Barack Obama Fails Economics (Updated)

Barack Obama said this about the economy today.

Barack Obama said Saturday there is “little doubt we’ve moved into recession,” underscoring the country’s need for a second economic stimulus package, swift steps to shore up the housing market and a long-term energy policy to reduce reliance on foreign oil imports.

Of course, this statement is total nonsense. A recession is NOT some vaguely defined term that any politician can use to their own pleasing. In fact, recessions are clearly defined as two quarters of negative GDP growth. The last quarter we had positive GDP growth as we have had since the beginning of 2003. Thus, there is no way we are in a recession because our current economic number don't come anywhere near what is clearly defined as a recession.

So, what is going on here and why is Obama making patently false economic statements? In fact, it appears that he is taking cues from Bill Clinton. Back in 1992, he, with the complicit help of the MSM, continued to talk down an economy that had begun to recover starting in the summer of 1992. He had to because the poor economy became the central premise of his campaign. Imagine if the economy was recovering. That would have meant that much of Clinton's campaign theme was no longer relevant. As such, Clinton continued to pretend that the economy was in trouble even though it was in fact recovering long before he got into office. In fact, the recession that lead to George HW Bush's defeat was one of the mildest in history. Much of its doom and gloom was nothing more than a media creation.

That isn't to say that the economy is not currently in serious trouble. In fact, the economy is in terrible danger. The duel news of Fannie and Freddie along with the closing of IndyMac underscore the terrible shape the mortgage crisis has left the banking system in. Furthermore, gas prices continue to eat away at the economy. Still, our economy is showing signs of great resiliency in the face of all this turmoil. Most predicted that our GDP would have long slipped into negative territory by now. Our unemployment rate is rising but still just above 5% which is plenty healthy. The jobs numbers have continued to be healthier than predicted over the last four months. Furthermore, the current round of stimulus hasn't even fully taken effect. I recently received my own stimulus check and it hasn't even been deposited yet. Shouldn't we all wait until the current stimulus is fully felt before we call for another one? That's only if your statements are rooted in policy not politics. Obama's are rooted firmly in the latter.

As such, there is no doubt that it is in Obama's favor to portray the economy in the worst light. As such, he dares not look at the economy objectively, and thus he will paint it in as bad a light as possible even if that means making up his own definition to terms that are clearly defined in other ways.

Update:

Per a good find by a reader, it turns out that McCain is no less a demagogue on such matters.

Sen. John McCain (R-Ariz.) said Monday that he believes the country is in a recession, adding that “these are very, very tough times in America.”

Americans are hurting today,” McCain said at an Associated Press forum in Washington, D.C. “They’re hurting in the towns and cities across America. They’re sitting around the kitchen table, saying, ‘Are we going to be able to make our home loan mortgage payments? Are we going to be able to -- do I have to try to get a second job? Can I keep my job? Why was I laid off?’”

While McCain, the presumptive Republican presidential nominee, said he thinks the country is in a recession, he noted that he is more worried about helping people who are facing “enormous challenges,” rather than figuring out what the technical definition of a recession is.

While I can appreciate the sentiment that it is much more important to concentrate on whether or not folks are hurting rather than what some dry economist calls a recession, making a term mean whatever you want it to mean is never right. McCain could have gotten the same message across, and so frankly could have Barack Obama, without twisting the meaning of a clearly defined word. It frustrates me no less when a Republican attempts alarmism by by redefining the word "recession" than when a Democrat does it.