• Friday afternoon, U.S. Congressman Paul Ryan (R.-Wisconsin) spoke on the current economic state of the country to students, faculty members and local professionals at the Law School.
• Friday morning the Department of Commerce released a report that showed a negative 6.2 percent growth in the U.S. economy.
• This was the sharpest economic decline the country has seen in 25 years.

As a whole, the U.S. economy contracted at a rate of 6.2 percent in the fourth quarter of 2008, according to a report released by the Commerce Department early Friday morning.

This staggering economic downturn was the main topic addressed by U.S. Rep. Paul Ryan (R-Wisconsin) during an, "On the Issues" with Mike Gousha discussion held later that afternoon in Sensenbrenner Hall. There were about 200 students, faculty members and local residents present for the event.

At the beginning of the discussion, Gousha informed the audience that the U.S. economy is in the midst of the sharpest decline it has had in the past 25 years.

"This is the biggest drop we've seen in a long, long time," Ryan said.

The current recession is getting significantly worse than the recession the country experienced earlier in the decade, worse than the recession of the 1990s and will most likely get worse than the recession of the early 1980s, he said.

Gousha began by asking the 39-year-old, five-time congressman what first moved the country toward this recession.

According to Ryan, the credit crisis put the wheels of the recession into motion.

"Credit is the lifeblood of our economy," Ryan said.

During a recession nobody trusts the other person's credit sheet, he said, so money can't flow smoothly through the economy. When businesses and banks don't trust their counterparties the economy will remain stagnate.

"Now it has gotten to the point where we are experiencing a domino effect," Ryan said. "The negative impact of the recession is rippling through the economy sector by sector."

Gousha then asked Ryan how he thought the government is currently handling the economic crisis.

Ryan said, he feels Ben Bernanke and the Federal Reserve are going in the right direction with the monetary policy, but he doesn't think Congress is going in the right direction with the fiscal policy.

"I voted against the stimulus plan, because I don't think it's going to do us any good," Ryan said. "We tried something like this in the 30s, and unemployment ranged from 12-25 percent."

According to the budget the president proposed on Thursday, the national debt is going to double in the next eight years, Ryan said.

Even if you're looking at the Keynesian economic playbook, which emphasizes government spending during a recession or depression, the president's new stimulus plan doesn't follow it, he said.

"Only 7 percent of the stimulus money will be spent in 2009, 32 percent in 2010 and the rest of the money won't be spent until 2011 and beyond," Ryan said. "The only way for the plan to be successful is to spend all that money as quickly as possible, especially on infrastructure."

Ryan said he realizes there is government spending that is necessary during a recession, such as on food stamps and unemployment, but it's all the unnecessary spending on top of these things that is going to get the country in trouble.

"I believe that we are coming to a tipping point in this country, were we will no longer be a democratic capitalistic country, and we will become more like a European social welfare state," Ryan said.

What Ryan said he meant by this is that more people in the country will be dependent upon the government than they will be on themselves.

"Eventually, the government will take so much out of your paycheck you won't be able to prosper," he said. "We are making it so the next generation will be in a worse position than we are. A Western European stagnate economy."

Ian Senne, a local real estate agent, was one of the many professionals attended the event.

"I think the main problem right now is fear and uncertainty," Senne said. "Right now, a lot of people are just waiting around to see what's going to happen. That alone is slowing down our economic recovery."