THE RECESSION’S OVER?…. It’s hard to take much solace from an “official” end to the recession when growth and job creation remain so weak, but the officials who serve as arbiters this morning made their announcement.
The recession officially ended in June 2009, according to the Business Cycle Dating Committee of the National Bureau of Economic Research, the official arbiter of such dates.
As many economists had expected, this official end date makes the most recent downturn the longest since World War II. This recent recession, having begun in December 2007, lasted 18 months. Until now the longest postwar recessions were those of 1973-5 and 1981-2, which each lasted 16 months.
Recession and expansion dates are based on various economic indicators, including gross domestic product, income, employment, industrial production and wholesale-retail sales. The Business Cycle Dating Committee typically waits to declare that the economy has turned until well after the fact, when it has a longer track record of economic data to confirm a new trend.
The NEBR added that while the recession ended in June ’09, that doesn’t mean economic health in July ’09 — the “official” end marks the point at which the economy began to turn around.
“In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity,” the bureau said. “Rather, the committee determined only that the recession ended and a recovery began in that month.”
I don’t imagine many folks will be especially excited by the announcement — indeed, much of the country likely perceives the recession as ongoing — but when it comes to official measurements, I suppose it’s at least somewhat encouraging to know the modest, slow recovery began about six months after the Recovery Act started pumping capital into the economy.
As for the debate over tax rates, the argument that we can’t allow higher rates* to return for the wealthy in “the middle of a recession” is wrong for a variety of reasons, not the least of which is that this isn’t “the middle of a recession.”