Are We in a Depression, or a Recession?
As we slog forward through the third month of the coronavirus economy, lots of well-meaning pundits and average folks are asking about the real state of our American financial health.
They’re wondering if we’re in a recession, or even possibly in a depression…
Both of these words, though, fail to miss the mark of an unprecedented boondoggle where we’ve given up trying to really control our money at all.
The U.S. legislature green lighted the delivery of $6 trillion in coronavirus relief over the last couple of months. Only a small portion of that went to working families – the rest went to various pork projects to help big industry to cover its end.
We’re also keeping up the enormous military and defense spending that’s so insanely destructive to our economy in times of peace, and seems gratuitous and cruel to the rest of the world in times of war. If you actually read this Matt Taibbi column in Rolling Stone, you’ll be overwhelmed with disgust at how these shameless defense contractors feed at the trough, dragging us further and further into unsolvable debt – for no reason!
Now, to stave off pandemic problems, we have six trillion dollars in new spending!
Think about that. In order to cover these bills, which dwarf all of the federal debt concerns of the last two decades, the Federal Reserve central-bank has simply printed trillions of dollars to hide any visible symbols of either a depression or recession.
That gives the talking heads plausible deniability to say that the indices are still healthy. “What depression?”
In reality, we’re so far past depression that the old labels don’t make sense anymore. The terms “recession” and “depression” were coined to talk about economic contraction over a number of quarters.
What we’re in now is an economic nightmare – people can’t work, so they can’t make money and pay the bills. Schools are closed, so parents can’t work, because they have to stay home with her children. The economy is contracting in ways that we’ve never seen and unemployment is set to skyrocket to unimaginable levels.
So instead of asking which classical economic model applies to the situation, we better get started on working on real solutions quickly. What we’re in is something we’ve never been in before, and we’ve never had this scarcity of trust in the people who are supposed to lead. It’s going to be very much every man for himself in the post-covid economy. Work on your local communities, and be safe!