Monday, December 01, 2008

The Economy, 12/07-11/08

Bloomberg News has reported that a committee of the National Bureau of Economic Research, a private, nonprofit group of economists based in Cambridge, Massachusetts, declared on December 1 that the U.S.A. has been in a recession since last December. Bloomberg explains

Although a recession is conventionally defined as two quarters of successive contraction in gross domestic product, the private committee doesn’t require supporting GDP data to make a recession call. Its members focus on month-to-month changes in the economy.
The NBER committee defines a recession as a “significant” decrease in activity over a sustained period of time. The decline would be visible in gross domestic product, payrolls, industrial production, sales and incomes.


Responding to the country's economic ills, a former U.S. Senator, according to Bloomberg, has recommended "a $25 billion package of investments in clean energy, job training and unemployment benefits. He said lawmakers should be prepared to allocate another $75 billion."

This sounds insufficient, but the idea came from John Edwards- in December 2008. Campaigning in Lisbon, Iowa, Edwards argued "hard-working families across America are already struggling to make ends meet. Before things get worse, I urge Congress to take action immediately to strengthen our economy and create new jobs." And when Edwards the following month attacked Bush's proposal hours before the President would unveil it at his State of Union Address on January 18 (with the other presidential candidates, Clinton and Obama, also criticizing the proposal), the spokesman for the Republican National Committee childishly remarked

John Edwards’ attacks are nothing more than desperation from a candidate frantically seeking attention. The tax refunds Edwards is so quick to discount may not cover more than a few of his haircuts, but they would be valuable relief for millions of Americans.

And so today Federal Reserve Chairman Ben S. Bernanke noted the economy “will probably remain weak for a time." If the recession continues another five months, it will be the longest downturn since the Great Depression.

Just another example, I guess, of the leadership vacuum of the last eight years.

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