Moreover, not all the economic data has been weak. Auto sales rebounded in July, helped by a new round of zero-percent financing. Strong auto sales in late 2001 helped keep that year's recession from being a deep one, to the surprise of many economists.
Politically, a new recession starting now could be dicey for President Bush, who knows that the recession that began in July 1990 and ended in February 1991 played a significant role in his father's failure to win re-election.
Since World War II, there have been four recessions that included parts of a presidential election year or the year before one. In each subsequent election the incumbent party lost the White House. Besides 1992, they were 1960, when John F. Kennedy was elected over Vice President Richard M. Nixon; 1976, when Jimmy Carter defeated President Gerald Ford; and 1980, when Ronald Reagan defeated President Carter.
Recessions early in presidential administrations do not seem to be as harmful, perhaps because they can be blamed in part on predecessors.
The US presidents Dwight Eisenhower, Nixon and Reagan were each re-elected despite recessions that ended during their second year in office.
One problem for presidents is that the National Bureau of Economic Research, which officially certifies recessions, is not known for speedy conclusions. It has yet to determine when the last recession ended, although most economists say it was in the October-to-December period of last year. Its announcement that the 1990-1991 recession was over came after Bill Clinton had won the 1992 election.
All that makes it likely that the White House will, at the least, not be upset if the Fed does decide to cut rates further.
And further worrying about economic weakness could lead some economists to call for additional tax cuts to provide more money for consumer spending.
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