The Unspeakable R Word

Why nobody in Washington wants to say recession.

By Daniel Gross
Posted Saturday, March 1, 2008, at 7:17 AM ET

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Testifying before Congress, Federal Reserve Chairman Ben Bernanke conducted a master class in the art of understatement last week. "The economic situation has become distinctly less favorable since the time of our July report," he said. Consumers, who account for 70 percent of U.S. economic activity, have been hamstrung by the "continuing contraction of the U.S. housing market," rising energy costs, and slowing job creation. And thanks to "tighter credit conditions for some firms," business spending should be "subdued" for the next several months.

Distinctly less favorable? Subdued? It calls to mind Japanese Emperor Hirohito's comment on Aug. 14, 1945, that "the war situation has developed not necessarily to Japan's advantage."