Who Does The Measuring
31st January 2024
Zman speaks some inconvenient truth.
In the 1980 campaign, Reagan would regularly say that a recession is when your neighbor loses his job. A depression is when you lose your job. It was a pithy line that got at something that was always missed by the politicians at the time. That is, the economy is not the same for everyone. You can have a good economy but there will be people who are not doing so good. The reverse is also true. Even in the Great Depression, there were people doing fabulously well.
That is the problem facing the political class this year. According to their court wizards, the economy is growing at a blistering pace. The fourth quarter of last year saw growth at over three percent and inflation falling down to two percent for what the wizards call personal items, while overall inflation was under two percent. The definition of “personal items” is one of those things that makes sense to the people doing the counting, but not to anyone who is doing the actual spending
Does it feel like the economy is growing at a blistering pace? Most people do not think the economy is great. In fact, most people think we are in difficult economic times, despite relatively high employment. This was one of the top reasons people voted for Trump in Iowa and New Hampshire. Under Trump, people perceived the economy as strong while under Biden it seems to be weak. The main reason is inflation. Every trip to the store sees prices higher than the last trip.