by John F Mann

Created on: April 30, 2008   Last Updated: July 10, 2008

As of July 2008, we continue to hear tortured pronouncements, typically without much factual information, about how the US is in "recession", and has been for several months. The vast majority of such recession mongers conveniently neglect to tell us that they are more interested in their own political agenda than fair evaluation of the facts on the ground. They are trying to score political points by falsely proclaiming (often with barely contained glee)that economic conditions are similar to past recessions, such as 1991 and 1981. Far too many Americans buy into these exaggerated claims, either because they do not remember previous recessions or they are easily "persuaded" by the constant pessimism pervading much of the media during this very political year.

Final first quarter (Q1) real GDP results have recently been increased to 1.0 percent, which is an increase from the prior quarter. There has never been a recession in the US where real GDP is both positive and increasing. The fact remains that the US economy is clearly not in recession, using any reasonable interpretation of the traditional definition.

For any debate on this issue to be fair, there must be basic agreement on the meaning of the word recession. However, considering arguments on the other side, it is quite clear that the vast majority of those who claim the US is now (and has been) in recession are twisting the traditional definition.

Some proponents of the "yes we are" in recession argument have in fact enunciated their intention to change the traditional definition of recession. However, they fail to also discuss how, using their personal definition, the US would have had many more "recessions" since 1945 compared to the identified recessions widely accepted by economists representing the two main political parties (and even some fringe parties).

The basic traditional definition (though there are variants to be considered) of recession is a contraction in "real" ("inflation" adjusted) production, generally accompanied by large-scale increase in unemployment.

A generally agreed upon condition of the basic definition is that production is fairly defined by the US government measurement of Gross Domestic Product (GDP).

Final fourth quarter (Q4) 2007 real GDP came in at 0.6 percent. While much lower than average values for the past 40 years, this value still represents "real" growth, not contraction.

Final first quarter (Q1) 2008 real GDP has been reported as 1.0 percent also; again, growth, not

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