New York Slimes: We’re Measuring the Economy All Wrong

Ten years after the collapse of Lehman Brothers, the official economic statistics — the ones that fill news stories, television shows and presidential tweets — say that the American economy is fully recovered.

The unemployment rate is lower than it was before the financial crisis began. The stock market has soared. The total combined output of the American economy, also known as gross domestic product, has risen 20 percent since Lehman collapsed. The crisis is over.

But, of course, it isn’t over. The financial crisis remains the most influential event of the 21st century. It left millions of people — many of whom were already anxious about the economy — feeling much more anxious, if not downright angry. Their frustration has helped create a threat to Western liberal democracy that would have been hard to imagine a decade ago. Far-right political parties are on the rise across Europe, and Britain is leaving the European Union. The United States elected a racist reality-television star who has thrown the presidency into chaos.

Look around, and you can see the lingering effects of the financial crisis just about everywhere — everywhere, that is, except in the most commonly cited economic statistics. So who are you going to believe: those statistics, or your own eyes?

Over the course of history, financial crises — and the long downturns that follow — have reordered American society in all sorts of ways. One of those ways happens to involve the statistics that the government collects. Crises have often highlighted the need for new measures of human well-being.

The article is a bit of a head-scratcher, to be honest, and I'm not sure the reporter understands the field clearly enough to present what these people are saying. That, and there's that heavy dollop of "If it makes Trump look good we're doing it wrong" so current among the MSM spinmeisters.

GDP is Gross Domestic Production. Period. There is nothing in it that reflects what happens to that production or who benefits. If you want to "measure the economy" by other metrics, fine, economists have been doing that since Adam Smith, but let's not pretend that changing from one standard to another is going to represent anything but a change in standards. For some time now the largely fraudulent "wealth gap" numbers have been hailed as some sort of dire revelation of the evils of capitalism. It's bunk.

What is really going on here is a change in reporting, not a change in standards, and it's a matter of finding those metrics that least make the sitting President look good, not that more accurately represent the economy. Unfortunately for that case these are not new metrics and are perfectly available for a lengthy historical period. If they're going to change to reporting those instead, they ought at least to be honest about why.

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