Charting Economic Decline

Abstract

The good thing about economic slumps used to be that they were followed by a boom. But this seems no longer to be the case. We are now coming out of the great recession of the early 1980s. Economic growth is picking up, and unemployment falling a few percentage points. But the improvements that are being forecast will still leave us with unemployment at levels — perhaps 8 per cent of the labour force, if we are very lucky — which only a decade ago would have marked the most vicious of slumps. Indeed, the really disturbing thing about the recent recession is not that it has been worse than any other of the post-war period, unpleasant though this fact may be. What is really worrying is that almost every recession since 1950 was the worst to date; that every recovery or boom was weaker than the last.

‘Nothing is so bad that it cannot get worse tomorrow.’

VARIATION ON GRESHAM’S LAW