Opinion | A Double Dose of Optimism

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In the spirit of a new year, I give you a double dose of optimism this morning. First, some political optimism, via a few of the wiser writers about democracy:

“I just want to remind everyone saying good riddance to 2018 that it was a heck of a lot better than 2017,” Benjamin Wittes of Lawfare tweeted on New Year’s Eve. “We are making progress. 2019 will also be better — which is not to say it won’t be hard. Keep the faith, people.”

Similarly, Yascha Mounk of Johns Hopkins University wrote: “2019 will bring plenty of terrible news. But with populist governments on the ropes in India, Poland, and America, it may also mark the year in which citizens around the world remember the importance of freedom and self-determination. Happy New Year, everyone! Let’s fight.”

And Anne Applebaum of The Washington Post was the most succinct: “Happy New Year to all. Spring is coming.”

I’ll echo the last part of Mounk’s tweet: Let’s fight. Democracy remains more threatened than I ever expected it to be in my lifetime. And there is indeed plenty of bad news, like the inauguration this week of a militaristic potential autocrat in Brazil. But like the writers quoted here, I see more reason for hope than at the start of either of the previous two years.

The main reason is that people have started to become more politically engaged and speak up for democracy. I hope it continues.

Like a pair of dice. Now for some economic optimism — or at least an absence of pessimism.

It’s become trendy to claim that the United States is “due” for a recession in 2019. The current economic expansion began in June 2009, which means it’s already the second longest on record. At some point, won’t the current expansion die of old age?

The short answer is no.

“It’s tempting to think of an economic expansion as being like a life span. The older you get, the closer you are to death; a 95-year-old probably has fewer years left to live than a 60-year-old,” as Neil Irwin of The Times wrote a couple of years ago, in a piece that changed my thinking on the subject.

In truth, he wrote, academic research pointed to a different conclusion: “Expansions don’t die of old age. They die because something specific killed them. It can be a wrong-footed central bank, the popping of a financial bubble or a shock from overseas. But age itself isn’t the problem.”

The American economy is certainly facing some risks right now. Stocks remain historically expensive. Global debt has risen substantially over the past decade. The Federal Reserve has been raising interest rates. And President Trump and his top advisers aren’t exactly top-notch economic stewards.

But don’t make the mistake of thinking that a recession is inevitable this year. The best rule about predicting recessions is that virtually no one can reliably do so.

To see where the economy is headed, keep an eye on the major indicators — like stocks, bonds and the job market — and don’t rely too much on short-term movements. The next data I’ll be watching will be the monthly jobs report that comes out on Friday.

And the most important indicator in that report is the number of jobs that the economy created in December. (The unemployment rate, though better known, is based on a much smaller survey and is less meaningful.) Recently, the American economy has been adding roughly 200,000 jobs a month. If that number starts falling over multiple months, it’s a bad sign.

2020. On the new episode of “The Argument” podcast, Ross Douthat, Michelle Goldberg and I answer listener questions — including who should be the Democratic nominee in 2020. We also talk with comedian and Emmy-winning writer Ashley Nicole Black.

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David Leonhardt is a former Washington bureau chief for the Times, and was the founding editor of The Upshot and head of The 2020 Project, on the future of the Times newsroom. He won the 2011 Pulitzer Prize for commentary, for columns on the financial crisis. @DLeonhardt Facebook

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