Corporate Think Tanks: Recession Ain't All That Bad!

I've been awfully worried about the economy lately, but instead of soothing my anxieties with the sweet numbness of illicit drugs, I prefer to numb my jangled nerves by reading the rich economic triumphalism spewed out by right-wing corporate think-tanks.

You should try it. Give the American Enterprise Institute's Kevin Hassett a moment of your time, and he'll show you that recessions aren't all that bad. The following comes from his brilliant op-ed, "5 Myths About That Depressing R Word" (which ran on Sunday -- I'm a little late) …

David Mamet once told an interviewer that he got the inspiration for his 1984 Pulitzer Prize-winning play "Glengarry Glen Ross" from an account of a salesman's fatal heart attack, caused by a recession "so vicious the competition was for jobs and sales, especially among older men." However, for most Americans, the story is quite the opposite. Americans get healthier as the economy gets worse. Unemployment tends to increase during recessions, but economist Christopher J. Ruhm of the University of North Carolina at Greensboro has found that a temporary one percentage point increase in the unemployment rate leads to a 0.5 to 0.6 percent reduction in the mortality rate, or about 14,000 fewer deaths per year.

Why the health benefits? With more free time and less money on their hands, people tend to consume less tobacco, exercise more, prepare healthier meals and lose weight. In addition, they are much less likely to have car and other accidents, and to catch communicable and sometimes fatal diseases such as influenza. Among the top 10 causes of death in the United States, only suicide rates show a substantial unemployment-driven increase. Even deaths caused by heart disease fall substantially.

Thank God for the clear-headed scholars at America's leading right-wing think-tank. Clearly, the idea that recessions cause real people a lot of real pain is just another lie by the Bush-hating media. The reality is that there are two sides of the story -- those who can't make their car payments appear to be in dire straights, but they just don't appreciate the benefits of getting out there for a strenuous walk!

There's even more sunny news for Hassett in the WaPo:

An unusually large share of workers have been out a job for more than six months even as overall unemployment has remained low, a little-noted weakness in the labor market that analysts said threatens to intensify the impact of the unfolding economic downturn.

The lucky duckies! Think about all that healthful rest and relaxation those guys are getting!

As far as I can tell, putting a sunny spin on the increasingly bleak economic picture was the point of Hassett's exercise. After all, his 5 myths aren't really myths, and his "debunking" of them is decidedly lame and half-hearted.

For example, his first myth is that "we're already in a recession," which he contests like this:

The truth is, nobody knows. The responsibility for declaring the stages of the business cycle is informally held by that most dreaded of concepts -- a committee of economists. The Business Cycle Dating Committee of the National Bureau of Economic Research (NBER) uses a number of economic indicators, including personal income, unemployment, industrial production and sales and manufacturing volume, to determine the health of the economy. It's not true that they declare a recession if economic growth is negative for two quarters in a row.

The NBER determines the official starting point of American recessions -- the definition of recession as two or more consecutive quarters of negative growth is an unofficial benchmark that's used in countries all over the world. Hassett, who's written a book about this stuff, presumably understands the difference, or at least that the NBER doesn't call recessions in Romania.