The Economy Really Does Suck

Apparently, the Biden administration thinks that it has a messaging problem. Aside from the fact that its esteemed leader can barely finish a sentence without tripping over himself, and aside from the fact that he has obviously had cosmetic surgery done on his face, the truth of the matter is, as David Leonhardt argues in The New York Times, people think that the economy sucks because the economy sucks.

It’s always nice to find someone who speaks clearly and directly. And it’s nicer to find someone who recognizes the limitations of mind control. For all of the messaging skill evidenced by the Biden administration and its satraps in the media and on social media, there is a bottom line, there is a moment when people see reality. And when the messaging deviates from reality they decide that they have been lied to. 

Anyway, the Biden administration apparently invited some journalists to a session where they would be taught how to spin the Biden economy more positively. Some have dutifully followed. Others have a higher regard for their reputations, and demurred.

Among them, Leonhardt. I quote him at length.

Why do Americans on the whole think that the economy is in trouble? Glad you asked:

Offices remain eerily empty. Airlines have canceled thousands of flights. Subways and buses are running less often. Schools sometimes call off entire days of class. Consumers waste time waiting in store lines. Annual inflation has reached its highest level in three decades.

Does this sound like a healthy economy to you?

In recent weeks, economists and pundits have been asking why Americans feel grouchy about the economy when many indicators — like G.D.P. growth, stock prices and the unemployment rate — look strong.

But I think the answer to this supposed paradox is that it’s not really a paradox: Americans think the economy is in rough shape because the economy is in rough shape.

Clear, precise, and to the point. Then, he schools us in the matter of what constitutes an economy. Not a bad idea:

But the economy is more than a household balance sheet; it is the combined experience of working, shopping and interacting in society. Americans evidently understand the distinction: In an Associated Press poll, 64 percent describe their personal finances as good — and only 35 percent describe the national economy as good.

If you ask what is wrong with American today, you will have no difficulty in counting the ways?

There are plenty of reasons. Many services don’t function as well as they used to, largely because of supply-chain problems and labor shortages. Rising prices are cutting into paychecks, especially for working-class households. People spend less time socializing. The unending nature of the pandemic — the masks, Covid tests, Zoom meetings and anxiety-producing runny noses — is wearying.

And then there is the topic that has preoccupied me on this blog. The lockdowns and social isolation has harmed people’s health:

 The increase in social isolation has harmed both physical and mental health. Americans’ blood pressure has risen. Fatal drug overdoses have soared, with a growing toll among Black Americans. A report this week from the surgeon general found that depression, anxiety, impulsive behavior and attempted suicides had all risen among children and adolescents.

And, he adds the problems produced, almost willfully, by closing schools. I have been following this closely-- see yesterday’s post:

Schools are a particular source of frustration. Last year, the closure of in-person school caused large learning losses. This year, teachers have the near-impossible task of trying to help students make up for lost time, which has left many teachers feeling burned out.

Yet, Democrats, what with their highly defective sense of what works, of what builds, of what creates wealth in this country-- hint, it’s not about messaging-- have not noticed the damage produced by the “Covid precautions:”

Yet many Democrats, both voters and politicians, have been almost blasé about the costs of Covid precautions — the isolation, unhappiness, health damage, lost learning, inflation, public-transit disruptions and more.

Democrats have sometimes focused on minimizing the spread of Covid, regardless of the downsides: Closing schools, for example, almost certainly harms children more than it protects them, given the minuscule rate of severe childhood Covid, even lower than that of severe childhood flu.

Again, I have also emphasized the simple fact that closing schools harms children. And it makes no real sense:

If that sounds strange, remember that society would cease to function if it tried to minimize every medical risk. Schools and offices don’t close each winter because of the flu. Families travel in cars even though crashes harm vastly more children than Covid does. People jog, play sports and ride bicycles even though thousands end up in emergency rooms.

The economic and social costs of our Covid precautions are real. In some cases, those precautions are clearly worth it — and in other cases they’re not. Figuring out how to control the virus while addressing the other Covid-induced crises is one of the great challenges of the pandemic’s next phase.

As I said, Leonhardt is sane, sensible and thoughtful. It helps that he reiterates points that I have long since been making myself.

If I had to add one point, Leonhardt ignores the fact of runaway inflation, the worst that we have had in decades. Regardless of the messaging, everyone goes to the store or the gas station, and feels the impact of inflation. I would note that Peter Schiff, a savvy financial strategist, noted that if we had been calculating inflation by the same metrics we were using four decades ago, the number would be into double digits.