Why Not Just Change the Definition of a Recession?
During the past decade, there has been this push to change the definition of words. Don’t like the definition of marriage? Go change it.
How about the definition of an expulsion? When I was in high school, if you got expelled, you were expected to never step foot on campus again, period. These days, a expulsion is expressed in a number of days. That used to be a suspension didn’t it?
In The Hartford Courant’s business section today, they are pushing the recession theme again. If not redefining a recession, they are certainly promoting that fact that we’re in the beginning phases of one. Run for the hills!
With all of the media gloom and doom during the past seven years, you’d think that we’ve been in-and-out of a recession since GWB took office. Here’s the link to the full article.
“Recessions are only apparent with hindsight,” said Nicholas Perna, economic adviser to Western Financial Corp.
It’s likely that when “we look back at the first quarter of 2008, we’ll see we are in a recession,” said Nariman Behravesh, chief economist and executive vice president of Boston-based Global Insight, an economic consulting firm. A recession is commonly defined as a decline in real gross domestic product over two consecutive quarters.
Well, in my day it was three consecutive quarters, but who’s counting.
If you look back at GDP percentage change based on chained-year 2000 dollars, you’ll see a bump in the road in 2000 and 2001, the biggest bump in the third quarter of 2001. (Do you remember why?)
2001 Q3 = -1.4 percent
2001 Q1 = -0.5 percent
2000 Q3 = -0.5 percent
You have to go back to the fourth quarter in 1990 and the first quarter in 1991 to find two quarters back-to-back with negative growth in GDP, and all the way back to the winter of 1974-1975 to find three quarters of negative growth – the true definition of a recession.
- Every single quarter since October of 2001 has shown a positive growth in GDP.
- The GDP has almost tripled since 1991.
- Personal income has doubled since 1991.
There certainly have been bumps in the road, and there always will be, but come on!
So why change the definition of a recession? Well if you can’t get what you want, you might as well lie or change the rules of the game. Right now, the liberal press and college indoctrination centers want power and control, so they will changed definitions at will to fit their agenda – simple as that.
Last month I posted commentary concerning the fact that Massachusetts will most likely loose a congressional seat after the 2010 census. It’s the same game plan. Since the current rules – on how to count people – don’t work for them, they want to change the rules of the game and find more people to count; maybe change the algorithm or something.
All they need is a calculator; and a dictionary.
- U.S. Department of Commerce, Bureau of Economic Analysis has all of the information you need for reference.
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