While economic commentators frequently use two consecutive quarters of negative GDP growth as a “rule of thumb” that an economy is in a recession, the Biden administration thinks that the United States is in no way nearing a recession. How do they know? Simple. They changed the meaning of the word “recession.”
Biden’s economic team argued in a blog post that while the economy shrank by 1.4% in the first quarter and even if GDP growth is also negative in the second quarter, it is still “unlikely” that the United States’ economy is in a recession.
“What is a recession? While some maintain that two consecutive quarters of falling real GDP constitute a recession, that is neither the official definition nor the way economists evaluate the state of the business cycle.
“Instead, both official determinations of recessions and economists’ assessment of economic activity are based on a holistic look at the data—including the labor market, consumer and business spending, industrial production, and incomes.
“Based on these data, it is unlikely that the decline in GDP in the first quarter of this year—even if followed by another GDP decline in the second quarter—indicates a recession,” the White House wrote.
This borders on information manipulation from the Biden administration. E.J. Antoni, a research fellow for regional economics at the Heritage Foundation, explained to the Daily Caller that even back to the end of World War II, a recession has been declared every single time the economy experienced negative growth for two consecutive quarters.
In a statement to Fox Business, Republican National Committee spokesperson Will O’Grady stated that redefining the word “recession” will not fix the fact that the Biden economy is not doing well at all.
“Redefining the word will not fix the fact that Democrats wasted $1.9 trillion, resulting in skyrocketing costs for Americans. This further underscores how out of touch Biden and Democrats are with the pain families are feeling,” O’Grady said.