What Les Misérables Can Teach Us About Paul Ryan's Poverty Plan

Mar 7, 2014Nell Abernathy

Conservatives who say getting a job is the answer to poverty fail to acknowledge the realities of low-income work.

Conservatives who say getting a job is the answer to poverty fail to acknowledge the realities of low-income work.

Les Misérables returned to Broadway last week, just in time for Victor Hugo’s tale of poverty and redemption to provide some context for thinking about the poverty report Rep. Paul Ryan released Monday. With a history of more than 6,000 Broadway performances and a Hollywood spin-off starring Anne Hathaway, the lavish musical has probably engendered more popular sympathy for the down-and-out than any progressive politician sticking to her talking points ever could.

When the resident villain, Inspector Javert, castigates characters who can’t find jobs, can’t feed children, can’t escape a past mistake, with his motto, “honest work, just rewards,” the American viewing public – conservative and progressive alike – laugh bitterly at his naïveté. “They are trying,” we want to shout at the stage.

But what if you live in a society where honest work doesn’t always lead to just rewards? This question, at the center of upheaval for both the characters and the society Les Mis portrays, is also worth asking in 21st century America.

The central flaw of Ryan’s report is his assumption that a job will lift incomes for poor Americans. Progressives agree that work should provide a path out of poverty, but given the dysfunction of our current labor markets, we know that Ryan's assertions hit the same false notes as Javert’s.

It is impossible to talk about poverty in the U.S. without addressing the fact that today work does not guarantee economic security.

Of the 26 million working-age adults living in poverty in 2012, more than 10 million were working full- or part-time. (This is according to the Official Poverty Measure used by Ryan, though most anti-poverty advocates, including me, prefer the Supplemental Poverty Measure.) Two-thirds of children in poverty live in a household with at least one working adult. But with the minimum wage stagnating at nearly 25 percent below its historical value, and part-time work at historic highs, a job in America no longer means independence. More than half of fast-food workers rely on one of the public assistance programs mentioned in Ryan’s report, according to an analysis from the UC Berkeley Labor Center. Nearly a quarter of the total workforce relies on public programs.

There are 16 million poor adults who aren’t working. Ryan suggests they are stuck in a “poverty trap” of federal programs that create disincentives for work. Incentives aren’t the whole story (there are plenty of Jean Valjeans out there facing structural disconnection from the labor market), but I will concede that incentives are a part of the problem. Indeed, research shows that single mothers must often choose between a bad job with no benefits or a meager government check that at least allows them to care for their children.

The conservative solution has been to cut government support in order to force workers into poverty-level work. This was the philosophy behind the 1996 welfare reform law, which Ryan’s report trumpets as one of the great successes in the war on poverty. Welfare reform did raise incomes for some of the American poor, but as my colleagues Andrea Flynn and Ellen Chesler write in a forthcoming paper, “increases in employment and wages moved many women off welfare, but also failed to enable them to achieve long-term economic independence” because the work they took on did not allow them to complete their education or provide health care benefits.

Progressive solutions to poverty include a range of policies designed to make work a true pathway out of poverty. Raising the minimum wage to $10.10 would lift 900,000 people out of poverty, according to the conservative CBO report, or nearly 6 million, according to Arindrajit Dube’s review of 12 different minimum wage studies. Paid family leave can help single moms stay in the workforce and earn higher wages. Recent reviews of California’s 10-year-old paid leave policy show that women who have paid leave work 16 percent more weekly hours and make 5 percent more in hourly wages than women who don’t. A government-funded work program could reintegrate the 3.8 million adults who have been out of work and looking for more than 27 weeks, and has been supported by conservative economists who understand that sometimes the down-and-out need a hand finding “honest work.” None of these policies were mentioned by Congressman Ryan, nor did he even acknowledge the state of work in America.

I believe Mr. Ryan is sincere in his attempt to propose solutions to poverty. Javert himself is ultimately a sympathetic character, eager to do his duty. The problem with Javert, and some conservative leaders, is that they cannot tolerate a world of nuance and moral ambiguity where truisms like “honest work, just rewards” are insufficient answers to societal challenges.

With so many Americans living in poverty, including 22 percent of our children (the highest child poverty rate among rich countries), we should have an honest debate about which policy responses are effective and which are not. The reality of low-income work must be part of that debate.

Nell Abernathy is the Program Manager for the Roosevelt Institute's Bernard L. Schwartz Rediscovering Government Initiative.

 

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Daily Digest - March 6: Washington State Points the Way on Wages

Mar 6, 2014Rachel Goldfarb

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Highest Minimum-Wage State Washington Beats U.S. Job Growth (Bloomberg)

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Highest Minimum-Wage State Washington Beats U.S. Job Growth (Bloomberg)

Victoria Stilwell, Peter Robison, and William Selway report that Washington hasn't just shown higher job growth – it also has lower poverty rates, and the supposedly vulnerable service industry is growing.

Minimum Wage Raise Would Reduce Food Stamp Spending By $46 Billion Over Decade: Report (HuffPo)

A new report from the Center for American Progress analyzes how higher wages would reduce need, writes Dave Jamieson. Raising the minimum wage would decrease the "culture of dependency" that Republicans decry.

The U.S. Economy's Big Baby Problem (The Atlantic)

The American birthrate has hit a new record low. That wouldn't be a big deal, writes Derek Thompson, if our economy didn't rely so heavily on families' consumer spending.

Over 2 Million People Now Without Unemployment Benefits (MSNBC)

The number of long-term unemployed workers in the U.S. keeps growing, and Ned Resnikoff says it's looking less and less likely that Congress will reauthorize their extended unemployment insurance.

When Regulation Threatens, Bankers Predict Doom For Main Street (ProPublica)

Jesse Eisinger explains how banks are trying to chip away at financial reform by negotiating behind the scenes on little-known issues. Going after collateralized loan obligation rules doesn't get much public scrutiny.

Does America Need a Robin Hood Tax? (Pacific Standard)

Kyle Chayka says a financial transactions tax could raise enough money to fight many social problems. Focusing such a tax on high-frequency trading would also curtail the banks' worst excesses.

It’s Still Paul Ryan’s Party (WaPo)

Greg Sargent calls out Ryan's hypocrisy in claiming the president's budget contains no attempt at compromise. Ryan's budget seeks even less common ground, with absolutely no funds for Democratic priorities.

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Daily Digest - March 5: Are the GOP's Plans Anti-Poverty or Anti-Poor?

Mar 5, 2014Rachel Goldfarb

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The New GOP Poverty Efforts Are Impractical, Incoherent, and Inhumane (TNR)

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The New GOP Poverty Efforts Are Impractical, Incoherent, and Inhumane (TNR)

Roosevelt Institute Fellow Mike Konczal explains the problems with the Republican focus on cutting costs and eliminating government programs. The president’s anti-poverty plan, while flawed, makes more sense.

The Partisan Divide Over the Earned Income Tax Credit (MSNBC)

Timothy Noah writes that the GOP now classifies any kind of government aid as “dependence,” even the EITC. That means the working poor can no longer count on any bipartisan support.

Obama's Budget: Help for Workers, Taxes for the Rich (CNNMoney)

Jeanne Sahadi says the president's budget proposal centers on tax reforms that help low- and middle-income workers. She lays out the minor changes this would mean for the wealthiest Americans.

Budget Day and Why That Matters–A Lot! (On The Economy)

It's true that many of the top-line budget numbers were set by the Murray/Ryan plan that ended the shutdown, but Jared Bernstein says the president's budget is about political aspirations.

The Real Poverty Trap (NYT)

Paul Krugman counters an assumption from Paul Ryan's poverty report, explaining that work effort doesn't guarantee social mobility. But reducing inequality increases mobility, so social safety net programs remain key.

Exclusive: Report Finds Taking A Paid Day Off When Sick Is A Privilege Of The Wealthy (ThinkProgress)

Bryce Covert looks at a new report from the Institute for Women's Policy Research, which shows the vast gap in access to paid sick leave between low-income workers and wealthier workers.

New on Next New Deal

Prevention Over Punishment: The Push to Reduce Gun Violence in Chicago

Focusing on strengthening neighborhoods and healing communities is a far more effective solution than sentencing minimums, write Roosevelt Institute | Pipeline Chicago City Network members Janaè Bonsu and Johnaè Strong

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Daily Digest - March 4: Want a Reason to Raise Wages? Here Are Seven.

Mar 4, 2014Rachel Goldfarb

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7 Bi-Partisan Reasons to Raise the Minimum Wage (Boston Review)

Roosevelt Institute Fellow Mike Konczal explains the most compelling reasons to increase the minimum wage, from poverty alleviation to civic republicanism. He says the political fight will center on fairness.

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7 Bi-Partisan Reasons to Raise the Minimum Wage (Boston Review)

Roosevelt Institute Fellow Mike Konczal explains the most compelling reasons to increase the minimum wage, from poverty alleviation to civic republicanism. He says the political fight will center on fairness.

A Public Option for Banking (AJAM)

Mike Konczal says that postal banking could function as a public option on the model of the Treasury Department's Direct Express program, which provides debit cards to Social Security recipients.

You Call This a Middle Class? “I’m trying not to lose my house” (Salon)

Conservatives spin poverty as a personal failing caused by lack of education or skills, writes Edward McClelland, but for many Americans, even education and experience aren't enough to make ends meet.

The Business Case for Paying Service Workers More (Atlantic Cities)

Richard Florida speaks to Zeynep Ton about her research, which links higher pay for employees to higher profits in the service industry. She says service-sector workers perform better when paid better.

We Do Not Have to Live with the Scourge of Inequality (FT)

Jonathan Ostry writes that according to his recent research, redistribution creates more equality and stimulates economic growth. That means it shouldn't be considered a dirty word in policy.

New on Next New Deal

The Simple Solution to Obamacare's Employer Mandate Problems

Roosevelt Institute Senior Fellow Richard Kirsch suggests employers should be offered a choice between providing health insurance for all employees or paying an additional payroll tax to cover the costs.

The Congressional Budget Office Should Serve the People, Not Politics

Roosevelt Institute Senior Fellow Jeff Madrick writes that when the CBO provides single numbers instead of ranges, it gives politicians what they want. But it shouldn't treat lawmakers as clients.

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Daily Digest - February 28: The Deficit's Going Down. Will the Economy Go With It?

Feb 28, 2014Rachel Goldfarb

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Federal Budget Deficit Falls to Smallest Level Since 2008 (NYT)

Annie Lowrey reports on the sharp decrease of the deficit, which she ties to growth in tax revenue thanks to the improving economy as well as the surprising slowdown in health care costs.

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Federal Budget Deficit Falls to Smallest Level Since 2008 (NYT)

Annie Lowrey reports on the sharp decrease of the deficit, which she ties to growth in tax revenue thanks to the improving economy as well as the surprising slowdown in health care costs.

Budget Deficits Shrinking at the Expense of Economic Recovery (Blog of the Century)

Andrew Fieldhouse writes that policies focused on growth could have achieved the same reduction of the deficit with a far healthier economy, but instead, we have austerity policies.

The Mobility Myth (New Yorker)

American economic mobility has never been particularly high, says James Surowiecki, so public policy should focus on raising the standard of living of ordinary workers instead.

Governors Move to Block Farm Bill’s Food Stamp Cuts (MSNBC)

By raising heat subsidies linked to food stamp eligibility, the governors of Connecticut and New York have ensured hundreds of thousands of households will get a reprieve from cuts, writes Ned Resnikoff.

Not a Single Home Is for Sale in San Francisco That an Average Teacher Can Afford (Bloomberg Businessweek)

Karen Weise reports that a tight real estate market and dwindling pay for teachers are causing the problem, and it isn't good for the school system when teachers can't afford a place to live.

Why Ivy League Schools Are So Bad at Economic Diversity (The Atlantic)

Robin J. Hayes says that elite universities have a singular view of what a high-achieving applicant looks like on paper – and that view overvalues the opportunities provided by wealth.

Are Unions Necessary? (LA Times)

It's unions, writes Michael Hiltzik, that have secured most of the major workplace protections that help all workers, unionized or not. Who else will push for new improvements to labor law?

New on Next New Deal

Beyond Black History Month: A Roosevelt Institute Reading and Viewing Guide

As Black History Month comes to a close, the Roosevelt Institute suggests books, films, and more to continue the discussion and reflection on race in the U.S.

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Snowed Under: When Keeping Schools Open Puts Low-Income Students Further Behind

Feb 18, 2014Sarah Pfeifer Vandekerckhove

New York City's public schools may provide hot lunches, but keeping them open in a snowstorm does no good if students aren't able to attend.

New York City's public schools may provide hot lunches, but keeping them open in a snowstorm does no good if students aren't able to attend.

On January 22, New York City saw its third major snowstorm in just three weeks. Despite nearly a foot of snow in the city and treacherous travel conditions, NYC Department of Education Chancellor Carmen Fariña and Mayor Bill de Blasio announced schools would remain open. Even so, just 47 percent of New York City’s 1 million public school children made it to school that day.

Last week, as another snowstorm made its way toward the New York City metro area, Fariña and de Blasio repeated that decision, simultaneously proclaiming travel hazardous and schools open. This time attendance was even lower at less than 45 percent.

Fariña has defended her decision to keep schools open in these bleak conditions by arguing that it is critical for the many poor students who depend on school for hot meals. But her argument is misguided, as it fails to acknowledge that those very students are the ones who have the greatest difficulty getting to school in inclement weather. Most are more likely to live and/or attend school in the outer boroughs of New York City. The Bronx and Brooklyn, home to the highest percentage of NYC K-6 public school students receiving free or reduced-price lunch, suffer from greater lack of access to public transportation and slower snow clean-up, which makes getting to school all the more difficult.

Source: New York State Well Being Indicators for 2010-2011 school year.

Aside from the physical danger it creates, keeping schools open when students can’t get there only serves to put these students further behind academically. As the Education Week blog pointed out after the January 22 snowstorm, keeping schools open despite low probability of attendance can mean disadvantaging the students who stayed home or inconveniencing the teachers and students who were present.

The low-income students in whose interest Fariña claims to work – those who theoretically benefit from school being open for the hot meals – already face enough of an achievement gap at school, performing worse academically than their middle- and upper-class counterparts. They don’t need one more reason to fall behind. Students from low-income families also suffer from Summer Slide, a phenomenon in which students experience summertime learning loss due to lack of educationally enriching resources and opportunities.  

Last Thursday’s public school attendance numbers not only showed results worse than the January 22 attendance numbers, but also demonstrated that the attendance rates disproportionately affect the outer boroughs. The Bronx and Brooklyn had 37 percent and 44 percent attendance rates, respectively, both below the total New York City average. (Staten Island had the lowest attendance rate at 26 percent).

Source: New York Department of Education

At a Bronx school only 15 percent of the students showed up, many leaving before lunch, according to one teacher. And Bedford-Stuyvesant Preparatory High School in Brooklyn recorded just 6 percent attendance while 37 Manhattan schools recorded attendance of over 80 percent.

For Fariña, as the leader of the nation’s largest school system, to close schools due to inclement weather is inevitably a tough choice with many complicating factors – as de Blasio pointed out, it has happened just 11 times in the last 36 years. But when less than half of the city’s students are able to attend school, and boroughs with the highest numbers of students receiving free or reduced-price lunch record some of the lowest attendance rates, it’s clear that simply keeping schools open for students who need the hot meals doesn’t add up.  

Sarah Pfeifer Vandekerckhove is the Roosevelt Institute's Director of Programmatic Operations.

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Finding Affordable Housing Solutions in Boston

Feb 18, 2014Gavin O Brien

Innovative solutions are needed to solve the serious problem of housing affordability in the Boston area.

Innovative solutions are needed to solve the serious problem of housing affordability in the Boston area.

The housing affordability crisis is reaching dramatic levels in Massachusetts. Case in point: according to The Boston Foundation’s Greater Boston Housing Report Card, “during the last eight years, the cost of living in Greater Boston has increased twice as fast as the median household income of homeowners and three times faster than the median household income of renters.” Affordability is a problem for 40 percent of homeowners in the area. For many families, owning a home is not even an option. The U.S. Census ranks Massachusetts 44th in homeownership and also 44th in income equality. These two rankings are not coincidental.

Homeownership increases social mobility and acts as a buffer against falling into poverty. For example, as an inheritance, a home can improve the economic outlook for future generations. Homes also have strong symbolic value as a key component of the American Dream. For these reasons, increasing access to homeownership is an important tool in the fight against inequality in America. Federal policies like the home mortgage interest deduction provide large financial incentives for homeownership. Other incentives and assistance may be needed.

Comprehensive efforts to maintain and increase the availability of affordable housing must involve all levels of government, in addition to nonprofits like local community development corporations. The private housing market will continue to drive up prices, so there is a need for creative solutions that avoid or reduce normal market pressures.

For example, cohousing or cooperative arrangements can allow for cost sharing and rent moderation. In a limited equity cooperative, members buy shares of a corporation that owns the housing. The corporation makes decisions democratically, can pay for building improvements, and removes the profit motive from property ownership. The value of a share is limited. There is, however, need for more bank financing of housing cooperatives, which could be addressed through state regulations or the use of community development financial institutions (CDFIs) – locally-based financial institutions targeting underserved populations.

Another possible solution is affordable housing trust funds operated at the city level, which are financed through property taxes, government funds, or fees levied on building developers. The trust funds can subsidize construction of new housing and provide direct subsidies to homeowners. The city of Somerville near Boston operates such a fund that loans money for down payments to first-time homebuyers and renters.

Affordable housing solutions must also involve local colleges and universities. Greater Boston has a large student population. Graduate students in particular are increasing in number, which drives up the cost of housing for student and non-student residents alike. City government could work with colleges to construct additional low-cost student housing to alleviate some of this upward price pressure.

High housing prices affect the ability of young professionals and families to remain in the Boston area. This in turn reduces the city’s economic and social potential.  Pipeline Greater Boston is organizing a series of discussions to examine possible solutions to housing issues that affect these groups. There is a need for civically engaged young people in Boston to implement new policy ideas and address the housing crisis that is affecting them, their neighborhoods, and the city as a whole.

Gavin O'Brien is a recent graduate of Brandeis University's Master of Public Policy program and a core member of the Greater Boston City Network of Roosevelt Institute | Pipeline.

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Daily Digest - February 10: When the Personal Becomes Political

Feb 10, 2014Rachel Goldfarb

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Turning Personal Tragedy Into Activism (Melissa Harris-Perry)

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Turning Personal Tragedy Into Activism (Melissa Harris-Perry)

Roosevelt Institute Fellow Dorian Warren discusses how tragedies like the deaths of Trayvon Martin and Jordan Davis have pushed so many to take part in activism. He uses the public pressure to cancel George Zimmerman's celebrity boxing match as a prime example.

Sex Workers' Rights are Just Workers Rights (WaPo)

Roosevelt Institute Fellow Mike Konczal considers the policy arguments on sex work presented in Melissa Gira Grant's new book, Playing the Whore. He sees the need to conceptualize sex work as labor as the most important takeaway, regardless of individual opinions on that labor.

Liberals Should Question Obama’s ‘Opportunity Agenda’ (AJAM)

Mike Konczal argues that shifting the discussion from inequality to opportunity could leave out key items on the progressive agenda. If opportunity isn't defined beyond legal equality of opportunity, or if acceptable policy outcomes aren't made clear, the progressive agenda won't advance.

The Case for a Higher Minimum Wage (NYT)

The New York Times editorial board calls for an increased minimum wage, emphasizing its purpose in reducing power imbalances between workers and employers. The accompanying interactive graphic from Jeremy Ashkenas and Bill Marsh shows the insufficiency of $7.25 per hour.

January Jobs Report: Hard to Read (MoJo)

Erika Eichelberger says that the jobs report released on Friday is hard to interpret. Unemployment is at its lowest point in five years, and the labor force participation rate increased slightly, but that could change without an extension of unemployment benefits from Congress.

The Spectacular Myth of Obama's Part-Time America—in 5 Graphs (The Atlantic)

Derek Thompson pulls data on part-time job growth, part-time workers as a share of the labor force, and part-time work for non-economic reasons to demonstrate just how wrong certain slices of the financial media are when they insist that the president is creating a part-time economy.

Obamacare: It's a Net Gain for the Economy (LA Times)

Jonathan Gruber writes that the Congressional Budget Office report shows that the Affordable Care Act in fact creates a more efficient job market in the U.S., by allowing people leave jobs when they want to and increasing job mobility.

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Daily Digest - February 4: A Vision for the Opportunity Community

Feb 4, 2014Rachel Goldfarb

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Students Rethink How to Build Community (The Nation)

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Students Rethink How to Build Community (The Nation)

Roosevelt Institute | Campus Network Senior Fellow for Equal Justice Erik Lampmann explains how the Campus Network's new Rethinking Communities initiative, which is evaluating institutions like universities on their local impact, could build a more equitable economy for the future.

  • Roosevelt Take: Roosevelt Institute Associate Director of Networked Initiatives Alan Smith writes about the theory behind Rethinking Communities' focus on local economies.

Would the U.S. Postal Service Make a Better Banker for the Poor? (Bloomberg Businessweek)

Joshua Brustein takes up the question of postal banking as a method for the unbanked poor to avoid exploitative payday lenders and their ilk. He sees a future in which banks become worse at retail banking, which makes postal banking a solid possible alternative.

Banks Don’t Do Much Banking Anymore—and That’s a Serious Problem (Pacific Standard)

David Dayen writes about how "shadow banks," which include hedge funds, private equity firms, and the like, have taken a primary role in the lending industry as banks do less and less traditional banking. That's a big concern, because shadow banks are far less regulated and expand risk in the entire financial system.

State Could Be First In The Nation To Make Sure Workers Can Take A Vacation (ThinkProgress)

Bryce Covert reports that Washington lawmakers have proposed a bill that would mandate paid vacation for workers who put in at least 20 hours a week at employers with 25 or more employees. There's nothing like this anywhere else in the U.S.

Placed on Unpaid Leave, a Pregnant Employee Finds Hope in a New Law (NYT)

Rachel L. Swarns reports on one of the first cases invoking New York City's new Pregnant Workers Fairness Act. The law is meant to protect workers like Floralba Fernandez Espinal, who was placed on unpaid leave from her retail job when she brought a note from her obstetrician requesting accommodations.

New on Next New Deal

Obama and the GOP Present Two Very Different Paths to Opportunity for All

Roosevelt Institute Senior Fellow Richard Kirsch contrasts the messages presented by the president in the State of the Union with Rep. Cathy McMorris Rodgers’s official GOP response. Both focus on opportunity, but only one emphasizes the need for collective action.

Internet for the Public Interest Needs Protection

Roosevelt Institute | Campus Network member Areeba Kamal calls on the Federal Communications Commission to redefine Internet Service Providers as common carriers in the wake of a court decision that struck down net neutrality regulations.

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Daily Digest - January 31: Out of Economic Chaos Come Executive Orders

Jan 31, 2014Rachel Goldfarb

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The President and Inequality (All In with Chris Hayes)

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The President and Inequality (All In with Chris Hayes)

Roosevelt Institute Senior Fellow and Chief Economist Joseph Stiglitz discusses the place of inequality in this week's State of the Union address, and the deeper question of why we don't implement the economic policies that would absolutely make a difference.

A History of Executive Orders (All In with Chris Hayes)

Roosevelt Institute Fellow Dorian Warren talks about the similarities between President Obama's plans for executive orders, as announced in the State of the Union, and President Franklin D. Roosevelt's use of the executive order, which also pushed for progressive labor policy.

Obama’s Toughest Job (NYRB)

Roosevelt Institute Senior Fellow and Director of the Bernard L. Schwartz Rediscovering Government Initiative Jeff Madrick comments on the State of the Union, complimenting the president for making jobs a central focus despite the challenges of that issue.

The Post Office Should Just Become a Bank (TNR)

David Dayen argues that there's one policy the president could push through that would contribute to many of the goals he articulated in the State of the Union: postal banking, which would create jobs, help the poor, and could be accomplished through executive order.

Why Alt-Labor Groups Are Making Employers Mighty Nervous (TAP)

Lane Windham says that for all that anti-union groups want to tout low union membership numbers, labor isn't going anywhere. Alternative labor groups are growing and gaining power, as the growing discussion about raising the minimum wage makes clear.

GOTD: Inequality Is Not A Four Letter Word (Blog of the Century)

Benjamin Landy contrasts Tuesday's State of the Union with the president's December 4 speech at the Center for American Progress. His shift from "inequality" to "opportunity" is clearly a political one, since he still endorsed progressive policies, but why the centrist rhetoric?

New on Next New Deal

The Rise of 'Insourcing' Gives Internet Companies a New Way to Exploit Workers

Roosevelt Institute | Campus Network National Operations Strategist Lydia Bowers cautions that while Internet-based service companies like Uber and Taskrabbit may make life easy for their customers, they don't give their workers any real protections.

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