subject: The Economy No One Will Admit: Double Dip Recession [print this page] The Economy No One Will Admit: Double Dip Recession
America has been quick to criticize the Japanese government's lack of candor with the Japanese people about threat of nuclear fallout after the tsunami, but are U.S. government officials being any more transparent about the economy?
All the news coming out of Washington D.C. is congratulatorybut wait a minute, isn't President Obama is already campaigning for 2014? So why wouldn't economic forecasts coming from the administration be optimistic? Robert Reich, former Secretary of Labor under President Clinton, recently wrote an articlein the Huffington Post that challenged the government's claim that the economy is recovering. He feels that we're headed toward a double dip recession.
America is a consumer-driven economy and according to a recent Consumer Board'sindex of consumer confidence, the trend is downward, not upwardas much as the Obama administration tries to convince us otherwise
I was the spokesperson for the FBI in Northern California for four years. The media would pick me apart from limb to limb if I tried to lie to them or misrepresent the truth. Even if I'd wanted to, in this digital age, it's very difficult to twist facts to suit the government's objectives. And if I tried, good reporters would always be there to keep me honest.
Good reporters need to do the same for President Obama. The difference is that in our social media savvy environment, you and I have as much access to information as reporters and watchdog groups.
No Great Expectations
According to the Consumer Board report, Americans expect:
Rise in inflation
Decline in improved business conditions
Anticipate fewer jobs
Expect incomes to decline
Think these findings aren't important? Consumer confidence plays an important role in the economy through household spending, which accounts for 70% of the U.S. economy.
192,000 jobs were added in February 2011 and another 216,000 jobs were added in March, bringing unemployment down from 8.9 to 8.8%. This is good news; however, the nation has lost so many jobs over the past few years that it's estimated that even at the rate of 200,000 per month, American won't get back to 6 % unemployment until 2016.
Government officials tell us the economy is growing againby an estimated 2.9% this year. But, if we were truly in an economic recovery, we'd expect a much healthier growth of 4-6 %. In contrast, the Great Depressionas it emerged from the deepest hole in 1934saw the economy grow at 7.7% and in 1936 it grew 14.1%.
And there are two other negative trends that economists can't ignore: dropping hourly wages and falling housing prices. Hourly wages continue to drop because of high unemployment and housing prices continue to fall because people still can't pay their mortgages.
Innovation Is Key
The bigger issue for most of us is this: no one really believes the economy of the future is going to look like the economy of the past. And the longer we keep hoping for the return of old manufacturing and production jobs, the deeper the rut we'll find ourselves in. It does little good to revive what used to be profitable; instead, Americans need to figure out what will be profitable to produce in the future.
The world is moving at a fast pace: http://www.youtube.com/watch?v=ljbI-363A2Q
The top 10 in-demand jobs of 2010 . . . did not exist in 2004.
We are currently preparing students for jobs that don't yet exist, to use technologies that don't yet been invented, to solve problems not yet identified.
One out of eight couples married in the U.S. last year met on-line.
The number of text messages sent and received every day exceeds the population of the planet.
The amount of technical information is doubling every 2 years. For four-year technical students this means that by their third year, half of everything they've learned will be obsolete!
Lack of Candor
Wall Street is buoyant, but that's because the only group that's optimistic about the economy are the CEO's of top American companies. Small and medium businesses, however, are still feeling cautious and worry that rising inflation may offset their profits.
Innovators need to be looking for new investments, new lines of business, and new career paths for workers. America needs more than a recovery, it needs a vision for the future.
President Obama and his economic advisors should take a lesson from mistakes made by the Japanese government and be more transparent.
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