Economic Histrionics

Yesterday, I saw an article in the newspaper titled Bush Insists US Not in Recession. Why should he need to insist, I wondered. More to the point, why should his simple statement of an easily verifiable fact be characterized as insistence, which carries a connotation of defensiveness and denial?

A recession is defined as a decline in Gross Domestic Product for two or more successive quarters. According to the U.S. Department of Commerce, we haven’t had two successive quarters of decline in the GDP since 1991. The last time we had a decline for even one quarter was in 2001. Considering that we haven’t had a single quarter of decline in the GDP for the last six and a half years, it seems rather whimsical of the media to be declaring we’re in a recession, doesn’t it?

Earlier in the week, I read an article titled Survey Shows Economic Depression Likely. The article went on to say an opinion poll revealed that the majority of Americans think we’re headed for a depression. Oh, my. That certainly sounds scary. A depression is even worse than a recession! And, if the majority of Americans think it’s likely, then it must be, right? I mean, the majority of Americans can’t be wrong….

Then again, if you were to ask the majority of Americans what’s the definition of an economic depression, how many of them would know? Is asking a bunch of random people who don’t actually know what a depression means really the best way to determine if one is imminent? The definition of an economic depression is a decline  of over 10% in the GDP. The fact is, over the last four years of Bush’s presidency, we’ve seen an 11.8% increase in the GDP.

What? How can that be? With all this talk of economic disaster, is it possible that we’ve actually had the opposite of an economic depression? Something must be wrong with the data. After all, why would a majority of Americans believe we’re headed for a depression if it has no basis in fact? — Well, perhaps they believe it because that’s what they’ve been told by the media, over and over, for the past year. And now the very fact that they believe it is being sold to them as evidence that it’s true! 

So, how do you know whom to believe, the mainstream media or the data from the Department of Commerce?  Is it conceivable that all this talk of dire economic straits is hyperbole? Well, look around you. How many bread lines have you seen recently? But, if it is just media hype, why would they want us to believe that? In whose interest might it be to stir up fear and uncertainty in the population?  Whatever could be their motivation?

At the risk of sounding cynical, it is an election year. If the majority of Americans believe we’re headed for a depression, or that we’re in the middle of a recession and our president is lying to us about it, they might get pretty upset and worried and feel like we really need a change. (Seems I’ve been hearing that word a lot somewhere lately.) If Americans are living in fear of an imminent economic collapse, they’ll be all the more receptive to claims that it’s those evil capitalists, with their greed, warmongering, and tax breaks for the rich, that have gotten us into this mess. It only makes sense that we need to elect a Democrat to get us out of it.

Not only will the Democrats punish the large corporations for making too much profit, and end the war by heroically turning our backs on the terrorists and scurrying back home, they’ll raise the minimum wage and provide you with free healthcare, free lunches, and free whatever else they can convince you that you need (whether they can deliver it or not). Why would anybody believe that kind of unrealistic rhetoric? Because a lot of people want to believe it, and most people are more than ready to believe what they want to believe. The Democrats know that very well.

But first they have to convince the majority of Americans that times are bad. Times are very bad. — If the aforementioned survey is a reliable indicator, it looks like phase one is succeeding.

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