Does that smother out distinction?
It could, but it could also stop the different smothering of distinction. I'll offer the supplemental package so it's not incomplete.
We stop worrying about 2 quarters GDP = recession —> our supply inflation complaints are justified. That's irrational, overfitting a technical recession indicator to declare a technical economic phenomenon to justify the problems caused by a different technical economic phenomenon
Needing it to be a recession, of course, proves this has nothing to do with "Biden redefined a recession" and everything to do with "there are problems to fix!" We are smothering distinction calling it all recession. So we stop calling it recession.
Now to re add distinction:
So start with the complaint: paycheck didn't rise with CoL. Problem to consumer is inflation. Cause is supply shortage. Solution to supply shortage: more supply.
Now our democracy researches or listens for supply solutions. Supply solutions: targeted investment in productive capacity. But to avoid further inflation during the buildup: higher taxes. Alternative inflation avoidance: higher
The problem with calling it recession:
The solution to recession is general spending, lower taxes, lower interest rates (which includes higher inflation!!!!), weakened currency, disincentivizing savings etc. The goal is increased spending in order to increase employment and stop deflation.
Most of this is ass backward for solving the current problem. Once we call inflation a recession, when we try to solve the inflation we confuse people with solutions for the recession. Kind of like how a bunch of Republicans and voters thought in 2009 the solution was to cut spending to "tighten the belts" until "the economy" came back, implying a supply problem.
Pretend none of division in the 2009 response was deliberate sabotage, and it was a reflection of the will of the voters based on their hopes for a best outcome: we had 5 years of below "acceptable" economy because a lot of our chosen recession reaction was functionally to fear inflation and do recovery stymying moves. We sow confusion and division using technical shorthands (recession) for general problems (bad).
Now the standard response to demand side inflation is to the opposite of a (demand side) recession like 2009. Higher taxes, higher rates interest, less spending, stronger currency, incentivizing savings. The goal is decreased spending. The problem itself is inflation, the solution is to stop the inflation.
With supply side inflation its more nuanced, the problem
To get more supply requires:
building, restarting, or recapturing what was lost. To do that requires spending, but the goal of stopping inflation requires we don't do this generally. So we target our spending: shortage of microchips makes cars expensive? Build chip factories. Shortage of basic consumer electronics we got from China?
Invade China and end their zero COVID strategy keep interest rates low and wait for other countries and domestic industry to fill the gap. Temporarily reduce government spending in things that compete for resources, raise taxes on anything that pulls away from fixing the bottleneck.
While inflation creates its own problems, the inflation from a supply shortage is, in addition to its own problem, the symptom of a poverty that will express itself in the economy no matter what, inflation or not, and as such will be worth weathering some of the inflation to not create other problems, while we solve the source of the inflation.
So yeah, the language matters. Both to reduce complication but also to increase specificity, so as to solve the right problem, together.
