What Recession?

Economic bad news has made an almost instant transformation into good news in recent weeks. Recovery is sprouting.

Analysis now swings to how such heavy clouds - the dotcom collapse, the stock market nose dive, the impact of the Sept. 11 attacks - could so quickly disperse.

The answers doubtless will be found in changes that have reshaped the US economy over a number of years. Foremost has been a remarkable increase in productivity - the output of goods and services per hour of work. Computer technology has, in many industries, allowed individuals to produce more in a shorter time than their counterparts a generation ago could have dreamed of.

In what some economists call a "spectacular performance," productivity continued its ascent even during the slowdown of recent months. Clearly, increased productivity is now built in, acting as a brake when the economy starts to slide.

An added bonus of technology is the instant availability of "real time" information to businesses' decisionmakers. They can respond more quickly to changing economic conditions than in the past.

At the same time, American consumers sustained a remarkable degree of buying power during the slump. That's largely due to low interest rates resulting from the Federal Reserve's easy-money policy.

The impact of other branches of government pales by comparison. Congress passed a minor stimulus bill last week just as Fed Chairman Alan Greenspan was proclaiming the recovery under way. (Still, the jobless will appreciate Congress extending unemployment benefits.)

This is indeed a "new economy." Workplace productivity deserves continued care and tending.