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The campaign in Iowa performed its usual task of starting the long process of winnowing out the presidential field, but it failed to fully resolve this year’s underlying mystery: Why are voters toying with radical change at a time when, objectively speaking, the country isn’t in bad shape?I can answer that.
Why Iowans Entertain Radical Messages from Donald Trump and Bernie Sanders Amid Seeming Prosperity By GERALD F. SEIB
"Objectively speaking," this time is different.
This time, the country didn't recover from the recession. In every other recession of the 20th century, including the Great Depression, economic growth went back to trend.
This time, no.
Yet only the people seem to know it.
They're not happy.
*Perhaps the 19th century as well -- I don't know the history.
6 comments:
I am going to take that a step further. I don't think we ever recovered from the 1999 dot com bust. Yes, that was a mild recession, but things never seemed to go back to normal after that. Many people do not realize that the term "jobless recovery" was first coined not after the 2009 crash, but after the dot com bust. During the supposed recovery of the 00's, nothing seemed very normal to me. Money sloshed around in strange ways. Incomes started falling. Older workers who had lost their job in 2000 just gave up. I believe the 00's were simply a process of decline, leading to the 2009 crash. I don't think the cause was the dot com crash either - I think that was a symptom too.
I have numerous friends and relatives who were in their 50's, in the tech sector or allied areas, who lost their jobs in 2000 and either retired unwillingly, or took many years to find another job. None of them ever recovered financially. This process has been going on for years
"I am going to take that a step further. I don't think we ever recovered from the 1999 dot com bust."
How much was the country outside tech/Silicon Valley impacted by the dot com bust, though? I'm a techie in Silicon Valley and it was HUGE here (my commute got very good for a few *years*...), but it seemed that outside here (and maybe Boston and Seattle/Redmond) it was a non-event economically. Yes, folks lost a lot of stock market money, but the jobs going poof seemed mostly confined to tech. Yes? No?
Wikipedia has a nice graph of GPD (https://en.wikipedia.org/wiki/File:Recession2001.PNG), but if tech got hammered then the rest of the sectors of the economy couldn't be doing too poorly for the numbers to work out.
Again, from Wiki, the unemployment rate *PEAKED* at 6.3% ... and if the tech sector got crunched, then the unemployment rate outside of tech had to be less than this.
-Mark Roulo
I think the unemployment rate is very misleading, because it only counts people who are actively seeking work, not those who have dropped out of the work force. The labor force participation rate gives a truer picture, and it's historically low.
Has anyone read Elizabeth Warren's book? She says that if you had asked her in the late 1970's where the American middle class would be in 25 years, she would have said they would be in great shape, because all those wives joining the work force would raise their family's financial situation. It didn't work out that way, because the costs of housing, medical care, and education went way up. Those cost increases wiped out the advantage of the two-income couple, and since the family was already maxing out their working hours, they had no room to maneuver in case of emergency. Now I remember the title -- "The Two Income Trap." Worth a look.
"The Two Income Trap" was published in 2004, so it would tend to support froggymommie's thesis. I think the fortunes of the middle class have been declining since the '70's. I read somewhere that 1972 was the first year that the U.S. produced more Ph.D.s than jobs that required them.
The phrase "jobless recovery" dates from the early 00's and refers to the aftermath of the .dot com crash. See this reference from 2003
http://www.economist.com/node/1772963
"How much was the country outside tech/Silicon Valley impacted by the dot com bust, though? I'm a techie in Silicon Valley and it was HUGE here (my commute got very good for a few *years*...), but it seemed that outside here (and maybe Boston and Seattle/Redmond) it was a non-event economically. Yes, folks lost a lot of stock market money, but the jobs going poof seemed mostly confined to tech. Yes? No?"
No, or at least the 1999 bust might have had less widespread effects without 9/11/01. The company I worked for at the time laid off about 1/3 of their employees in late October, 2001. My older brother had been downsized in May, at age 53, from a large technology (as opposed to tech?!) company. He got a good severance package and had been told by the provided consultant that taking off 3 summer months before starting a job search in earnest was a perfectly good idea. Then 9/11 happened and he never worked in his field again. I think there was a lot of that, as froggiemama noted.
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