"A word means what I want it to mean, nothing more, nothing less," Humpty Dumpty said in " ". or signup to continue reading The International Monetary Fund says "most commentators" define "recession" as two consecutive quarters of negative economic growth. And the "growth" refers to growth in gross national product (GNP).
Hence we have the Alice-in-Wonderland conclusion that . Last week's ABS figures had Australia's economy growing at 0.1 per cent.
Phew! We are not in recession. Bunkum. When you take away the "gross" in gross domestic product (GDP) and convert it to real life as per-person income, Australia has had five quarters of negative growth.
In short, people's incomes have been shrinking for more than a year. So, let's go back to Humpty Dumpty. Let's define "recession" as "two consecutive quarters of negative growth of per capita GDP", or, cutting out the jargon, as "two consecutive quarters of people's income shrinking".
And what would you call five quarters of people's income shrinking? I would call it a "depression". And it is all down to Australia's huge . Sure, we do not have the massive unemployment and destitution of the 1930s.
This is because we have a social welfare net and instead of unemployment, we have large underemployment. Moreover, the effect on the lives of people on low and middle incomes is much worse than the figure of a shrinkage of 1.3 per cent suggests - for two main reasons.
The first is that the housing crisis (caused by high population growth,.
