On the topic of American Growth, here's an interesting
entry in the Weblog of Brad de Long, a macroeconomist at Berkeley. The bulk of the information is expressed in two lines. The red one shows the development of the American economy's actual output, the blue one its potential output -- what it could produce if it was running at full capacity.
[Edit: I had to remove the image because it was waaay too big. It's in the article I linked to though]
Several points:
1) There is no such thing as overcapacity. There's only insufficient demand. Put money into people's hands, and they'll find a way to make use of the overcapacity.
2) Given a level of productivity, it is usually easy for the government to increase demand by lowering interest rates, increasing government spending, tax cuts for people who spend them, or a combination of the three. But this time, the Fed can't cut their interest rates any lower, the Bush administration won't cut taxes for the lower and middle classes much, who are the most likely to spend it. That leaves spending growth. Better than nothing, but it has been insufficient so far.
3) the area between the two lines is a measure of the macroeconomic waste caused by inadequate government policies. Guess which three years in history have seen the most waste since the Great Depression.
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