What Happened and How the Aftermath Explains Trump’s Political Success

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I was in college when the Great Recession officially ended in June 2009. But I couldn’t find a job that summer or the next one because the effects of the recession, which reverberated throughout the economy, lasted for years. Americans lost their homes and their jobs. Many communities never recovered. That crisis and the botched response by the Democratic Party are crucial to understanding what’s happening in US politics now.

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Take the 2024 presidential election. Donald Trump gained support among Latino voters, Black men, some voters between the ages of 18 and 29, and voters without a college degree. Meanwhile, many Americans — especially young people — simply didn’t vote at all. Surveys found that the economy was the top issue in the election, with two-thirds of voters saying it was in poor shape in an Edison Research poll, Reuters reported. A number of the young people who voted for Trump this year don’t identify as “very or somewhat” conservative, according to the AP VoteCast survey. They were upset about issues like rising prices, housing costs, and job quality, and they didn’t believe Democrats would help them.

Trump has claimed that under his presidency, “inflation will vanish completely.” While many economists have said that his economic policies will worsen inflation, voters were willing to take that risk. In my book, Y2K: How the 2000s Became Everything, I argue that we can’t understand contemporary politics without understanding the Great Recession and its aftermath. And part of that is understanding how Democratic leaders’ decisions helped discredit the party among those who lived through that tumultuous time.

Below, we break down how the recession came about, the Democratic Party’s failure to meet the moment, and how we’re still living with the consequences.

What happened during the Great Recession?

In December 2008, the nonprofit National Bureau of Economic Research — which has a committee that officially decides whether a recession is happening in the US — announced that the economy had been in a recession since December 2007. While a capitalist economy has cycles of growth and slowdown, this was different. Two major investment banks had collapsed in just months and, according to Ben Bernanke, who served as Federal Reserve chairman during the recession, 12 out of 13 of the biggest financial institutions were on the verge of failure at one point. “September and October of 2008 was the worst financial crisis in global history, including the Great Depression,” Bernanke said. According to then-Treasury secretary Tim Geithner, the economy was “in free fall” and no one knew what to do.

Between 2007 and 2010, approximately 3.8 million American families lost their homes to foreclosure, according to estimates from an economist at the Federal Reserve Bank of Chicago. This statistic doesn’t fully convey how badly certain communities were hit. In cities like Detroit and Las Vegas, the foreclosure rates were especially high. Entire blocks were full of boarded-up, abandoned houses. And the people who lost their homes were much more likely to be Black or Latino than white. The housing crisis, in fact, led to the destruction of generations of Black wealth.

After the recession officially ended in June 2009, the unemployment rate continued to grow, reaching over 10% that October. However, that was just the national rate. According to the Bureau of Labor Statistics, the Black unemployment rate that month was 15.7%. For Hispanics, it was 13.1%, and teenage unemployment was 27.6%. The unemployment rate didn’t return to pre-recession levels until 2017, according to Bureau of Labor Statistics data. Experts call periods like this (where there’s economic growth following a recession but jobs are slow to come back) a “jobless recovery.”

Some people who lived through the Great Recession and the subsequent jobless recovery never fully recovered. This is due to something called economic scarring, or the prolonged negative effects of a recession on individuals, families, and communities. Particularly hard hit were millennials who graduated college into the worst job market in decades and struggled to start their careers. And they, unlike their parents, were often burdened by thousands of dollars in student debt (which was tough to pay off when there were so few jobs). This caused many millennials to move back in with their parents, put off buying houses, and delay starting families.

Though Gen Z was younger during the Great Recession, a number of them have formative childhood memories of that period: of their families losing their jobs, homes, or savings. And Gen Z also has to live with the economy that came afterward. It’s an economy where jobs are less stable, harder to get, and less likely to keep up with the rising cost of living. And it’s an economy where people are increasingly doing side hustles or gig work rather than working at one full-time job. In fact, experts say the jobless recovery was partially responsible for helping the gig economy grow. Uber was founded in 2009 and Lyft was founded in 2012, and these new companies helped people make at least some money when full-time work was hard to find. It generally didn’t pay very well, but it was better than nothing.

How did the Great Recession come about and who was held responsible?

The Great Recession didn’t just happen. It happened because of specific choices made by politicians, including Democratic president Bill Clinton and Republican president George W. Bush, that helped deregulate the financial industry and inflate the housing market. And it happened because of the behavior of financial executives. Companies like Citigroup, Wells Fargo, and Countrywide Financial took advantage of the new freedom and started selling risky, subprime mortgages that they knew people might not be able to pay back (failing to meet the terms of a loan is called defaulting). In 2012, Wells Fargo agreed to pay $175 million to resolve the federal government’s allegations that the lender deliberately targeted Black and Hispanic customers for subprime mortgages, with some employees in private purportedly referring to these offerings as “ghetto loans” for “mud people.”

These mortgages were then pooled together to form financial products called mortgage-backed securities by investment banks like Citigroup, Wells Fargo, Bank of America, and Goldman Sachs. These mortgage-backed securities were, in many cases, falsely marketed as safe investments, and people put their retirement money, college funds, and savings into them. In 2007, when the economy started to slow down and large numbers of Americans weren’t able to pay their mortgage, this had a domino effect. Because the economy was doing badly, many companies had massive layoffs and stopped hiring people. And because a lot of people didn’t have jobs, they weren’t spending as much money, which meant companies weren’t growing. It was a vicious cycle.

And yet few financial executives were punished. Banks were fined, but CEOs still got to keep their giant bonuses. There were congressional hearings, but in the US, only one bank executive went to prison. Many of the people behind the policies that helped lead to the recession — like Clinton and his treasury secretary Larry Summers, who became Barack Obama’s top economic adviser — continued to have successful careers. The government could have gone after the people responsible for the Great Recession a lot harder than it did.

It also could have made more of an effort to help struggling Americans get back to work and stay in their homes. The Obama administration oversaw huge bailouts, but a lot of that money went to banks and corporations rather than to struggling families. The president put through a stimulus package, but its size was limited due to calculations pushed by Summers, which ended up prolonging the recovery.

It didn’t have to be like this. During the Great Depression, in the 1930s, the government helped restart the economy by putting millions of Americans to work in government jobs: building bridges, roads, parks, and airports, and hiring unemployed artists, writers, and playwrights to create murals, take pictures, write travel guides, run community theater programs, and teach art classes. I wish this kind of program had been created during the Great Recession, too. It would have been especially helpful for young people like me. I bet it would be helpful for young people today as well.

How is the Great Recession still influencing our politics?

When Trump campaigned in 2016, he gained popularity in part because many Americans were angry. They felt, correctly, that American society no longer worked for them. Some of those voters loved Trump, but some of them just liked that he promised to run things differently.

After Trump won that election, Nate, a retired federal government worker and military veteran in Pennsylvania, told a Guardian reporter that he had been a Democrat for 39 years. But he voted for Trump because he felt frustrated with Democratic leaders. “Obama created jobs, but minimum wage jobs,” he said. “You can’t support a family on a minimum wage. Our manufacturing plants are gone, the coal industry is gone from my area, and Hillary [Clinton] would just shut it down the rest of the way.”

While you can argue with some of the details of what Nate said — for example, the growth of poorer-paid service jobs and the decline of American factories started in the 1980s — it reflects something bigger: For many Americans, the Obama years coincided with a decreasing quality of life.

It’s worth noting that, as president, Joe Biden had a number of economic policies that improved the quality of life for many Americans: the Inflation Reduction Act, the expanded child tax credit, expanded unemployment benefits, and increased money for state and local governments. He also supported workers’ right to join unions and nominated Lina Khan to run the Federal Trade Commission, where she cracked down on shady practices by large corporations. But this was too little, too late. These policies still weren’t big enough to deal with the problems many Americans have been living with since the beginning of the Great Recession. And, thanks to the conservative majority on the Supreme Court, Biden was unable to fully deliver on some of his promises, like the student loan debt relief plan.

When Kamala Harris replaced Biden as the 2024 Democratic nominee, she advocated for more affordable housing and creating a “care economy.” But in her messaging, she distanced herself from parts of Biden’s positive economic legacy and instead cozied up to big business. This erased some of the progress I believe Biden made in convincing Americans that Democrats were interested in improving their lives. To a number of economically struggling voters, it looked like Harris wasn’t interested in their problems.

Trump’s rise didn’t only happen because Americans were angry with Democrats and their economic policies. I’d argue that the recession — and the inadequate response by the government — helped create the conditions that allowed millions of Americans to get radicalized online. In the wake of the recession, people lost their in-person communities when they lost their jobs, homes, and businesses. They found themselves increasingly isolated and hustling to make ends meet. When they turned to the internet to connect or find news, many discovered online communities filled with conspiracy theories and disinformation (a trend that got worse during the COVID-19 lockdowns).

These online spaces helped mobilize support for Trump. A growing number of Americans falsely believe that vaccines are dangerous, that the 2020 election was stolen from Trump, or that Democratic politicians and Hollywood elites are running a child sex trafficking ring. It’s hard for Democrats to campaign effectively when so many people disagree about basic facts and what the truth really is.

We’re still living in the country the Great Recession made. If Democrats want to win elections, they need to start campaigning (and delivering) on big economic policies like family leave, well-funded public schools, and a higher minimum wage. These policies would give all Americans a stake in our society (and they’re popular, with many progressive ballot measures winning this year even in red states). Democrats also need to focus on rebuilding in-person communities that offer alternatives to disinformation-filled online spaces. Until those two things happen, even Taylor Swift and Beyoncé can’t guarantee victory.

Originally Appeared on Teen Vogue

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