Top Lines: US Economy And Trade Policy | 2020 Election And Political Analysis | Coronavirus Crisis | Impeachment | Protecting Our Elections And Disinformation | Immigration And The Border | Countering Illiberalism's Rise
Notes On 2020 - Last week, the White House made a significant attempt to portray “normalcy” - we saw meetings in the Oval Office in close quarters with no social distancing and no masks; the Vice President began official travel again, still with no mask; and the White House press briefing returned, again with no masks. It was a show, a very purposeful show, of our return to before, of opening up.
To make all of this happen, with the COVID infection rate in the US remaining the highest of any major developed country in the world per capita (and not falling), the White House created a regime of ubiquitous, rapid testing for the President and Vice President and anyone they come in contact with. The problem with this story, of course, is that this type of testing regime is something that the President has explicitly said he is not attempting to provide for the people of the United States. If this is what it takes to “re-open,” and we know that the American people don’t have it and won’t at best have it for many months, why is the President working so hard to undermine and end the stay-at-home policies which have worked to slow the virus? As Simon said in this Washington Post story from over the weekend, the President did more last week to show us how far we are from returning to normal than how close it all is.
As we’ve been writing for months now, once the virus started spreading here in the US (which we now know was in mid to late January), the President had two choices - mandatory stay at home orders, and/or an aggressive testing/tracing/isolation regime like the one South Korea implemented immediately. Today, he has still chosen to do neither, and as the President has essentially ended the national stay at home period, it is imperative that Congress force the President to adopt a national testing/tracing/isolation system. Without such a national system, it is going to be very hard to slow the current far too rapid spread of COVID and give people confidence that their government is doing everything it can to keep them safe in this period before a vaccine comes. If these two things aren't the case, we will have enormous trouble beginning the recovery that the President so desperately wants.
From the very beginning, the President’s response to COVID has been outside of science and reason, and full of magical and wishful thinking. Not surprisingly, it just hasn’t worked. Poll after poll show the President’s approval rating plummeting now, frontline governors 20-30 points more popular than him, and broad majority support for more aggressive measures to attack the virus. What remains so difficult to understand is why the President refuses to do what he knows needs to be done - which is why, now that Congress has begun to return, winning Phase II of our nation’s response to COVID should be the highest priority for both Speaker Pelosi and Senator McConnell. If the President refuses to fight the battle against COVID, they must, along with the nation’s governors, take the lead.
Wed, May 6th, 2pm - “With Dems, Things Get Better” Webinar - Please join us this Wednesday for the latest showing of our "With Dems, Things Get Better" webinar. This project builds on a body of our work over the past few years, and makes the argument that one of the defining political developments of our time is just how different the two American political parties are, and have become.
This webinar will be a data rich dive into America in this new age of globalization since 1989. We will look at the performance of the two parties during this time - the 16 years of Obama and Clinton, the 15 plus years of the Bushes and Trump. What the data shows is that America has prospered and made progress when Democrats have been in power, and fallen behind, again and again, when Republicans have held the White House. This webinar will take place on Zoom, and you can register for the event here.
Much More Economic Support Is Needed To Prevent A Lost Decade - Over the past few weeks, we've begun to receive data on the state of the economy during the coronavirus crisis, and the numbers are even worse than expected. First quarter GDP fell by 4.8% on an annualized basis, the second worse quarterly decline since 1982 (only Q4 2008 was worse at -8.4%), and economists now project that Q2 GDP will decline by over 25%, by far the largest quarterly decline since the Second World War (the current worst decline is -10% in Q1 1958). Furthermore, over 30 million people have filed jobless claims over the past month and a half, and economists forecast that this Friday's employment report for April will show the unemployment rate hitting 15%.
But perhaps the most worrying economic data is the CBO's newly released projection of unemployment - they forecast the jobless rate to average 10.1% in 2021, meaning that a v-shaped recovery doesn't occur and people continue to remain unemployed for an extended period of time, similar to the slow recovery seen in 2009-2011. This type of lost decade, with elevated unemployment and weak wage growth for years, is not inevitable however, and Congress and the Administration should do everything in their power to boost growth right now. In particular, there are four areas where a surge in new spending could make a real difference in boosting the recovery - significantly increasing funds for the PPP small business fund and making those funds more widely available; boosting spending on direct relief programs including food stamps, housing assistance, Medicaid, and TANF; sending out another round of $1,200 cash payments and making those payments monthly; and developing a massive loan program for state and local governments so that they don't cut budgets and lay off workers. The point is to boost spending in the economy as much as possible and, given historically low interest rates, the federal government shouldn't worry about taking on large deficits to do it.
Unfortunately, and reminiscent of their blanket opposition to the 2009 stimulus as well, Congressional Republicans have recently come out in opposition to this type of urgently-needed economic support package. Last month, McConnell infamously came out against aid to state and local governments as "blue state bailouts", even though this would help all states and clearly the dire straits of these states is a result of coronavirus, not profligate spending by certain states. Furthermore, Republicans opposed hundreds of billions of dollars in new funding for hospitals and testing, state and local governments, and relief programs such as food stamps in the latest relief package negotiations with Democrats, and only backed down in return for no money for state and local governments. This should not be a partisan issue - every additional dollar spent now will mean fewer unemployed Americans in a year's time, and it is our hope that Congress will come together to pass this type of legislation in coming weeks.
Best,
Simon, Chris, and the rest of the NDN team
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