Scholar Says Recession's Effects Will Linger for Years
Scholar Spotlight on Donald Peck, Centerpoint, October 2010
As congressional elections approach, economic hardships factor prominently in voters' minds. But regardless of which party takes the majority in November, the effects of the economic recession will be felt for years to come, said Donald Peck, a Wilson Center public policy scholar.
Peck, who is deputy managing editor of The Atlantic, is at the Wilson Center writing a book on the potential consequences of sustained unemployment. The book is an extension of The Recession's Long Shadow an article he wrote for the magazine earlier this year.
"There already has been a long period of chronic joblessness," Peck said, "and when you have long periods marked by anxiety and unemployment, you see social corrosion, which takes a long time to develop and then endures long after recovery is complete."
During long periods of economic decline, he said, a sense of instability prevails. People tend to become more antagonistic, xenophobic, and conservative. "Whatever party takes control," Peck said, "we're likely to see a retreat from liberalism" as support declines for programs that help the disadvantaged.
But even when recovery is well underway, Peck said the nation will not fully recover to pre-recession realities. Long, deep recessions tend to accelerate economic trends that are already underway, such as the decline in manufacturing employment. And, the construction and finance industries, bloated by a decade-long housing bubble, "will not return to their previous size," said Peck. In addition, he said, these unemployed financial and construction workers will need to retrain and find new careers.
One interesting demographic change is that women are now the majority of employed Americans for the first time in U.S. history, said Peck. Men generally have had trouble transitioning into the white-collar workforce, he said, and do not pursue or finish higher education to the extent that women do.
Traditionally, inequality declines during times of recession, said Peck, but that is not the case now. He said the wealthy have rebounded well.
Writing a book on an evolving topic has its challenges. "This topic is a moving target," Peck said, "as I'm describing [events] still happening. Intellectually, I hope the premise that the recession has already caused changes that will endure long into recovery makes the book invulnerable to what happens in the months ahead."
Peck said the book will include policy options in part based on what strategies succeeded in other distressed countries. "My fear is if this recession extends long enough, unemployment, particularly among less educated Americans, could become self-sustaining," he said.