Saturday, June 13, 2009

Past Recessions

This graph from House Speaker Nancy Pelosi's blog got a lot of press over the last few days:

That situation looks pretty dire. Of course, the data they used to generate the chart is available back to 1945, and they didn't include recessions prior to 1990 - for various reasons. Adding previous downturns muddies the picture a bit:

Economic downturns have taken various forms over the years and the explanation for the recovery in each case probably isn't as clear as it was in 1991 or 2003. But what's clear is that we've entered the most severe recession most of us have seen in our lives. Not only that, the three months since the Presidential Election have been a disastrous period of inaction.

But compare that to what happened during the depression:

If job losses in this recession exceed 10% of the labor force, the economic situation will be a disaster beyond anything most of us would have imagined. It boggles my mind to think of what the impact of losing 24% of the jobs in the United States would be.

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