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2008: The Great Depression

At least that what they're being told in the UK complete with pictures of desperate-looking people standing in line.

So what's the story?

The first bit of evidence that we're doing badly are projections by the CBO that food stamp usage will rise in 2008 to "record levels". Of course, as you can see here, the increase appears to be linear since 2001, meaning that every year has a "record level" since then. Has poverty rising linearly since then? Then why isn't that reflected in other more concrete indicators? Hmmm...

The increase – from 26.5 million in 2007 – is due partly to recent efforts to increase public awareness of the programme and also a switch from paper coupons to electronic debit cards.

So the "programme" (need that extra "me"!) is marketing itself better, and electronic payments make it easier to cash in. I would also wonder what interaction there is between food stamps and "undocumented" immigration. You can't just comment on the rising number of people in social programs without asking how many of them have entered into the country recently, or are the offspring of those who have.

The other two exhibits are Michigan and Rhode Island, which provide an seemingly-typical example of how awful the US is doing. But, being familiar with Michigan, I know that the state's policies have had a lot more to do with Michigan's tremendous economic downturn than anything going on nationally.

High taxes have been driving companies out of the state; Detroit has been shirking from 1.8 million people, now down to 900,000. When wealthier residents flee an area, they leave behind a lot of now-cheap real estate, which draws people who can't afford housing, and are living on assistance.

But you won't find that in the Independent article:

Michigan has been in its own mini-recession for years as its collapsing industrial base, particularly in the car industry, has cast more and more out of work. Now, one in eight residents of the state is on food stamps, double the level in 2000. "We have seen a dramatic increase in recent years, but we have also seen it climbing more in recent months," Maureen Sorbet, a spokeswoman for Michigan's programme, said. "It's been increasing steadily. Without the programme, some families and kids would be going without." ....

In Rhode Island, the segment of the population on food stamps has risen by 18 per cent in two years.

But, wait, what's this little omitted factoid?

Rhode Island is one of only two states, the other being Michigan, in which payrolls were down from January of last year, according to the U.S. Bureau of Labor Statistics.

Imagine that! Only two states report a downturn in payroll numbers, and, by some amazing co-incidence, those are the the exact same states which UK readers are told about to create an "accurate picture" of the state of the US economy. Heh.

(Instead, it should raise the question "What's going on in these two states, that they're doing so much worse than the others?")

I'm not saying things are all fine; I don't think we know yet. It seems unemployment is still relatively low, though certainly a weak dollar isn't a brilliant move. I'm certainly not writing to deny that there might be some troublesome indicators, amidst a more mixed picture. But there's a vast difference between the "reality" which Europeans receive (and which appears in our news sources as well), and the actual overall picture "on the ground" in the US.

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