One of George Carlin's most incisive routines concerns the changing name of that condition soldiers suffer after being exposed to battle. In WW1 it was called "shell shock"; in WW2 it became "battle fatigue"; in the Korean War it became "operational exhaustion"; and in Vietnam it became "post-traumatic stress disorder". Each version is blander, more euphemistic, longer, less clear, more evasive, less expressive.
The "current financial crisis" (that's pretty euphemistic too) has reminded me of the same tendency. The first thing like it that I learned about in American History is the "Great Depression". Ever since it, there's been a reluctance to use the word Depression again. There's a famous quote from Harry S Truman about this: "It’s a recession when your neighbor loses his job; it’s a depression when you lose your own." Even in Truman's day, though, the word was avoided scrupulously. There's a sense that market confidence is a factor in market recovery, so if we call it something bad then we're afraid that will make it worse, or delay recovery.
In the 1970s the United States had an economic turn that in sheer numbers was probably comparable to the Great Depression, but no one ever called it a Depression. And perhaps for good reason. With a lot more "safety net" in place in government services, and with average standards of living being a lot higher than in the 1920s and 1930s (so people had higher to fall from), a lot fewer people were reduced to complete destitution. But mostly we avoided the word and instead called it a Recession because of that consumer confidence thing, I think. But by the end of the Recession the word had come to mean the same thing as Depression to most of us.
It's hard to compare numbers accurately between today and 1929 because the market is so different so no direct comparison really compares well. I don't know if 2008 really compares to 1929, but it's certainly at least as big as the 1970s. Sure, sometimes I'm hearing the word Recession and even Depression bandied about, but this time, the word I hear most often is Downturn. Sure sounds milder, more temporary, a minor adjustment in our ever-expanding course of progress, right? I would like to know if there's a better reason for this terminology than just a reluctance to use whatever word we used last time, and thus, bears the negative connotations of last time.
Are we really, as a society, so shallow that just calling it a Downturn instead of a Recession will keep people from pulling out more? I don't like either possible answer to that question.