As I write, fears of recession are on the minds of many. Unemployment is rising. Investment is falling. Prices for fuel and food staples are on the increase. The cycle of bad news feeds on itself. People want to know what we can expect in the future. Much depends on the policy response. If Washington does not attempt to “fix” the problem, markets will clear after much pain, and we will enter into a growth path again. If policy makers institute controls on prices, which inflate ever more, and attempt bailouts of every failing enterprise, we could be looking at a long economic downturn.
There are some certainties about downturns. Families will feel the pinch even more. If past data indicates something, we can expect charitable contributions to fall. People will spend more time working rather than in leisure. Volunteering in houses of worship or other community-minded organizations will decline. Cultural activities are always the last funded and the first to go in a recession.
We can see, then, that on the margin, a decline in prosperity reduces our quality of life in many ways, not just material ones. Recessions hit areas of life that are central to what it means to live in a good society. Unlike some people who believe that declining living standards are somehow good for us, spiritually and otherwise, I believe that economic declines are always unfortunate and something to be regretted.
And yet we will make it through. There are impulses we must fight against. We must not forget those less fortunate than us even as we struggle to make ends meet. We must not lose sight of the important educational and spiritual work that we need to do even as we see our incomes and living standards fall. Let us pray for everyone who faces a family crisis as a result of decline.
During recessions, free markets also come under attack. In fact, free markets represent a solution to the problem, and recessions are the worst time to abandon them. Thank you for your support of our work, which I believe is more necessary now than ever.
Rev. Robert A. Sirico, President