A top CNN editor isn’t sure if the United States is in a recession but found it “weird” the people who determine when to use the dreaded term are White, old and “associated with prestigious universities.”
Economic data revealed on Thursday showed two consecutive quarters of negative gross domestic product (GDP) growth, which has long been the measure that determines whether the U.S. is in a recession. While many mainstream news organizations have echoed White House talking points pushing the notion that the devastating economic stats don’t necessarily mean the economy is in a recession, CNN published a piece attempting to get to the bottom of it.
CNN Business senior editor Allison Morrow wrote in the network’s “Nightcap” newsletter, “Are we in a recession? Yes. No. Maybe,” which admits the press has essentially given the Biden administration a pass.
“The US economy shrank in the second quarter of the year, and that does indeed meet the unofficial criteria for being in a recession. But, as you probably noticed, we’re not rolling out the R-word in any definitive way yet (more on that in a minute),” the CNN senior editor wrote.
Morrow then wrote the drop in GDP activity “was driven mostly by a decline in inventory levels,” and blamed the COVID pandemic for economic woes.
“Basically, businesses have been scrambling to replenish stockpiles that got drawn waaaaaay down during the worst of the pandemic, when all of us were stuck at home thinking about ways to spruce up the house or expand the garden,” Morrow wrote. “But now stores find themselves overstocked — we’re all shopping a bit less now that pandemic aid has dried up and we’re shelling out whole paychecks on food and gas.”
The CNN senior editor went on to explain “it depends on whom you ask” when getting to the bottom of whether America is in a recession.
“A lot of economists, plus President Joe Biden and Fed Chief Jerome Powell, say it’s not likely. Take the GDP data with a grain of salt, as Powell put it yesterday. Plenty of political pundits might say we are,” she wrote.
The piece took a turn when the CNN senior editor was forced to explain who determines if the United States in a recession, and she wasn’t pleased with her findings.
“In the United States, a recession is determined by a panel of eight economists you’ve never heard of at the nonprofit National Bureau of Economic Research,” she wrote, noting it “seems weird” for a variety of reasons.
“For starters, every single one of the eight members is White,” she wrote. “Each is over 60 years old… they are all associated with prestigious universities.”
Morrow then declared the “bottom line” is that things can change.
“Economists say the biggest reason it would be premature to call a recession based on Thursday’s numbers is that the data can and probably will change. Subsequent revisions to first-quarter GDP figures, for instance, changed from an initial drop of 1.4% to 1.6%, and Thursday’s numbers are just the first of three estimates,” she wrote.
Pundits on CNN and elsewhere have played up the notion of “fears” of a recession, rather than acknowledging the U.S. was now, by definition, going through one.
CNN’s front-page headline described the news as crossing a “symbolic recession threshold,” and its report also used “fueling recession fears.” The report described the technical definition of a recession as the “unofficial” definition.
CNN’s left-leaning White House correspondent John Harwood was criticized after he retweeted a Politico article this week, whose author Ben White commented, “The White House is pretty obviously right that even two quarters of shrinking GDP would not show the economy is currently in recession.” Yet, Harwood, then with CNBC, tweeted during the Trump administration in 2019, “recession = economy shrinks for two quarters.”
Fox News’ David Rutz, Nikolas Lanum and Joseph A. Wulfsohn contributed to this report.