Jim Devine
Wed, 01 Sep 2010 08:34:02 -0700
cb: > Thanks for this. I didn't realize that a depression was defined > differently than a recession.
You're welcome. Note that there is no "official" definition of a "depression." The one I use is from the cable-TV commercial: "I've fallen and I can't get up." Even the definition of "recession" is unofficial since the "official" namer of recessions (the NBER), is a non-governmental organization. It's sort of a matter of people saying: "those folks have set the dates of recessions based on real-world data (and in a generally consistent way), so we don't need to do the work and use our own definitions." By the way, the pretty orthodox Money & Banking textbook by Lawrence Ball I'm using has a different definition of "recession." He includes the high-unemployment aftermath of the NBER recession as part of his recession, dating its end as when the economy returns to full employment. This is similar to CB's view. > I must say that I didn't realize that the definition of recession > didn't include high unemployment as well as three consecutive quarters > of a fall in GDP. it's two consecutive quarters, but that's a journalistic definition which usually produces the same dating as the NBER definition. (The NBER uses months rather than quarters to date recessions and GDP data aren't available on a month-to-month basis.) > I thought it was both in the late 60's text book by > Samuelson. I thought "they" ( the NC dominators ?) had dropped the > attention to unemployment because of the general conservative turn in > the profession, and a propaganda shift so that they could say the > economy is not so bad when it is bad for working people and the poor. I don't think that the NBER (unlike Ball) has ever included high unemployment as part of recessions. However, the starting date of the recent NBER recession (assuming that it's not still going on, since the NBER hasn't spoken yet) was decided upon partly by noting the sharp fall in employment. GDP didn't have a sharp fall then. > Notice there is never any wide publication of the number of people > living below the poverty line as in the "old days" of the sixties and > seventies. The word "poverty" has dropped out of the oligopoly media > vocabulary. In the 1960s, poverty (a completely different issue from NBER/textbook recessions) was falling as a percentage of the population. It's been mostly trending upward since then, but the official stats aren't very good, since they are based on the assumption that people spend 1/3 of their income on food. (They figure out how much it costs a family to pay for an "emergency" diet -- defined in terms of nutrition -- and then multiply by three to determine the official US government poverty line.) I don't think "poverty" has dropped out of the media, but then again I haven't done a Nexis/Lexis search, either. > Seems to me the current definition of "recession" is basically a form > of rightwing propaganda, especially since wages have been stuck for 30 > years or whatever it is. does the concept of "recession" have to include all of the things we don't like? it's supposed to be a technical term that describes one phase of the business cycle (akin to Marx's concept of a crisis, but not the same). Would a lawyer think it's okay to use the word "tort" to refer to all bad things in the law? To my mind, it's wrong to use definitions for propagandistic purposes (calling something a "recession" simply because it's bad to make some sort of political point), since eventually the words lose meaning. Me: > Of course, it doesn't matter what we call the situation. What matters > more is how the majority of working people see it. Even if they see it > as a "depression," it's possible that they'll find scapegoats for it > (immigrants, Obama, CB, etc.) CB: > ... Yeah, with all the foreclosures, > unemployment, stagnant wages the "workers' economy" is in depression > and the "capitalists' economy" is peachy. Maybe heterodox economists > could develop a "tale of two economies" like the "tale of two cities". I wouldn't say that the capitalists' economy is peachy except if in the sense that a snap-shot of it would look good. Profits are up, etc., but the hidden instabilities suggest that the economy could go bad in a way that hurts the capitalists in the future. Foreclosures hurt banks, while consumer demand could fall significantly, hurting profits. It's like taking a snap-shot of the family at Yellowstone which misses the hungry bear lurking nearby. (Of course, that doesn't mean that the bear will actually eat one of the children.) -- Jim Devine / "Segui il tuo corso, e lascia dir le genti." (Go your own way and let people talk.) -- Karl, paraphrasing Dante. _______________________________________________ pen-l mailing list pen-l@lists.csuchico.edu https://lists.csuchico.edu/mailman/listinfo/pen-l