Well, we can stop worrying about the economy now. Write it down. Chris Rugaber at the Associated Press, aka the Administration’s Press, tells readers today that the business cycle has been repealed. That’s right. As of now, “Gone are the fears that the economy could fall into another recession.”
Even giving him the benefit of the doubt that he only meant to refer to the short- or intermediate-term, it takes a mountain of chutzpah to make such a declaration after a quarter during the which the economy grew at an annualized 0.4%, i.e., an actual 0.1%. It’s doubly hard to take because the press, led by the Associated Press, feared that a recession was around the corner virtually every month or quarter from the time I began blogging in early 2005 until mid-2008, when the National Bureau of Economic Research defied the normal person’s definition of recession (i.e., two consecutive quarters of contraction) and decided that a recession began in December 2007, seven months before it really did.
Here is a rundown of Rugaber’s good news and bad news items. The entire collection should cause an observer to be unimpressed. But not our good buddy Chris:
Good news (i.e., “What’s Back”; counterarguments are in italics) –
Household Wealth (largely thanks to Ben Bernanke’s propped-up stock market; Ben can’t, or at least shouldn’t, prop things up forever, though the left thinks he can, will, and should)
Retail Sales (largely thanks to overgenerous governemnt benefits, or what Ed Morrissey calls “A Food Stamp Recovery” at the Fiscal Times)
(Reduced) Layoffs (seasonally adjusted unemployment claims have risen for the past three weeks, and weekly raw claims aren’t lower than last year at the same time by very much)
Reduced Foreclosures — (well, at some point you run out of houses to foreclose on, and the government will bring those numbers back if it continues to insist on resurrecting the subprime market)
Stock Market (a Ben Bernanke prop-up)
GDP, which is a tiny bit higher than it was before the recession began (even Rugaber admits that per-capita GDP, also known as the Warren Buffett benchmark, is still 1.5% short of where it was before the recession began. It’s the Buffett benchmark that’s the point at the famed investor has said he will recognize that the recession is really over.)
Here’s Rugaber’s bad news (i.e., “What’s Not Back”; no need for counterarguments, just reinforcements), which really represent reasons why there has been no real recovery from the recession –
Total Jobs — 3 million below their pre-recesison peak. But “the population of Americans 16 and older has grown by 13 million since then,” so the true shortfall is really close to if not in the double-digit millions.
Unemployment Rate — Rugaber writes: “When the recession began, unemployment was 5 percent. Now, it’s 7.7 percent. Probably no figure better illustrates the downturn’s lingering damage.” No Chris; no figure better illustrates the downturn’s and subsequent pathetic recovery’s continuing damage.
Housing — ” Most economists welcome the steady but modest growth housing has achieved in recent months.” Lord have mercy. The sector is still at least 40% below where it should be in a healthy and non-bubbly situation.
Auto Sales — still over 4% below the pre-recession peak.
Industrial Output — still about 5% below the pre-recession peak.
All of this adds up to the worst recovery since World War II, and an economy which could be sent into a recession by any number of factors: high gas prices, escalating tensions in North Korea and Middle East, and a European financial implosion, to name just a few.
I hope I’m wrong, but the chances that Chris Rugaber will come to rue his rose-colored outlook are far from small.
Cross-posted at NewsBusters.org.