Economy Shrinks for First Time Since 1993; Analysts Divided on Whether the Country Is in Recession
The terrorist attacks of Sept. 11 helped cause the already weakened U.S. economy to contract slightly in the July-September period, the first such decline in more than eight years, the Commerce Department reported yesterday.</br></br>Some economists said the decline in the nation's output of goods and services signaled that the U.S. economy has entered its first recession in more than a decade. Others said the outlook remains uncertain.</br></br>"If it's not a recession technically, it really doesn't matter, because growth is so far below the country's potential to grow" that unemployment is rising, corporate profits are falling, and business spending on new plants and equipment is plunging, said economist James Glassman of J.P. Morgan Chase Securities.</br></br>President Bush said the report confirmed that the attacks hurt the U.S. economy, and he appealed to Congress to quickly pass legislation to stimulate economic growth.</br></br>The attacks "affected our workforce and affected our business base," Bush said in a speech to business executives. "People are having tough times in America. People are losing their jobs. . . . It's time for our government to act in a positive and constructive way. The Congress needs to pass a stimulus package and get it to my desk before the end of November."