Bank failures add to Biden’s game of economic whack-a-mole

The Silicon Valley Bank collapse prompted President Joe Biden to rise early March 13, impressing his former press secretary.

“It is important to note President Biden does nothing at 9 a.m.,” Jen Psaki shared her thoughts with MSNBC Morning Joe. “He is a night owl. So, the fact that he is doing this at 9 a.m. anyway speaks to how vital the White House recognizes it is for him to have his voice out there conveying that to the American public.”

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Biden’s Monday morning quarterbacking is a sign that he wants to regain the economic initiative ahead of his likely 2024 reelection campaign. He has survived a midterm election cycle where this was the Democrats’ biggest political liability.

Finally, signs are beginning to show that inflation is slowing down. The economy is expanding. Unemployment is low, as the economy has remained resilient to Federal Reserve interest rate increases. Biden and Republicans are about to engage in a Debt Ceiling Showdown that could have enormous implications for the federal government’s borrowing capacity.

Politicians have been playing economic whacka-mole trying to control various problems while trying to engineer a soft land that calms inflation and doesn’t trigger a recession. This was evident in the Silicon Valley Bank Bank’s latest setback.

Biden was not given high marks for the economy in a period of no recession or high unemployment. According to The Associated Press, Biden’s approval rating on this issue is currently 20 points lower than it was in the past. RealClearPolitics His numbers are worse than the average polling result. Some surveys revealed that majority disapproval was seen even before inflation reached a 41-year peak.

The stock market fell like a stone initially due to uncertainty. Forecasters were facing new fears of a 2008-style crisis and the Fed backed off its aggressive campaign to increase interest rates to keep the economy moving. Biden now faces new challenges right at the moment when he had every reason to believe the tide was turning in his favor.

“Today, thanks to the quick action of my administration over the past few days, Americans can have confidence that the banking system is safe,” He said it as a reassurance. “Your deposits will be there when you need them.”

Biden also actively took on the 2024 political component to all of it. “During the Obama-Biden administration, we put in place tough requirements on banks like Silicon Valley Bank and Signature Bank, including the Dodd-Frank law, to make sure the crisis we saw in 2008 would not happen again,” He stated. “Unfortunately, the last administration rolled back some of these requirements.”

Former President Donald Trump is the front-runner to win the Republican nomination for the presidency to challenge Biden in 2019.

“I’m going to ask Congress and the banking regulators to strengthen the rules for banks to make it less likely that this kind of bank failure will happen again and to protect American jobs and small businesses,” Biden vowed. Biden has vowed to go to the House Republican majority, where he will continue fighting for spending cuts and the debt limit in the coming months.

Biden also offered the standard incumbent’s pitch to stay the course. “We have made strong economic progress in the past two years,” Biden continued. “We’ve created more than 12 million new jobs — more jobs in two years than any president has ever created in a single four-year term. Unemployment is below 4% for 14 straight months. Now we need to keep that progress going.”

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It is unclear whether this will be possible. Biden is also facing an anti-bailout backlash for his efforts to protect depositors at two banks of medium size. Many of these venture capitalists are also part of the bank’s portfolio. Biden would be happy to raise their taxes under normal circumstances. However, markets have rebounded after the first signs of bad news. It is unlikely that the Fed’s tightening, which could have halted recent growth, will be stopped. Biden has plenty of positive economic data points to cite before next year’s election and the debt ceiling showdown this summer.

Biden claims he has made good economic policy decisions. Others argue that it was luck. The time will tell if either one or both are about to expire.