Bill Clinton famously said, “it’s the economy, stupid.”
Okay, that’s not exactly how it went. James Carville, Clinton’s chief campaign strategist, coined the term and wrote it on a whiteboard in Clinton’s campaign headquarters. It was his way of reminding Mr. Clinton of what the people really cared about.
And he was right. It was the economy. And it still is.
Even in the time of COVID?
Yes, even in the time of COVID.
Skeptical? Stay with me.
Before we get into why that is, let’s get on the same page and establish a working definition of the “economy.”
According to Investopedia:
An economy is the large set of interrelated production and consumption activities that aid in determining how scarce resources are allocated.
In an economy, the production and consumption of goods and services are used to fulfill the needs of those living and operating within it. (emphasis added by me)
IMO, this is a darned good definition.
Unfortunately, many of us don’t have this definition in mind when we refer to the “economy.” We think of the “economy” as if it was a singular, non-living entity with a sole decision-maker at the top. We think of it in the same way we think about a business, but on a massive scale.
This is a terrible mistake. The economy is not a business. It’s not a singular entity with centralized decision-making at the top. It is not non-living.
The truth is the economy is comprised of people. It’s the accumulated output of people. In short, the economy = people.
I’m talking about real flesh and blood people like you and me.
In America, it’s hundreds of millions of people all trying to have a good life and make the most of our existence. It’s the mom worried about how remote learning will affect the social development of her children. The pilot who wonders if she’ll have a job come October or if she’ll be furloughed. It’s the new homeowners who are struggling to pay their mortgage because they aren’t allowed to go to work.
The economy is comprised of sisters and brothers, moms and dads, neighbors, co-workers and strangers. People from all walks of life.
When the “economy” isn’t doing well, it means people aren’t doing well. People are struggling to pay their mortgages. People are collapsing under the weight of life without a paycheck. People are stressed to the max worried sick with how they’re going to support their families.
It’s easy to say “shut it down, it’s only the economy” when we think of the economy as a nameless, faceless, non-living thing. We don’t have empathy for inanimate objects. But, we should have empathy and understanding for people because there is real damage being done to them.
It’s not difficult to understand why so many have this perspective. How we see the world is colored by our lived experiences. For most of us, “shutting down the economy” hasn’t hit us where it counts: our pocketbooks.
Setting aside the unprecedented amounts of government support for the unemployed and small businesses, let’s dig into one of the key components of the economy: unemployment.
Currently, we’re at an unemployment rate of approximately 10%. We can all agree this isn’t a good number by historical standards. Here’s the thing: an unemployment rate of 10% means 90% of the labor force has a job and is working. It means 90% of us aren’t taking on the brunt of the “just shut down the economy” mantra. It’s one thing to acknowledge that a 10% unemployment rate is bad. It’s a completely different experience to actually lose your job.
It’s easy to speak about “making sacrifices,” “doing the right thing,” and “it’s only money, we’re talking about lives” when the burden falls on someone else, when some else’s livelihood is on the line, when the hopes, dreams, and aspirations of others crumble at the feet of a shutdown economy.
Thankfully, most of us aren’t taking on this burden. Remember, 90% of the labor force is still employed. That’s the upside.
The downside is it’s a lot harder to empathize and understand what life is like for those who aren’t working, for those bearing the brunt of the economic shutdowns. If we continue to think of the economy as some nameless, faceless, non-living thing, we’ll continue to be blind to the human costs incurred and that’s a human tragedy we can do something about.
I don’t say this to criticize those who believe shutting down the economy is the right thing to do. That’s an entirely different discussion.
My point is simply this: we need to be more mindful of the human costs incurred for “shutting down the economy.” We need to weigh the human costs that come with an economic shutdown.
If we do that objectively and ultimately decide the costs are worth the benefits, so be it. But, it needs to be a thoughtful evaluation of what is at stake.
If we think of the economy as real people and determine the sacrifices they bear is the lesser of two evils in the quest to stop COVID, okay then. None of us have a crystal ball and knows exactly what to do. At the very least, we need to treat the “economy” with the same care and understanding we have for our family, our neighbors, our fellow citizens because they are one and the same. The economy = people.
“It’s the economy, stupid.”
Politics aside, whether you’re a fan of our 42nd president or not, he was right on this point. Although, I think I’d change the slogun to, “it’s about the people, stupid.”