Writer, researcher and columnist John Mac Ghionn issued a dire warning Saturday that the United States was not only inching towards a recession, but one so severe that it may go on to "redefine the word retroactively.”
“A recession is coming – not the manicured kind economists dress up in euphemism, but a real one, the kind that redefines the word retroactively,” Ghionn wrote in an op-ed published Saturday in The Hill.
“[British historian] Niall Ferguson has been mapping the terrain: geopolitical shocks, energy disruption, inflation that won’t be reasoned with. History, he notes, does not reward economies caught in that particular combination. It never has. But this one carries something extra, something structural.”
Ghionn noted that while previous recessions have been “brutal,” they were ultimately temporary, with new jobs eventually replacing those that had been lost. The U.S. economy ultimately recovered from both the COVID-19 pandemic–induced recession and the 2008 financial crisis, even if a growing number of Americans continued to slide into economic instability.
With the rapid advancement of generative artificial intelligence, however – which is “already replacing thousands of jobs per month” – coupled with a “collision of forces” such as the U.S. war against Iran – which has sent tremors through the world economy – the United States might not be able to recover from another recession like it has in the past, Ghionn warned.
“AI-displaced roles do not come back when the economy recovers,” he wrote. “They are simply gone. Permanently retired behind a wall of efficiency gains and margin expansion.”
Furthermore, the growing wealth inequality in the United States – which has reached heights rivaling the Gilded Age of the late 1800s – has eroded Americans’ “faith in institutions,” only exacerbating the potential effects of a recession, Ghionn wrote.
“The cultural confidence that once carried societies through genuine hardship – the belief that sacrifice was worth something, that tomorrow warranted patience – has faded into a nihilism that is difficult to condemn in people who arrived at it honestly,” he wrote.
“A society that still believes in endurance can survive contraction. A society built entirely on consumption faces a harder test.”