The New York Times ran a compelling piece today on a report written by Alan Blinder and Mark Zandi which found that the policy response to the economic downturn was “highly effective” and that without the fiscal stimulus and the financial measures the Administration and the Federal Reserve took last year there would be 8.5 million fewer jobs.
With the hard-fought passage of Wall Street Reform last week, the President ensured that Wall Street will be held accountable, and that the American taxpayer will never again be on the hook for their actions. As the President had said repeatedly, he was just as angry with having to take steps to shore up our financial system as all Americans were. But when the President came into office, the economy was falling off a cliff, and this report demonstrates just how deep and disastrous the valley below truly was had he not done everything possible to pull it back. The report particularly emphasizes the effectiveness of financial stability measures including the bank stress tests, the actions of the Fed and the TARP program and it highlights the potential cost to the taxpayers had policy makers not acted at all.
The depth of the crisis required decisive and historic action. While the steps we took were not always politically popular the results become more indisputable each day. We went from losing 3.7 million jobs in the first six months of 2009 to gaining more than 600,000 jobs in the first six months of this year, and as this report demonstrates, it could have been much, much worse.
But the President needs no reminder that there is far more work to be done. That’s why he was in Edison, New Jersey this afternoon meeting with local small business owners about the importance of lending assistance for small businesses. The Senate is expected to move forward in the coming days on a vote on the small business bill that strengthen the capacity of small businesses to create jobs and lead economic recovery. The legislation includes several key Administration initiatives – including the Small Business Lending Fund (SBLF), the State Small Business Credit Initiative (SSBCI), extension and expansion of key SBA loan programs, and small business tax cuts including zero capital gains for key small business investments.
In addition, we can’t let the recovery of the financial sector distract from what led to this crisis which is why we are focused on protecting consumers, reining in Wall Street, ending bailouts and too big to fail through the implementation of the Wall Street reform bill the President signed into law last week.
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