The Fork in the Road Already Facing Obama's Second-Term Agenda

Feb 25, 2013Bo Cutter

President Obama has a limited amount of time to accomplish his second-term goals, so there's no time like the present to go big.

Admittedly it is absurdly early to be suggesting that President Obama's second term is at a crucial fork in the road. But I think that's where we are and here's why.

President Obama has a limited amount of time to accomplish his second-term goals, so there's no time like the present to go big.

Admittedly it is absurdly early to be suggesting that President Obama's second term is at a crucial fork in the road. But I think that's where we are and here's why.

Second presidential terms are two years, not four years. Second terms have rarely been resounding successes. Sometimes the reason is too specific to be generalized. More often, the reasons have included scar tissue, fatigue, and a dwindling bench. The American people get sick of the same faces, the old players are exhausted and have spent whatever intellectual capital they came with, and the new players aren't as good as the old players. But, always, the underlying direction is declining political capital. Senior American politicians, regardless of party, are as a class or caste the most self-referential, self-reverential, and self-regarding group our species has known in its roughly 100,000 years on the planet. They have an uncanny capacity to sniff out the exact nano-second that power begins to ebb, no matter how slightly, and then act to accelerate that ebbing. 

So President Obama has two years, not four, to get anything big accomplished, and that means he has to say what it is -- now.

There are three obvious mega strategies. Whether the president's political advisors know it or not, the choice between these three is the big decision they are making right now.

1. Beat up the Republican party with the hope of fracturing it completely or simply clobbering it in the 2014 Congressional elections. This seems to be the preferred direction right now.

2. Accomplish a series of individual policy wins -- pick among immigration reform, preschool education, a small infrastructure plan, or even a carbon tax.

3. Change the political/policy game in America and give the country a new story.

That first goal is an emotionally satisfying choice and no group deserves clobbering more than this era's Republicans right wing. But it may not be possible and it may not help achieve real policy goals as much as one might think. The Democratic left is nowhere near as unpleasant as the Republican right, but it is just as mired in a 60-year-old, outdated ideology. And this strategy doesn't constitute much of a legacy for President Obama.

The second goal is highly worthwhile and may be all anyone can accomplish in today's dysfunctional Washington. If President Obama achieved significant legislation in each of the four areas I named above, he would have achieved more than any of the last three, maybe four, second-term presidents going back at least 50 years.

The third goal -- a new vision or story of America -- sounds so over-reaching as to be preposterous. But I believe we are at a moment when this is possible: a time of immense global change, an improving economy with better prospects than any other developed economy in the world, a gridlocked political environment locked into interminable debate over the wrong issues, a high level of American citizen dissatisfaction with our politics, and a popular second term president with room to maneuver. We are unlikely to see this confluence of circumstances again for another 50 years. 

Two points about these mega strategies: They are in part mutually exclusive and path dependent. And only a president can outline them and carry them out. Certainly strategy 1, on the one side, and strategies 2 or 3 are mutually exclusive. In terms of how politics and human beings work, the president cannot decide to beat the Republicans up for a time and then change gears and directions. But strategies 2 and 3 are not mutually exclusive. President Obama could present a new American story and then move to a set of specific policies. In fact, this might be the best course for accomplishing anything. 

I believe that right now, the president could do two big things that, if successful, would make his second term successful, have high odds of being successful, and would have low costs if they aren't successful. First, he could offer a real deal to stop sequestration and, second, he could define the next era.

Lets start with sequestration. This is a manufactured crisis -- a set of automatic budget cuts that will make our defense, international, and domestic programs worse (in fact, the set was designed to make everything worse) but on the other hand will do next to nothing about our long-run debt and deficit problem. It was a last-ditch, desperate effort 18 months ago to look as though something was being accomplished. Its big flaw -- other than being completely irresponsible -- was that if it were going to force a real resolution, it always depended on the president defining a deal. Congress is not capable of doing that. All Congress can ever really do is the short-term, kick it down the road for three months efforts being thrown out today. These are worthless.

Now is the moment for the president to put forward a real deal, with real entitlement reform. This means reductions in the long-term rate of growth in entitlement spending, some further defense cuts (I don't think we should cut normal regular domestic spending, but it should certainly be rearranged), income tax reform where possible (but not much is possible), and a new source of revenues -- a new tax. We cannot solve our debt/deficit problem and pay for the government we all know we are going to have without new revenues. I've always been a proponent of a highly defined, progressive value added tax (a VAT), and still am. But I think that a carbon tax would be the better choice right now. Why not raise $1 trillion over the next decade and simultaneously begin to solve our most pressing environmental problems?

But the president should define such a deal not as the be-all-and-end-all of his administration, but rather as a necessary step toward an era of safer, higher, more sustainable, more equitable growth. He could explain how achieving this growth is possible and why it requires both fiscal reform and investments in the future. He could demonstrate easily how the specific policies he stressed in his State of the Union fit into this long-run direction. He could show a deeper understanding of the real private sector. And he could emphasize that we have time to adjust to change if we start now. As an example, a real and credible 10-year debt/deficit plan is what we need, not an economy-breaking one or two year slash and burn plan.

I believe that a deal is there, waiting to be made. The adults in the Republican party know they are in a trap. Americans would support a deal (all the polls show that the American people are far less polarized on these issues than Washington is). Most Democrats would rather be talking about solutions and growth than waging these interminable budget wars. The president could get 1) a deal, 2) an agreement to stop the incessant budget warfare (by permanently canceling the sequestration and ending the constant debt ceiling threats), 3) the chance to create the coalitions necessary to accomplish his policies without constantly fighting the budget battles, and (4) an actual shot at defining the contours of America's next era. 

But the president has to decide and act. What strategy is he pursuing? What does the country need? What are second terms for? 

Roosevelt Institute Senior Fellow Bo Cutter is formerly a managing partner of Warburg Pincus, a major global private equity firm. Recently, he served as the leader of President Obama’s Office of Management and Budget (OMB) transition team. He has also served in senior roles in the White Houses of two Democratic Presidents.

 

Obama image via mistydawnphoto / Shutterstock.com.

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Millennials Helped Elect Obama and Now They’ll Push for Progress

Nov 28, 2012Jean-Ann Kubler

The Millennial vote is here to stay -- and it demands progressive action.

In the days leading up to the 2012 presidential election, journalists from across the political spectrum dedicated large portions of airtime and print space to answering one critical question: would Millennials turn out to vote? The resounding hypothesis seemed to be yes, but in significantly lower numbers than they did in 2008. And we’ve heard their logic before: young people are apathetic, jaded, lazy, and spoiled. 

The Millennial vote is here to stay -- and it demands progressive action.

In the days leading up to the 2012 presidential election, journalists from across the political spectrum dedicated large portions of airtime and print space to answering one critical question: would Millennials turn out to vote? The resounding hypothesis seemed to be yes, but in significantly lower numbers than they did in 2008. And we’ve heard their logic before: young people are apathetic, jaded, lazy, and spoiled. 

Interestingly, the polling numbers seemed to back up their conclusions. In mid-October, with less than a month to go until the election, the Harvard Institute of Politics released a study that seemed damning to any campaign relying on the youth vote. The study indicated that between 2008 and 2012, the percentage of “definite young voters” decreased dramatically from 63 percent to 48 percent and the percentage of young people describing themselves as “politically engaged” had dropped from 43 percent to 25 percent.

But on Election Day, Millennials proved the numbers wrong. A staggering 23 million members of the largest, most diverse, and most progressive generation in American history made their voices heard. Some stood in line for hours, some sent in absentee ballots, and some went the extra mile and worked for a campaign or registered their peers to vote. But no matter how they did it, a solid 50 percent of eligible Millennial voters cast ballots in this election—a number that mirrors the 2008 turnout nearly exactly.

Millennial America proved that it’s a political force that will not be discounted, that will not be silenced, and that will not let this country make decisions without its input. We defied expectations and made it to the polls because, despite our current political climate of hyper-partisanship and gridlock, Millennials still believe government can be a force for social good. And we’ll keep working toward making that more of a reality now that the election has passed.

As the post-election stats keep rolling in, it’s becoming ever more apparent that voters between 18 and 29 were critical to President Obama’s re-election. According to data published by the Center for Information and Research on Civic Learning and Engagement (CIRCLE) at Tufts University, Millennial voter turnout in swing states averaged 58 percent. If Millennials had not voted, the critical states of Ohio, Florida, Pennsylvania, and Virginia would have swung Republican rather than Democratic.

Millennials helped decide this election and will continue to exert their influence. We may be young and idealistic, but we are not blind to the shortcomings of our political system. The polling may have been skewed because we don’t always engage with politics through the same means the generations before us did, but we are dedicated to ensuring that the political institutions we inherit represent our interests, our values, and our principles.

We voted because we haven’t given up and we know that government can improve lives. Campus Progress reports that 64 percent of Millennial voters support the DREAM Act, a bill providing pathways to legal status for undocumented students. Eighty-four percent support accessible, affordable contraception for women. Sixty-two percent favor the legalization of gay marriage. Eighty percent still believe in the American Dream.

And every day, we’re using social media to share information and opinions, and to jumpstart political movements to push forward on these values and beliefs. We’re blogging about the issues that affect us. We’re entering the corporate world and pressuring it to be more socially responsible as we do. We’re pushing for progress, and now, through a Roosevelt Institute | Campus Network project, Government By and For Millennial America, Millennials across the country are developing both pragmatic and visionary policy ideas that speak to the issues that influenced our votes.

Despite our optimism, we are also acutely aware of our government’s inadequacies. Millennials overwhelmingly support increased government involvement in improving public education and making college more affordable, and we believe that our current economic system unfairly favors the wealthy.

Millennials want a government that provides for its people equitably. We want a government that rewards hard work with fair labor practices and reasonable hours. We want a government that encourages its youth to enroll in colleges that it ensures are accessible, affordable pathways to future success. We want a government that fosters its people’s prosperity and isn’t afraid to make unpopular choices to do so.

We voted because we are engaged, we want change, and we’re not afraid to work for it. The Millennial vote is here to stay. As we become a more critical voting block, our lawmakers must become more hospitable to progressive ideas. Our generation is not interested in maintaining the status quo. We don’t want to wait and see if the ineffectual legislation of the past pans out in the future. To continue to earn the support of Millennial voters, our politicians must overcome partisanship and gridlock and move forward on critical issues like the environment, education, and social justice. Millennial voters will continue to vote, and we’re voting for progress.

Jean-Ann Kubler is a former Roosevelt Institute | Campus Network Summer Fellow and a senior government major at Skidmore College.

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Obama's Second Term Could Mark the Return of the Four Freedoms

Nov 21, 2012David Woolner

As part of our series "A Rooseveltian Second Term Agenda," a call to return to a foreign policy based in FDR's vision of shared peace and prosperity.

As part of our series "A Rooseveltian Second Term Agenda," a call to return to a foreign policy based in FDR's vision of shared peace and prosperity.

Even though we come from different places, we share common dreams: to choose our leaders; to live together in peace; to get an education and make a good living; to love our families and our communities. That’s why freedom is not an abstract idea; freedom is the very thing that makes human progress possible — not just at the ballot box, but in our daily lives.

One of our greatest Presidents in the United States, Franklin Delano Roosevelt, understood this truth. He defined America’s cause as more than the right to cast a ballot. He understood democracy was not just voting. He called upon the world to embrace four fundamental freedoms: freedom of speech, freedom of worship, freedom from want, and freedom from fear. These four freedoms reinforce one another, and you cannot fully realize one without realizing them all.—Barack H. Obama, University of Yangon, November 19, 2012

In his historic visit to Burma, also referred to as Myanmar, President Obama spoke at length about the journey Burma is taking from dictatorship to democracy, a transition he said has the potential to inspire people the world over as “a test of whether a country can transition to a better place.”

President Obama made it clear that his journey to Burma—the first by an American president—was inspired in part by his own desire to encourage the people and government of Burma to press ahead with their democratic reforms so that the “flickers of progress” that the world has seen will not be extinguished. The president’s visit was also notable for his repeated insistence that America was a “Pacific nation,” whose “future was bound to those nations and peoples to our West.” But perhaps the most significant aspect of his speech was his decision to frame his remarks around a concept first articulated by Franklin D. Roosevelt at one of the darkest moments of the Second World War—the need to build a world founded on four fundamental human freedoms.

At a moment when Adolf Hitler had proclaimed the onset of “a new order” in Nazi-occupied Europe, and when Japanese militarists had seized much of China and were poised to expand their grip on Southeast Asia, Franklin Roosevelt proposed “a greater conception,” a “moral order” that represented the very antithesis of the “tyranny which the dictators seek to create with the crash of a bomb.” FDR’s order was based on the idea that all people—“everywhere in the world”—deserved the right to enjoy freedom of speech and expression; freedom of worship; freedom from want; and freedom from fear.

He articulated this vision in part because of the critical need to gain the support of the American people and Congress for the passage of the Lend-Lease Bill that was pending on Capitol Hill. But the enunciation of the Four Freedoms and initiation of Lend-Lease—which would make it possible for the United States to provide arms and munitions to Great Britain free of charge—was also inspired by a much deeper conviction: that the security of the United States was tied directly to the health and well-being of other nations.

For many Americans today, World War II and the Great Depression are two separate events. But for the generation that lived through these unparalleled crises, nothing could be farther from the truth. In their minds, and in the mind of Franklin Roosevelt, the two were inextricably linked. The Great Depression, after all, was not confined to the United States, but represented a worldwide economic crisis that helped inspire anti-democratic forces in both Europe and Asia—anti-democratic forces that helped give rise to the fascist movements in Germany and in Japan that would initiate the most destructive war in human history.

In light of this, Franklin Roosevelt remained convinced that the Second World War had economic causes. Moreover, as the war progressed, he became more and more convinced that America’s security was tied to the security of the rest of the world. As such, it was not enough for the United States to rely solely on the strength of its armed forces to provide for the nation’s safety; we also had to concern ourselves with the political, social, and economic health of other regions of the world since, as FDR put it in 1944, “true individual freedom cannot exist without economic security and independence”…and “people who are hungry and out of a job are the stuff of which dictatorships are made.”

It was this basic idea that inspired not only the Four Freedoms, but also the many institutions and practices that were put in place during and after the war to foster international cooperation and a more prosperous, healthy, and peaceful world. Many of these institutions and practices—like the United Nations, International Monetary Fund, World Bank. and multilateral trading regime—are with us still, so that much of the world we live in today is the world shaped by the vision of Franklin Roosevelt.

In recent years, however, we seem to have moved further and further away from this vision to a foreign policy that is dominated largely by the use of military force—no doubt inspired in part by the advent of modern technology, such as drone aircraft. This is unfortunate, for even though President Obama has shown willingness to use other means to pursue America’s interests abroad, his foreign policy to date has remained highly militarized.

His eloquent speech in Burma may indicate that he has decided to pursue a more progressive foreign policy agenda in his second term, one based on the recognition that the best means to keep America safe in the long term is to ensure that the hopes and aspirations of people the world over to enjoy freedom of speech and expression, freedom of worship, freedom from want, and freedom from fear stand not, as Roosevelt said, as some “vision of a distant millennium,” but as “a definite basis for a kind of world attainable in our own time and generation.”

David Woolner is a Senior Fellow and Hyde Park Resident Historian for the Roosevelt Institute. He is currently writing a book entitled Cordell Hull, Anthony Eden and the Search for Anglo-American Cooperation, 1933-1938.

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Building the Infrastructure for a Lasting Progressive Coalition

Nov 21, 2012Monika Johnson

In order to sustain the progressive coalition that re-elected President Obama, we can create spaces for civic engagement among young Americans at the local level.

In order to sustain the progressive coalition that re-elected President Obama, we can create spaces for civic engagement among young Americans at the local level.

Young voters surprised pundits and Republicans again this year as we turned out in record numbers to vote, joining key constituencies including African Americans, Hispanics, and women to reelect President Obama. Composing 19 percent of the electorate, up from 18 percent in 2008 and 12 percent in 2004, young Americans demonstrated their importance to a growing progressive coalition.

Many question, however, whether our diverse and unprecedented coalition will be able to build on this foundation and sustain the power of our ideas and values throughout our lifetimes. Or, like the Reagan coalition after 1990, are we fated to fracture as a political force by 2016? Some suggest that the strong generational power of today’s 18-30-year-olds will become inconsequential as the hype dies down and we grow up. Our next steps are critical.

Young progressives are a distinct and large population that favors pragmatic problem-solving, opportunity for all, justice and equality, and government’s promotion of such ideals. Identifying more strongly with values than with a political party, we are a significant portion of President Obama’s alliance. Yet given the diversity of the Obama coalition, someone must lead productive grassroots dialogue, finding a broader progressive voice. As members of the largest and most diverse generation in American history, young progressives are the best candidates for the job.

Rather than waiting 30 or 40 years to see how this pans out, let’s write the story ourselves today. Young people are powerful influencers of elections, and we’ve built a strong foundation on which to stand. But it’s up to us to define citizenship for our generation and maintain a unified commitment to progressive values to solidify the political shift.

One lacking aspect of Reagan’s group of committed, conservative supporters was a shared vision of active citizenship and a space within which to exercise it. When the candidate went away, they left. With our core values gaining increased momentum, civic engagement is more important today than ever.

The renaissance of bold millennial progressivism will not be realized in the federal offices of Washington, but on America’s sidewalks and street corners. Generations before us used Kiwanis and Rotary clubs, consciousness raising groups, and bowling leagues to facilitate civic infrastructure; today, we must take a critical look at how we support people and ideas to build a better America for all. Our model is still being formed, but we need to build an infrastructure that will make the progressive coalition last beyond the campaign cycle.

With this in mind, Roosevelt Institute | Pipeline is capitalizing on a unique moment in history to engage young people in activating progressive ideas across the nation. Obama for America led a national dialogue throughout the election on what values shape our nation, but constructive exchangement must continue in the context of community action. In order to do this, we need to create spaces to facilitate the exchange of ideas on the local level, engaging all demographics of the progressive coalition. By leading conversations on local issues in 15 cities, we are supporting and empowering individuals to be active citizens and translate the national dialogue to the community level.

The Pipeline chapter in New Orleans, LA is holding discussions among young progressives about public policy issues in its city. The members pick a new topic every few weeks, build a diverse group of people working in different fields, and engage in dialogue about potential solutions for problems facing their neighborhoods. The result is better informed, more engaged people, a community of progressives, and a platform for influence.

In San Francisco, CA, the Pipeline chapter convened tech start-up leaders to create a space to refine ideas for social entrepreneurship. By creating a local space to support young people enacting innovative ideas, members are building an infrastructure for progressives outside of politics. Moreover, they are engaging individuals from both the public and private sectors.

Creating progressive infrastructure will ultimately yield decisions that change our economy and society. For example, I was struck recently when a relative turned down a lucrative deal because the organization was enacting anti-gay policies in conducting business. In making this decision, he took a stand for what he believed in and created a ripple effect that will influence that business’s chances of success.

Hands-on opportunities to connect constituencies and build a progressive community are also sprouting up across the nation. Organizations such as the Future Project are creating innovative ways to connect young people with students and inspire brighter futures. At Groundswell, organizers are helping community members leverage their collective buying power to bolster the local clean energy sector. Like Pipeline, both of these organizations are leveraging the power of the diverse progressive coalition.

To borrow from Roosevelt Institute President Felicia Wong, who spoke to a group of us young progressives last weekend in Hyde Park, NY, “Great ideas and great people rise up together.” Before we begin the next campaign cycle, let’s think critically about how civic engagement translates progressive values into change. When dozens, hundreds, thousands of local actions take place and we create a shared space to support them, we catalyze progress. If the conversation on what ideas and values shape our nation stagnates, we risk losing the foundation progressives have built over the last five years.

Monika Johnson is the co-Chapter Head for the Roosevelt Institute | Pipeline in Washington, DC and a member of the Pipeline Advisory Committee.

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A Solution for Money in Politics Highlighted by the Election

Nov 20, 2012Mark Schmitt

As part of our series "A Rooseveltian Second Term Agenda," an acknowledgment that the election didn't just showcase the problems of outside money in campaigns, but a potential way forward.

As part of our series "A Rooseveltian Second Term Agenda," an acknowledgment that the election didn't just showcase the problems of outside money in campaigns, but a potential way forward.

It's been tempting to treat the 2012 election as proof that money in politics doesn't matter as much as commonly believed, or that Citizens United and the emergence of Super PACs and political non-profits didn't change things as much as predicted. “Effect of 'super PACs' proved to be less than expected,” the Los Angeles Times declared in a post-election headline.

It is true that the presidential candidacy most dependent on Super PACs and other “dark money” support was soundly defeated, and the same was true of the Senate candidates backed by Karl Rove's American Crossroads and related groups. Prophecies that corporate money would flood in and swamp the candidates, particularly Democrats, didn't come true. (Some of us were always skeptical of this prediction.) And it turned out the Super PACs had some particular disadvantages because they couldn't purchase media time at the favorable rates that are available to campaigns. The Republican dark money committees' focus on broadcast advertising to the exclusion of other campaign activities turned out to be misplaced in an election where the “ground game” of identifying voters and getting them to the polls is what mattered. (It's also likely that the Republican Super PAC operators focused on radio and television because there are financial incentives for consultants to buy media and collect a commission of 10 or 15 percent. Voter mobilization efforts don't have the same payoff.)

But a general election presidential campaign, and even a high-profile Senate campaign, is not where we would expect to see the decisive power of money in election outcomes. Presidential candidates, especially incumbents, are well known and have ample opportunity to get their message out without paying for it. For example, half the number of people who voted watched at least one of the presidential debates. Money is more significant in determining who has an opportunity to run for office and whether that candidate has sufficient resources to be heard.

This year's elections for the House showed just how much money still matters. More than nine out of ten incumbents were reelected, despite a backlash against the Republican House reflected in the aggregate vote (48 percent to 47 percent). While some of this incumbent advantage was a result of redistricting that entrenched Republican seats, a great deal of incumbent advantage involves money that incumbents can raise from lobbyists and few challengers can. According to the Campaign Finance Institute, incumbents who won with more than 60 percent of the vote, which accounts for more than two-thirds of races, outspent their challengers by a factor of nine. Notably, most of the seats captured by Democrats in this cycle involved very high-profile Tea Party Republicans like Allen West of Florida or Joe Walsh of Illinois and opponents who were either well known in progressive circles, such as Walsh's successful opponent Tammy Duckworth, or former members of Congress with established fundraising bases. In many of those high-profile races, such as West's, outside groups played a large role. Data from the Campaign Finance Institute indicates that successful challengers spent $2 million, suggesting that that is the new price of entry for a viable campaign, although this will vary greatly by region.

But even these results show some hope. Many of the successful Democratic candidates, like President Obama, were able to build strong bases of small donors. While Obama's small donors accounted for 44 percent of his total, Duckworth, for example, raised 37 percent from small donors. The small donor era, which began in 2008, has continued in both parties. This suggests that the best path to making elections competitive and offsetting the influence of big money, outside money, and dark money is to enhance the value of small contributions. This can be done through a matching program such as New York City's successful model, the proposed Fair Elections Now Act (supported by a majority of Democrats in 2010), or Rep. John Sarbanes' Grassroots Democracy Act.

Since Citizens United, many reformers have worried that such initiatives would be rendered ineffective by the flood of big money, which would overwhelm the small donors, or that candidates would resist participating in these matching programs, fearing big outside money attacks. That would argue for pursuing a remedy for Citizens United, in the Constitution or the Court, before moving on to matching fund public financing. But the election results, in which neither Obama nor successful candidates for House and Senate were overwhelmed by outside money, indicates that these systems are likely to be more resilient than we think. Giving every candidate the opportunity and encouragement to build a participatory base of small donors isn't the only thing we need to do to offset the influence of money in politics, but it is a good start. House minority leader Nancy Pelosi identified campaign finance reform as a major priority for her caucus in the next Congress. The first step is to reach consensus on what is to be done, and the election points in a clear and positive direction toward solutions that encourage participation and grassroots campaigns.

Mark Schmitt is a Senior Fellow at the Roosevelt Institute.

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The Missing Living Wage Agenda

Nov 20, 2012Annette BernhardtDorian Warren

As part of our series "A Rooseveltian Second Term Agenda," a long-term plan to provide justice on the job for all workers.

As part of our series "A Rooseveltian Second Term Agenda," a long-term plan to provide justice on the job for all workers.

Now that the election is over, our hope is that we can finally move beyond the vacuous invocations of an imaginary middle class where everyone is in the same boat. It’s time to get real about the concrete policies needed to take on the multiple inequalities that run deep through the U.S. labor market. And we’re not talking about the “skills mismatch,” another red herring routinely flung into this debate by both sides (including by President Obama as recently as the last week of the campaign).

What we’re talking about is a broad, multi-year agenda to give America’s workers a living wage and voice on the job and to take on the continuing exclusion of workers of color, immigrants, and women from good jobs. The media may have discovered inequality last year with the surprise emergence of Occupy Wall Street, but in truth, there is a 30-year backlog of policies to fix the extreme maldistribution of wages and opportunity in the labor market.

First, we have to make our core workplace standards much stronger – whether it’s in terms of wages, health and safety, or voice on the job. That means raising the minimum wage so that it’s a meaningful floor again (some good news: voters in Albuquerque, San Jose, and Long Beach raised theirs last week). It means updating health and safety regulations written in the 1970s. And it means restoring the right to organize, because at this point, virulent employer opposition and retaliation has rendered U.S. labor law obsolete. Fifty-eight percent of U.S. workers say they would like to be represented by a union, but only 11.8 percent actually are. This is what happens when one out of four workers is fired illegally for attempting to organize a union while employers face minimal penalties.

Second, we have to take on the profound reorganization of the American workplace. The poster child for precarious work is temp jobs – but subcontracting has had a much broader impact, as janitors, laundry workers, warehouse workers, security guards, food service workers, and millions of others have been outsourced to low-wage firms. A good model for a solution is California’s recent law making companies liable for minimum wage and overtime violations by their subcontractors, recognizing that end-user firms such as Walmart exert considerable control over working conditions down their supply chains.   

Third, we have to double down on enforcement. A 2008 study of Chicago, Los Angeles, and New York found that 26 percent of low-wage workers were paid less than the minimum wage and 76 percent were underpaid or not paid at all for their overtime hours. Yet the number of federal wage and hour inspectors is still below 1980 levels, and it would take 131 years for OSHA investigators to inspect each workplace just once. Until employers face substantial costs to their bottom line (as is true in other bodies of law, such as environmental regulation and employment discrimination law), practices like wage theft, retaliation against workers trying to organize a union, and independent contractor misclassification will continue unabated.

Fourth, we have to do a better job of leveraging the government’s capital. Public money touches millions of private-sector jobs, whether by purchasing goods and services for the government or by funding everything from schools and bridges to health care and social services. There are plenty of innovative models to ensure that this money results in good jobs, whether it’s responsible contracting policies (in California, Massachusetts, Connecticut, and Illinois), living wage laws (in more than 140 cities and counties), or accountable economic development policies (in Los Angeles, Pittsburgh, and New York City, among others).

Fifth, we have to explicitly break down systemic labor market exclusions of people of color, immigrants, women, the unemployed, and people with criminal records. For example, advocates are pushing the U.S. Department of Labor to finally end the exemption of home care workers from minimum wage and overtime protection, and cities across the country are passing “ban the box” policies to reduce hiring barriers for people with arrest or conviction records.  

But we also have to challenge de facto exclusions. A good example is targeted hiring and training programs on publicly funded projects, which in our mind will be crucial to solving the escalating (and chronically under-reported) economic crisis in communities of color. A great example is Portland’s 2009 residential retrofitting program, which mandated living wages and local hiring from designated training programs. As of last year, the program’s workers earned median wages of $18 per hour; fully 84 percent were local residents, nearly half of them people of color. While unemployment is still at Depression-era levels in many black communities, we know what works to employ those still excluded from access to the labor market.

A final word on why we think these policies (and many others; see the long-form version here) are politically viable. In communities across the country, there is an undeniable thirst for justice on the job and investment in local communities. This is true not just for raising the minimum wage, which consistently polls in the 70-80 percent range, but also policies such as paid sick days, increased funding for elder care and child care, cracking down on wage theft, using taxpayer money to create living wage jobs, and restoring the right to organize.

(If you doubt support for organizing, consider the recent wave of strikes by Walmart workers, or New York’s taxi workers organizing for better pay even though they are independent contractors, or Palermo’s pizza workers in Wisconsin staying out on strike for three months and now pressuring Costco to boycott their employer.)

The real question is whether President Obama and Democrats in Congress understand that raising taxes on the top 2 percent is only the first step on a long road toward building a sustainable living wage economy in the U.S. Our hope lies in the growing recognition among progressives that it will take the pressure and power of social movements to convince him to walk that road with us.

Annette Bernhardt and Dorian Warren are Fellows at the Roosevelt Institute.

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An Agenda for Revitalizing Our Democracy

Nov 19, 2012Richard Kirsch

As part of our series "A Rooseveltian Second Term Agenda," important steps that can get us back to a truly representative form of government.

As part of our series "A Rooseveltian Second Term Agenda," important steps that can get us back to a truly representative form of government.

This election was ample reminder of the myriad ways we urgently need to fix our democracy. As Justice Brandeis wrote a century ago, "We can either have democracy in this country or we can have great wealth concentrated in the hands of a few, but we can't have both." The greatest barrier to achieving the next Rooseveltian agenda proposed in these posts is the deep flaws in our democracy. To move forward on our aspirations, we need to integrate a democracy agenda into all of our battles for a fair economy and sustainable environment. Here is a short list of crucial reforms to revitalize our democracy:

1. Bolster voting rights. President Obama can make good on his impromptu remark that "we should fix that" when he addressed Election Day voting problems in his victory speech by pushing for passage of the Voter Empowerment Act, sponsored by New York Senator Kirstin Gillibrand and Georgia Representative John Lewis. The act's two major provisions would automate voter registration whenever people interact with the government and allow for same day voter registration nationally. Other provisions address barriers to voting such as using mail to purge voters, partisan voter administration, and felony disenfranchisement. Nationwide early voting should be added to this agenda.

2. Change the Electoral College. After another election in which the presidential candidates ignored the electorate in 40 states -- with fewer people in those states bothering to vote -- federal and state representatives from the outcast states should be eager for change. While it would be wonderful if that led two-thirds of Congress to amend the Constitution, an easier and more feasible path is offered by National Popular Vote. NPV is a compact between states representing more than half of the Electoral College to cast their votes for the winner of the national popular vote. The movement is halfway to its goal with legislation passed in 12 states that together hold 132 Electoral College votes, including California, Illinois, and New Jersey. Republican Governor Jan Brewer added her support after this year's election. Imagine an election in which presidential candidates had to focus on issues and voter turnout in every state! The result would impact not just the presidency, but down-ballot races across the country.

3. Increase public financing. While Super PACs may not have gotten all their money's worth, the public agenda remains captive to the upper-income contributors and corporations who finance the lion's share of elections. We won't get a bumper crop of candidates who represent the interests of ordinary people until we have a campaign finance system that allows candidates to compete successfully by rejecting large contributions in return for small contributions matched by public funds. Getting there is impossible in this Congress, but that shouldn't stop reformers from constantly raising the flag while looking for opportunities to move forward in states. New York has a real shot of passing a good public financing bill in 2013. And when President Obama has the opportunity to appoint new Supreme Court justices, reformers should make both Citizen's United and the 1976 Buckley v. Vallejo decision that equates money with speech major issues in the confirmation hearings.

4. Fix the filibuster. It's bad enough having a fundamentally undemocratic body like the U.S. Senate as a co-equal legislative body, but that institution's rules also thwart the constitutional provision that Senate decisions on legislation are to be made by majority vote. Democrats should not settle for making senators actually filibuster; they should put in place the proposal by Iowa Senator Tom Harkin, which would reduce the votes needed to stop a filibuster from 60 to 51 over the course of debate.

5. Institute non-partisan redistricting. Partisan redistricting increasingly makes the congressional body designed by the Constitution to provide equal representation fall far short of that goal. While Democrats narrowly won the popular vote for members of the House this year, partisan drawing of congressional lines will result in Republicans having at least 30 more representatives. The path to change here is arduous: state by state. But a Supreme Court committed to the Constitution's vision of the lower body as a people's house could take a fresh look at permissible gerrymandering.

Cast by themselves, democracy reforms too often cause the public's eyes to glaze over, not seeing the connection between process and the pressing issues in their daily lives. Champions of creating a vital democracy can turn that around by connecting people's topmost concerns -- good jobs, a secure retirement, affordable quality education, and, increasingly, climate disruption -- to creating a government that works for all of us, not just the wealthy and CEO campaign contributors. 

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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Three Principles for Restoring Progressive Taxation

Nov 19, 2012Mark Schmitt

As part of our series "A Rooseveltian Second Term Agenda," advice on revamping the tax code to raise the revenue we need.

As part of our series "A Rooseveltian Second Term Agenda," advice on revamping the tax code to raise the revenue we need.

Our current tax system is a toxic legacy of the George W. Bush years. It loomed over Obama's first four years, bearing deficits that limited the scope of economic stimulus, drove inequality to astonishing levels, and led directly to the debt limit showdown of the summer of 2011 that forced us into even more dangerous policies. President Obama's second term offers a long overdue opportunity to restore the promise of progressive taxation and revenues that are adequate to our long-term economic priorities. It requires both short-term and long-term action.

The greatest failure of the tax system is not that it’s too complicated or inefficient or that there are too many “special-interest loopholes,” as House Speaker John Boehner put it on the day after the election. It's that it doesn't raise enough money and it encourages all sorts of manipulation because of the differential rates for investment income and income from work. These are not things that developed over time, as if by some natural process – they are the product of specific decisions made in 2001 and 2003 by Republican-controlled Congresses that used the budget reconciliation process to avoid any bipartisan compromise.

Here are some principles that the administration should hold to in restoring adequate and progressive taxation:

1. Start from the law, not current tax policy. Under the law, the Bush tax cuts expire on January 2, 2013 and revert to their levels at the prosperous end of the 1990s. This expiration along with several temporary tax cuts that expire at the same time and the budget sequester devised to escape the House GOP blackmail on the debt ceiling in 2011 is what's known as “the fiscal cliff.” There will be an effort to negotiate a deal on taxes and spending before we hit the cliff out of fear that expiration of all the cuts at once would tip the country back into recession. But the effect won't be felt at once, and there's plenty of time to negotiate a new round of cuts once the law as written goes into effect. There is no reason to negotiate based on rates that are set to expire within weeks or days.

Under the law, capital gains rates will rise to 20 percent from 15 percent, dividends will be taxed at the same rate as regular income, and two provisions that limit personal deductions and exemptions for the wealthy will come back into effect. All tax rates will rise, but the tax code will instantly be fairer, by every definition, than it was in December. From that baseline – which is not some accident; it's what the law calls for – we can have a debate about which rates should be permanently lowered. There's a strong argument, for example, for bringing the bottom rate back down to 10 percent, given that these are the households that were hit hardest during the recession and saw few gains even during the prosperous years before 2008.

2. Don't try to define “the rich” with arbitrary thresholds. In its first four years, the Obama administration's tax policy was hamstrung by its commitment to the $250,000 line – that no household with taxable income lower than a quarter of a million dollars should face any kind of tax increase and any increase should apply only to the income above $250,000. Later, the line became a million dollars as the administration tried to craft what it called “The Buffett Rule” to remedy Warren Buffett's recognition of the absurdity that he paid a lower tax rate than his secretary. These new thresholds would be grafted onto the tax code on top of the existing rate brackets. For example, households with incomes below the quarter-million line would keep the preferential rates for capital gains and dividends, while it would go up for those above it. These thresholds would add a new level of complexity to the tax code, sharply reduce the revenues that could be gained, and reinforce the impression that taxes are a sort of punishment for the rich. It's a lot simpler, more efficient, and infinitely fairer to say that a single person who makes, say, $80,000 from capital gains alone should pay the same rate, no more and no less, than a comparable household that earns $80,000 from work. Right now, the first household would pay less. With the same rates for all income, rates can be held down and we can maintain the low-end cuts, such as the 10 percent rate for middle-class households, and gain enough revenue for the future. Artificial new thresholds, which would apply to some forms of income and not others, will make this much more difficult.

3. Consider one new source of revenue – and make it a “Pigovian” one.  Even an ideal income tax system, one in which income from any source is taxed in the same way and distorting deductions are kept to a minimum, is unlikely to raise sufficient revenues to support the level of investment the country needs in the long run. Adding one additional source of revenue will not only help to close the revenue gap, but it can serve vital purposes as well. (Such taxes, which have a dual purpose of raising revenue and reducing some undesirable activity, such as smoking, are known as “Pigovian,” after the Cambridge economist Arthur Pigou.) The two leading candidates would be a tax on carbon and a very small tax on financial transactions. The former would have some of the same effect as a cap-and-trade system to reduce emissions that cause climate change, with less complexity, and could also fund clean energy research and job creation. The latter would generate revenue from the still thriving financial industry, while putting a little bit of friction into transactions and reducing the payoff – and the risk – created by strategies that rely on massive, fast trading. While those strategies weren't the main cause of the 2008 financial meltdown, they do play a role in creating instability (such as the “flash crash” of 2010). Either of these, or both, would helpfully supplement the income tax, the payroll tax (which supports Social Security and Medicare), the corporate income tax, and federal excise taxes. 

Mark Schmitt is a Senior Fellow at the Roosevelt Institute.

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How to Strengthen Financial Reform in the Next Four Years

Nov 16, 2012Mike Konczal

As part of our series "A Rooseveltian Second Term Agenda," an outline of what needs to be done to build upon and safeguard Dodd-Frank.

As part of our series "A Rooseveltian Second Term Agenda," an outline of what needs to be done to build upon and safeguard Dodd-Frank.

One of the Obama administration’s biggest vulnerabilities when it comes to its first term policy legacy was that the roots of the legislation it ushered through wouldn’t take hold until around 2014. Thus if a Republican president took office in 2013, there was a real chance that he could dismantle, or at least strongly interfere with, the new framework for health care and financial regulations. And it was clear by 2010 that movement conservatives would make the repeal or collapse of both bills a litmus test for all Republicans in office.

But with President Obama’s victory last week, the core framework of Dodd-Frank, the financial reform bill he signed in 2010, will become the law of the land. The question now is how to best push it forward in the coming months and years.

The most sensible, immediate reform would be to give regulators the adequate resources necessary to do their jobs. The CFTC had its funding cut by both parties last year in a move that will make their crucial work even harder to accomplish. The GOP is aiming to remove the independent funding stream for the CFPB. Without decent resources, it is unlikely that financial reform will be carried out effectively.

The next goal will require new reforms to draw some lines on the issues that haven’t been implemented well after the initial passage of the law. The Volcker Rule continues to be a mess while rules are being written. There isn’t a clear vision for what important new offices like the Office for Financial Research will set out to accomplish. These are major pieces of the legislation and are essential to creating fair, accountable, and transparent markets.

Fleshing out the post-Dodd-Frank agenda is also crucial. What should the proper regulations, if any, of high-frequency trading look like? Is breaking up the banks necessary for eliminating Too Big To Fail and the power of the financial firms over the markets, as a larger chorus of experts is starting to argue? How important is the government in preserving middle-class access to a 30-year fixed interest rate mortgage loan?

Fighting off a bi-partisan effort to make Dodd-Frank more industry-friendly will continue to be a full-time battle. But even though we don’t have to worry about the party in power repealing what has already been put into place, there’s no excuse for neglecting to articulate a vision for a financial sector that serves the greater interests of the real economy.

Mike Konczal is a Fellow at the Roosevelt Institute.

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President Obama's Three Necessary Tasks: Cut the Debt, Goose Growth, and Prepare for the Future

Nov 15, 2012Bo Cutter

As part of our series "A Rooseveltian Second Term Agenda," a way forward if Obama wants to really get things done.

I'm writing this under the following key assumptions: that President Obama actually wants to accomplish something and that he doesn't want simply to play small ball. If these assumptions hold, then President Obama must (1) clear away the underbrush, (2) shore up short-run growth, and (3) acknowledge and prepare the country for the on-going economic transformation.

As part of our series "A Rooseveltian Second Term Agenda," a way forward if Obama wants to really get things done.

I'm writing this under the following key assumptions: that President Obama actually wants to accomplish something and that he doesn't want simply to play small ball. If these assumptions hold, then President Obama must (1) clear away the underbrush, (2) shore up short-run growth, and (3) acknowledge and prepare the country for the on-going economic transformation.

Clearing away the underbrush means confronting and solving the nation's slow moving debt and deficit crisis. We do not have to turn ourselves inside out to solve this problem tomorrow, but we do have to put in place plausible, real policies to solve it over the next 10 years. Progressives insist on ignoring the problem but it is real and will not go away. Therefore, as his first step the president should immediately endorse Simpson-Bowles and ask, as I've written elsewhere, Simpson, Bowles, Rivlin, and Domenici to lead the effort to pass legislation by June 2013.

Shoring up short-run growth means putting in place a two-year modest stimulus program - roughly 2 percent of GDP each year - calculated to raise the growth rate of our economy to around 3 percent. This stimulus should consist roughly of 50 percent tax cuts and 50 percent budget support to states and cities. The right regards any stimulus as anathema; the left wants a reprise, but bigger, of the 2009 stimulus. Both of these alternatives would do more harm than good, and in any case, a presidential commitment to a very large stimulus would guarantee no stimulus after a protracted, enervating battle.

Preparing for our on-going economic transformation means first restructuring our tax system so that we invest more in the private sector and consume less. A swing of two or three percentage points would do wonders for our economy in the long run. To do this we should replace a part of our existing tax structure with a small value added tax, and substitute part of the payroll tax with a carbon tax. Next it means putting in place a 10-year public infrastructure investment program of about 1 percent of GDP annually. And finally, it means defining and starting the next revolution in American education.

Many Americans think the country is headed in the wrong direction. The president's popularity has consistently hovered at barely 50 percent. And both presidential campaigns were almost unremittingly negative.

Just scraping by this way should occasion some soul searching. The president must see that the White House and the presidency were not managed tightly or strategically well enough in the first term. In particular, the president's overall strategy was neither focused sufficiently or explained well (if at all) or advocated consistently. To accomplish anything at all, the president will have to provide a clear, simple, short plan to the American people, explain over and over why it matters, and design his White House so he can get this done. 

Roosevelt Institute Senior Fellow Bo Cutter is formerly a managing partner of Warburg Pincus, a major global private equity firm. Recently, he served as the leader of President Obama’s Office of Management and Budget (OMB) transition team. He has also served in senior roles in the White Houses of two Democratic Presidents.

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