By Robert Reich
“The recovery has been very strong,” Donald Trump said last week. Then the Commerce Department reported the U.S. economy contracted between April and June at the fastest pace in nearly three-quarters of a century, which is as long as economists have been keeping track. The drop wiped out five years of economic growth.
But pesky facts have never stopped Trump. Having lied for five months about the coronavirus, he’s now filling social media and the airwaves with untruths about the economy so he can dupe his way to election day.
The comeback “won’t take very long,” he reassured Americans on Thursday. But every indicator shows that after a small uptick in June, the US economy is tanking again. Restaurant reservations are down, traffic at retail stores is dwindling, more small businesses are closing, the small rebound in air travel is reversing.
What’s Trump’s plan to revive the economy? The same one he’s been pushing for months: just “reopen” it.
He wants the public to believe the shutdown orders that began in March caused the economy to tank in the first place, so reversing them will bring the economy back.
Rubbish. It was the virus that caused the downturn, and its resurgence is taking the economy down again. The virus is surging back because governors reopened prematurely, before the virus was under control – at Trump’s repeated insistence.
The sequence of cause-and-effect is clear. The virus has surged most in states that were among the first to reopen, such as Florida, South Carolina, Texas and much of the rest of the Sun Belt.
Because of this resurgence, many states are pausing plans to reopen and some are reimposing restrictions. But these restrictions are not the reason the economy is slowing. They are the necessary consequence of allowing the pandemic to get out of control.
Even the White House’s own coronavirus taskforce concludes that 21 states have outbreaks serious enough to justify more restrictions.
Notably, the economy is sliding again even though the government has pumped trillions of dollars into it.
What happens when the money stops? We’re about to find out. Senate Republicans can’t agree among themselves, let alone with House Democrats, about more funding, while Trump says “we really don’t care” about reaching a spending agreement.
That means starting this week more than 30 million Americans will no longer receive $600 in extra weekly employment benefits. As a result, tens of millions will not be able to make rent or mortgage payments. More will go hungry, including children. The economy is likely to slide even further.
The White House argues that the extra unemployment payments have discouraged workers from seeking jobs because some are receiving more money in benefits than they would earn by working.
“We don’t want to create disincentives to work,” says Trump adviser Larry Kudlow.
More rubbish. A study by Yale economists finds “no evidence” that people who have lost their jobs are choosing to stay unemployed because of the extra federal aid. In fact, “workers facing larger [unemployment] expansions generally appear to be quicker to return to work than others, not slower.”
People can’t go back to work because there is very little work for them to do. Fourteen million more people are unemployed than there are jobs.
In fact, the extra benefits have been keeping some 3 million employed because the money has gone into the pockets of people who spend it, thereby sustaining economic activity. Shrinking those benefits will put less money into consumer pockets, with the result that millions more jobs will be lost.
Lies about the economy are harder to spot than lies about the coronavirus because the virus’s grim death count is painfully apparent while the economy is complicated.
But Trump’s economic lies are no less egregious than his coronavirus lies, and, like the coronavirus lies, his economic ones are about to cause a great deal of unnecessary suffering.
Robert Reich is the Chancellor’s Professor of Public Policy at the University of California, Berkeley, and a senior fellow at the Blum Center for Developing Economies. He served as secretary of labor in the Clinton administration, for which Time magazine named him one of the 10 most effective cabinet secretaries of the the twentieth century. The author of many books, including the best-sellers Aftershock, The Work of Nations, Beyond Outrage and, Saving Capitalism. He is also a founding editor of The American Prospect magazine, chairman of Common Cause, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentary, “Inequality For All.” Reich’s newest book is “The Common Good.” He’s co-creator of the Netflix original documentary “Saving Capitalism,” which is streaming now.
Richard says
The ONLY thing dangerous about Trump to the left is the fact that he wants America to be #1 plus he wants to drain the swamp which he is finding it harder than he thought due to how deep the corruption goes. The Democrats lost their power and control to him in 2016 which pisses them off royally and they will lose again this November.
Larry Linn says
Well the United States is first in Coronavirus fatalities!
BLM says
Again, a simple google search will yield: Every. Single. Lie.
Trump and his family as well as his criminal friends and congress IS the swamp. This will be cleaned like the biohazard it is, 11/03/2020.
Maybe if you didn’t read only alt-right news and watch Fox so as to cherry pick the talking points that validate what you want to believe, you would know this.
Nicole Bartel says
Maybe anybody who votes should do some research and put as much time and energy into searching things that this president has done before his time in officr and currently! He is not concerned with you or me or any other person in this country HE IS ONLY ABLE TO CARE ABOUT HIMSELF why are ppl still believing anything that spews out of his mouth! All I know is that every time he speaks I have to fact check EVERYTHING!! And i don’t think or feel like that qualifies as this “freedom” so many speak of with being an American! He 8s literally shattering every person’s soul slowly but surely and he enjoys it which is all on another level!!! Karma please help those who cannot see whats really going on and feed all of his pitiful shit right down his throat!!!!
Bill nelson says
I started reading this and was trying to keep track of Mr. Reich’s misinformation and lies. I finally gave up because his selective use of facts consistently involved apples and oranges comparisons. This man consistently lies and is a waste of type face.
Larry Linn says
Please cite the “lies” Mr. Reich made.
Mark says
Pesky facts, Apr to Jun vs now. One measure? not the overall picture.Let me take the info that support my agenda and spin it so I can call Trump a liar and lie about my agenda. Nothing new here.
Jimbo99 says
Well, this is the difference between Europe & the USA. Europe goes on vacation every August, so COVID-19 was their early vacation month. USA has too many parasites for industries that stand to make big money off financial hardships and wealth transfers. For Europe the close down was a walk in the park, they do that because they came back to employers that didn’t shut down permanently. They had a plan obviously, it’s called every yearly cycle of a lifestyle for them. We have overpaid types that lie cheat & steal, that’s not Trump. Cuomo/NYC early in this was the definition of the handout model. Over reporting any & everything and getting paid for it. Most everyone else approached it as a temporary close and get back open. Only the greediest of liars didn’t dispense Federal unemployment when they should. DeSantis held that money & earned interest on it. Probably because the pathetic state of FL unemployment system was bankrupt. They collapsed under the load of unemployment claims and they dragged their heals once they got the federal aid. The other article, DeSantis is weighing the definition of essential workers now. Still looking for more job cuts ? Others to screw over so that he still gets paid at 100% and whatever raises they’ll give themselves for telling themselves they did a great job with this.
Steve says
Its a rehash article for sure but what correct is that C19 is not under control The economy is double dipping. To me its about Revenues. At the Federal State County local etc. Without money coming in thru the channels or alot less of it States will be next to be baled out. I do not think this is a time to be fiscally responsible. All these plans should have already been in place to get the populous the funds to keep the Economy crawling until this thing breaks. With better leadership from the beginning wewould have been coming out of this pandemic instead of falling deeper into abyss.
Trailer Bob says
“With better leadership from the beginning wewould have been coming out of this pandemic instead of falling deeper into abyss”
OK, you hate Trump and I will venture that you don’t agree with Republicans at all in any event.
Sore losers who don’t understand that the people voted and Trump came out on top.
The hate towards trump, a legally elected President, elected by the voters, is pathetic and damaging to our Country.
Get over it and put up a decent, qualified candidate…it is your obligation and duty to do so.
The immaturity of both sides is pathetic to say the least.
Most of us Love America and can handle it when we don’t get our way via the voting booth. But this is really getting damaging to our country. This newspaper is only adding fuel to the fire. Very immature and self-centered to say the least.
Come on, let’s grow up and get together on at least some issues. But no…we rather be at war with ourselves.
We are dying as a nation and it is not the fault of one temporary President. It is the fault of millions of individuals who cannot accept the results of an election. Vote at the voting booth, that is the only place one can make a change.
Linda says
I agree that if you are making more then you would working, why would you go back to work and make less! That is common sense. You stay home safe, relax, maybe do some upkeep on your home, or take the time to spend with your family and friends, pay your bills and have a staycation!!! TRUMP wants to continue unemployment but at 400.00. A smaller amount which is still a nice plus for unemployment! I am retired so it does not matter to me, I live off of my S/S. Which is much less then the unemployment. I live comfortable, pay all my bills, but I do get EBT! And I spend monies in the economy, I buy what I need!!! If people would learn how to manage their monies and not live above their means, instead of going out to eat or ordering in, cook for your family and enjoy family time, play board games, charades, talked to each other! God forbid we enjoy each other’s company! Also this gives parents to understand what their children like and what they are into!!! Sing songs, dance, tell jokes laugh!!! Most of all pray together!!! 😊❤☝🙏☝❤😁
Mike Cocchiola says
Trump’s a congenital liar and con-man. Undoubtedly a sociopathic narcissist. But, his believers don’t really care because he’s been annointed to destroy a godless America – chase Muslims out out of the country; build a half-assed wall on our southern border that an eight-year old can easily climb; walk away from years of international treaties and alliances to please Putin; insult allies; make Chinese goods more expensive; develop a beautiful health care plan to replace the Afordable Care Act; drain the swamp by adding over 100 industry lobbyists to key federal jobs; first dismiss, then ignore the novel coronavirus, then promote quack doctors and dangerous miracle cures; send millions of federal government tax dollars to help his failing hotels and resorts; make 302 personal visits to his golf courses at a cost of $139,000,000; pardon convicted felons who keep their mouths shut; invade our cities with unidentified armed forces; encourage foreign intervention into our election and create doubt about voting by mail.
What’s not to like!
864511320 says
Glad to see someone with more than one operating brain cell comment on this. However, trumpets are not moved by logic and certainly not the truth which is available to anyone who can use google and doesn’t get their news from YouTube, fb, Russian bots or some right wing nut talk show host.
They’re triggered when the truth is pointed out to them and they, like trump, resort to violence, blame game, finger pointing, temper tantrums, and use pre-approved fascist taglines. Yawn. They’re getting sooo anxious and scratchy because their plans to make America a
Military state isn’t going to pan out. They’re going to all have nervous breakdowns when reason is once again restored and the guy in the White House gets escorted out. 😁
Trailer Bob says
Calm down. I think most of us would call you extreme in your beliefs and thoughts. Nothing is as black and white as it may seem to you. We had a better economy since we have had in a long time, plenty of jobs if one wants to contribute to the workforce and pay their own way through life.
Politics creates difficulty in compromise among people. But when one totally believes one side and believes nothing of the otherside, it creates serious problems, as we are seeing today.
Every registered voter has the obligation to vote if capable or pretty much shut up.
If Trump gets re-elected that will be because more people voted for him than for Biden. It is really that simple.
Unfortunately, you pretty much told me I don’t have a brain cell, so anything else you say has no meaning to me. You have gotten caught up in the disease, the hate, the separation of a nation.
Not everyone who voted for Trump is blinded to the errors and sometimes controversial things that have come out of his mouth. Not all of us are “Trumpsters”. And most Americans will be able, once again, to show who they feel would better run out country for the next 4 years. We will all be OK…no need for breakdowns, really.
864511320 says
Extreme? Not all republicans are Trump lovers but they put him there you deflecting blame for trumps unethical behavior and horrible leadership into democrats and in the same breath call me an extremist. I’m sure you are basically a nice guy but the vile lies that trump has spewed since way before the election shoulda warned you he was not a good man. He is/ was obviously unfit and should’ve been removed from office but the GOP sat there and did nothing. Now you wanna virtue sling a little more at me? YOU calm down and be nice.
Trailer Bob says
trumpets? REMEMBER that when you sling shit, other will sling it back. What if Hillary was elected? Remember that was the choice. I do think Trump is behaving poorly, or course. I am not an idiot. But you throw stones and people will throw them back.
But, I am concerned about the economy, jobs, crime…you know…the things that liberal democrats could care less about.
Anyway, have a nice evening and remember , it is a shitshow called politics. We will survive either way.
Jonathan says
Well I’m sorry but he’s actually right, shutting down and restricting states access isn’t helping our economy, it’s destroying it. Florida re opened, but we have our economy back up as people are going on normal trips, as social distancing isn’t happening and restaurants are at full capacity, masks are the only restriction. New Jersey did the same thing we’re going through, this will be slowly the end of our month spike, we need to get rid of our false positives and reporting false COVID deaths.
James says
Talking about Rubbish, this article is worse than Rubbish. I have not heard anything from your Token Boy Joe on how he would have taken care of the virus or the economy. Taking the fact that he is a life time politician scares the hell out of me, and being he was Obama’s flunky, and Obama not accomplishing anything for 8 years. The situation at hand is being handled the best it could be handled. And also the American public should be ashamed of what the Democrats are doing by Stalling on the Stimulus Package. The Democrats would have this time we are in , in such a turmoil we would never get out . Just look at the Democratic run cities.
Lawrence says
When Obama/Biden took office the Dow was at 8000-9000
When leaving office the Dow was at 19,000-20,000. Not bad for being left with 2 unpaid wars by the Bush administration. Get your facts right
Trailer Bob says
“Facts right”? That ship left long ago dude. We merely pick and choose the facts that fit our agenda.
You guys are going to be really confused when Biden becomes the President. Who you gonna blame then? Trump? Our entire nation really needs to calm down and put things in perspective. The nation is going crazy. Both sides have their idiots, for sure. At 65 years old, this is insane and shows the lack of concern for the next generation, the current generation.
Maybe we should have a temporary moratorium on political comments for awhile. It is only causing destruction and is nowhere near intended to bring people together. I now the editor is enjoying all the attacks, but it is wrong and destructive and we all need a vacation from it for awhile. Or are we enjoying watching society, neighbors, relatives… exercise their rights to blind hatred? There really isn’t much more to say (argue about) that hasn’t already been said a thousand times. How about we all grow up and stop acting like children? For one day? Is that too much to ask?
marlee says
If you go to a doctor, you must believe in science.
Why do people deny science now?
This is global…
It is not a Dem PLANdemic.
Makeitso1701 says
The most dangerous, racist, incompetent, colossal failure of a president in American history.
Hopefully in November the Blue tsunami will clean out the swamp in the White House and Senate!
JJ says
Folks, it’s okay to be conservative AND admit that Trump is a failure, liar, and loser. Instead of yelling to “give him a chance”, you should be yelling to get Kasich or Romney up there to run for president. They would at least give conservatives a chance.
Just like all of his failed businesses, this moron has ruined and divided our country.
If you choose to continue to support him, YOU are to blame. YOU.
Our children and grandchildren don’t need us to have a tax cut. Why would he do that? Why? Because he never pays his bills. Never has. Lets someone else worry about it.
Wise up people and do the right thing.
kcpc says
This article is worth reading, but why not feature opposing views from someone like Dennis Prager?
FlaglerLive says
Because we’re obviously saturated with the likes of Prager, but you won’t see Reich printed much in our red zone.
Trailer Bob says
“More rubbish. A study by Yale economists finds “no evidence” that people who have lost their jobs are choosing to stay unemployed because of the extra federal aid. In fact, “workers facing larger [unemployment] expansions generally appear to be quicker to return to work than others, not slower.”
One can find a study on anything they wish, if they search enough for it.
There are also studies on that fact that people like to get paid for doing nothing, trust me.
Let’s stick to unbiased news. Enough of the politics. We get it. You don’t like Trump.
Bill C says
Trump put the US in virus!
Justin Case says
The $600 bonus funds alone exceeded my paycheck. So, unemployment plus $600 would have been a great incentive for me to stay home. It also would have been safer, (according to experts). So how can you call these claims rubbish? I did my own fact checking, by comparing my weekly pay with unemployment benefits + $600.
Reinhold Schlieper says
Trump is using the debate between Dems and Reps to step out on an executive order to continue benefit payments. He blames Dems for all. Here’s someone appearing as a benign and caring prez to get reelected by bribery. He’s getting scary now, in most humble opinion.
Dennis says
About the $600 a week. I personally know two people from Pa that are collecting about $300 a week more not working, than working the vast majority of laid off workers are of the lower scale. Service industry, restaurants and such. Pa pays 50% of your gross. You make $15 an hour, gross $600 a week. You get $300 unemployment plus $600:equals $900 a week. You are asking the wrong people. Please take your Democratic Party bullshit back to Jersey, or where ever you come from.
Pierre Tristam says
The bullshit you don’t recognize—perhaps because your own is your aromatic Chanel #5–is that you’d actually defend slave wages, as if the fault here is the workers for once getting the checks the6 should be getting rather than so many businesses being shown up for paying their employees bullshit wages. But all that is assuming the false narrative of workers staying home for unemployment much validity. Even at $600, this ain’t Sweden or France’s unemployment allowance—and it’s history, anyway.
Pogo says
@The usual limbaugh addicted idiots and trumphole losers barking at Robert Reich
https://robertreich.org/
trump has all the best people, e.g., his Director of the United States National Economic Council:
“…In the late 1990s, after a publicized battle with cocaine and alcohol addiction, Kudlow left Wall Street to become an economic media commentator – first with National Review, and later hosting several shows on CNBC…”
“…Kudlow was fired from Bear Stearns in the mid-1990s due to his cocaine addiction…”
https://en.wikipedia.org/wiki/Larry_Kudlow
Don’t remember the late Bear Stearns? Sure you do:
“…Other investors in the fund included Jeffrey E. Epstein’s Financial Trust Company…”
https://en.wikipedia.org/wiki/Bear_Stearns
And now trump wants to continue his tragic magic:
https://www.google.com/search?-b-1-d&q=trump+defunding+social+security
Sherry says
The stock market which has been propped up by “BILLIONS” of federal dollars in massively deficit spending. . . is NOT the end all be all indicator of the health of our economy, as trump would like you to believe.
Real gross domestic product (GDP) decreased at an annual rate of 32.9 percent in the second quarter of 2020, according to the “advance” estimate released by the Bureau of Economic Analysis.
The unemployment rate remains high at 10.2 percent, the U.S. Bureau of Labor Statistics reported . . . without continued unemployment benefits, evictions by the thousands may be on the horizon.
Do your own research, and you’ll find that our economy is suffering from the huge gap between the billionaires’ high stock prices and “main street” businesses and services where the reality of the “real” US citizens is played out.
snapperhead says
Save your breath folks. If anyone still supports Trump after all we’ve been through the last 3 1/2 years they’re not going to change their minds now. Focus on getting people to register and VOTE if they’re not typically inclined to. Biden wouldn’t have been my first choice but he’s a hell of a lot better than the alternative.
Al Villa says
The writer is a professor at the University of California, Berkeley.
A temple of free speech and opposing ideas!
Pleeease Child
Carl Lewis says
There is a somewhat popular misconception that there is a choice between fighting Covid-19 or saving the economy. In reality, these are one and the same thing. We have to contain the spread of this pandemic in order to restore the economy. By not adhering to safety measures long enough to minimize the spread of the virus and by not having a coherent nationwide approach, the economy is going to suffer so much longer than it needed to, not to mention the huge cost of treating so many sick people. That is the cost in dollar terms. This is not even mentioning the thousands of lives needlessly lost, which cannot be quantified in terms of money.
Our local leaders have done a remarkable job of closing facilities as needed, encouraging the use of masks and other safety measures to contain this pandemic. The same cannot be said for Florida and the US as a whole. When it comes time to vote in the General Election, remember how our incumbent local leaders have done an excellent job, but our state and national leaders have failed to provide the coherent response to the Corona Virus and please vote appropriately!