transcript

Speaker 1:
[00:02] The rising inequality and growing political instability that we see today are the direct result of decades of bad economic theory.

Speaker 2:
[00:10] The last five decades of trickle-down economics haven't worked. But what's the alternative?

Speaker 1:
[00:16] Middle-out economics is the answer.

Speaker 2:
[00:18] Because the middle class is the source of growth, not its consequence.

Speaker 1:
[00:23] That's right.

Speaker 3:
[00:29] This is Pitchfork Economics with Nick Hanauer, a podcast about how to build the economy from the middle out. Welcome to the show.

Speaker 4:
[00:45] So, Goldie.

Speaker 2:
[00:46] So, Paul.

Speaker 4:
[00:48] I know that having been born in the...

Speaker 2:
[00:54] 19th century.

Speaker 4:
[00:55] Yeah.

Speaker 2:
[00:59] I was gonna start this off by saying that I'm old, but you just did it for me.

Speaker 4:
[01:04] So, having been born in FDR's first term, Goldie, you might not be able to relate to this, but speaking for myself, my entire life, I have known America's social safety net programs as something that Republican presidents try to dismantle, and then Democrats come in and try to tweak at the edges of what the Republicans were doing, and then the next Republican comes in and they do more damage, and it's been this sort of game of attrition, right? We've been losing safety net by attrition my whole life.

Speaker 2:
[01:37] It's been bipartisan, Paul. Remember, it was Bill Clinton who proudly claimed that we were ending welfare as we know it.

Speaker 4:
[01:46] That's true. That is true.

Speaker 2:
[01:48] Which I always found interesting because the word welfare is positive. Like, right? And if you understand economics, it's not like, oh, the social welfare state. It's welfare economics. That's literally what neoclassical economics used to call itself welfare economics. I mean, that's what it's about is increasing the welfare of as many people as possible. But no, Reagan said welfare was a bad word. So now that's considered a negative.

Speaker 4:
[02:17] And you're right, Clinton was pretty much full on attacking welfare when he was in office. But it's generally been a back and forth, a game of tennis.

Speaker 2:
[02:26] It is a back and forth. And, you know, historically, let's be fair, Jimmy Carter was essentially our first neoliberal president. A lot of the deregulation started under the Carter administration, the deregulation of the trucking industry and the airline industry, most famously. Also, you know, tax cuts kind of, you know, actually, it was first JFK who started cutting taxes after the Eisenhower administration. So both parties share the blame. They don't share the blame equally. One party just thinks, oh no, we're constrained by economics. These are the things we have to do. That's the Democrats. And the other party is, hey, let's screw all the poor people. And I don't know, is that unfair?

Speaker 4:
[03:19] No, you know, more or less, I think that's that's directionally accurate is maybe how I'd put it.

Speaker 2:
[03:25] In any case, the point, the inspiration for this conversation, Paul, I think, if I know where you're going, is that, I don't know, how should we what's the technical way of phrasing this? Our social safety net is totally fucked up.

Speaker 4:
[03:42] Yeah, I think in tatters is how is the cliche of the day when it comes to politicians talking about it. But yes, he's fucked up also.

Speaker 2:
[03:49] Right. And one of the things that we've seen in the past is that when the Republicans come in and break things, and by things we mean the economy, our democracy, not just individual things like all of government, which this administration is doing. But when the Republicans break things, the Democrats who actually, you know, old time liberals who actually believe in government. I mean, that to me is the difference. Liberalism, American liberalism, is we believe that the government is a force for good in improving people's lives. You can take your progressive values and put that on top of it, but underneath it is a philosophy of governance. And Democrats come in and they try to restore norms and rebuild institutions and fix the things that the Republicans intentionally broke. And I think the guest we have on today is going to tell us that maybe fixing this old system isn't the right approach. Maybe we need a more dramatic approach to reimagining how we approach poverty in America.

Speaker 4:
[05:00] Yeah, you're talking about Jamie Keene. She is the stratification economics fellow at the Roosevelt Institute and former Biden White House policy advisor. Her report is called From Safety Net to Power Base Reimagining Not Restoring the US. Anti-Poverty System, which is just I just I just love that I love that I love that title. I think it's really it sings it's it's it's got art to it.

Speaker 2:
[05:24] Well, then let's let's talk to Jamie and let her sing.

Speaker 5:
[05:33] Hi, I'm Jamie Keene. I'm a fellow at the Roosevelt Institute. I work on a range of issues, including progressive economic policy, democracy, and civil rights. And I used to work in the Biden White House. I was a special assistant to the president for equality and opportunity. And I have a new report out that looks at how we might reimagine the social safety net so that it does a better job of rebalancing power in our economy.

Speaker 2:
[05:57] Well, thanks for joining us. You know, I was reading the report, and you hit a soft spot for me here. Something I've been thinking a lot about, how broken the system is, and that it's not enough just to fix it. If you could just explain your general thesis at the top before we go on.

Speaker 5:
[06:16] So I think we all know that the safety net is under attack. You know, Trump has literally financed this massive transfer of wealth upwards by cutting off health care and food assistance for the poor. It's very draconian. But my argument is that even before these attacks started, the safety net really was broken. And it's true that millions of people rely on safety net programs. But the safety net has really been eroded by neoliberal policy design. I think neoliberalism has told us that if we deregulated markets and we privatized public services, then wealth would magically trickle down from the top of our economy and it would alleviate poverty. But that vision has failed. But it has really shaped the way our safety net is designed. And I would point to three kind of structural design issues with the safety net we have today. The first is we have a safety net that relies on private markets to deliver assistance while failing to regulate those markets. So most of our safety net programs assume that if we just give people a subsidy into a private market, that they'll be able to like not be poor anymore. And we ignore that it's the conditions of those markets themselves that are creating conditions of poverty to begin with. I think the second structural problem is that our safety net has become really fragmented. It is so complicated to get help in this country. We force people to jump through big hurdles, and the safety net is just not keeping pace with changes in our economy. And the third problem is that it's really passive. We've assumed that markets will work, and then the safety net will catch people after they fall. And I think that logic has really proven to be backwards. And the cumulative effect is that we're the wealthiest nation on earth, but one in ten Americans live in poverty. And for millions of Americans who live above that poverty line, they're facing downward mobility. That's not an aberration in our economy anymore. It really is a dominant economic condition for millions of people. You know, I would just point to a sort of quote from history that I think sums us all up, because many of these ideas are not new. But Martin Luther King in his 1967 speech, Where Do We Go From Here? He says, We are called upon to help the discouraged beggars in life's marketplace. But one day we must come to see that an edifice which produces beggars needs restructuring. I think that restructuring is what I'm trying to get at in this report.

Speaker 4:
[08:46] To take a look at that edifice as it currently stands, though, I wanted to ask, I think that most people define poverty as a lack of income, and you talk about it as a lack of power. I was wondering if you could talk about what that looks like for people who are in the system today.

Speaker 5:
[09:01] Yeah. Our safety net has taken what I would describe as a pretty one-dimensional approach to measuring poverty. Programs say, how much income do you have, and then what are some of your costs? Income is clearly a big part of poverty, but I think there's a different test we should be using, which is, do you have the power to say no? Do you have other choices? You might be employed, you might even be receiving one of our primary anti-poverty programs, the Earned Income Tax Credit. But if you can't leave a shitty job without risking eviction, you don't actually have power in our economy. You might be receiving a childcare subsidy. But if you can't pick the childcare provider that you trust the most, because your employer has the power to change your schedule with no notice, then you don't have power even if you're receiving safety net assistance. I think the painful truth is that many parts of the way the safety net itself is designed contributes to this disempowerment. Nothing exemplifies this better than work requirements. This is a really coercive trap. In order to get benefits that aren't enough to survive off of, you have to work a job that won't pay you enough to survive off of. If you leave the job, you lose your benefits. That is disempowerment that's baked in to policy design. I think poverty is not just about income. It's about how much control you have over the decisions that affect your life. Our economy is really converting that control into a luxury good.

Speaker 2:
[10:41] When you talk to Democrats about this, and I assume you have, I know there's this instinct within the party that if we still have a democracy and we take back control, we get Congress and eventually the White House, that we're going to fix all these things that were broken. How resistant are they to the idea that fixing the old system isn't sufficient?

Speaker 5:
[11:06] I think Democrats aren't a monolith. There are plenty of Democrats who still believe that we can like tax credit our way out of economic inequality.

Speaker 2:
[11:16] Right.

Speaker 5:
[11:17] And I think that just pumping up the system we have today is not going to be good enough. I do think we're in this political moment where the question is whether you are going to double down on the institutions we have or kind of reimagine them wholesale to rebalance power in our economy. And there are some Democrats who get that. But I think that the safety net is often an afterthought in our economic policy and in our economic politics. And part of that is just that it hasn't been delivering the kind of economic freedom and economic power that people need. So I think we need a much bigger imagination about what the safety net can do to bring it back into the heart of our economic policy making.

Speaker 2:
[12:01] Right. And as you point out in the report, it's part of an integrated system, or at least was initially intended to be part of an integrated system, and that we've lost those other parts and we treat them all separately. It's not just that it's market failures that create the conditions of poverty. It's actually the market working how markets work.

Speaker 5:
[12:22] That's exactly right. I mean, I think the argument I'm making in this report that I think is likely to ruffle the most feathers is an argument that the safety net is sometimes inadvertently subsidizing the same corporations that are creating economic precarity in the first place. And I know that this can feel uncomfortable because millions of people rely on these programs every day and their lives are made better by these programs every day. But I think when we take sort of a big step back, the safety net functions as an inadvertent form of corporate welfare. And I'd like to point to like a couple of ways that that happens. One is that the safety net lets some companies offload their costs onto the public. So when wages are insufficient and jobs are insecure, people still need to eat. They still need health care. They need a roof over their head. And it's public programs that are filling that gap. And effectively, what that means is that employers get to offload part of the cost of sustaining their workforce onto the public. It's like this hidden subsidy for low wage and high precarity business models. And I look at a place like Walmart. One in four SNAP dollars are now spent at Walmart. They are an enormous corporate beneficiary of the program. And at the same time, Walmart itself is one of the most prevalent employers of individuals who use food stamps to make ends meet. And at the same time, Walmart has a long history of preventing union organizing among its workers. So, SNAP is doing a lot of really helpful things for Walmart. And I don't think that that's the way we want our anti-poverty programs to operate.

Speaker 2:
[14:00] Right. And it's not just SNAP, of course, the Earned Income Tax Credit. I mean, that is a direct subsidy to employers. You only get it if you have a poverty wage job. You have to be working at a job that doesn't create an income sufficient to support you to get it. So, it's people like that that work at low wage employers like Walmart, who will qualify for the EITC.

Speaker 5:
[14:23] Well, you know, there's like a long and spicy history of debating whether the EITC subsidizes low-road employers. I think the argument I want to make is, like, it's not just in the context of the labor market that the safety net is providing these subsidies to corporate actors who are really creating economic precarity. Like, let's look at Medicare Advantage for a moment. Medicare Advantage was created under the argument that the private sector could deliver health care more efficiently than the government could. And, you know, we were approaching a place where a majority of Medicare recipients are actually receiving benefits through Medicare Advantage rather than through direct Medicare. But in 2024, Medicare paid over $80 billion more to Medicare Advantage insurance for the cost of coverage than if those same seniors had just been enrolled in traditional Medicare. And at the same time, the Medicare Advantage marketplace has become completely concentrated. There are just two insurers, United Health and HUBANA, that now carry 40% of all Medicare Advantage plans. And these same Medicare Advantage companies are being investigated by the DOJ for engaging in really egregious anti-competitive practices. So I think we have to ask ourselves, like, funding that is supposed to meet the needs of low-income people or economically precarious people is really being, like, siphoned up by corporate actors in our economy who have found ways to make their interactions with the safety net very profitable.

Speaker 4:
[15:56] Part of your critique is that there's been a divorce between social policy and market policy in terms of the safety net. And I was wondering if you could talk a little bit about what that means and why it's important that they not be divided.

Speaker 5:
[16:11] I think one of the things neoliberalism has taught us to think is that markets are natural and they're inevitable and then social policy should come behind those markets and do a little bit of cleanup for anyone who's fallen through the cracks. But like that's a political construction. Markets are shaped by rules. And I think what's happened over the last several decades is that we really systematically deregulated and restructured markets to favor capital, while relegating social policy to this compensatory model. And this shows up in really basic ways in the way we organize policy making. So federal and state systems that provide subsidies into a marketplace through safety net programs generally don't coordinate or share strategies with the regulators of those same marketplaces. So, for example, an employer who has been found to have engaged in wage theft against their own employees can still receive federal workforce training investments. And that disconnect between social policy and market policy, I think, is making the safety net really much less effective than it could be if we had shared market strategies and social policy strategies that we were bringing to bear in the sectors of our economy that create conditions of poverty, as opposed to focusing on regulations and programs as these separate functions of the state.

Speaker 4:
[17:35] And so the title of the report is very catchy, From Safety Net to Power Base. Could you talk a little bit about what the difference between a safety net and a power base is?

Speaker 5:
[17:44] You know, part of my argument is that if we look back historically to the origins of our safety net, we find many of these programs are built in the New Deal era. And the New Deal is really, it's not just a set of new programs, it's a power rebalancing project. FDR uses market regulations, public options where markets had failed, and social insurance programs. He uses these tools together to create counterweights to concentrated economic power. And as that framework eroded, as New Deal liberalism gets replaced with neoliberalism, we really lost the idea that governments could actively shape markets in the public interest. And so I think part of our task is to really restore the power balancing promise of the New Deal, but for the conditions we face in the 21st century. And I think there are a couple ways that we could start thinking about how to make this shift. The first is, in so many contexts, private subsidies into unregulated markets is not working, and we should be building strong public options. So some of the most impoverishing parts of our economy are the care sector, child care, health care, elder care. These are just crushing families' budgets. And I think we've sort of learned time and time again that the markets are not really capable of serving the interests of low-income people in care sectors. So we need public option child care. We need public option health care. We need public option elder care. I think one of the biggest sectors where we need a public option is actually in financial services. You know, James Baldwin famously observed how extremely expensive it is to be poor. And that's true. Poor people get hosed by credit card fees and overdraft fees. And we need public options, public option banking to give people a better option for financial services. I think another way that we might shift from a safety net to a power base is to really build towards a system that is capable of planning and making investments. So instead of a reactive safety net that catches people if they fall, we need a safety net that is actively monitoring the economy for disruption and planning ahead. And I just think about the magnitude of disruption that may be on the horizon as AI raises the potential for job displacement. Our safety net has almost no tools to proactively manage and transition. This potential disruption in our economy, that's a real problem and it makes people very vulnerable.

Speaker 2:
[20:19] Right. One of the things we've known for a long time is coming, for example, is long-call trucking is going to be, eventually, it's not yet, but it's going to be displaced by autonomous vehicles. And there are millions of truck drivers in this nation. It's one of the largest job categories in many states. And we know it's coming and we're doing nothing about it from the perspective of workers who are going to lose their jobs.

Speaker 5:
[20:50] It's exactly right.

Speaker 2:
[20:51] And that's what you mean when you talk about our system being too passive.

Speaker 5:
[20:55] Right. The way our system would work today is, let's say, tens of thousands of long-haul truckers start losing their job because of the adoption of autonomous vehicles. What we have available for them is unemployment insurance, which is time-limited. It's a system that is already struggling to keep pace. I mean, just a huge number of unemployed people cannot actually access unemployment insurance. That's especially true for gig workers. And we have very few tools to help people transition or upskill or participate in another part of the economy. And this idea that we should just wait for people to get hosed by economic transition and then offer them piecemeal support, like the rate of change in our economy, I think, demands something that's much more active.

Speaker 4:
[21:42] You actually make the case that when you strip people of economic power, it creates the conditions for an authoritarian state, purely hypothetically, of course. And I was wondering if you could talk a little bit more about that link, how the one feeds into the other.

Speaker 5:
[21:58] I think this relationship is just so basic. If people's primary interaction with the government is trying to get safety net assistance, and the safety net treats them with disrespect, and it's hard to get the help you need, and you feel like your social status and your economic status is diminishing, and the government is not there to help you, why would you continue to have faith in that system? So, you know, I argue that feelings of economic powerlessness really are a breeding ground for right-wing populism. There's actually really compelling evidence that when people feel like they're experiencing regional decline or a loss of economic standing, they're more likely to support anti-democratic movements because those movements promised to tear the system down and to restore people's sense of pride and prosperity. But I think the other connection here between wealth inequality and threats to our democracy is just that we've wrongly treated money like speech in this country. And so, you know, wealthy people just have more power in our democracy than poor people do. And that's a pretty frontal threat, I think, to long-standing democratic legitimacy.

Speaker 2:
[23:11] You talked about providing public options in a number of areas. One of the things you bring up, which seems to be a recurring theme on the podcast these days, is sectoral bargaining. Explain why that's important and how it would work.

Speaker 5:
[23:26] Yeah. So one thing I argue for in my report is this idea of shifting from this liberal obsession of delivering programs really well to taking a more sectoral approach. I mean that in two ways. So one is we should shift towards sectoral bargaining in our labor policy. Sectoral bargaining is the idea that instead of a union having to negotiate individually with employers, that they should be able to negotiate at the sector-wide level. I think this makes pretty basic sense. Why would nurses at one hospital have worse pay and benefits than nurses at another hospital a few miles away? We should be able to bargain at the level of health care workers. So I think sectoral bargaining is a really important way to rebalance power for workers. But I think a sort of additional idea is the idea of taking a sectoral approach to anti-poverty policy. We know which sectors of our economy create conditions of poverty. It's like health care, child care, utilities, groceries. These are the areas of life that sort of dominate the affordability debate right now. But affordability, I think, is like this, it is sort of a sanitized way of saying that conditions of poverty are creeping up the income ladder. So I think instead of just delivering grocery assistance, we need a much more comprehensive approach to rebalancing power in the grocery sector. And so that sectoral approach would mean organizing the way the state engages in a fundamentally different way than what we do right now. And as I mentioned before, there's this basic disconnect where the people who subsidize markets often are like not in the same room as the people who regulate those markets. And that allows corporations to capture a pretty big share of public investments that are intended to counteract poverty.

Speaker 2:
[25:20] Yeah, if you think about it, if you think about, you know, obviously, our approach to market economies is that it's this complex adaptive system with various feedback loops. You make one small change here and it creates another change elsewhere. It totally doesn't make any sense that we wouldn't bring these interventions together, that the regulators wouldn't be working with the people who are delivering the safety net programs, that we wouldn't be thinking of the tax system as part of this entire system. Yeah, it's a different way of approaching it, but again, it is a lot more complicated, and I think there's one benefit to our very complicated system of, or at least it has been our complicated system of delivering safety net programs and aid and so forth. And that is the more complicated it is, the harder it is to dismantle. It's one of my critiques of universal basic income when people tell me how much more efficient it would be just to give people money than to provide all of these services. And that's well, once you've eliminated the social safety net and you've replaced it with the universal basic income as efficient as that might be on paper, now all you need to do is erode the universal basic income and you've eliminated everything.

Speaker 5:
[26:51] You know, I have my own reasons why I think universal basic income is not a silver bullet. But I don't think I agree with you that complexity makes us safer. I think part of why Trump has been able to take a sledgehammer to the safety net is that it's so complicated that people don't really understand how it works. It's so complicated that some of these programs just don't feel that good to receive. And so they are easier to attack politically. Notice how much harder it is to attack social security than it is to attack more complicated fragmented programs. Social security works because it's really straightforward. Like you turn 65, you get your benefits. And I think that we need...

Speaker 2:
[27:41] Well, 67 now.

Speaker 5:
[27:42] 67, yeah. Fair enough. And actually, we should, I think, be having a debate about lowering the retirement age in this country. But we need more parts of our safety net to operate in that straightforward, accessible, guaranteed way.

Speaker 2:
[27:57] Right. I can tell you, I'm 63. And so I started to investigate Medicare recently. And I got to tell you, I was shocked. I just assumed that I would turn 65 and European style socialized medicine. And suddenly, you know, no more premiums, no more deductibles, no more messing around with anything. Just one simple system. Oh, my God, is it complex? And it seems to be designed to drive people into Medicare advantage, where they can then take advantage of you. I think that's where the advantage comes from in the branding.

Speaker 5:
[28:35] And just wait until you start getting calls from all the insurance brokers who are going to try to sell you a plan you don't actually need, because it turns out that they're taking kickbacks from Medicare advantage providers to do so.

Speaker 2:
[28:47] Yeah.

Speaker 4:
[28:47] You touched on this briefly, and I just wanted to sort of get it on the record, because for a long time, giving people money was seen as the solution in various parts of the democratic sphere. I know Vox was big into it. And I mean, we did see some success, I think, during the pandemic, during the lockdowns when we did send people money, and it did strengthen the economy. But I was wondering if you could talk about why giving people money isn't the end-all solution.

Speaker 5:
[29:13] Well, I think it's a big part of the solution. So I want to be clear about that. I mean, cash is the most dignified, efficient way to help people who are struggling in our economy. And I think we would be in much better shape today if more of the safety net operated as cash-based programs. But I think the challenging reality is that if rents keep rising because we haven't fixed that marketplace, if healthcare costs keep rising because we haven't fixed that marketplace, then pumping more cash into people's pocketbooks is going to get absorbed by broken markets. So I think cash is a floor that we should provide to more people, but it needs to be part of a much broader intervention into the economy. I'm very skeptical that cash on its own can do all of the heavy lifting for rebuilding an economy that is fair.

Speaker 2:
[30:08] So we're going to put you in charge. No political constraints. You can fix the system however you want. What might it look like the next new deal that comes out of your report?

Speaker 5:
[30:24] If I could make one change today to the safety net, I would think about expanding social security for families with children. We are such an outlier globally in our failure to provide a child allowance. Having a kid in this country is so expensive. Actually, having a baby in this country precipitates a period of poverty for something like 40% of moms. And that's ridiculous. We're the wealthiest nation on earth. Social security has been one of the most effective anti-poverty programs in the country. And I think that a bold idea is that families with little kids need that same kind of help. The Child Tax Credit showed us what is possible when we expanded it. During the pandemic, we cut child poverty in this country in half in one year. That's remarkable. I think that there's no reason to believe that we shouldn't expand the promise of social security when people start a family.

Speaker 2:
[31:21] Well, that makes sense. I, you know, treating it like disability insurance. I remember when my daughter was young, I was pretty disabled much of the time.

Speaker 5:
[31:29] I mean, I do think there's interest, this interesting opening in our politics where there are some reasonable people on the right who I think are starting to realize that deregulating the labor market has led to a set of economic conditions that are totally hostile to family life. But I think we really need to be careful that we don't buy into the pro-natalist argument, which I think really leads you down the path of policies that diminish people's personal freedom and power. What we need is that everyone has the power to make choices about when and how to start a family.

Speaker 4:
[32:04] So you've been really generous with your time. So thank you for that. I did want to ask you the one question we ask all of our guests. Why do you do this work?

Speaker 5:
[32:12] I started my career in local government working on homelessness services. And I think that we have this sort of bizarre thing that has happened to many of us morally, where we see homelessness in the midst of our enormous wealth. And we treat it like it is just sort of a natural by-product of the economy. And when you spend time with people who are experiencing homelessness, you're really seeing just like the canary in the coal mine, that our system has just rotted out for people. And there is a level of desperation in this country that we cannot ignore. I think we're just at the outer limits though, of how much we can fix with the systems we have. And so, you know, I think it's just important that we use a bigger imagination to think about rebuilding the systems we have.

Speaker 2:
[33:15] When you asked her that final question, Paul, and she talked about her work at the city level with homelessness and talking about how we kind of accept this as a natural byproduct, I'd argue it is a natural byproduct. It's a natural byproduct of a market economy. It's not a natural byproduct of a functional society and a functional democracy, but left to its own devices. It is and always has been a byproduct of markets. So this is the sad truth. We're pro-market. Nick is, I am, I assume you are, our office is, our whole philosophy is a pro-market economic philosophy. But at the same time, we understand that markets inevitably, inevitably create extreme inequality and inevitably as well, they concentrate wealth and power in the hands of the few. And inevitably, when this power is unchecked by a functional democracy, from what Jamie talks about in her report, countervailing power, sufficient countervailing power, it will produce immense immiseration. It will produce things like homelessness. There has never been a point in our history where the market has created affordable housing, like high quality affordable housing, something we would consider sufficient, where the market has built that for homeless people, to bring people out of homelessness. The market cannot and will not do that. It will create more homelessness because there's a lot of money to be made off of poor people.

Speaker 4:
[35:03] I am starting to doubt your credentials as a Libertarian, Goldie. I think they might kick you out of the party. Yes. No, I agree. That's what the government is for. That's supposedly what it's for is to redirect and to punish people who take advantage and to create a system that ensures that everybody is involved in the economy and in society and that everybody has a voice and everybody has economic power and yeah, this is the most basic political question of our time and it's amazing that so many people are failing at it.

Speaker 2:
[35:42] Right. I think it's really important she makes this point about how not addressing these issues helps feed authoritarian populism, that if we want to save our democracy, we need to rethink, reimagine and we need to address this better. If you go back to the New Deal, and of course, it's the Roosevelt Institute, they always go back to the New Deal, right?

Speaker 4:
[36:08] Sure. Yes. Yeah.

Speaker 2:
[36:09] Right. It is the Roosevelt. That's the Roosevelt they're talking about. It's not the Teddy Roosevelt Institute. It's the Franklin Delano Roosevelt Institute. But you look what Roosevelt did with the New Deal. He saved American democracy. I mean, he saved us from, we could have gone the totalitarian route like Germany did, like the Soviet Union did, and there was this understanding that market capitalism was failing, and that when it failed, those were the types of things that happened. Disaster followed. A lot of the compromise in the 1940s and 50s and 60s, that post-war period where we saw the creation of the largest, most prosperous middle class the world has ever seen. We saw inequality fall and poverty rates fall. We saw incomes rise with economic growth and with productivity growth. Part of this compromise was that even the American business community, the people with power and money, understood they needed to do this to protect the system that benefited them. It's cliché to call for a new new deal because that worked out. But it was this integrated system that wasn't just about providing services to the poorest of the poor. It really was a rethinking. In that moment, it was a rethinking and a reimagining of how the American economy worked and the role of government in it. And I think we're at this point of multiple interrelated crises, this crisis of inequality, of democracy, and of climate where we need that type of imaginative rethinking if we're going to save the American Republic.

Speaker 4:
[38:06] Something that struck me as we were listening to Jamie talk is that she is accurately identifying both the problem and the solution, which we've been doing this some form of podcasting for about 10 years, the better part of 10 years now, right? And you and Nick have been doing this for that long. And it struck me listening to her talk that 10 years ago, if we were to get someone from a progressive institute, they would not talk about rebuilding a social safety net program into a power base or a public health care plan or any of the things that she was talking about. Like those things, the whole left economist policy machine was basically invested only in tinkering around the edges. And more and more people we talk to now are like Jamie, where they acknowledge that the system is busted and we need something new, so we need to think about the new. And I find that incredibly hopeful. You know, talking to her is feels so much better than speaking to someone who says, you know, we need to increase the EITC to, you know, solve, pull 0.6% of Americans out of poverty or whatever. You know, like this is it's a big swing and it's time for big swings. And people acknowledge that. And I really enjoy. I really like hearing hearing that type of talk from.

Speaker 2:
[39:28] How many times have we heard about how the EITC is the most successful anti-poverty program in American history, that no other program has lifted more people out of poverty? But what it hasn't done is is address the issue of poverty wage jobs. If anything, it's exacerbated it. So, yes, it it ameliorates the problem without addressing the cause of it, which is we are subsidizing parasitic employers.

Speaker 4:
[40:03] Yeah. Walmart is the real welfare queen in this scenario, yeah.

Speaker 2:
[40:09] Right. So, yeah, it's good to hear this. It's good to hear it coming from different sources, from different people, different ideas. We've talked about the public option before, a very important idea, both in terms of how to phrase it, but also it just sometimes markets don't work well and there isn't a lot of competition. And so you do a government option, a public option, provide that competition. And it doesn't necessarily displace the market, market players. It says, no, no, you got to compete with us, right? I mean, that's why they fought the public option, the public option in health care. They don't want a public option because they don't want to have to compete. They'd rather just have, who'd she say it was? United Health and the other one had 40% of the market. Yeah. Humana. You know, they don't want competition from the government. They'd rather just price fix between themselves. So you can look at that throughout various sectors. Obviously, I've talked about it before. I believe we need a public option for housing that will never address the affordability crisis until we have a public option for rental housing as a major part of the market. Not the dominant player in the market, not the landlord to the majority of Americans, but a significant place in various markets actually force the private market to compete. That's how you drive down housing prices in the long run. She's right. Obviously, childcare, daycare, it's not working in the private sector. We need a public option there. I am sympathetic to the idea of public option for grocery stores and food deserts. I think it's worth trying. Maybe it doesn't work. Maybe it's something that is not the type of thing government can provide, but I'm sympathetic to trying. That's another thing getting back to FDR, the name of that institute, the Roosevelt Institute. You know, he very famously said that the thing we need to do in this moment is to try things, and if they fail, try something else. Don't be afraid of failure.

Speaker 4:
[42:25] If anybody knows not being afraid of failure, it's you, Goldie.

Speaker 2:
[42:28] That's right. I've said this before. This is actually true. Paul, when I've described the track of my life is I'd rather fail big than succeed small. And man, have I done that from time to time. In any case, if you want to read more from Jamie, we will provide a link in the show notes to her full report, From Safety Net to Power Base, Reimagining Not Restoring the US Anti-Poverty System.

Speaker 6:
[43:08] Pitchfork Economics is produced by Civic Ventures. If you like the show, make sure to follow, rate and review us wherever you get your podcasts. Find us on other platforms like Twitter, Facebook, Instagram, and threads at Pitchfork Economics. Nick's on Twitter and Facebook as well, at Nick Hanauer. For more content from us, you can subscribe to our weekly newsletter, The Pitch, over on Substack. And for links to everything we just mentioned, plus transcripts and more, visit our website, pitchforkeconomics.com. As always from our team at Civic Ventures, thanks for listening. See you next week.