Two phrases that Daniel Patrick Moynihan put into America’s political lexicon two decades ago are increasingly pertinent. They explain the insufficient dismay about recent economic numbers.
Moynihan said that when deviant behaviors — e.g., violent crime, or births to unmarried women — reach a certain level, society soothes itself by “defining deviancy down.” It de-stigmatizes the behaviors by declaring them normal. And sometimes, Moynihan said, social problems are the result of “iatrogenic government.” In medicine, an iatrogenic ailment is inadvertently induced by a physician or medicine; in social policy, iatrogenic problems are caused by government.
When the economy grew by just 2.6 percent in 2014’s fourth quarter, The New York Times headline cheerfully said “Economy Pulls Ahead.” The story said the U.S. economy is “an island of relative strength” in a world facing “renewed torpor and turmoil.” This was defining failure down.
The Wall Street Journal said “U.S. Economy Hits Speed Bumps,” as though speedy growth had been normal for a while. The speeding had consisted of one quarter (2014’s third) of 5 percent growth. But the economy had gone 43 consecutive quarters without 5 percent growth, the longest such period since the government began keeping the pertinent records in 1947. And even with this third quarter, growth for 2014 was just 2.4 percent, making this the ninth consecutive year under 3 percent. During the recovery from the recession of 1981-82, there were five quarters of 7 percent or higher growth, and five years averaged 4.6 percent growth.