The pandemic, stupid
One thing that was curiously missing from the 2024 campaign rhetoric was the Covid-19 pandemic, a traumatic event from which we are just now beginning to recover. From a psychological point of view, this is not surprising: our brains have a wonderful survival mechanism that makes it easy for us to forget traumatic events.
But our collective amnesia has unfairly benefited Donald Trump while putting Joe Biden and Kamala Harris at a disadvantage.
Trump claimed again and again that he handed over a perfect economy to Biden and Harris, and they ruined it. But anyone with a memory of late 2020 and early 2021 knows that isn’t true. When Biden took over, the economy was still reeling from the pandemic. The unemployment rate in December 2020 was 6.7%, down from April’s high of 14.8%, but still significantly higher than the 4.7% at the beginning of Trump’s first term.
Of course, nobody blames Trump for this: it was caused by the pandemic. But why then does everybody blame Biden for the inflation that followed, which has been recognized by economists, then and now, as having been caused by the pandemic?
I suppose it is poetic justice, in a way: Democrats have often campaigned against Republican incumbents by blaming them for economic woes, most notably in 1992, when Bill Clinton blamed George H. W. Bush for the recession that occurred in that year. His aide, James Carville, famously made a sign to keep his candidate focused. It read: “The Economy, Stupid!”
But perhaps the public interest would be better served if we stopped talking about the economy as if it were a big machine whose controls are in the White House.
Yes, the federal budget and interest rates set by the Federal Reserve Bank can have a big influence on the economy. But nobody really controls it. Essentially, we have a free market economy, and the marketplace is subject to shocks from wars, diseases, and other outside events.
The word “unprecedented” has been getting quite a workout in the last few years, and I know people are tired of it, but it truly applies to the covid-19 pandemic. History is filled with plagues and pandemics, but this is the first one that has occurred since computers and the internet made it possible for people to work from home.
The last world-wide pandemic of comparable size was the Spanish flu outbreak that occurred just after World War I. Electricity, telephones, and cars existed back then, but if you didn’t live in a place like Downton Abbey, chances are you wouldn’t be able to afford all of those things.
But now, almost everybody has electricity, a computer, and internet access, so during the most recent pandemic, lots of workers were able to continue doing their jobs from home. It wasn’t ideal: the cat might photobomb an important call, or a big business meeting might be interrupted by a toddler meltdown. But part of the economy went humming right along, with workers doing their jobs and collecting paychecks — only now, there were fewer places where they could spend their money because so many restaurants and shops were closed.
Meanwhile, workers whose jobs depended on person-to-person contact — hairdressers, “nonessential” retail workers, bartenders, waiters, and anyone else in the hospitality and travel industries — were liable to be laid off. While parts of the economy kept right on going, other parts were almost completely shut down. Manufacturing continued sporadically, with factories occasionally shutting down because of a covid outbreak.
When the lockdowns ended and the economy came sputtering back in late 2020 and 2021, economists were baffled by the mixed signals the economy gave off. This shouldn’t have been a surprise, given the patchy nature of the pandemic’s effects. Economists were consistently wrong in their predictions. Again, this shouldn’t have been a surprise: economic predictions are based on the way the economy has acted in the past, and this was a situation that was truly unprecedented. I was only baffled at the fact that they were so baffled.
And it shouldn’t have surprised anyone that the pandemic led to inflation. The cause of inflation has been described as “too many dollars chasing too few goods.” The pandemic provided the classic setup: those lucky enough to work from home had plenty of money — and a lot of those jobs were the better-paid ones to begin with — while the supply of goods and services was constantly stymied by Covid, as it depends on in-person labor.
Covid forced us to learn all about supply chains — something we previously took for granted. Many of the goods we consume are foreign-made, so even if the factories were running — and China’s zero-tolerance policy on Covid meant frequent factory closures — the goods still had to get from factory to port, and onto a ship bound for the U. S. At an American port, cranes would unload containers from the ship and then load them onto trains, and eventually they’d be loaded onto trucks and brought to stores. If any ship’s crew had to be quarantined for Covid, or a crane operator, train engineer, or truck driver called in sick, the timing of the whole process would be thrown off. The result: bare shelves in stores — too few goods.
The too-many-dollars problem was exacerbated by the patchy nature of the pandemic’s effects. The unemployed desperately needed relief, while others were socking away their paychecks for lack of things to spend money on. The government wanted to help, but to identify who really needed it and who didn’t would take a long time — time that many people didn’t have. So both the Trump and Biden administrations opted for the quick solution of sending everybody a check. Many people really appreciated those checks — I know I did — but for many, it only made the too-many-dollars problem worse.
Nowhere was the effect of the post-pandemic period on inflation more evident than in the travel industry. In the summer of 2020, many people were reluctant to travel, even if it were possible. By the summer of 2021, folks were starting to get antsy about those missed summer vacations, but the pandemic was still raging, partly because so many people refused the vaccines that appeared in a miraculously short time. By the summer of 2022, when travel restrictions were finally lifted, people who had the money were willing to pay any price to go somewhere, anywhere, other than the homes they’d been cooped up in for two years. The travel industry found it difficult to go from a dead stop to a full-out run. Airlines were suffering because so many pilots chose to retire when the pandemic hit. The result: too many dollars chasing too few airline tickets. Ticket prices skyrocketed.
All this was going to happen no matter who was in the White House. So what was Biden to do? Nothing, really, although he could’ve done a better job of messaging. But admitting that presidents don’t really control the economy means letting go of a campaign tactic Democrats have successfully used for years. Besides, nobody likes to hear the words, “It’s not really my fault,” especially coming from an elected official.
But what if it’s true? Don’t we want our elected officials to be truthful?
Biden’s message should’ve been something like this: “Fellow Americans, the pandemic has brough us another problem: inflation. I know many of you are suffering from this, but rest assured, we are doing all we can to stop it.”
Instead, Biden seemed to downplay inflation, which came across as not caring about low-income voters — the people who suffered the most from the pandemic unemployment, and those whose meager paychecks were now being eaten by inflation. His message should’ve used some variation of Clinton’s “I feel your pain.”
But perhaps the Democrats would’ve lost regardless of their messaging. Voters tend to vote their pocketbooks no matter what.
What should Democrats do now? Nothing. They didn’t lose because of anything Biden or Harris said or didn’t say during the campaign. They lost because the voters unfairly blamed inflation on the Democrats.
There is no need for agonizing re-appraisal. Besides, the noise coming out of the party lately sounds less like honest self-examination and more like finger-pointing between the party’s two factions: progressives are saying Harris lost because the party is too moderate, and moderates are saying that she lost because she was too progressive.
The Republicans will now own the White House and both chambers of Congress. That means they also own whatever economic problems come up in the next four years. And if Trump has his way on tariffs and immigration, there will be problems, and it will clearly be his fault.
