CLAIM: We’re not currently in a recession nor are we heading towards one.

REALITY: This is most likely false. All the data shows that we’re currently in a recession or heading towards one.

There is no official government definition of a recession, but it has been unofficially defined as ‘two quarters in a row of negative growth.’

“For years … including right now, if you pick up a lot of principles of macroeconomics textbooks, they will say that in there,” Victor Claar, a professor of economics at Florida Gulf Coast University, told the Washington Examiner.

Recently, there were two quarters in a row of negative growth. Despite, the two quarters in a row of negative growth, the Biden administration claimed that we’re not in a recession.

Joe Biden said, “We’re not going to be in a recession, in my view.”

Instead of using the common definition, the Biden administration wanted to use the broad definition by the National Bureau of Economic Research (NBER). The NBER defines a recession as “a significant decline in economic activity that is spread across the economy and that lasts more than a few months.”

The media quickly came to his defense, claiming that ‘two quarters in a row of negative growth’ isn’t the official determination of a recession. The determination is ultimately up to the NBER.

The NBER is responsible for determining whether we’re in a recession. The NBER uses a variety of indicators to determine if we’re in a recession. According to Alex Durante, an economist at the Tax Foundation, “They look at employment, personal income, durable goods, housing permits — so the GDP is certainly part of it, but they’re looking at other indicators, as well.”

Here’s what the media left out, according to Sean Snaith, an economist at the University of Central Florida, “There has never been an occasion in which GDP contracted for two consecutive quarters and a recession was not eventually declared.” So, the GDP contracting for two consecutive quarters ultimately leads to a recession.

According to an article written by Zachary Halaschak for the Washington Examiner, “All of the past 12 recessions identified by the National Bureau of Economic Research have seen at least two-quarters of negative GDP growth, and, conversely, each instance of at least two quarters of negative GDP growth has later been declared a recession.”

What’s also conveniently left out is that Democrats, in the past, defined recession as “two quarters in a row of negative growth.”

“A recession is two quarters in a row of negative growth,” President Bill Clinton said on December 19, 2000.

A recession “is two-quarters of negative growth in a row,” Nancy Pelosi said in 2008.

“Economists have a technical definition of recession, which is two consecutive quarters of negative growth, ” Biden’s NEC Director Brian Deese said in March 2008.

The media also omitted that according to the NBER, the GDP is the best indicator of aggregate economic activity. “We view real GDP as the single best measure of aggregate economic activity.” So, two consecutive declines in the GDP remain the most accurate measure.

To summarize, two quarters in a row of negative growth is a near-perfect indicator of a recession; economists have defined it that way, Democrats have defined it that way in the past, and the NBER said: “real GDP is the single best measure.” All evidence points to us heading towards a recession.

Despite, the Biden administration and the media claiming we’re not in a recession, a majority of Americans aren’t buying it. According to a recent survey by Morning Consult, 65% of voters believe that we’re currently in a recession.

SOURCES

Oliveira, A. (2022, July 29). Wikipedia suspends edits to its ‘recession’ page after woke users changed definition to Biden’s claim that the US is NOT in one. Daily Mail Online. Retrieved September 27, 2022, from https://www.dailymail.co.uk/news/article-11060135/Wikipedia-SUSPENDS-edits-recession-page-woke-users-changed-definition-Bidens.html

Rushe, D. (2022, July 22). US economy shrinks in second quarter, signaling unofficial start of recession. The Guardian . Retrieved September 27, 2022, from https://www.google.com/amp/s/amp.theguardian.com/business/2022/jul/28/us-economy-gdp-second-quarter

Bannister, C. (2022, July 29). In 2000, then-pres. Bill Clinton defined ‘recession’ as ‘two quarters in a row of negative growth’. CNSNews.com. Retrieved September 27, 2022, from https://www.cnsnews.com/blog/craig-bannister/then-pres-bill-clinton-defined-recession-2000-recession-two-quarters-row

Halaschak, Z. (2022, July 26). White House challenges common definition of ‘recession’ – here’s what to know. Washington Examiner. Retrieved September 27, 2022, from https://www.washingtonexaminer.com/policy/gdp-report-questions-defines-recession

Patteson, C. (2022, July 28). White House takes heat after Biden adviser accused of ‘redefining recession’. New York Post. Retrieved September 27, 2022, from https://nypost.com/2022/07/27/white-house-takes-heat-after-biden-adviser-accused-of-redefining-recession/

Wilkie, C. (2022, July 29). White House goes on offense to argue that the U.S. is not in a recession. CNBC. Retrieved September 27, 2022, from https://www.google.com/amp/s/www.cnbc.com/amp/2022/07/29/white-house-goes-on-offense-to-argue-that-the-us-is-not-in-a-recession-.html

Snyder, A. J. (2022, July 13). Are we in a recession? 2 in 3 voters say yes. Morning Consult. Retrieved September 27, 2022, from https://morningconsult.com/2022/07/13/recession-outlook-us-economy-data/