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Re: Off Topic: Economic Recovery

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Daryl Richardson wrote:
Fellow engineers,
 
        I am writing this in the hopes that it will provide some encouragement to those of you who are hurting.
 
        In the past couple of weeks or so there have been announcements indicating that the recession in Canada was over...
The problem, Daryl, at least here in the U.S., is that many of us consider this "spin." Just as, during the last election, the mainstream media was busy TALKING DOWN the economy in order to improve the chances of their candidates of choice, they've been talking UP the economy in the last three months in order to improve the polling numbers of the incumbents.

The biggest problem is the STRUCTURAL defects in the economy (no pun intended). Here in the U.S., we have very suddenly added a great burden of public debt to that which we already had in place. If you think the budget deficit was a problem before, just wait!

In addition, much of that debt has been incurred at cross-purposes. When our President went to Europe during the last economic summit, he tried very hard to "talk up" his own plan for public spending to rest of the bunch. They wisely weren't having any of it, because they know they've already shot that wad. The EC's aggregate unemployment has been at a level FOR YEARS, that here in the U.S. we'd call "recessionary." The European leaders know that Mr. Obama's plans were a recipe for disaster because they'd already BTDT.

I am currently still unemployed. Waiting by the phone each day, still trying to make new contacts, doing a little bit of freelance work, but still waiting. It is not in my best interest, obviously, for the economy to continue bad. I don't care who's in power, I need a job, very badly.

However, I've stopped holding my breath. The economic landscape here in the U.S. has changed so dramatically over the last year, that it's hard to predict what is going to happen. Had our government just DONE NOTHING during that time, we'd already be out of it, but they really needed to "do something" for political points. Unfortunately, what they did was pour gasoline on a few smoldering embers, that resulted in a destructive conflagration.

The latest polling here in the U.S. shows that the current administration's handling of our economic matters is considered "bad to very bad" by a majority of the public. Only 32% - essentially the hardcore of their political party - think they are doing a "good job."

Perception is everything when it comes to economic recovery. You can have all the academic bean counters lined up in a row, telling us that according to this or that computer model of the economy, we are "out of the recession," but more than 70% of people at this time don't believe it. Ironically, the President's cheerleading section in the MSM did their job too well, and now they're having a hard time arresting the runaway train.

My understanding is that here in the U.S., at least, they're defining "recession over" not by signs of economic growth, but rather signs of SLOWING OF ECONOMIC SHRINKAGE. The suspicion is that, even if economic growth resumes, it's going to be on the order of 2-3% for a long while, MUCH less than the 5.5-6% growth we had during the Bush years. This is representative of the long-lasting drag on the economy of the economic "stimulus," which is going to have to lead to higher taxes, which is going to lead to long-term sluggishness.

This is just inevitable. "You can't tax and spend your way to prosperity," but the career politicians don't care about the reality of that so long as they sell their bills of goods for the moment, and secure more and near-permanent power for themselves.

If I'm wrong, I'm wrong. But I'm not banking on anything. Literally.
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