Most working families have felt tough economic times for several years now, but economists have refused to designate these conditions as a recession. A perfect storm of severe economic data has made it harder to deny, however.
Just this week, the government released its initial estimates of the GDP, the figure used to describe the total economic activity in the country. According to those figures the economy shrank by 0.3 percent. The sharpest decline in consumer spending in almost three decades fueled the contraction.
Recent government data on jobs, declining wages, home foreclosures, higher rates of bankruptcy, retirement insecurity and other indicators suggest that a recession may not be going away in the near future.
Over the past year or more, unemployment and underemployment have risen sharply. (Underemployment refers to the number of people who are officially unemployed plus those who are without jobs but no longer counted by the government and those who are part-time workers seeking full-time work.)
This year alone, underemployment, which now stands at 17.1 million people, has grown by more than 3 million, with 2 million of that number having lost their jobs since January. Since March of 2007, a total of 4 million people have been added to this figure.
Currently, their are 2.9 unemployed workers for every job opening in the country, 60 percent higher than one year ago. In the past ten months, total employment in the private sector has fallen by nearly one million jobs.
For those who have kept their jobs, economic uncertainty reigns. Median weekly wages have shrunk by 1.6 percent since the fall of 2007, making keeping up with debts, paying for necessities, and saving more difficult.
In addition to this, combined business and individual bankruptcies stood at 800,000 in the past year, with business bankruptcies leading the way. Pension values have shed approximately $2 trillion in values in the past year and a half due mainly to collapsing financial markets. Home foreclosures in the third quarter of this year totaled more than three-quarters of a million, about 70 percent higher than the same period last year. More than 7 million homeowners are still in hot water over their mortgages right now.
With all of this bad news, John McCain has offered more government assistance to big business, oil companies who have raked in record profits, the wealthiest corporations, and the banks who through poor decisions and predatory behavior got us into this mess.
On the other hand, he has described the relief Barack Obama has promised to provide for 95 percent of working families as "redistributionist." It is the classic George W. Bush response to recession: give aid to those who least need it and sit idle on the problems facing working families.
