United States: an overview

An American flag at 1 World Trade Center. Credit: Getty Images

Despite the apparently inexorable rise of China, the United States remains by far the world’s largest national economy, a position it has held since the 1890s. The US GDP of $15.1trn accounts for over 19 per cent of gross world product by purchasing power parity.

The country remains the world’s largest manufacturer, producing one-fifth of global manufacturing output, and is home to 139 of the world’s 500 largest companies, twice the number of any other country.

In 2008, a combination of the sub-prime mortgage crisis, investment bank failures and the global downturn pushed the US into the longest and deepest recession it had suffered since the 1930s. The following year, Congress passed President Barack Obama’s $787bn stimulus bill, a combination of tax cuts and spending programmes designed to stimulate recovery. The economy returned to growth after four quarters of contraction, and has since regained all of its lost output (as measured by GDP).

Economic uncertainty has increased in recent months as Republicans and Democrats have struggled to reach political consensus on how to reduce the national debt, which has reached $15trn (98.9 per cent of GDP).