The Commerce Department says the economy has escaped recession since 1982. Al Sindlinger disagrees. There was a recession in 1986, he says, and there is one now.

He knows this, he says, because the American people tell him so. Who should know better, he asks, the householders of America looking into their own pocketbooks or the statisticians looking at an impersonal pile of numbers?The Commerce Department's analysis has had the economy tiptoeing along the positive side of the expansion-recession line, which by definition is whether the gross national product is growing or shrinking.

Sindlinger, an octogenarian who has in some way measured every economic cycle since the days of Herbert Hoover, says the current recession is quite pronounced, affecting 68.6 percent of households. And it is worsening.

His researchers, who make hundreds of calls each week to households in the 48 contiguous states, now classify 28 states and the District of Columbia as recessed. They find the downturn most intense in New England and the Northeast.

In contrast, the strongest state is Illinois, followed in order by Washington, Ohio, Oregon, South Dakota, Wisconsin, Indiana, Minnesota and Iowa. By their reckoning, all these states are secure, for the time being.

Right on the edge, but still economically positive, are Nevada, Nebraska, Utah, Missouri, Michigan, Kansas, Colorado, Idaho, Montana, North Dakota and Wyoming. The remainder, according to Sindlinger, are in recession.

Moreover, he says, the recession is deepening. While the number of states he lists as being in recession hasn't grown in the past three months, the economies of even the strongest states are showing slow deterioration.

Unlike the Commerce Department, which uses estimates of total output of goods and services to make its determination, Sindlinger's researchers go right to the people, calling about 1,000 a week from Wallingford, Penn.

From the questions asked the heads of households they determine whether "household liquidity" is positive or negative.

If the respondents respond negatively to any of four questions (see box) their household is said to have negative household liquidity. For an entire state to be so classified, more than 50 percent of households must report negatively.

The concept is based on the notion that in economic matters the consumer calls the shots, and that the consumer generally has a good idea of what goes on in his or her economic universe.

Sindlinger doesn't ask them to theorize, only to report their own specific situation. With consumers accounting for two-thirds of gross national product, much larger than either business or government sectors, the individual reports are assembled into a portrait of state and national conditions.

What the people are now telling Sindlinger and his researchers is that they are up to their ears in bills and debts - personal, business, governmental - and can't make any strong financial moves.



Negative liquidity

According to economist Al Sindlinger, a household is determined to have negative liquidity when:

- Current income is lower than it was six months earlier; or,

- Income expectations for the next six months are lower; or,

- Fewer jobs are anticipated six months hence at the place of employment; or,

- Business conditions locally are expected to worsen.