Former Vice President Joe Biden inherited a recession in 2009 when he and former President Barack Obama were elected in 2008, and if he wins this year, it will happen again.
Although 14 million jobs have already been recovered from the state-led Covid pandemic economic lockdowns in the Bureau of Labor Statistics’ household survey — up to 25 million were lost when labor markets bottomed in April — there is still a long way to go to get back the other 11 million jobs.
Here’s the problem. The last time Biden as in the White House with Obama, it would not be until May 2012 when the U.S. economy would begin creating jobs on a net basis — almost three-and-a-half years after they took office.
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To be fair, the economy was still hemorrhaging jobs from the financial crisis at the end of 2008, a trend that began in Nov. 2007, and would not reach a bottom until Dec. 2009, 11 months after assuming office. Overall, it was not until Sept. 2014 when the more than 8 million jobs lost throughout the entire recession would be regained.
Could Obama and Biden have acted quicker? Was the $787 billion stimulus — which easily passed as Democrats nearly had a filibuster-proof majority in the U.S. Senate — enough to provide the American people with immediate relief?
In contrast, President Donald Trump worked with Congress on preempting the Covid recession this spring with the $2.2 trillion CARES Act that included $525 billion of relief for small businesses, supporting 5.2 million small businesses and saving as many as 50 million jobs.
While the 2008 Congress engineered a Wall Street bailout, and the 2009 Congress was focused on wealth transfers to state governments — the 2020 Congress with President Trump worked on a Main Street recovery package.
And so far, it’s been largely successful, with 14 million jobs recovered. The labor market hit its bottom rapidly in this recession in just two months, compared to more than two years in the last recession.
But the headwinds are strong. In September, the limits of the recovery were tested and job creation in the household survey appeared to slow down a bit. 879,000 Americans left the labor force altogether as their unemployment benefits ran out.
The economy, therefore still has a long way to go, and it will take leadership to get the economy safely reopened. Biden does not appear dedicated to this task, saying he would “shut it down” again if advised by medical professionals even though the scientists are saying you don’t need a lockdown again.
A lot of families are still struggling through the lockdowns. We mustn’t forget them. We need to get America back, no matter who wins the election. This cannot go on forever.
The key to that will be safely reopening schools again so that working families can get back to work, which Biden complained in the first debate would be very expensive to do. But all the same it is absolutely necessary.
In the meantime, Biden has done almost nothing to encourage House Speaker Nancy Pelosi (D-Calif.) and Senate Minority Leader Chuck Schumer (D-N.Y.) to work with the Republican Senate and President Trump on completing the next round of stimulus in phase four legislation.
Perhaps Biden, Pelosi and Schumer are sitting around waiting for a better deal after the election — assuming they are going to win. The risk is that by failing this critical leadership test, the American people might not give them a second chance to disappoint them.
Robert Romano is the Vice President of Public Policy at Americans for Limited Government.
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