Big, Structural Change
The global pandemic’s shock to our economy has led us into the deepest recession since the Great Depression. At the end of March, Congress passed an economic stabilization package as a response to lessen the impact to working families. It was an insufficient first step that never really received a follow-up, and most of the benefits it created (the enhanced Unemployment Insurance, the eviction moratorium, and the Paycheck Protection Program) either expired in August or were too underfunded and poorly designed to achieve maximum impact. Today, we are in the midst of a whirlwind of economic pain. One in seven parents report not being able to provide enough food for their children. Approximately, 40 million Americans are at risk of being evicted from their homes. Small businesses are shuttering with 40% of Black-owned businesses not expected to survive. It gets worse.
The economic pain of the recession is compounded by the fact that several structural flaws in our economy have been growing over the past few decades to yield an affordability crisis that is breaking the middle class. The time for marginal and incremental change is over. Our structural economic deficiencies can be categorized as a porous safety net, debilitating wealth inequality, a regressive tax system, enfeebled labor, and a corrupt regulatory state. It’s time for big, structural change to build a more equitable, prosperous future.
Revitalizing Our Safety Net
Filling the holes in our safety net starts with fixing our unemployment system through nationalizing the program, simplifying the enrollment process, and retaining the enhanced benefits during downturns. In addition, we should modernize and expand food stamps and other welfare programs to end onerous lifetime restrictions and work requirements that do little to encourage employment and do plenty to deny critical economic assistance to those in need. Next, we should be creating public options for sectors of the economy the market can’t adequately provide for (housing, business lending, grocery stores, banking, cable/internet, etc.). With respect to healthcare, every credible study illustrates that transitioning to a single-payer, Medicare for All system will save money by eliminating the excessive administrative costs in the private insurance industry and by reigning in prices from healthcare suppliers. If we do nothing to reform our health system, Americans are set to pay out $11 trillion in co-payments, deductibles, premiums, and other out-of-pocket costs over the next 10 years. We should adopt Elizabeth Warren’s plan for Medicare for All that makes healthcare free and universal by asking largest corporations and the wealthy to pay their fair share. We are the wealthiest country in the history of the world. We can afford a world-class safety net.
Debilitating Wealth Inequality
Debilitating wealth inequality harms our political system and trust in government. Filling the holes in our safety net will start to reduce it, but we must go further. Zucman, Saez, and Piketty have illustrated that in recent years the wealthiest Americans are paying a lower tax rate than low-income and middle class Americans, and it’s no accident. The superrich are able to buy political influence through campaign spending to write the rules to increase their share of the economic pie at the expense of everyone else. It’s a corrupt bargain that has galvanized widespread and bipartisan resistance at the grassroots-level. Building a sustainable future requires us to make structural changes to end the grotesque concentration of wealth.
A Regressive Tax System
Reforming our tax code is the most concise method to end debilitating wealth inequality. We can do this by establishing annual taxes on the net worths on the top 0.1%, properly funding the IRS, creating new brackets for marginal incomes over $400,000, and ending the preferential treatment of investment income over labor income. These reforms will yield trillions in new revenue critical to funding our safety net, but they can also be used for redistributive programs like a basic income, a childcare allowance, and student living stipends.
The defanging and demoralization of organized labor has been systemic and duplicitous and has led to wage stagnation, degraded safety standards, and meager benefits. In a moment in our history where millions of essential workers are putting their lives on the line to provide healthcare and basic services that allow society to function, it is our moral obligation to revitalize the labor movement and guarantee every worker can live with dignity and economic security. Co-determination (worker representation on corporate boards) and sectoral bargaining (industry-wide bargaining) are two bold and impactful policy goals that will revitalize organized labor and undo the negative consequences of its degradation. Another way to massively increase worker power is to prioritize full employment through monetary policy, establish automatic fiscal stabilizers, and create a federal jobs guarantee.
A Corrupt, Regulatory Process
Finally, industry regulations are often written explicitly by and for the most powerful corporations allowing monopolistic, monopsonistic, predatory corporations to shutter small businesses, exploit their workers, lie to their consumers, and pollute the environment. In the name of fair regulation, we need to recognize and resolve the root causes: unmitigated corporate influence in our political system and the undemocratic nature of our electoral and political systems. We need robust anti-corruption legislation that addresses insider trading among politicians, overturns Citizens United, creates a publicly-funded voucher system for elections, and establishes independent redistricting as well as implementing a 21st century voting rights act and moving to abolish undemocratic political systems like the Senate and the Electoral College.
While the American people face significant economic hardship, we can choose another path. We can build a future that revitalizes our safety net, reigns in wealth inequality, overhauls our regressive tax system, rejuvenates and rebuilds organized labor, and dismantles anti-democratic systems and political corruption to restore integrity in government and in our regulatory process. I believe in our ability to make big, structural change. I hope you’ll join me in this fight.