Land’s smoothness in carrying on a conversation about the policy and cultural blindspots that keep the country from being able to make meaningful progress for the working poor while basically doing two jobs at once is a living example of the determination and grace on display in her memoir, in which she renders vividly the back-breaking and often surreal work of deep-cleaning strangers’ homes while navigating the baffling bureaucracies of government assistance programs ostensibly designed to help her, all the while daring to dream of — and then build — a better future for herself and her daughter. Land’s personal story brings together so many intersecting issues which are rarely considered from a holistic perspective, such as the dangers facing women in abusive relationships who don’t have financial safety nets; the health issues that manual labor and substandard housing can cause or exacerbate for the entire family, and their financial implications; the affects of hunger and poor nutrition on a working parent; the psychological and financial tolls of unstable hourly-wage work; and the public assistance systems that are frequently more frustrating than helpful. Land and I spoke about all of that and more. Our conversation has been edited for length and clarity.
For Americans under the age of 40, the 21st century has resembled one long recession. I realize that may sound like an exaggeration, given that the economy has now been growing for almost a decade. But the truth is that younger Americans have not benefited much. Look at incomes, for starters. People between the ages of 25 and 34 were earning slightly less in 2017 than people in that same age group had been in 2000. The wealth trends look even worse. Since the century’s start, median net worth has plummeted for every age group under 55.
Why is this happening? The main reason is a lack of economic dynamism. Not as many new companies have been forming since 2000 — for reasons that experts don’t totally understand — and existing companies have been expanding at a slower rate. (The pace of job cuts has also fallen, which is why the unemployment rate has stayed low.) Rather than starting new projects, companies are sitting on big piles of cash or distributing it to their shareholders. This loss of dynamism hurts millennials and the younger Generation Z, even as baby boomers are often doing O.K. Because the layoff rate has declined since 2000, most older workers have been able to hold on to their jobs. For those who are retired, their income — through a combination of Social Security and 401(k)’s — still outpaces inflation on average. But many younger workers are struggling to launch themselves into good-paying careers. They then lack the money to buy a first home or begin investing in the stock market. Yes, older workers face their own challenges, like age discrimination. Over all, though, the generational gap in both income and wealth is growing.
Given these trends, you’d think the government would be trying to help the young. But it’s not. If anything, federal and state policy is going in the other direction. Medicare and Social Security have been spared from cuts. Programs that benefit younger workers and families have not. The biggest example is higher education. Over the past decade, states have cut college funding by an average of 16 percent per student. It’s a shocking form of economic myopia. In response, tuition has risen, and students have taken on more debt. Worst of all, many students attend colleges with high dropout rates and end up with debt but no degree.
And as badly as the government is treating the young today, the future looks even more ominous. First, the national debt, while manageable now, is on pace to soar. The primary cause is the cost of health care: Most Americans receive far more in Medicare benefits than they paid in Medicare taxes. The Trump tax cut also plays a role. It is increasing the debt — and it mostly benefits older, affluent households. There are some unavoidable trade-offs between the young and the old: A dollar spent on Medicare is unavailable for universal pre-K. But the country’s biggest economic problems aren’t about hordes of greedy old people profiting off the young. They’re about an economy that showers much of its bounty on the already affluent, at the expense of most Americans — and of our future. The young pay the biggest price for these inequities. That’s a vital subject for the 2020 campaign, whoever the leading candidates end up being.
The scope of financial crimes unearthed so far by state and federal authorities investigating President Trump and his associates is remarkable. Paul Manafort was found guilty of bank and tax fraud, and faces another trial involving charges of money laundering. Former campaign adviser Rick Gates pleaded guilty to financial fraud. Former Trump attorney Michael Cohen pleaded guilty to tax evasion and illegal campaign donations. The Trump Foundation was just dissolved over what the New York attorney general described as “a shocking pattern of illegality.” And authorities opened new investigations following a recent New York Times exposé describing hundreds of millions of dollars of potential financial fraud by the Trump family.
Even more remarkable is what these investigations tell us about the levels of criminality among America’s business and political elite. Tax evasion, money laundering, financial fraud and campaign finance violations: Every turned stone reveals thick webs of financial misdeeds. These white collar crimes, which often implicate the powerful and the wealthy, notoriously thrive in the loose regulatory environments created when big money exerts undue influence on politics.
Mounting indications: The Trump investigations join a growing body of evidence pointing to lax enforcement of high-level financial crimes. We know, for example, that massive fraud involved in the 2008 financial collapse — from mortgage lenders who deceived customers to banks that deceived investors — went essentially unpunished. We know that under-enforcement is common with certain big-ticket tax evasion practices — like misstating the value of assets under the gift tax. Gift tax fraud, which may save millions of dollars to a taxpayer, is a major component of the alleged tax evasion scheme of the Trump family. Lax enforcement and minor punishments are notoriously common with violations of campaign finance laws — the point where private and public corruption often meet. And as for money-laundering: According to congressional testimony, regulations against it are so ineffective that “the bottom-line metrics suggest that money-laundering enforcement fails 99.9 percent of the time.”
Executive, legislative and judicial failures: The blame for this loose regulatory environment is not limited to lax executive enforcement. Legislative and judicial actions play a substantial part in the swirling financial illegalities. Congress, for example, is responsible for the many easily abused tax deductions for the rich that populate our tax code. And legislators have long refused to fund the IRS at levels allowing effective tax enforcement. It is also Congress that has structured the Federal Election Commission as a weak and conflict-ridden enforcer of campaign finance regulations. The courts have similarly contributed to the lax regulatory environment. As a professor of constitutional law (and ex-prosecutor), I have watched with concern as recent Supreme Court cases extended ever-increasing constitutional protections to the alliance between big money and politics.
Many Americans are being left behind by today’s modern, global economy, and they are justifiably angry about it. Growing numbers of people feel our economic and political systems are rigged against them. And it’s no wonder why. Recent progress in low- and middle-income wage growth is a blip against decades of wage stagnation. Low unemployment masks the fact that millions of prime-age men and women are missing from the workforce altogether. Today’s adults are less likely to earn as much as their parents did, and they foresee the same fate for their own children. Concrete economic policy solutions are urgently needed. But the hollowing out of America’s middle class has coincided with the disintegration of our political center and the weakening of the very political institutions that sustain our democratic policymaking process. No issue underscores this breakdown more than the historically long government shutdown our country just suffered.
We must turn these tides. Our experiences in public service have taught us that policymaking among parties that passionately disagree is never easy, but it is made possible through adherence to certain principles of good governance. First among them is a commitment to truth, which must be rooted in rigorous analysis. There can simply be no good policymaking without first establishing a common set of facts about what is happening in the world and what any given policy or proposal will likely accomplish. Second, good policymaking requires that lawmakers trust one another. This takes time, the ability to convene in confidence and a mutual commitment to shared goals. Third, our leaders must be willing to make principled compromises. Finding the middle ground has never been easy, and nobody wants to lose a negotiation. But today, our leaders are equating compromise with moral failure, making it that much harder to begin a discussion, much less reach agreement.
Recognizing the importance of these principles in effective policymaking, in 2017 we formed the Aspen Economic Strategy Group, a group that is committed to evidence-based policymaking, civil discourse and exchanging policy ideas with those who hold different points of view. Over the course of the past year, we collected policy ideas to address the barriers to broad-based economic opportunity and identified concrete proposals with bipartisan appeal. These proposals are being released Feb. 4 in the edited volume “Expanding Economic Opportunity for More Americans: Bipartisan Policies to Increase Work, Wages, and Skills” by the Aspen Institute. The policy ideas are based in evidence, not ideology, and are wide-ranging in scope, including massive federal investments in community colleges, dedicated strategies to promote the economic health of rural labor markets, sensible zoning reform to promote housing affordability and a payroll subsidy to offset the cost of minimum-wage increases on employers, among others.
We believe that practical ideas such as these provide a thoughtful starting place for policymakers and community leaders to work together to address our nation’s deep structural problems. But our leaders must first commit themselves to the principles of good governance that have sustained our democratic policymaking for generations. Doing so is as important to the health of our economy as it is to the strength of our democracy.
What we’re actually seeing is a shift in the intellectual energy of American politics. This is the lesson of the disarray in the Republican Party, and the ultimate capitulation of President Trump in the shutdown fight he initiated. Trump’s decision to close the government in the vain pursuit of an essentially meaningless goal showed a party and ideological movement lost in the wilderness. Trump’s rise itself was a symptom of this. Traditional conservative nostrums of tax cuts for the best-off and business-friendly deregulation were not answering the needs of less affluent Republicans. Frustrated, they embraced Trump’s nationalism and protectionism along with, in many cases, his racialized appeals. They also noticed that Trump defended key social-insurance programs, especially Social Security and Medicare, which serve an aging Republican base.
In practice, Trump has stuck resolutely to the old conservatism, with the corporate tax cut being his major achievement. His administration is a coterie of millionaires and billionaires whose insensitivity to the shutdown’s victims suggested a worldview inspired by French Bourbons, not prairie populists. Trump has asked his blue-collar loyalists to live on a diet of rhetoric and empty symbols — the border wall being Symbol No. 1. Trump’s deteriorating poll numbers showed that all but the most extreme of his supporters were losing faith in his project. In the meantime, liberals and the left have absorbed key lessons from the Trump insurgency. One of them is that a progressive movement seen as speaking primarily for affluent metropolitan areas will never command a durable majority. Another is that there is room for bolder political thinking given the discontent in the country with unevenly shared economic growth.
What is interpreted as a leftward lurch can thus be better seen as an effort to pull the entire political spectrum away from the premises that have dominated U.S. politics since the Reagan era. These exerted a gravitational pull even on the Barack Obama and Bill Clinton presidencies. Conservatives succeeded in selling the poppycock that showering money on the investing class — the “makers not the takers,” the “job creators” — would lead to prosperity for all. Influential books were essential to conservatism’s rise, and you can see this billionaire-friendly notion now under assault from both moderate progressives (Steve Pearlstein’s “Can American Capitalism Survive? Why Greed Is Not Good, Opportunity Is Not Equal, and Fairness Won’t Make Us Poor”) and voices further left (Robert Kuttner’s “Can Democracy Survive Global Capitalism?”).
Presidential candidates — those thinking of running and other Democratic politicians — are also responding to the policy vacuum on the right embodied by the shutdown-for-a-symbol. For starters, supply-side economics is so yesterday. There is now room to talk about a wealth tax, proposed last week by Sen. Elizabeth Warren of Massachusetts, and a large middle- and working-class tax cut offered by Sen. Kamala D. Harris of California. Meanwhile, Rep. Alexandria Ocasio-Cortez of New York has inspired serious debate (unimaginable even a few years ago) about a 70 percent tax rate on earnings over $10 million. The underlying assumptions of the right are under assault as well. Sen. Sherrod Brown (D-Ohio) has made “the dignity of work” his battle cry, making a case for the priority of labor over capital. During Jimmy Carter’s administration in the late 1970s, conservatives launched an intellectual revolution that left liberals gasping for breath and helped create the presidency of Ronald Reagan. Trump is doing all he can to become the latest one-term president to empower a philosophical and policy rebirth among his opponents. The real wall is between conservatism and fresh ideas.