Back on Feb. 29, when President-elect Joe Biden won the South Carolina primary, it was clear he would clinch the nomination, and likely the presidency.
In just 30 days, the country Mr. Biden would inherit isn’t at all like the one he saw the day he won. The equivalent of totaling your new car the second you leave the dealership parking lot.
Once again, in the tradition of FDR, Clinton, and Obama, it will be left to a Democratic president to clear up the economic and social train wreck a Republican president left behind. It’s a no-win situation. These episodes exact a terrible price that can’t be made back. No one should underestimate the challenge before us.
When Obama was inaugurated, David Letterman quipped that he was handed the keys to a store that had been shuttered for eight years.
Now Mr. Biden gets the keys to one that’s been trashed, and the shelves stripped bare. I don’t know who would even want the job. The Murdoch press will ask why the economy hasn’t healed by March 1st and lay the failure at the feet of “policies” Democrats advocate.
One of the best examples of this was an article written by George H.W. Bush’s head of the Council of Economic Advisers, Michael J. Boskin, who wrote an article in the Wall Street Journal on March 6, 2009 titled “Obama’s Radicalism is Killing the Dow.”
Obama was in office for all of five weeks, and according to Mr. Boskin, he was tanking the market.
Unfortunately for his predictive capability, the Dow bottomed just three days later and didn’t stop climbing for the duration of Mr. Obama’s two terms.
Mr. Boskin is also the author of a book called “Too Many Promises: The Uncertain Future of Social security.” It was published in 1986. Like most of his kind, “always wrong, never in doubt.”
In any case, Mr. Biden inherits a broken economy and a traumatized population. And they’re going to expect miracles that can’t be delivered even if the COVID crisis ends by Summer. It’s one thing to bail out of a recession caused by a turn in the business cycle.
It’s quite another to recover from an exogenous shock like this. Millions will live with economic precarity for some time to come.
The good news is that the President-Elect has assembled an outstanding economic team. Aside from the masterstroke of appointing Janet Yellen as treasury secretary, some lesser-known names, like Brad Setser of the Council of Foreign Relations, will bring sanity and discipline to trade policy, replacing Mr. Trump’s sloppy, drunken amateurs.
Former Obama hands like Jared Bernstein of the Economic Policy Institute are in the transition team. Also as important is the restoration of the Council of Economic Advisors, which was turned into a horse stable by the Trump Administration. Media clowns like Larry Kudlow have thankfully seen their last day in the sun, replaced by seasoned professionals.
Mr. Biden faces pressure from a younger cohort in the party that is impatient and demands long-overdue structural changes in the way we manage our economy. He demonstrated great (and grossly underappreciated) political skill during the primaries and managed to offer the progressive wing a platform they could live with. Now, he has to implement it.
All economic policy going forward now hinges on two Senate seats in Georgia, which gives you an idea of how dysfunctional and outdated our electoral system is.
One man, Mitch McConnell, did everything in his power to sandbag the economic recovery under Barack Obama. He will have no qualms about doing it again, even at the cost of the welfare of the American people. To him, all that matters is the kill.
The ruse Mr. McConnell and his cohorts will use is a new found love of fiscal “discipline” and a call to “rein in reckless spending,” which of course, he had no objection to when it came to tax cuts and bailing out Mr. Trump’s murderous response to the COVID crisis.
In any case, the return of political maturity and expertise is welcome. I wish I could say it couldn’t come too soon. For millions, it will have come too late.