Thanks to Ben DeGrow for bringing Randall Hoven's article to my attention.

Over at The American Thinker, Randall Hoven suggests that our current recession is not an unprecedented crisis, and that economic statistics so far during this downturn are little different from other post-WW II recessions.

I disagree.

The first statistic Mr. Hoven mentions is the recently-reported -3.8% GDP growth rate for the fourth quarter of 2008. However, the only reason the drop wasn’t closer to the consensus forecast drop of over 5% was a huge build-up of inventories…inventories which I can’t imagine will be sold anytime soon. As Brian Wesbury noted, “That leaves two alternatives: either the inventory increase will be revised away in future reports (reducing Q4 real GDP growth) or the inventory correction in the first half of 2009 will be extremely sharp, meaning real GDP in Q1 may be even weaker than in Q4.”

It also bears pointing out, as Wesbury does, that “The weakest components of real GDP were personal consumption, which fell at the consensus expected 3.5% annual rate, and business investment in equipment and software, which dropped at a 27.8% rate. Home building fell at a 23.6% rate.”

It is hard to imagine more likely leading indicators for the economic times we’re about to live in than huge drops in consumer spending, business investment, and home prices.

What else? In December, new single-family home sales hit their lowest level since records starting being kept. Not only were fewer houses being sold, but what was sold went at far lower prices, with the median price down over 9% from a year ago and the average price down over 13%. Considering what a huge percentage of consumer spending in recent years came from mortgage equity withdrawals, this bodes extremely poorly for the overall economy, and it’s something very different from any prior post-WW II recessions.

The Rasmussen Employment Index fell to a record low for the fourth straight month. Their consumer and investor indexes aren't much better.

Also different from those recessions is the truly massive de-leveraging cycle we’re in now. In no other recession were financial and other institutions cutting back from leverage levels frequently as high as 30:1. While most Americans pay attention to the stock market, the real life blood of the economy is the debt market. And today there is no money being loaned out…not that there is much demand to borrow any. This de-leveraging will make this recession deeper and longer than others.

I’d also point out that most of the horrible economic numbers we get lately end up being revised to even worse numbers at the next report. This is true of consumer sentiment, manufacturing indices, productivity measures, etc.

In terms of employment, I think the uptick in unemployment, with 7.2% reported for December, is just the beginning. Mr. Hoven makes some strange arguments trying to show that “payroll shrinkage”, “GDP shrinkage” and other measures of economic (in)activity are about average in comparison to prior recessions. But those comparisons are worthless because they are with completed recessions…we’re already “average” in comparison and our recession feels like it’s just getting up to speed.

I do not believe this will end up being a “typical recession” by any stretch.

And, as I’ve written about frequently in recent weeks, another enormous difference between the current recession and prior ones is that we now have a government which aims to “fix” the problem by destroying attacking capitalists and capitalism, by socializing medicine, by pandering to the cult of Algore and his global warming hoax, and by turning the majority of Americans into wards of the state.

The Democrats’ medicine will be worse than our current illness, and will turn what should have been a moderately annoying case of the fiscal flu into a devastating economic pneumonia.