Biden REACTS To The Economy – Outrageous or True?
(NewsBroadcast.com) – The American economy is in a recession! Or is it? Although there is a veritable mountain of statistical data, it seems that answering that question may be more in line with “if a tree falls in the forest and no one is there to hear it, does it make a sound?” It all depends on whom one asks — and the president of the United States is downplaying it all.
Biden Claims There’s Nothing to See Here
One place Americans should be able to look to for answers is the White House. In his comments on Thursday, July 28, President Joe Biden claimed the country is “on the right path” and that his “economic plan is focused on bringing inflation down….” He pointed to a strong job market and low unemployment as proof.
Biden took the opportunity to push for the passage of the CHIPS and Science Act, which did pass both the Senate and the House. But is he in touch with what’s going on with everyday citizens? After all, he downplayed inflation for a year before his administration admitted it was a major problem.
Currently, the president’s assessment doesn’t seem to agree with the experts who typically decide such things.
Competing Definitions of Recession
One of the more prevalent theories relies on the trend of the gross domestic product (GDP) — the total sum of all the goods and services made in the US — as it is measured by the United States Bureau of Economic Analysis (BEA). Those who use this as their benchmark claim that two consecutive quarters of that figure shrinking is all that is needed as proof.
According to BEA data, in the first quarter of 2022, there was a GDP decrease of 1.6% and the estimate for the second three-month period is -0.9%. So, by this widely used definition, the economy of the United States is now in recession.
The nonprofit group the National Bureau of Economic Research (NBER) consists of eight economists who make the “official” decision about what to call the country’s economic state. These folks like to consider more information than just the GDP, and according to its website, it believes “a recession involves a significant decline in economic activity that is spread across the economy and lasts more than a few months.”
The Political Lens
Because of the criteria the NBER uses, there are times it hasn’t declared a recession until after it has passed and the economy has begun to improve. That is, of course, a great inconvenience to the elephants and donkeys who inhabit the zoo called Congress.
With the ever-decreasing approval ratings of both President Joe Biden and Vice President Kamala Harris and inflation rates that have not been seen in four decades, Democrats are desperate to avoid another black eye — so they don’t want to say we are in a recession. Republicans, on the other hand, are seeing their presumption of winning back both chambers in November shrink and are equally fierce in their desire to see every person facing economic hardship blame it on the Left.
Taxing and Spending
Senator Joe Manchin (D-WV) just recently agreed with his party’s leadership to help pass an extremely pared-down version of the $3 trillion reconciliation bill that will increase both government spending and taxes. While that might garner votes in the midterm elections, it may be bad news for their theory of whether or not the country’s economy is in recession.
According to NBER, both of those things can have a negative impact on GDP, which could theoretically lead to them joining the chorus saying that a recession is upon the country. When it comes down to it, it may all be a personal perspective similar to what President Harry S Truman once quipped, “it’s a recession when your neighbor loses his job; it’s a depression when you lose yours.”
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