Business Notes THE ECONOMY

Now that most private economists have declared that the U.S. is in a recession, top government leaders began edging toward the R word last week. Federal Reserve Chairman Alan Greenspan became the first to acknowledge that the economy is shrinking when he told a congressional committee that "a meaningful downturn" had occurred in October and November and the GNP would probably decline for the fourth quarter as a whole. But Greenspan stopped short of calling the downturn a recession, which is officially defined as two straight quarters of a falling GNP. Said he: "We won't know whether it is the beginning of a recession or just some aberration for quite a while."

The Bush Administration also chose its words carefully. White House spokesman Marlin Fitzwater said the U.S. was in a "slowdown," while President Bush called the economy "sluggish." Meanwhile, the Commerce Department reported that the GNP grew a weak 1.7% in the July-September period, down slightly from the previous estimate. Most of the growth came before Iraq invaded Kuwait on Aug. 2.