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Center on the American Governor > Governors and Economic Crises

Governors and Economic Crises

The Eagleton Center on the American Governor held a roundtable discussion on November 11, 2019 with Governor Jon Corzine and key members of his cabinet and financial team examining his administration’s 2008-2009 response to the recession and the challenges associated with governing in such an unpredictable time. While the circumstances now, certainly, are different, it may be useful to return to that discussion as we consider ways to alleviate the economic pain that is likely to come in the wake of the novel corona virus.

 

Covid-19 is a global health pandemic. With over 350,000 cases and 15,000 deaths (and counting) worldwide, the current focus is on managing that health crisis using vigorous approaches such as shutting down businesses, enforcing social distancing among citizens, and asking people to self-quarantine in their homes. The hope is that these actions will spread the impact of the disease over a longer period of time, alleviating an otherwise potentially disastrous surge of patients on hospitals and health care workers.

While this will hopefully work, there will be costs. Covid-19 will have a monumental—perhaps unprecedented—impact on the world economy. Many businesses, facing the reality of weeks or even months without income, have begun laying workers off, creating spikes in unemployment claims. Some businesses will not be able to weather the storm and will likely not reopen. An economic recession is all but certain.

For states that are already facing budget shortages and challenges, this economic crisis could be catastrophic. Governors, now focused on stopping or controlling the spread of the virus in their states, will soon have to survey the economic damage and plot a policy course to help their states’ vulnerable citizens.

There are few, if any, analogous situations in U.S. history, but recessions themselves are not new. Governors can look, for example, at the 2008 global financial crisis and resulting Great Recession for guidance on how to govern in the midst of a worldwide fiscal recession.

The Eagleton Center on the American Governor held a roundtable discussion on November 19, 2019 with Governor Jon Corzine and key members of his cabinet and financial team examining his administration’s 2008-2009 response to the recession and the challenges associated with governing in such an unpredictable time. While the circumstances now, certainly, are different, it may be useful to return to that discussion as we consider ways to alleviate the economic pain that is likely to come in the wake of the novel corona virus.

We present the conversation below. The panel specifically discussing the economy and the Great Recession begins at 01:24:55 in the video and on page 28 of the transcript. Also available are a number of newspaper articles and other documents from the time period providing further context and information.


Transcript available here (pdf)