"Cactus" over at the Angry Bear blog, which is one of my favorites even though the writers don't much care for me, takes issue with my radical declaration that the economy was not in recession during the first quarter based on government data that said the economy was not in recession during the first quarter:
Nevermind that these figures are likely to be revised (based on this administration's recent history with data, anyone care to guess which way they'll be revised?), or that they use 2.6% deflator.... I would also note that GDP did not shrink for a single quarter during the 1970s. Not one. In fact, the smallest quarterly percentage increase in GDP during the entire decade was more than 3 times faster than the 0.6% of GDP James P is so excited about.
My take: How's that? Not a single negative quarter during the 1970s? Ah yes, the Great 1970s Boom. A few GDP numbers, adjusted for inflation—as was yesterday's GDP number: 1970 1Q (-0.67 percent); 1970 4Q (-4.22 percent); 1973 3Q (-2.11 percent); 1974 1Q (-3.42 percent); 1974 3Q (-3.82 percent); 1974 4Q (-1.56 percent); 1975 1Q (-4.7 percent); 1977 4Q (0.04 percent); and 1980 Q2 (-7.83 percent).
I guess the point Cactus was struggling to make is that the feds are underestimating inflation, which is funny since the feds have actually been overestimating inflation for a generation, leading to all sorts of erroneous claims that workers today are doing worse than in 1980. And as I mentioned in an earlier post, the folks at the National Bureau of Economic Research will not call the current slowdown a recession if the economy keeps growing. All this said, I would love the government to take this opportunity to push for pro-growth economic policies.