: THE 1994 ELECTIONS: VOTERS; 'It's Like a Call to Arms, Which the Democrats Will Ignore at Their Peril')

Links to Articles:
http://www.world66.com/orld66.com/ New York Times
Consumer Prices in 1994 Collective Bargaining in Private Industry 1994
1994 Economy

Authors: Joseph Pavalone, Lisa Williamson and Phyllis Brown.

Politics:
THE 1994 ELECTIONS: VOTERS

• Republicans seem to have evoked in their call for no government or less government or smaller government. Somehow, the Republicans have captured that insurgent feeling against all politicians in general. And now it's their turn to try to prove that their solutions for the complex problems of America -- the balanced budget, lower taxes, somehow magically reducing the deficit, and welfare reform and harsher measures on crime -- will actually work. Alan Brinkley Professor of history at Columbia University.
  
  
• Americans begin to trust Republicans over Democrats. Republicans assure Americans that changes can be made, and that the government should play a smaller role in the American lifestyle.
  


• This assurance typically creates a wider spending range on non necessary items.
  


• Clinton signed the Family and Medical Leave Act, which required large employers to allow their employees to take unpaid leave because of pregnancy or serious medical condition.
  


• This act allows families to have more job stability and security, providing a better income and allowing them to spend more on leisure activities such as shopping, traveling, and out door activities.
  
• Source: http://www.nationmaster.com/, http://www.nytimes.com/, http://www.infoplease.com/, http://www.indyweek.com/
  
  Region of residence, Average Annual expenditures and Characteristics, Consumer Expenditure Survey, 1994-95
  
• Region tables contain expenditure data from the four regions of the country:
  This information is helpful to sellers and producers for predicting what consumer buying trends will be in the to come.