In case you missed it yesterday, be sure to check out a new report from the fiscal and economic policy experts at the N.C. Budget & Tax Center entitled “Meeting the needs of today to secure a more inclusive recovery tomorrow.” In it, the BTC analysts explain why it’s critical that both the federal and state governments remain strong and active in responding to the health pandemic. Now, the report, points out, is the last time to start cutting services and aid to communities in need.
In a section entitled “Critical lessons learned from prior recessions,” the report puts it this way:
In this historic policy landscape, policymakers are likely to best accomplish the goal of a full recovery from the public health and economic crisis with the least possible harm by considering lessons from previous recessions alongside the unique features of the COVID-19 pandemic.
Timely and targeted interventions. Early response to the crisis is a critical element to both public health and economic shocks as timely engagement can address the initial impacts before they spread broadly into other aspects of life. While many public health analysts point to the delays at the federal level in planning and responding to COVID-19 despite knowledge of its potential harm, the federal response began with a targeted effort to respond to the public health issues with a focus on bolstering the public health infrastructure and accelerating research into a vaccine and treatment.
Bold and inclusive support. Another lesson of public policy response in moments of crisis is the importance of bold action. Researchers often point to the fact that the greater risk comes from proposals that are too small relative to the need and that don’t do enough to reduce the potential for long-term impact on people and communities. Such support must also reach all people since the exclusion of certain groups can further hamper the recovery process and hold back overall public health.
Systems-oriented policy design. Perhaps most significant in this moment is the need for a sustained commitment to the use of public policy to address the issues resulting from public health or economic shocks. Many analysts have pointed to the problem of ending public policy interventions too soon before the recovery has been secured and reached all people. Additionally, making certain the policy design continues to meet and respond to emerging needs is critical to ensuring that families are supported to financial security and greater well-being.
The coronavirus pandemic ended the longest economic expansion in U.S. history, and its threat to public health will persist for longer than a season. Researchers at the Congressional Budget Office suggest that effects on the economy could extend through 2021 into 2022. While projections for North Carolina in particular are still forthcoming from state agencies, some economists in North Carolina have pointed to the early stages of impacts and the long road to recovery.
Once the official expansion begins, however, it will be clear that recessions have a longer-lasting impact on well-being than the time frame in which they occur. North Carolina’s own experience of the last expansion period showed little progress in bringing down poverty and increasing the wages of the average worker. National studies of the Great Recession and prior downturns point to the large and scarring effects — including lost income and wealth, reduced educational opportunities, and poorer physical and mental health outcomes — on people. Recessions also generate disproportionate harm on communities of color and women, both of which already face barriers in connecting to opportunities.
Given that the underlying cause of this economic shock is likely to linger, it is even more important that policymakers continue to engage in assessments and actions that can minimize the long-term harm to our collective well-being.
In short, the basic message is that now, more than ever, is the time for government to do its job and for state and federal leaders to secure the resources necessary to make it possible. Click here to read the full report.