What Happened to the Recession? Surprise! Bush Expansion Continues

[CactusCarlos]

http://www.northstarwriters.com/dc170.htm

I once heard Rush Limbaugh say the way he deals with a recession is to “not participate in it.” Today we found out that in our current so-called recession, the economy itself is not participating.

 

You’ve heard, of course, about the “recession.” The Associated Press has been referring to it as an established fact for much of the year. Every day, we see interviews with economists who grimly warn that we are surely already in a recession. The only debate is how bad it will get.

 

Oops. Some facts just arrived, and they’re not what the media, the economists and the Democrats had long since made up their minds was the truth.

 

We’re not in a recession. Not. The economy is still growing. It’s not growing at a break-neck pace, but it is growing, and that means there is more per-capita wealth in this country now than there was three months ago. A recession is happening when you have two consecutive quarters of negative economic growth. At present, we’ve had about 25 consecutive quarters of positive economic growth. So, recession? Sorry, we’re not in one.

 

The economy grew (yes, emphasis on grew) at a rate of 0.6 percent in the first quarter of 2008. Or, as the Associated Press would put it, the economy “limped along.” Everyone’s a critic.

 

Most people don’t understand what economic growth really represents (especially if they get their economic news from the Associated Press), so let’s briefly review: Economic growth means the nation, as measured by gross domestic product (GDP), generated more value in the form of goods and services than it did during the last period measured.

 

Most news reports about the economy lead you to believe that if growth is slow, the economy is getting worse. It’s not. If there is any growth, the nation’s output is improving. When growth is negative, that’s when it’s getting worse. That hasn’t happened since early in President Bush’s first term, and it hasn’t happened at all since Bush’s 2001 and 2003 tax cuts went into effect, which is why John McCain, who voted against them, now admits “they worked” and proposes to make them permanent.

 

But the major media has been so bought into the idea that we were falling into a recession, they saw no reason to actually wait for the numbers. It’s become an accepted tenet of conventional wisdom that the recession was underway. Most of the reporting on the subject has operated under the presumption that the first and second quarters of 2008 would make it official.

 

Now that we know the storyline was wrong, it’s not hard to figure out why they got it wrong. It happened primarily for two reasons.

 

First, many in the mainstream media were engaged in hopeful reporting. They don’t like President Bush, and they are eager to discredit his economic policies. Since 85 percent of professional journalists vote Democratic according to most surveys, they see it as their job to speak truth to power, man, so warning people of the coming recession was their job. They thought.

 

The second reason is less sinister but just as irresponsible. Too much of reporting these days consists of making predictions instead of reporting facts. If a bunch of economists think we’re going to have a recession, that doesn’t mean news has happened. It just means a bunch of people expect something, even though they have no idea if it’s going to happen or not.

 

Before we had economic growth numbers available, we read about the rather bizarre statistic known as “consumer confidence,” which we were told was down. Gee. Wonder why! Every time the stock market is down, we hear about “jitters” fueling the decline.

 

Yet all the gloomy predictions, repeated over and over again, still haven’t been enough to produce a recession.

 

Now, you may protest, a recession could still happen! Sure it could. And if it does, it should be reported as news. We could also get a new pope some day who takes the name Larry, but in the meantime we don’t need to see news stories speculating that it could happen, let alone that it’s a foregone conclusion.

 

Wait. See. Report the facts. Otherwise you’ll end up like the Associated Press, having to go back and write corrections to all the news stories you’ve written reporting the recession is already under way.

 

Nope. The Bush expansion continues.

 

[DixieBelle]

I hate the mainstream media.

I also believe that when they run doom and gloom reports based on zero facts, that it can be a self-fulfilling prophecy. We have friends and family who believe everything that Mr. Joe Anchorman says on the evening news and they are the first ones in line to buy things like rice when they hear it's being rationed. They are also the first people in line to tighten their wallets out of some irrational fear that the economy is tanking when in fact it's not. It makes no sense. If you're still earning a living, your job is secure, you aren't in a personal financial death spiral, then there is no reason to go into panic mode and start stocking canned goods in the basement.

Don't get me wrong though. Being frugal and being prepared is important. But for us, it goes without saying. But, we don't stop living our lives and start staying home. If people do that without cause, consumer confidence slips and it does affect business owners and the entire economy. We haven't changed our habits. We still support the local economy and go out. You live within a budget, you don't let the media dictate when you spend or save.

[USA4ME]

I'm going to go against the grain here and say we did have a recession, howbeit a small one.  It's an election year, and there's no way on the planet with an R president and a D Congress that either want to take the chance of a recession being blamed on them, so the numbers were done in a way that there was some growth, but not much.

But see, a recession doesn't bother me.  It's just a natural part of the economy to have ups and downs.  In fact, I'd just as soon have 24 or 30 months of growth and a little dip rather than 10 years and a big adjustment, it's just healthier that way.

So I think we had some negative growth (wierd term, I know), but it's an election year, so there ain't no way it'll ever be reported that way.

I also like what Dixie had to say.

.

[DixieBelle]

Thanks! I'm no financial whiz but I'd like to think this stuff isn't too hard to figure out once you filter out the political angles.

[Lacarnut]

I hate the mainstream media.

I also believe that when they run doom and gloom reports based on zero facts, that it can be a self-fulfilling prophecy. We have friends and family who believe everything that Mr. Joe Anchorman says on the evening news and they are the first ones in line to buy things like rice when they hear it's being rationed. They are also the first people in line to tighten their wallets out of some irrational fear that the economy is tanking when in fact it's not. It makes no sense. If you're still earning a living, your job is secure, you aren't in a personal financial death spiral, then there is no reason to go into panic mode and start stocking canned goods in the basement.

Don't get me wrong though. Being frugal and being prepared is important. But for us, it goes without saying. But, we don't stop living our lives and start staying home. If people do that without cause, consumer confidence slips and it does affect business owners and the entire economy. We haven't changed our habits. We still support the local economy and go out. You live within a budget, you don't let the media dictate when you spend or save.

The media is foaming at the mouth to make us believe that the economy is going to hell in a hand basket. The purpose is to brainwash the electorate into thinking that they will be better off with a Democratic Prez.

[Lauri]

the other thing to keep in mind is just exactly how large our US economy is.. and what that .06% translates into.. its still a helluva lot of money cycling through.

and yes, Dixie is right; the negative media spin on everything is affecting how people think and making them leery. but as i keep telling my young neighbors and kids, its an election year and they are throwing everything possible at Bush to make his approval ratings go down and inflict pain on the GOP.

but you watch.. should a Dem somehow manage to get into the WH, it will all be rosy and fine. no recession for them.

[Lacarnut]

but you watch.. should a Dem somehow manage to get into the WH, it will all be rosy and fine. no recession for them.

Correct

The day after Bubba became Prez, the rants by the media and the democrats about "it's the economy stupid" turned into a miraculous transformation that everything about the economy was peaches and cream.

[Lauri]

but you watch.. should a Dem somehow manage to get into the WH, it will all be rosy and fine. no recession for them.

Correct

The day after Bubba became Prez, the rants by the media and the democrats about "it's the economy stupid" turned into a miraculous transformation that everything about the economy was peaches and cream.

i just hope once the economy does indeed stabilize - and it always does - the McCain team will put together commercials of either Hilary or Obama constantly downgrading this country the past year and how 'terrible' the USA is .. just one undermining remark after another.

then he needs to contrast that with some uplifting remarks about how the US is NOT over..

i tend to think the majority of the US would be in agreement ..

[Ptarmigan]

I'm going to go against the grain here and say we did have a recession, howbeit a small one.  It's an election year, and there's no way on the planet with an R president and a D Congress that either want to take the chance of a recession being blamed on them, so the numbers were done in a way that there was some growth, but not much.

But see, a recession doesn't bother me.  It's just a natural part of the economy to have ups and downs.  In fact, I'd just as soon have 24 or 30 months of growth and a little dip rather than 10 years and a big adjustment, it's just healthier that way.

So I think we had some negative growth (wierd term, I know), but it's an election year, so there ain't no way it'll ever be reported that way.

I also like what Dixie had to say.

.

Took it out of my head.  I think there was a recession and we didn't know about it already. If there is a recession, we would know that later this year.

[West Coaster]

While I agree with many here that the MSM overplays the economic crisis, I also agree with USA4ME that we have been in a mild recession.  The definition is two consecutive quarters of negative growth while the official numbers have shown .6% growth in both of the last two quarters.  However, it's important to remember that that number is adjusted for inflation, but the inflation factor they use in calculating the final growth number does not include gas or food, which have both increased significantly in costs during that period.