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Some liberal media have begun to align with the Biden administration’s role in redefining what a recession is before releasing potentially devastating economic statistics.
Economic data to be revealed on Thursday may show two consecutive quarters of negative GDP growth, which has long been the yardstick that determines whether the United States is in a recession.
However, there has been significant pressure from the White House to proactively announce that even if the US economy contracts in two consecutive quarters, this does not necessarily mean that the economy is in recession.
Jared Bernstein of the White House Council of Economic Advisers said neither President Biden nor the White House were about to “soften” incoming GDP numbers, telling CNN on Saturday that only the National Bureau of Economic Research’s Business Cycle Dating Committee could determine whether The US economy is in a recession. Treasury Secretary Janet Yellen emphasized Sunday that two quarters of negative GDP growth is not a “technical definition” of a recession, acknowledging it as the “common” definition, calling it on NBC a “wide-based contraction in the economy.” on a wide range of data.
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White House Director of the National Economic Council, Brian Daisy, echoed Yellen in citing the so-called The “technical definition” of stagnation, which said on CNN that it includes a “much wider range of data points”, and dismissed the existence of “technical discussions about lagging-looking data”. White House counsel Gene Sperling also brought up similar talking points while appearing on Fox News’ “The Story,” noting Monday that the “labor market” is playing an important role in what has already contributed to the recession.
Now, the media is embracing talking points.
New York Times columnist Paul Krugman told readers “there’s a good chance” GDP will contract in the second quarter, which would make a “breathtaking commentary” about a recession. But he insisted, “We won’t be.”
‘I was wrong,’ ‘a lesson in humility” Paul Krugman said in the New York Times.
“This is not how recessions are defined; more importantly, it is not how they are defined. should Krugman wrote on Tuesday. “It’s possible that people who are actually deciding whether we’re in a recession … will eventually announce that a recession has started in the US in the first half of this year, although that’s unlikely given the data.”
His assurances that there would be no economic recession came just days after he was presented with the responsibility of falsely predicting in 2021 that the country would not face hyperinflation. He also predicted in 2016 a global recession after Donald Trump’s election victory.
New York Times economic correspondent Ben Castleman insists it is “difficult to tell” whether the country is facing a recession no matter what Thursday’s numbers reveal.
“Economic output, as measured by gross domestic product, declined in the first quarter of the year. Government data due this week may show that it fell in the second quarter as well. Such a decline in the two quarters would be offset by a common, albeit unofficially defined, recession,” Casselman wrote on Monday. “Most economists still do not believe that the United States meets the official definition, which is based on a broader set of indicators, including measures of income, spending and job growth.”
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Like the White House, Castleman referred to NBER’s Business Cycle Dating Committee, something he says is “trying to be final” and defended his long (“as much as a year”) schedule for determining whether a recession has occurred, writing, “even if we’re in It’s already stagnant, we may not know that – or at least we may not have official confirmation of it – until next year.”
Boston Globe reporter Jim Bozangera used similar language on Saturday, claiming “it’s not an official recession until a small group of experts hired by the National Bureau of Economic Research in Cambridge say so — and they’re known to take their time.”
Politico’s Ben White tweeted on Tuesday, “Obviously the White House is right that two quarters of shrinking GDP will not show the economy is currently in a recession.” “I regret to report that conditions are ripe for a decline in GDP growth lasting at least two quarters, which is the technical definition of a recession,” he wrote last month.
After one Twitter user referenced his earlier language, he wrote, “I did. I should have expanded more on the ‘technical’ part. Mea culpa.”
MSNBC’s Stephanie Rohley praised White’s article saying, “Many economists agree that this post-pandemic moment does not meet many of the criteria for a recession.”
The Associated Press published The Explainer about when to know a recession has begun, telling readers, “According to one common definition, the US economy is on the cusp of a recession. However, that definition isn’t what matters.”
“On Thursday, when the government estimates gross domestic product for the April-June period, some economists think it may show that the economy contracted for the second consecutive quarter. This would satisfy a long-term assumption when the recession begins.” Reporter Christopher Rogaber wrote on Monday. “But economists say that doesn’t mean the recession has begun. During those same six months when the economy contracted, companies and other employers added 2.7 million jobs — more than were gained in most of the entire years before the pandemic. As wages are rising at a healthy pace, Many employers are still struggling to attract and retain enough workers.”
The Washington Post later shared the Associated Press’s “The Interpreter”.
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Bloomberg analyst Simon White urged viewers to “be very careful” to consider only one indicator of recession as negative GDP growth, and insisted on Tuesday that the recession assessment includes a “widespread sweep of the indicators.”
White went on to suggest that looking at GDP was “helpful” but dismissed it as a “red excuse”.
CNN White House correspondent Jeremy Diamond, after a network committee mocked the White House’s attempt to redefine what a recession is, said the White House was “actually right” in saying that successive quarters of negative growth were not indicative of a recession.
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“The White House has been careful to fend off this notion that two consecutive quarters of negative GDP growth automatically equals a recession. Yes, it’s a general rule. But the White House is really asserting here, trying to educate the public, basically, for the past week,” Diamond said on Tuesday. , that there are all these other economic indicators that go into that as well, and they don’t necessarily indicate a recession. She’s really right about that.” “The National Bureau of Economic Research, a nonprofit, nonpartisan body that effectively determines whether or not the US economy is in a recession, also takes into account other factors, including employment, personal income, and industrial production. GDP numbers are an important part of that equation.”