90%, 72%, 3.3%: What is Reality?

There was a little paragraph sitting by itself in this New York Times article.

Ninety percent of the Democratic delegates said the nation was in a recession, while 72 percent of the Republican delegates say it is not.

Talk about diametrically opposed views of the world. To understand this better, let’s look at the way the question was worded.

Right now, do you think the United States is in an economic recession, or not?

So this is not a question of the future or the past, but the immediate now. The republican delegates were polled over July 23 to August 26. The democrat delegates were polled July 16 to August 17, Generally, month long polls are viewed with suspicion, especially in politics, because so much can change between when the first responder to the last. But for an economic snapshot, we just have to understand the “now” to be about the last 6 weeks.

The other point is that this is not a question of how good or bad the economy is for them, their neighbors, etc. This is a question that has a specific, definable answer (even if there is more than one definition) and is not a subjective answer. That subjective answer was in the question that preceded this question.

How would you rate the condition of the national economy these days? Is it very good, fairly good, fairly bad, or very bad?

For that question, the dems and GOP delegates had partly similar answers of 34% of dems and 33% of GOP saying the economy was fairly bad. They diverged with 63% of the dems saying the economy was really bad and 55% of the GOP saying it was fairly good.

So we have 63% of the dems saying the economy is really bad and 90% of the dems saying the country was in a recession. 55% of the GOP saying the economy is fairly good and 72% saying we are not in a recession.

Now there are two principle definitions of a recession. The simpler one is when you have two or more quarters of negative GDP. The more complicated one is from the NBER.

A recession is a significant decline in economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. A recession begins just after the economy reaches a peak of activity and ends as the economy reaches its trough. Between trough and peak, the economy is in an expansion. Expansion is the normal state of the economy; most recessions are brief and they have been rare in recent decades.

Now note this press release from the BEA.

Real gross domestic product — the output of goods and services produced by labor and property located in the United States — increased at an annual rate of 3.3 percent in the second quarter of 2008, (that is, from the first quarter to the second quarter), according to preliminary estimates released by the Bureau of Economic Analysis.  In the first quarter, real GDP increased 0.9 percent.

Now whichever definition you want to use of recession, 3.3% growth is not a recession. In fact, 3.3% growth is a relatively robust growth rate. Or as the NBER puts it, an indication of economic expansion, not recession.

Now you will notice that the New York TImes passes this fact off without comment. A lonely little paragraph buried in the poll results article. But when it comes to the economy, this shows just how out of touch the democrats are. They have morphed themselves into the party of doom and gloom economically, environmentally and internationally. And they are not seeing reality. The question is how much of the electorate has their view of the world distorted through the lens of the MSM and how many are able to discern reality? The answer to that question may well decide who sits in the White House in 2009.