NOW It's Official

In an earlier post, I complained that the NBER had essentially redefined what we call a recession. By way of review, the problem I had was, first, we use definitions for a reason, i.e. to help us compare events over time -- how can we compare the current economic downturn to previous downturns if we keep changing the standard we use to compare them? Secondly, I felt that the NBER pronouncement was emblematic of the "talking down" of the economy being carried out by the media and some in the government; I certainly was not advocating burying our heads in the sand, but simply that we do not need to exacerbate the problem by creating further anxiety.

That said, with the release of fourth quarter GDP estimates by the BEA, we can officially declare ourselves to be in a recession. This makes it somewhat easier to compare current economic conditions with those of the past. According to the BEA release, preliminary numbers show GDP to have decreased by 3.8% in the fourth quarter of 2008 (note that these numbers are reported as an annualized rate -- in other words, if the fall in GDP seen in the last quarter continued for a full year, it would be a 3.8% decrease). Recall that GDP decreased by 0.5% in the third quarter. In terms of GDP, the current trend so far most closely resembles the beginning of the downturn in 1990-91. In the third quarter of 1990, inflation-adjusted GDP was unchanged from the previous quarter; this was followed by a 3% decrease in the fourth quarter of that year, and a decrease of 2% in the first quarter of 1991 with the resumption of moderate economic growth in the second and following quarters. Unemployment, however, is nearly a full point higher than it was at this stage of the 1990-91 recession; this could be a cause for concern. However, the current recession does not (again, so far) look to be following the trend of the recession of the early 1980's, which started off with a much deeper drop in GDP (7.8% in the second quarter of 1980) and higher unemployment.

So, we do have a recession, and just how bad it will be and how long it will last remains to be seen. We may have some hard knocks to take before it's over with. But, again, I hope that those in government and the media will refrain from doomsday speculation and hyperbole and just report the facts.

Addendum (27-Feb): The BEA revised their estimates for the fourth quarter to a 6.2% drop in real GDP, which makes the current recession look somewhat closer to the recession of the early 80's. It remains to be seen if it will be as protracted as that recession. Again, however, I reemphasize the importance of the media and government not "talking down" the economy, thereby making things worse.

Thoughts on Obama's Agenda: Hate Crimes

The Obama White House has posted the president's agenda for America. Some of the president's goals listed on the page are laudable, for example, expanding the use of drug courts for some first-time nonviolent offenders allowing them to avoid prison time, and the imposition of harsh penalties for those practicing voter fraud (I'm curious how vigorously this will be enforced against ACORN). However, many of the listed goals are exemplary of the far-left social agenda that many of us were concerned that Mr. Obama would seek to advance.

Among these is an expansion of hate crimes legislation. As heinous as crimes carried out against people strictly because they are "different" are, laws imposing special punishment on so-called hate crimes are not an acceptable remedy.

Anyone who commits murder or violently assaults another human being is motivated by hate in one form or another; anyone convicted of any such crime should be punished to the fullest extent of the law. However, to pick out certain groups of people in order to impose harsher penalties on those committing the same crimes against them is morally wrong and constitutionally indefensible. It is morally wrong because it singles out certain groups as more highly valued by the government than others: if you murder Person A, you will receive X number of years in prison, but if you murder Person B, you will serve X+n years in prison. This is no less immoral than imposing less of a sentence on someone who murders a homeless person than on someone who murders a wealthy corporate CEO.

It is constitutionally indefensible because it is a violation of Equal Protection under the Law ensconced in the Fourteenth Amendment. It also carries First Amendment implications, insofar as it criminalizes the holding of certain ideals or beliefs. The First Amendment protects our right to hold our opinions and beliefs and to express them; it does not discriminate between those that are true or correct and those that are not. In fact, according to John Stuart Mill it is the interaction between truth and error and the resulting "clearer perception and livelier impression of truth" that freedom of speech was intended to protect. Beliefs are not restricted but practice of those beliefs may be -- but only if that practice in and of itself infringes upon the rights of others or is damaging to public order.

Hate crimes legislation, however, turns this standard on its ear, working backwards to go beyond the practice itself to the held beliefs or the thoughts behind them. Under existing precedent, the belief itself is not criminalized, but only actions that are harmful that happen to spring from that belief -- it is important that those actions would be illegal regardless of the beliefs behind them; the law cannot single out a single set of beliefs (this applies particularly to religious beliefs, but conceptually it extends to other types of beliefs). Under hate crimes laws, it would be the beliefs themselves that are criminalized; actions that are already illegal will be punished more harshly based upon the beliefs from which they sprang. Imagine for instance if polygamy were more harshly punished for Mormons than for anyone else (that polygamy laws did not single out a particular group was an important fact considered by the Court in the Reynolds case in 1879). This would clearly be unconscionable.

While one can hardly find sympathy for anyone who treats those different from him as as less worthy of human dignity, hate crimes laws constitute a very real threat to all of our freedoms. They in essence make the holding of certain opinions -- opinions deemed by the State to be impermissible -- a crime.

Looking Ahead to Inauguration

I have always been fascinated with the thought of witnessing history being made. Furthermore, I hope, perhaps against hope, that the breaching of the race barrier in the nation's highest office will lay to rest some of the animosity that has lingered in our country from the wrongs of the past. I hope, again perhaps against hope, that our country has by and large grown to the point that we no longer judge men "by the color of their skin but by the content of their character". On the other hand, this is clearly not the president that I was hoping to see being sworn in, and I have very serious reservations about Mr. Obama on a number of levels (see a good summary of some of these written by Fred Barnes), and about the policies that he advocates.

All of this aside, we have to wish Mr. Obama the best -- for the good of the nation; if he falls on his face, we may get the White House back in four years, but the country will suffer in the meantime. I do, however, anticipate continued, vigorous disagreement with him (while keeping an eye open for a suitable Republican challenger in 2012). The caveat for Democrats is that Obama-mania, which reached a messianic fervor during the campaign (consider a Maryland state senator's recent statement: "It doesn't matter if the state of Maryland is broke, so long as Barack Obama is president"), will very quickly meet reality. Obama cannot live up to the hype -- no one could. For this reason, I anticipate that Obama will follow the trend for most Democratic presidents since LBJ to serve only one term. But I suppose it's still early for handicapping the next election.

Opposing "Fairness Doctrine"

Senator DeMint (R-SC) is co-sponsoring a bill to prevent liberal Democrats from re-instituting the so-called "Fairness Doctrine", which would require broadcasters to present programming that supports both liberal and conservative positions. In other words, a radio station broadcasting conservative programming would be required to broadcast an equal amount of liberal programming. Senator DeMint and his cosponsors are absolutely correct in taking a stand against this Doctrine.

The Doctrine would clearly impose a burden on the broadcasters, insofar as radio programming is determined by the market, i.e. what people want to listen to; therefore forcing stations to run program mandated by the government will cost them listeners and therefore advertising money. Infinitely more important, however, is the blatant infringement of the First Amendment that such a rule would constitute, because, essentially, determining what constitutes "acceptable" programming would become, much like Pravda in the old Soviet Union, the prerogative of the government. The protection of free speech, especially political speech, is a bulwark of the American political system. Supreme Court Justice Hugo Black (a Democrat) once said: “The Framers knew that free speech is the friend of change and revolution. But they also knew that it is always the deadliest enemy of tyranny.” Not to put too fine a point on it, but perhaps we can interpret his words as a warning of impending tyranny when the government tries to restrict freedom of the press.

Here is Senator DeMint's press release on his Broadcaster Reform Act, along with more historical information about the Fairness Doctrine.