There is now an emerging consensus that the United States has entered a recession. In a technical sense, this may or may not be true. Whether the economy will contract for two successive quarters or be considered a recession by some other technical measure, clearly the U.S. economy has shifted its behavior from the relatively strong expansion it has enjoyed for the past six years.
But whether there is a recession now is not the question. Rather, the question should be whether what we are experiencing is a cyclical downturn on the order of 1991 or 2001 — which were passing events — or whether the economy is entering a different pattern of performance, a shift that could last decades. The dread of hidden catastrophe is one thing. Quite another thing is whether the economic expansion that began in 1982 and has lasted more than a quarter-century is at an end.
