Is this the single greatest and fastest comeback from a recession in our history? A strong case could be made that it is with the recent news that national economic output soared to the highest rate in more than seven decades. The 33 percent increase in gross domestic product was twice the last record set back in 1950 when Harry Truman was president and economic growth was almost 17 percent at the time.
No one expected anything like this. The Federal Reserve had predicted growth of about half of this rate. Most Wall Street economic forecasters predicted less than 20 percent growth. The same occurred with jobs as we have now lowered unemployment to below 8 percent in September. The Federal Reserve and the Congressional Budget Office estimated we would have unemployment at nearly twice that rate. It was not until late next year that unemployment would fall to this rate.
Overshadowed by such blockbuster economic growth was the report on unemployment claims, as we have moved more than 15 million Americans off of such benefits in just six months. That has never happened before in our history. The housing market is also hotter than it has been in decades. Many are buying new homes as they leave cities as shutdowns, concerns over crowded areas, and riots have sparked an exodus out to the suburbs. Small business confidence soared to its highest level since the pandemic started, according to National Federation of Independent Business data, and is higher than any time in the last administration.
Job openings have scurried to more than 6 million unfilled positions. This is also a higher number than in the eight years that Barack Obama and Joe Biden were setting policy. The recovery is now almost entirely driven with business and workers with the private sector. Investment from the private sector rose by more than 80 percent in late summer.
One reason the recovery is so strong is the health of the economy before the pandemic at the start of 2020. We had the lowest unemployment rate in 50 years, over 6 million unfilled jobs, and the highest income levels with median households in our history, while poverty for all races, genders, and ethnicities fell to record lows. Imagine if we went into the pandemic with a weak economy. Instead, we entered the coronavirus era with arguably the best conditions in decades, which has given us the necessary cushion to soldier on in this terrible pandemic and devastation.
The only things that have curbed the recovery are blue states that closed commerce, while red states let stores and restaurants back into business. This has led to a lopsided recovery across the country. The states with the highest unemployment are blue states such as New York, New Jersey, and Illinois. The states with the lowest unemployment are mostly led by those Republican governors. A notable outlier is Colorado.
If more Democratic governors allowed people to get back to business, we could have had 40 percent to 50 percent growth. We could have had over 2 million more workers if unemployment in blue states were as low as that for red states. Some governors like Andrew Cuomo of New York have also imposed fresh lockdowns on stores and restaurants, while Philadelphia is letting criminals ransack and issuing standby orders for police. Is this the kind of irresponsible leadership that Americans want?
One last point is that Biden argued that the United States has dealt more ineffectively with the coronavirus under Trump than any other country. I will not defend the actions Trump has taken to contain the pandemic, but European death rates are climbing again. Moreover, our recovery is ahead of most European and Asian countries. The economy looks like the fabled Secretariat sprinting down the home stretch. I cannot imagine changing horses now. I believe in the end the voters will agree.
Stephen Moore is an adviser at Freedom Works and a member of the White House economic recovery task force. Find him on Twitter @StephenMoore.