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Tyler Cowen

Politics Have Distorted Americans’ Views of the Economy

Republicans should be happier than they are with current economic conditions, and Democrats more dissatisfied. 

The price people notice.

The price people notice.

Photographer: Gabby Jones/Bloomberg

According to a recent survey, a majority of Republicans and a plurality of Democrats believe the US is in a recession. The question is how seriously to take their complaints.

Most Americans probably do not know the formal definition of a recession — “a significant decline in economic activity that is spread across the economy and lasts more than a few months” — but they do know that current prices of gas and food are especially high, and inflation is rising the fastest in 40 years. At the same time, unemployment is below 4% and the US economy continues to create new jobs at a rapid pace.