Mike Konczal

Roosevelt Institute Fellow

Recent Posts by Mike Konczal

  • New Paper: Against the Coupon State

    Dec 3, 2012Mike Konczal

    Imagine if current neoliberal policymakers had to sit down today and invent the idea of a library. What would it look like? They'd likely create a tax credit to subsidize the purchasing and reselling of books, like much of our submerged welfare state. They might require a mandate for people to rent books from approved private libraries run by Amazon or Barnes and Noble, with penalties for those who don’t and vouchers for those who can’t afford it, like the recent health care expansion. 

    Or maybe they’d create means-tested libraries only accessible to the poor, with a requirement that the patrons document how impoverished they are month after month to keep their library card. Maybe they’d also exempt the cost of private library cards from payroll taxes. Or let any private firm calling itself a library pay nothing in taxes while exempting their bonds from taxation and insuring their losses by, say, paying for books that go missing. You can imagine them going through every possible option rather than the old-fashioned, straightforward, public library, open to all, provided and run by the government, that our country enjoys everyday.
     
    I have a new white paper out with New America's "Renewing the American Social Contract" series, titled "No Discount: Comparing the Public Option to the Coupon Welfare State." Here's the introduction, and here's the full pdf.
     
    Given that the state wants to provide a certain good, I wanted to find the arguments over whether or not the government should provide that good itself or provide coupons for purchases in the private market. Surprisingly, there were few cohensive summaries, so I created one myself. Though not explicitly stated, It's relevant for discussions over whether or not the welfare state should be entirely replaced with cash (the ultimate coupon).
    The rest of the papers in the series are very much worth your time too. I hope you check them out. Mine starts out with:
     
    The fundamental ideological conflict surrounding the Welfare State in the U.S. is no longer over the scope of government, but instead how the government carries out its responsibilities and delivers services. The conservative and neoliberal vision is one of a government that provides a comparable range of benefits as conventional liberals, but rather than designing and delivering the services directly, it provides coupons for citizens. Coupons – whether by that name or more anodyne terms such as “vouchers” or “premium support” or tax subsidies – could then be used to purchase the services in the private market. Whenever neoliberals have sought to expand the scope of the welfare state or conservatives have tried to fundamentally shrink it, both have come bearing coupons.
     
    Read the rest at New America.
     
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    Imagine if current neoliberal policymakers had to sit down today and invent the idea of a library. What would it look like? They'd likely create a tax credit to subsidize the purchasing and reselling of books, like much of our submerged welfare state. They might require a mandate for people to rent books from approved private libraries run by Amazon or Barnes and Noble, with penalties for those who don’t and vouchers for those who can’t afford it, like the recent health care expansion. 

    Or maybe they’d create means-tested libraries only accessible to the poor, with a requirement that the patrons document how impoverished they are month after month to keep their library card. Maybe they’d also exempt the cost of private library cards from payroll taxes. Or let any private firm calling itself a library pay nothing in taxes while exempting their bonds from taxation and insuring their losses by, say, paying for books that go missing. You can imagine them going through every possible option rather than the old-fashioned, straightforward, public library, open to all, provided and run by the government, that our country enjoys everyday.
     
    I have a new white paper out with New America's "Renewing the American Social Contract" series, titled "No Discount: Comparing the Public Option to the Coupon Welfare State." Here's the introduction, and here's the full pdf.
     
    Given that the state wants to provide a certain good, I wanted to find the arguments over whether or not the government should provide that good itself or provide coupons for purchases in the private market. Surprisingly, there were few cohensive summaries, so I created one myself. Though not explicitly stated, It's relevant for discussions over whether or not the welfare state should be entirely replaced with cash (the ultimate coupon).
    The rest of the papers in the series are very much worth your time too. I hope you check them out. Mine starts out with:
     
    The fundamental ideological conflict surrounding the Welfare State in the U.S. is no longer over the scope of government, but instead how the government carries out its responsibilities and delivers services. The conservative and neoliberal vision is one of a government that provides a comparable range of benefits as conventional liberals, but rather than designing and delivering the services directly, it provides coupons for citizens. Coupons – whether by that name or more anodyne terms such as “vouchers” or “premium support” or tax subsidies – could then be used to purchase the services in the private market. Whenever neoliberals have sought to expand the scope of the welfare state or conservatives have tried to fundamentally shrink it, both have come bearing coupons.
     
    Read the rest at New America.
     
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  • Following Walmart and Black Friday

    Nov 21, 2012Mike Konczal

    My colleague Dorian Warren describes what is going on with Walmart in the video above and here.

    Here's a list of events and ways to particpate by standing with Walmart on Black Friday. I encourage you to check it out.

    Josh Eidelson has been a must read on this topic. Read him at his new Nation blog here, and follow him on twitter here.

    Also, I enjoyed reading Sarah Jaffe reporting at the Guardian, and Seth Ackerman talking about Walmart via Hostess here.

    My colleague Dorian Warren describes what is going on with Walmart in the video above and here.

    Here's a list of events and ways to particpate by standing with Walmart on Black Friday. I encourage you to check it out.

    Josh Eidelson has been a must read on this topic. Read him at his new Nation blog here, and follow him on twitter here.

    Also, I enjoyed reading Sarah Jaffe reporting at the Guardian, and Seth Ackerman talking about Walmart via Hostess here.

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  • Are We at the End of the Welfare State?

    Nov 21, 2012Mike Konczal

    I have a piece at the American Prospect, The Great Society's Next Frontier, about potential futures for the welfare state. It attempts to answer the question over whether or not the passage of Obamacare means that the welfare state is now complete.

    I have a piece at the American Prospect, The Great Society's Next Frontier, about potential futures for the welfare state. It attempts to answer the question over whether or not the passage of Obamacare means that the welfare state is now complete. If we take the project of American liberalism to be Keynesian economics, plus the mixed economy, plus social insurance, plus political liberalism, can we check the social insurance part as complete? I decided to ask several scholars of the welfare state what they see as potential steps in the decades ahead, and lay out their answers.

    The "completed welfare state" usually means a few different things. One is that the major committments of social insurance are now determined, and it is just a matter how broadly or narrowly to construe those committments. That's many people's answer for the issue. Dylan Matthews gave a similar answer on bloggingheads recently, noting that things like universal pre-K will fall out of our obligations to provide universal K-12 schooling. Many of the changes experts in the piece proposed were extensions of already functioning programs, like the EITC or unemployment insurance or expanding K-12 schooling to a younger age.

    Another is that the level of expenditure and revenue is set for the near future, so if social insurance is expanded it'll require a more fundamental change in what we are willing to pay for our government. And indeed many of the debates going forward will be about spending less than projected on health care through controlling costs, or changing how we fund things, such as taking the tax expenditures for 401(k)s and making them more progressive. There are many things that don't require changing the level of expenditure and revenue, such as raising the minimum wage (which compliments the EITC quite well). This is one reason we may see more of a focus on "predistribution" policy in the years ahead.

    I wanted to add this point from Envisioning Real Utopias about a basic income, but also pertains to both the minimum wage and things like Demos' call for raising retail wages. In addition to reducing coercion as workers aren't separated from the means of subsistence, eliminating poverty without creating the major pathologies of means-tested anti-poverty transfers, recognizing the value of decommodified care-giving activities and subsidizing the social and cooperative market economies, a basic income also does the following:

    Second, universal basic income is likely to generate greater egalitarianism within labor markets. If workers are more able to refuse employment, wages for unpleasant work are likely to increase relative to wages for highly enjoyable work. The wage structure in labor markets, therefore, will begin to reflect more systematically the relative disutility of different kinds of labor rather than simply the relative scarcity of different kinds of labor power. This, in turn, will generate an incentive structure for employers to seek technical and organizational innovations that eliminate unpleasant work. Technical change would therefore have not just a labor-saving bias, but a labor-humanizing bias.
    This connection between cheap labor and technology change is a constant theme of Peter Frase, who mentioned the Prospect piece in a recent post.
     
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  • Children, Parents and Mass Incarceration

    Nov 21, 2012Mike Konczal

    After a round of discussion on family structure, Reihan Salam tweeted out "@reihan Important point about family stability and public policy: mass incarceration is a huge part of the problem." I've just read a book, Invisible Men: Mass Incarceration and the Myth of Black Progress, by the sociologist Becky Pettit, whi

    After a round of discussion on family structure, Reihan Salam tweeted out "@reihan Important point about family stability and public policy: mass incarceration is a huge part of the problem." I've just read a book, Invisible Men: Mass Incarceration and the Myth of Black Progress, by the sociologist Becky Pettit, which addresses this. Let's get a few charts out.

    Here's a chart of children with a parent behind bars:

    That's a fivefold increase since 1980. But that's with a parent behind bars at any one moment. What about the percentage of children who will have had a parent behind bars at some point in their childhood?

    24% of black children will have had a parent behind bars by age 17, an eightfold increase since 1980.

    The interesting thesis of Invisible Men is that the government, through the means it uses to record, analyze and ultimately see the population it governs, systematically misses incarcerated people. This biases various policy debates, as researchers build their arguments off these records. This is particularly important for some serious ongoing debates, like gaps between blacks and whites in earnings or labor-force participation, or the high-school dropout rate. This missing population also means that a variety of research agendas, from political participation to family structure, are also lacking an analytical mechanism for understanding how the large increase in incarcerated populations are impacting the topics.

    There aren't definitive answers for how incarceration changes family structure, though there is evidence that incarcerated fathers are less like to be cohabitating or marrying a year after their child's birth. And incarceration increases the liklihood of divorce. But we don't have full answers, in part because the incarcerated fall off the government's radar for data collection. Hopefully Pettit's book will draw attention to this gap in our knowledge, and help future researchers understand the subtle yet devestating consequences of the War on Drugs and other means of mass incaraceration for our country.
     
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  • What Are Conservatives Getting Wrong About the Economy? (Douthat Reply Edition)

    Nov 19, 2012Mike Konczal

    Ross Douthat argues in his recent New York Times editorial, The Liberal Gloat, that the coalition that elected President Obama was "created by social disintegration and unified by economic fear." Douthat argues that "single life is generally more insecure and chaotic than married life, and single life with children." The implicit argument is that marriage is an important part of handling the economic fears of the business cycle, and if there were more married couples there'd be

    Ross Douthat argues in his recent New York Times editorial, The Liberal Gloat, that the coalition that elected President Obama was "created by social disintegration and unified by economic fear." Douthat argues that "single life is generally more insecure and chaotic than married life, and single life with children." The implicit argument is that marriage is an important part of handling the economic fears of the business cycle, and if there were more married couples there'd be less call for economic policy. Krugman notes that "insecurity is on the rise for everyone, driven by changes in the economy" and that "[y]our church and your traditional marriage won’t guarantee the value of your 401(k)."

    For fun, how well has the income of couples with children held up in the Great Recession when compared to single households with children? Let's look at the Federal Reserve's recent Survey of Consumer Finance. This comes out every three years, with the last version covering 2010. Here's net income for single households with a child versus couple households ("families in which the family head was either married or living with a partner") with a child:

    In the Great Recession, single households with a child lost 2.3 percent of their income, while couple households with a child lost 9.4 percent of their income. Now obviously having $67K is better than having $29K. And the 2.3 percent loss of income for people with less could sting a lot harder than the 9.4 percent loss for those with more.

    But what is important to emphasize is that having a couple raising kids, whatever its other virtues, is not a good form of insurance against the business cycle. The Great Recession has hit married households with larger drops in income. This is probably driven by having two people working in the household, which, as Senator (!) Elizabeth Warren emphasized years ago, doubles the chance that someone might lose their job. So even if the number of children being raised in single households dropped suddenly, that's no replacement for an aggressively liberal, Keynesian welfare-state approach to driving the macroeconomy to full employment.

    This isn't just conservatives, as education-obsessed centrists and liberals have a blind-spot here as well. I recently wrote a piece for The American Prospect about young people graduating into the recession. The focus was how the average college graduate is likely to have a permanent loss to their income, compared to the more temporary income loss for those who attend elite colleges or don't go to college at all. I mentioned it in passing at the end, but this technically means that the college premium, especially at the margins, drops in a recession. Therefore getting more education is a poor form of insurance from the business cycle compared to, once again, Keynesian welfare-state full employment.

    Paradigm Down

    I have no interest in seeing a resurgent conservative movement in this country. One reason I was worried about Romney winning the 2012 election and passing the Ryan Plan in January 2013 and Lochnerizing the Supreme Court is because an animal is most dangerous when it is dying and knows it. But it might be helpful for those on the right to get an outsider's perspective.

    Douthat argues that conservatives focused too much on those getting "gifts" and other free-loader metaphors. But the most sustained conservative economic arguments of the Great Recession have been reviving the liquidationist, Mellonite approach to the business cycle. I think that's one important reason Romney and conservatives were unable to put real pressure to President Obama's vulnerability on the economy. They believe the recession is purging the weakness in the economy, doing healthy work, and to the extent the recovery is sluggish it is the fault of activist government and policy attempting to address unemployment.

    The House GOP, in particular, has pushed the Mellon-wing, calling for austerity to promote growth, while also pulling back on monetary policy to stimulate the economy. Understanding the "47 percent" and "free stuff" comments benefit from the context of conservative arguments that government policy is the primary reason that unemployment remains high, as all the free stuff allows the unemployed to stay on vacation. If conservatives want to build a new economic paradigm that works for working people, they should probably have some idea on getting unemployment down sometime in the next decade.

    Another important conservative focus is running everything the government does through private hands. The conservative movement is not about small government, it is about privatized government. From Bush and Ryan's attempts to privatize Social Security, to turning Medicare into a Groupon, to bringing private industry into the military, every step involves introducing market agents into government processes and pushing market risk to individuals. This continued under Mitt Romney's big policy ideas. He had an idea for taking our system of unemployment insurance and turning it into a system of private unemployment savings accounts. He wanted to fix higher education costs by expanding the for-profit industry, which would "hold down the cost of education," even though they are far more expensive than their non-profit equivalents.

    The conservative idea that citizens don't have enough undiversifiable exposure to the risks of the new economy - long-term unemployment, low wages, risks of a large drop in income, globalization, automation etc. - is not one that is going to work going forward. The economic voters Douthat wants to win over see the cronyism of funneling money through private agents, and they think of the market with far more dread and anxiety than entrepreneurial glee. Though they may be ambivalent about more liberal solutions, they certainly don't like the perpetual conservative project of making all of government's functions look more and more like their empty 401(k)s. That might be another place to start for conservatives who want to rebuild their economic ideas.

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