No, seriously, you can’t make this up. That’s what someone needs to tell the economists at the White House who have actually opted to make up a new definition for a recession. They claim that despite the sad reality that the US economy has contracted twice in as many quarters, since unemployment hasn’t risen, it’s not really a recession. Long story short, everything costs more, businesses have slowed dramatically, interest rates have risen, but you still have a paycheck, so don’t complain.
The White House has opted to come out ahead of this week’s damning report. The US is in a recession, and has been in one since January 1st of this year. We’ve seen this administration (and all others) concern themselves with optics, but this is a new low. Changing the definition of one of the single most important economic indicators regarding the success, or lack thereof, of a president is remarkably wrong. It comes off as a sad reality that they are more concerned with how they present their distorted views to the American public, rather than change course from their failing policies. It’s a real life example of the Biden Administration opting to Thelma and Louise this economy right into the Grand Canyon.
The other issue with the White House creating their own definition for recession is that they are demeaning the American public. They’re treating the public as if they are too dumb to understand what their eyes and personal experiences are actually showing them. Then, the administration takes it one step further via their newly-created definition of a recession. They claim that since most Americans (based on their flawed data) have jobs, that this recession isn’t actually a recession. That’s the equivalent of telling the person you just rear-ended at the red light and totaled their car that it’s all OK because you have insurance. Don’t worry about their health. Don’t worry about the time they’ll waste going to doctors and auto body shops. Just tell them, ‘hey be thankful I have insurance to cover what this costs you.’ It’s entirely tone deaf and very insensitive to tell the American public it’s not that bad out there just because they have a paycheck coming in.
Economically, this is all flawed. First, the unemployment rate they rely on is wrong. This figure does not take into account the number of folks who have left the workforce, which is currently at a record high. Speaking of record highs, the unemployment rate isn’t also factoring in the amount of job openings. That too is at a record high. We have a problem where folks simply don’t want to work, and/or are not qualified for the role that is open to them. Both are tremendous issues when examining the health of the labor market, that the administration assures us is strong.
The other fact is, a recession is when the US economy does not grow, but instead contracts over a period of two consecutive quarters. That’s it. It’s always been the definition. It’s arguably one of the most widely-accepted definitions in all of economics. Trying to distort this reality is incomprehensible. This is par for the course, though. We’ve seen the administration try this with inflation. It’s all Putin’s fault, not the trillions in unnecessary spending. They’ve done this with other economic issues from the supply chains at the ports, to the baby formula shortage, and to issues at the airlines. It’s somehow always someone else’s fault, but never their own policies.
The American people have short memories, and are a forgiving bunch. It’s still over two years away for whomever runs for the Democrats in 2024. Knowing that, one needs to ask why won’t this administration change course? What are they trying to achieve with their unbelievable lack of success? And, to add insult to injury, their large emphasis on rebranding problems as something else is failing horribly. They say things aren’t as bad as they are, yet every poll shows the vast majority feel we’re moving in the wrong direction. And, they tell us all these economic problems are not because of their doing, yet Biden’s approval rating has fallen further and faster than the Titanic the night it struck the iceberg. So, their marketing isn’t even working. Knowing that, why wouldn’t they reverse course? They have over two years to try to solve the problems! Why simply continue to inflict pain on Americans, refuse to change policies, and consistently lie to us all that we shouldn’t believe our eyes? It sadly feels as if something maniacal is going on. Incompetence and ignorance are one thing. This doesn’t feel like that anymore. This feels intentional. But, why?