"Self-Perpetuating Orgy of Negativity"

Are things really as bad as the media keeps telling us? That's the subject of the latest post by David Harsanyi, who asserts,

A self-perpetuating orgy of negativity regarding the economy begins with the media, which collect every morsel of daunting economic news and jump to a logical conclusion — which is to say, Armageddon.

Oil prices will sink the Republic. No, the stock market will. That mortgage crisis will put you in a shantytown. This is all terrible news.

Recession? What recession?

There is so much recession talk, in fact, that according to a Gallup poll back in March, 75 percent of Americans already believed the U.S. economy was in a recession. A recession, defined by most economists as economic contraction for two or more successive quarters, has not happened.

Many economists — most of them still arguing over why we have recessions at all — believe that with a credit crunch, the housing market falling and high oil prices, the economy growing (as it did slightly last quarter) is a sign of resilience.

As market strategist Ed Yardeni (hat tip to U.S. World and News Report) claimed, "this profits recession is very much limited to the Financials sector and the Homebuilding industry . . . . Removing these two reveals that profits rose 15.9 percent in Q4 and around 12.0 percent during Q1. The resilience of 'core' profits and of the economy in the face of the worst credit crisis since the 1930s is impressive indeed."

That kind of perspective is, typically, lacking in economic coverage. Take, for instance, the housing crisis. It is real. It is painful. Yet more Americans own their own homes now than ever before. Those evil corporate warlords who had the audacity to offer low-interest mortgages put millions of families that otherwise would never have been able to afford it into homes. Only a fraction risk losing their investment.

Many of those borrowers made bad decisions. Many lenders made bad decisions, as well. A lesson could have been learned. Instead, government has reinforced irresponsible behavior with massive bailouts.

Let's not forget that overstating our troubles is also part of the political season. Isn't it curious how often we're on the precipice of economic ruin during a presidential election? The candidates, naturally, have all the answers — tax holidays, tax hikes, increased regulations ... until, that is, the next downturn comes around and we start it all over again.