Paul Krugman makes a very pertinent point today in his blog: the technical definition of recession doesn’t really matter to Americans. What really matters is not how the economy is labeled, but whether or not Americans can fill their cars with gas, put food on the table, buy clothes for their kids, pay their bills — including their mortgage, and hold down a steady job with a well-paying wage.

In academic terms, a recession is defined as a “few” months of consistent pessimistic economic activity spread throughout the economy. This is normally visible in a convergence of negative GDP, income and employment levels, retail sales, and industrial production.

When all these elements converge, there is no disputing that the economy is going down the tubes. But Americans have been singing this song now for months, even years, and they don’t give two cents about dictionary definitions or Wall Street economists — they want relief. Other economic indicators tell a more revealing story:

– Gas prices, which have been quickly approaching the $4/gallon mark, have finally reached the record-breaking levels they haven’t seen since March of 1981.

– The unemployment rate has climbed to 5.1 percent and is expected to move higher in the coming months.

– Consumer spending and retail sales, which account for 70 percent of the US economy, have fallen steadily, scraping lows unseen in more than seven years.

– Home foreclosures have topped the charts, as a record 18.6 million U.S. homes stood empty in the first quarter of 2008.

– Consumer confidence levels, which record popular perceptions on inflation, the job market and the economy in general have hit bottom. The overall number has reached its lowest point since the 2003 invasion of Iraq, while inflation expectations are the highest they’ve been since Hurricane Katrina.

– The share of consumers planning to take a vacation in the next six months has plummeted to a 30-year low.

So when the Department of Commerce announces that the GDP has increased by a meager 0.6 percent in the first quarter of 2008 — signifying that the economy may not technically be in a recession — Paul Krugman asks: “Who cares?”

The Republican National Committee has put out a press release defending Sen. John McCain’s (R-AZ) proposal to suspend federal gas taxes over the summer. The press release claims that the proposal “would save Americans over $6 billion“:

Sen. John McCain Has Proposed Immediate Gas Tax Relief, Which Would Save Americans Over $6 Billion:

Sen. John McCain’s Gas Tax Relief Would Last From Memorial Day To Labor Day. “Hard-working American families are suffering from higher gasoline prices. John McCain calls on Congress to suspend the 18.4 cent federal gas tax and 24.4 cent diesel tax from Memorial Day to Labor Day.” (John McCain For President Website, www.johnmccain.com, Accessed 4/22/08)

“A USA TODAY Analysis Showed That McCain’s Gas-Tax Proposal Could Save Motorists $6.8 Billion In Taxes During The Summer.” (Kathy Kiely, “Gas-Tax Holiday Among McCain’s Plans For Economy,” USA Today, 4/16/08)

The RNC fails to provide a link to the USA Today story. Here’s what the article actually says:

A USA TODAY analysis showed that McCain’s gas-tax proposal could save motorists $6.8 billion in taxes during the summer. Len Burman of the non-partisan Urban Institute said the money won’t necessarily go back to consumers. Refineries already are running high to meet summertime gasoline needs, Burman said, so if demand for gas increases, so will prices. He said that means “a huge windfall for refiners,” not consumers.

Reuters reiterates: “Economists said that since refineries cannot increase their supply of gasoline in the space of a few summer months, lower prices will just boost demand and the benefits will flow to oil companies, not consumers.”