-7 upvotes, 2 direct replies (showing 2)
View submission: Thoughts on trump’s economy?
Yeah, they just changed the definition of a recession instead.
Comment by Tokidoki_Haru at 10/03/2025 at 19:44 UTC
11 upvotes, 1 direct replies
A recession has always been recognized as 2 consecutive quarters of negative GDP growth.
Where and when has that changed?
Comment by Ruminant at 10/03/2025 at 20:15 UTC
3 upvotes, 0 direct replies
They did no such thing. You have fallen for a right-wing lie.
There is no universally-agreed-upon definition of a recession, even among economists. The "two consecutive quarters of real GDP decline" rule is common, but there are good arguments that it is too reductive. It excludes situations that clearly seem like recessions but never recorded two consecutive quarters of real GDP decline, such as the big economic contraction following the bursting of the Dot-Com bubble. And it can include situations which are very questionable, such as a "recession" where job growth and consumer spending stayed positive and the unemployment rate was literally lower than what many economists would have said was possible just half a decade earlier.
And while other governments do use that rigid GDP rule to define recessions, the United States government never has. In fact, here is a document from NBER (in 2007!) that explicitly calls out how it does not consider two quarters of real GDP decline to be either necessary or sufficient to define a recession: https://web.archive.org/web/20100603062416/https://www.nber.org/cycles/cyclesmain.html[1][2]. NBER is the private, non-partisan group of economists upon whom the federal government has for decades relied on to define official recessions, so their definition is effectively the definition of the US government.
1: https://web.archive.org/web/20100603062416/https://www.nber.org/cycles/cyclesmain.html
2: https://web.archive.org/web/20100603062416/https://www.nber.org/cycles/cyclesmain.html
In other words, when the Biden administration declined to call what happened in 2022 a recession, it was just deferring to the same definition that the US government has always followed.
If you are interested in learning more about the ambiguities involved in classifying and defining recessions. two great places to start are the Wikipedia pages for "Recession" from July 2021[3] and July 2010[4]. You can get a sense of the definitions used by economists and governments and the tradeoffs of those definitions, back from before right-wing politicians and media began their concerted effort to retcon the historical definition for political gain.
3: https://en.wikipedia.org/w/index.php?title=Recession&oldid=1036117583
4: https://en.wikipedia.org/w/index.php?title=Recession&oldid=376460019