It's Not A "Recession"

2011-01-18

The term "recession" has been ubiquitously used by government and media to describe the economic situation in the United States for the past decade. But, a recession is "a general [cyclic] slowdown in economic activity over a period of time for more than two consecutive quarters", which doesn't at all describe the economic decline the United States has experienced since the tech bubble crashed in the late 1990's. Rather, the past decade has been "a sustained, long-term downturn in economic activity in one or more economies", better known as a "depression" (source: Wikipedia). "Recession" is not only a misleading euphemism, but outright incorrect.

First, the tech bubble burst. Worried by the insubstantial economy, people invested in real-estate, even if they didn't have a use for it. Then, when it turned out that investing in real-estate priced higher than what many people could really afford and that building homes that there was no need for could only disguise a failing economy for so long, real-estate prices crashed. Finally, faced with few jobs and high debt, people have turned to higher education to keep them viable while the economy fixes itself. The hope is that by they time they get out of school, they can use their advanced degree from a private university to find a job (that currently doesn't exist) and pay off the additional debt acquired from attending school. But, why should the economy "fix itself"? If the education bubble bursts, what will be left?

What worries me is that I have many intelligent, well educated, hardworking, and sociable friends who are unemployed or extremely underemployed. Since graduating from college in 2008, I've also had to deal with irregular employment and at times severe underemployment.