Sluggish?

My beloved in-laws talk about the "recession;" Mom-in-law said she was glad we put up a Christmas tree "to bring joy to the people depressed by the bad economy." The whole group is employed in the public sector and their belief in dark days is unshakeable.

Reading MSM, though, it's easy to find support for their theories, not in news articles but in the headlines.

The brave warriors at the WSJ Ed Page fight that meme with a lead editorial today.

Google the words "sluggish U.S. economy" and "2004," and in 0.40 second you get 4,540 results. "Weak employment report points to still-sluggish U.S. economy," reads a recent headline, on the news that "just 112,000" jobs were added in November.

Well, we live in a world economy, so when headline writers use the word sluggish, we have to ask: Sluggish compared with whom? According to the November forecast of the Organization for Economic Cooperation and Development, gross domestic product in the U.S. is expected to increase by 4.4% in 2004. Elsewhere, the OECD predicts growth of 4% for Japan, 2.7% for the U.K., 2.1% for France and 1.2% for Germany. For the 12-country euro zone, the figure is 1.8%. To put matters in historical perspective, the last time Japan, Britain, France and Germany had growth rates at or in excess of 4.4%, the years were 1990, 1994, 1989 and 1991, respectively.

But, some say, America's current economic performance is sluggish compared with its past performance. So let's look at the data again. From 1997 through 2000--the great Clinton go-go years--U.S. growth averaged 4.25%. For Mr. Clinton's first term, the average was 3.3%. For the eight years of the Reagan presidency, it was 3.4%. By what standard, then, can this year's forecasted 4.4% be described as sluggish?

The article is on the free site, and takes down these misguided perceptions one at a time. It is well worth a whole read.

They won't read it but that's okay -- Love you guys!

Posted by jk at December 30, 2004 11:52 AM