Sunday | August 11, 2002
Are we in a 'recession'?
56 percent of Americans think the US is in a recession, which probably has the White House in full panic mode. The administration is avoiding the word "recession" like the plague, instead lauding the "fundamentals" that indicate the economy is set for growth.
In effect, administration officials continuously point to certain economic data that, supposedly, offer proof the economy is sound. That may well be true, but it is irrelevant. The technical definition of 'recession' is nearly incomprehensible to all but learned economists -- and even they will disagree 99 percent of the time.
When people on the street talk about 'recession', they mean something entirely different. The word describes the prevailing economic zeitgeist -- an emotional term, not a scientific one. It's the way we feel when we see our friends and family lose their jobs, when the markets are in the gutter, when CEOs are being led away in 'cuffs, when the trade deficit hits record highs, when storefront after storefront has a “For Lease” sign on the window, when the dollar gets pounded in the currency markets, when big business continues its unabated mass layoffs, when job insecurity rules the day. Thus when faced with this economic malaise, we give it the one name our language provides: recession.
There's nothing the president can do about it, short of massive stimulus spending -- but that would be political suicide. Best he can do is try and shirk responsibility. Unfortunately, his fingerprints all over the situation. Forget Harken and Halliburton for the moment. Let's go back to the tax cuts. This is what Bush, circa 1/2001, had to say about them:
President Bush's agenda will [...] improve the performance of the economy. His tax cut will help prevent a prolonged economic downturn, and it will encourage innovation. His plan will also allow workers to pay down consumer debt, while leaving growing surpluses to pay down a record amount of public debt.Bush made a clear promise: pass the tax cut, and the economy will rebound. We will avoid a 'prolonged economic downturn'. We will 'encourage innovation' (whatever the heck that meant).
Bush could claim with justification that the 2001 recession wasn't his fault. But the tax cut was going to solve that. It was the solution to the nation’s economic woes. One year later, not only is the economy worsening, but the “growing surpluses” are history, as are any chances of paying down a “record amount of public debt.” Enron, Harken, Halliburton et al are the whip cream and cherry on top. The War on Terror has taken a backseat to personal economic security.Posted August 11, 2002 09:21 PM | Comments (0)