Wednesday, February 27, 2008

"Is this a recession? Americans say yes"

This was the blaring headline in last Monday's Metro, reporting on an AP-Ipsos poll that revealed that sixty-one percent of the American public believes that we're in a recession.

Now, I haven't checked lately, so we may well be in a recession. And if we aren't, we may well be heading for a recession.

Vox populi and all that - and I know that economics has a lot to do with expectations - but does anybody really believe that most people know what a recession actually is?

I didn't think so.

How much more intelligent this poll might have been if it had asked a question that the man and woman on the street are actually qualified to answer. That would be a question like:

  • Do you think the economy is in good shape?
  • Do you feel confident about your personal economic future?
  • Do you believe that your children will be financially better off than you are?

"Fee-lings, oh, oh, oh, oh, oh fee-lings." That's what we have about the economy, and those feelings are understandable. After all, we are in an economic situation brought about in no small part by greed, economic illiteracy, and mindless consumption. And also brought about by globalization, which if it does nothing else is going to put a serious dent in what can only be characterized as America's blind consumer exceptionalism - the feeling that (if we think about it at all, which is unlikely; see: economic illiteracy) we are entitled to consume way more than our share of everything than anyone else on the face of the earth. Just because we're us! And God, apparently, shed not just His grace on we, but a never ending stream of credit cards. (Talk about pennies from heaven.)

No argument here that in plenty of ways, we deserve more. Chalk some of it up to just plain luck (natural resources, geographic isolation, etc.), but much of the rest gets chalked up to the unquestionable brilliance of our institutions (financial, legal, and - yes, even political). Then there's the American can-do attitude and inventiveness. (Years ago, I read that one of the aces in the hole in the American effort in World War II was the ability of GI's to improvise in the field, figuring out how to get that Jeep going, how to cut through those hedgerows.) Immigrants, meritocracy, public schools, The American Dream.

While God was shedding all that grace on we, we were shedding a lot of the crap that didn't work so well in the Old World. (Let's face it, there was a reason our grandparents and great-grandparents got on The Boat and immigrated. To quote me sainted grand-mither: If Ireland were so great, we wouldn't have all had to come over here.)

So, yeah, we have a lot, but a lot of it we've worked pretty darned hard for.

The question becomes both how do we sustain it, and - more importantly - should we sustain it at the rate of increase that we still enjoy today.

There are ample reasons for Americans to be uneasy about the economy, and I wish the conversation would occasionally veer in the direction of an honest conversation about that unease - rather than in the direction of a simple-minded question about whether we're in a recession. (I'll have to check that poll out and see what was actually asked.)

While I'm on my ripped-from-the-headlines rant: While there is plenty of reason to be nervous (mortgage crisis, energy, aging population, etc.), people are, I'm sure, made a lot jumpier by the ubiquity of noise about the economy.

CNBC has non-stop Talking Heads - experts, pundits, journalists, entertainers - who have to fill 24/7 with blather. Sound bites are easier on the ears than long drawn out explanations and analysis.

Henny Penny says the sky is falling! Pass it on!

vs.

NASA spokesperson Henny Penny today announced that the sky is falling at the rate of on gazillinth of a centimeter a year. At this rate, which is expected to decelerate due to the uplift factor of increased commercial flights, the sky will fall to earth in the year 471,986,261 A.D. NASA scientists are exploring the feasibility of erecting an umbrella.

OMG! The sky is falling!

I try to tune it out, but I heard one of the TH's in the background the other day yakking about people in mutual funds who don't realize that their funds are worth less, yadda, yadda, yadda.

Well, even the financial illiterates among us probably "get" on some level that our mutual funds are often, in fact, composed of stocks. Maybe we just don't feel the need to make ourselves crazy by checking our "position" morning, noon, and night and figuring out that we've got paper losses.

Sixty-one percent of Americans believe that we're in a recession?

Maybe we are.

But guess what? Whether we're in a recession or not, there are serious questions to be had about our collective American economic future. And I'm not hearing much of it.

Asking whether we're in a recession or not doesn't quite do it for me.

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