Next Social Contract: Latest Articles

What's the Matter With Bitterness?

Ron Tang — Wed, 16 Apr 2008 11:42:00 -0400

Behind the controversy over whether Sen. Obama's description of rural Pennsylvanians as "bitter" about their economic circumstances was condescending, there is another argument, one that's been lurking, unspoken, since the beginning of the Democratic campaign. It's a debate about the legacy and meaning of the last 16 years of the Democratic Party, and both candidates have said some highly provocative things, putting cards on the table that they've been holding for months.

First, Sen. Clinton. In the "Compassion Forum" Sunday night, she tried to depict Obama as comparable to the last two defeated Democratic nominees: "Large segments of the electorate concluded… more

Obama-ism Without Obama

Ron Tang — Tue, 01 Apr 2008 10:52:00 -0400

Whether he becomes president this year, sometime in the future, or never, Barack Obama will surely stand as a distinctive and surprising figure in our political history. Yet as the lens pulls back, individuals who at first seem uniquely transformative almost always come to be seen, more modestly, as reflections of their times, as products of trends and choices not of their own making. When Ronald Reagan was turning American politics on its head in 1980 and 1981, we saw Reagan, the man; today it is hardly revisionism to see Reagan as part of a long process of conservative reinvention… more

Democratizing Capital

Ron Tang — Thu, 20 Mar 2008 05:53:00 -0400

Below is a longer version of the article published in The Nation. For the version appearing in The Nation, please click here.

Historical analogies are never exact. Yet many of the choices we have before us today are similar to ones that an earlier generation of progressives faced as the 1932 election approached. As we do today, the progressives of the 20th century confronted a society beset by a huge gap between classes and an economy laid flat by the bursting of the speculative excesses of the previous decade. To be sure, our economy is nowhere near Depression levels… more

America Still Works

Ron Tang — Fri, 01 Feb 2008 00:00:00 -0500

Anyone who reads the serious press about the condition of the US might be excused for believing that the country is headed towards a series of deep crises. This impression is exacerbated by economic slowdown and by the presidential primaries, in which candidates announce bold plans to rescue the country from disaster. But even in more normal times there are three ubiquitous myths about America that make the country seem weaker and more chaotic than it really is. The first myth, which is mainly a conservative one, is that racial and ethnic rivalries are tearing America apart. The second myth,… more

Economic Diversification

adminn — Mon, 31 Dec 2007 22:23:00 -0500

Harry Markowitz’s 1952 essay Portfolio Theory broke new ground in developing ways to diversify financial portfolios. By the time he won the Nobel Prize nearly four decades later, countless financial innovations to help spread risk had been introduced, making the risks associated with investing more acceptable -- particularly to the American middle class. Sure the markets are taking a hit now, but those with diversified portfolios are certain to weather this downturn better than those without.

U.S. economic public policy would benefit from a similarly innovative approach to managing risk. The economy is facing growing pains that go deeper than just… more

The Moral Equivalent of Optimism

Articles — Fri, 16 Nov 2007 16:44:00 -0500

You may have noticed a recurring theme in this column: that there is a set of assumptions about political possibilities that date from the late 1970s and have led to the timidity of more recent liberal politics -- and that are overdue for questioning.

Here’s another: An unfinished challenge from the late 1970s involves the question of how to create a meaningful and successful politics suitable to what then-California Gov. Jerry Brown called "the era of limits." In that first moment when the U.S. confronted the finitude both of fossil fuels and of America’s postwar economic hegemony, Brown and Jimmy Carter… more

Don't Throw Baby Bonds Out With Bath

Articles — Thu, 01 Nov 2007 08:54:00 -0400

For better or worse, America has a habit of conducting much of our policymaking through the presidential election process. This can be dangerous when meaningful reform efforts get trumped by volatile politics. Sure, we’d like campaign promises to mean something but it’s counter-productive if we let the consideration of good ideas get easily diverted into the gutter.

A case in point was the recent discussion of Hillary Clinton’s Baby Bond proposal, which was quickly hijacked by partisan politics. That’s a shame because the idea of creating a system of children’s savings accounts has good politics behind it and… more

Forget Easy Money

Articles — Sun, 07 Oct 2007 07:12:00 -0400

Countrywide Financial, the nation’s largest mortgage lender, has a curious new idea -- or, more precisely, an old one. No longer will it use wads of Chinese cash recycled through Wall Street to make subprime loans to unqualified borrowers. Instead, it will take in deposits from small savers and lend them out to people who might actually repay them -- just like that humble thrift institution president George Bailey did in It’s a Wonderful Life.

Imagine: a bank that promotes thrift! This could be the start of something big. Writing recently in the American Banker, Eugene Ludwig, a former comptroller of… more

Five Myths About Sick Old Europe

Articles — Sun, 07 Oct 2007 04:22:00 -0400

In the global economy, today's winners can become tomorrow's losers in a twinkling, and vice versa. Not so long ago, American pundits and economic analysts were snidely touting U.S. economic superiority to the "sick old man" of Europe. What a difference a few months can make. Today, with the stock market jittery over Iraq, the mortgage crisis, huge budget and trade deficits, and declining growth in productivity, investors are wringing their hands about the U.S. economy. Meanwhile, analysts point to the roaring economies of China and India as the only bright spots on the global horizon.

But what about… more

Public Investment Works

Articles — Sun, 30 Sep 2007 10:16:00 -0400

An important debate over fiscal policy is beginning to take place within the Democratic Party. For the past 15 years, deficit hawks within the party have argued that addressing America’s fiscal challenges should take priority over our public investment needs, suggesting that, in effect, we cannot afford to increase public investment until we have reduced the federal deficit.

But there is an alternate view, holding that the deficit hawk position neither accurately reflects America’s true economic strength nor represents good policy in light of the very significant changes that have occurred in the economy over the past decade… more

Share the Credit

adminn — Sat, 01 Sep 2007 08:55:00 -0400

The Democrats are a potential majority party in need of a major idea with potential. The major idea that built a Republican majority starting with Ronald Reagan's election was simple: cutting income taxes, with or without cuts in spending. The Republicans reduced income tax rates and then they cut big holes in those rates by creating new or enlarged tax credits available only to Americans who pay income tax.

Meanwhile payroll taxes have risen for working Americans who, because they pay little or no income tax, are ineligible for a range of tax breaks from the $1,000-a-year child… more

The Thirty-Year Itch

Articles — Tue, 31 Jul 2007 14:49:00 -0400

I’ve always resisted the idea that there is "an inherent cyclical rhythm in our national affairs," as the late Arthur M. Schlesinger Jr. put it. Schlesinger suggested that American history moves in 30-year cycles between liberalism and conservatism, between public and private concerns. But it’s hard not to notice that it was exactly 30 years ago that the conservative era dawned, with the introduction of the then-audacious Kemp-Roth tax-cut proposal, in 1977, followed by California’s tax-limiting Proposition 13 the next year. Also in those two years, a freshman Utah senator named Orrin Hatch led a 19-day filibuster that brought down… more

How to Hit the Trifecta

Articles — Wed, 25 Jul 2007 09:40:00 -0400

Rising insecurity in the oil producing regions of the world along with rising carbon levels in the atmosphere are pushing Congress to update our nation’s energy policies. But far from providing a bold solution to our converging environmental, energy and security dilemmas, the bill that has come out of the Senate to gradually increase fuel efficiency standards relies on timid half-measures. Congress should instead consider a more effective and long-overdue step towards energy independence and environmental protection -- implementing a broad-based energy tax.

Clearly, U.S. energy policies need reforming. Oil-producing nations hold too much sway over our pocketbooks and our… more

Bloomberg Tackles Poverty

Articles — Sat, 30 Jun 2007 11:40:00 -0400

Even for public servants with the best of intentions, the seeming intractability of poverty in America can be awfully discouraging. Its causes are complex and past efforts have met with limited success. Until Hurricane Katrina hit land, poverty had been absent from the public agenda for so long that there was little consensus among policymakers in how to respond. Not only was the toolbox of effective antipoverty proposals empty but partisan gamesmanship often seems to block innovative, good faith efforts to address it.

Yet persistent, concentrated, and intergenerational poverty remains a scourge upon our prosperous society, an enduring challenge… more

The Next Social Contract

Articles — Thu, 17 May 2007 12:54:00 -0400

The initial round of presidential primary debates leaves no doubt that the presidential horserace has already broken from the gates. While some may lament the early departure -- given that votes will not be cast for another 8 months -- the absence of incumbents vying for each party’s nomination has created a wide open race, one where the stakes are remarkably high.

Although most of the press coverage to date has focused on the daily stream of polls, jibes, and behind-the-scenes intrigue, the coming election represents our first real chance to remake the social contract for the 21st century. Our nation’s… more

Create a College Access Contract

Articles — Sat, 07 Apr 2007 01:01:00 -0400

America’s financial-aid system provides too much taxpayer support to banks that make college loans, asks too little of students who assume them, and burdens families with too much debt. We need to rethink the system in order to improve college access and affordability. Federal higher-education policy largely fails to reward rigorous college-preparatory work in high school. It penalizes students who hold jobs while in college. Lenders make extraordinary profits, while young people leave college burdened with debt and, more often than not, without the degree or skills necessary to repay it.

A new more

Going for Broke

Articles — Tue, 06 Mar 2007 04:55:00 -0500

In the aftermath of Hurricane Katrina, which struck the Gulf Coast with such ferocity in late August 2005, Americans were shocked by the broadcast images of desperately poor people left to fend for themselves. The depth and consequences of poverty in America, normally hidden from public view, had once again become the subject of debate and national soul-searching. And yet, a year and a half later, the subject of poverty has fallen so far off the public’s radar screen that President Bush did not give it a mention in his recent State of the Union Address. How can our prosperous… more

Read My Lips: Raise Taxes

Articles — Wed, 31 Jan 2007 06:56:00 -0500

The greatest challenge in politics is to understand when a political era is closing and the door to a new one is ready to be opened. Thirty years ago, a small band of conservatives understood that what they called the era of “tax and spend” -- in which government grew inexorably on a tide of invisible tax increases through Republican and Democratic administrations -- was ready to be challenged.

In 1977, Rep. Jack Kemp and Sen. Bill Roth introduced a bill to cut tax rates by a third and index them to inflation. They were radicals even within their party; this… more

The $800 Billion Tax Loophole

Articles — Fri, 19 Jan 2007 01:44:00 -0500

Democrats are in a bind when it comes to their domestic economic agenda. They have promised a number of new and costly initiatives such as fixing the Alternative Minimum Tax, providing middle-class tax relief, and increasing spending on homeland security and education. But they have also made a commitment to fiscal responsibility. So how can they deliver on their promises without opening themselves up to the old "tax and spend" label? Reforming tax entitlements -- a large, mostly under-the-radar part of the federal budget -- might just give them a way out of their predicament.

As a result of the 1986… more

The Smallholder Society

Articles — Wed, 17 Jan 2007 04:59:00 -0500

In recent years, the idea of promoting widespread property ownership in the United States by means of public policy has enjoyed a renaissance across the political spectrum. George W. Bush and other American conservatives have borrowed the term "ownership society" from Margaret Thatcher's Britain and employed it to justify a range of proposals from the partial privatization of Social Security to individual health savings accounts. On the left, thinkers like Michael Sherraden and Bruce Ackerman, reviving a tradition that goes back to Thomas Paine, have proposed granting every citizen a substantial capital endowment. More modest versions of this proposal… more