Economic recovery: Is it real or imagined
Recent economic data indicates the American recovery may be taking hold, albeit in a very tepid fashion. Employment is increasing in the service and health care sectors, but others lag significantly. And most of the recent hires have been in temporary or part-time work. So what will the future hold?
Washington Post columnist Robert Samuelson sees similarities between the American economic performance and Japan’s own experience.
“How much can fiscal policy (government budget policy) and monetary policy (interest rates, credit conditions) compensate for underlying structural problems? Since the early 1990s, Japan has run loose monetary policies and large budget deficits. They haven’t fully resuscitated the economy. Some economists argue that these policies were always too little, too late; others contend that there are limits to what textbook economic policies can do,” he writes.
Writing in the New Yorker, James Suroweicki points two trends in housing and new car purchases as signs the recovery may be a lasting one.
“Perhaps the most striking feature of this economic downturn is the way it changed the rate of household formation. Between 1947 (when the government first started collecting data on the subject) and 2007, the number of households in the U.S. rose every year, closely tracking population growth. This recession dramatically broke the trend,” he asserts.