Around certain political circles, it is forbidden to use the word "recession". The idea is that simply by saying the word you're invoking the action. Foolish superstition, of course, but there it is.Back in the day, long before most of us were even born, recessions happened every few years. During the eight years of the Eisenhower administration, for instance, there were three recessions. In the 70s, the recessions seemed to overlap. Since the end of 1982, however, we've only had two, and the second one was quite mild.
So it will come as quite a shock to most people when America slides into another recession within the next year or so.
No, I'm not an economist. An economist is defined as someone who can explain why the predictions he or she made last year failed to come true. But take a look at current economic indicators - ever-increasing budget and trade deficits, rising interest rates, sliding stock prices, lower home sales, a lackluster job market, increasing poverty, declining disposable income for all but the very rich, the quagmire in Iraq, and so on. It's not a pretty picture.
Add the fact that over the past three years the truly rich in this country have done quite well while the rest of us have not. This means that, while the overall numbers might appear good at first glance, the underlying support for an expanding economy just isn't there. Top it off with record Republican pork-barrel spending, and George W. Bush's failure to understand what's going on.
The result is going to be the worst recession in a long, long time.
What will have caused it? The economic policies of the Bush administration, combined with Republican majorities in Congress, gave trillions of dollars we don't have to people who don't need it. The supposedly independent Federal Reserve, chaired by long-standing right-winger Alan Greenspan, has been the lackey of the administration, artificially keeping interest rates at ridiculously low levels, masking the effects of George W. Bush's policies.
Then there's the $300 billion plus that we will have spent invading a country that was never a threat to us.
Four the last four years, George W. Bush and the Republicans have blamed all their problems on others. But this time, they'll have nobody to blame but themselves. Oh they'll have their state-sponsored media trying to explain it away, but it won't wash. Unfortunately, America will be learning too late that the blame game doesn't get the job done. Millions will be out of work. Foreclosures, already at record levels, will reach new highs. Home prices will fall as interest rates rise.
And we'll do more than talk about the "R" word; we'll be living it.
Copyright 2005, Dan Jacoby
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