Recession - A Political Dirty Word

Last week, Ben Bernanke, Chairman of the Federal Reserve Banks, in testimony before Congress, and President Bush, at a press conference, both remarked that the U.S. economy was not heading for a recession. Even if they’re right, which many economists find highly doubtful, such claims are largely meaningless in light of the fact that tens of millions of individual U.S. economies – the economies of individual American households – are already experiencing recessions and there is little hope of changing the landscape anytime soon

2.83 million Americans collected unemployment benefits last week, the largest level since September of 2005.

Employers slashed 63,000 jobs from the economy last month, the largest decrease in five years.

Home foreclosure rates have skyrocketed to their highest point in 23 years.

Because of the tanking housing market, 10% of American homeowners have no equity or negative equity (mortgage higher than a home is worth) in their home.

The average price of a gallon of gas has surpassed $3.27 and is expected to hit $4.00.

The value of the U.S. dollar is in a free-fall in money markets around the world.

The stock market has lost over 600 points spanning the last 5 trading sessions.

Consumer confidence is at its lowest point since 2002.

Health care and College education expenses have soared through the roof.

Inflation could top 7% in 2008 if the current rate-climb continues.

Against this backdrop, millions of Americans are eagerly awaiting the ‘stimulus’ checks the government is planning to send out, starting in May. Unfortunately, most of that money will not be spent on stimulating the U.S. economy, or individual household economies for that matter, it will be spent by ordinary Americans in a vain attempt to keep from drowning. That is to say, it will be spent trying to stay current on the bills.

America needs a stimulus package that does more than simply mail out checks. It needs a package that creates millions of real jobs, shores up America’s infrastructure and stimulates long-term growth that individual economies can then experience. And it’s going to take leaders willing to admit that for many, recession is already here. If you can’t admit there’s a problem, you’re not going to be working towards a solution.