Reform That Rewards Work: A New Vision for Strengthening Social Security’s Intergenerational Compact

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Reform That Rewards Work: A New Vision for Strengthening Social Security’s Intergenerational Compact

Posted on by Alyssa Brown

For 90 years, Social Security has served as the foundation upon which people plan for retirement in the United States. But changing demographics and decades of policy mistakes have put this vital program on unstable financial footing. Just seven years from now — before the end of the next president’s term — the program will face a crisis if no action is taken. Policymakers are running out of time to prevent disaster and give Americans the retirement security they deserve.

At its conception, Social Security was designed to be an “earned benefit” — workers pay a dedicated payroll tax on wages up to a certain level, and once these workers reach retirement age, they receive benefits to replace some fraction of the wages upon which they were taxed. The benefit formula is progressive in the sense that workers with lower incomes receive a higher replacement rate for the wages on which they paid payroll taxes, but people with higher lifetime earnings ultimately receive higher benefits. To reinforce the link between contributions and benefits, an internal “trust fund” was established to ensure that spending on benefits would track payroll taxes over time.

But this structure has broken down due to a combination of demographic and policy changes, and Social Security now spends significantly more than it raises in revenue each year. The program’s trust fund system allows Social Security to temporarily run deficits commensurate with the savings generated by past surpluses. But in 2032, Social Security’s Old Age and Survivor Insurance (OASI) trust fund is projected to be depleted, and benefits will be automatically cut by 24% to match the program’s incoming revenues. Even if lawmakers were to combine the OASI fund with Social Security’s Disability Insurance fund, they would only delay insolvency by less than two years.

The prospect of such a steep and sudden benefit cut makes it difficult for current workers to plan for retirement and risks throwing vulnerable seniors into poverty. But simply continuing to fund scheduled benefits without any changes, whether by raising payroll taxes or by borrowing money to finance Social Security’s deficits, would impose an unfair burden on working Americans to solve a problem they did not create.

Unfortunately, today’s policymakers are not only failing to solve this problem — they are actively making it worse. Recent legislation has increased Social Security’s shortfall through unfunded benefit expansions and tax cuts, both moving up the date of insolvency and increasing the size of automatic cuts that will happen when that occurs. The most popular proposals in Congress for “addressing” Social Security’s insolvency rely on gimmicks that would strain the link between contributions and benefits while exposing the federal budget to massive fiscal risk.

If policymakers are unable or unwilling to make the current Social Security system sustainable in a way that’s consistent with its founding principles, then now is the time to reimagine it from the ground up. PPI believes that lawmakers should take this opportunity to reassess Social Security’s structure and build a new model that is fairer, more pro-work, and more sustainable for the future.

Through a groundbreaking new formula developed by PPI, we propose that Social Security award benefits based on the number of years someone worked, rather than their lifetime earnings. This innovative structure cements Social Security’s status as an “earned benefit” but is far more progressive and affordable than the current formula. A low-income worker and their higher-earning boss would get the same benefit if they put in the same amount of work, and anyone who works for at least 20 years would receive a benefit that keeps them out of poverty. Parents would also receive up to five years of credit for caregiving to reflect both their hard work and their contributions to future Social Security solvency.

Our comprehensive package of benefit reforms also makes a number of other changes to improve the fairness and sustainability of Social Security spending. We propose increasing Social Security’s retirement ages to keep pace with rising life expectancies, while preserving a special early retirement age for lower-earning workers, who have not experienced the same gains in longevity. We would change cost-of-living adjustments to more accurately reflect inflation but boost benefits for the oldest beneficiaries who are most at risk of outliving their savings. We would reform spousal and survivor benefits to better protect widow(er)s from falling into poverty. And we would make the recently passed “Social Security Fairness Act” live up to its name with fair treatment of people who work both in and out of the public sector.

Under PPI’s plan, beneficiaries in the top fifth of the lifetime earnings distribution would absorb cuts relative to the current formula that are, on average, comparable to the ones already slated to occur under current law. At the same time, the majority of beneficiaries would see no reduction in their monthly benefit, and many low-income or long-career workers would even receive greater benefits than they could receive under the current formula. Altogether, PPI’s proposed reforms would close half of the program’s shortfall over the next 30 years through benefit changes while reducing old-age poverty.

PPI would close the remainder of Social Security’s shortfall through new revenue. Under the current system, in which benefits are based on a worker’s contributions, the only structurally coherent way to raise revenue is by increasing the payroll tax. But the payroll tax is regressive and depresses the wages of working Americans. By transitioning to a system that awards benefits based on years of work rather than tax contributions, there is an opportunity to transition to a more progressive and economically efficient funding structure.

PPI’s framework proposes comprehensive changes to federal payroll and income taxes paired with broad-based consumption taxes that spread the cost of fixing the nation’s fiscal challenges fairly among all Americans. We would also reform the use of trust-fund accounting to prevent structural deficits from threatening to impose another big benefits cliff in the future.

Taken together, the proposals in this blueprint offer a robust framework for radically pragmatic Social Security reform that is both generationally and politically balanced. PPI realizes that any plan that reduces scheduled benefits or increases taxes on anyone but the ultra-rich will nevertheless be politically challenging to enact. The mathematical reality, however, is that any plan to rescue Social Security will require some combination of these difficult choices. And the longer policymakers wait to admit this, the more painful the solutions will become. Now is the time to address Social Security’s shortfall in a thoughtful way that is fair to working Americans and retirees alike, giving both groups retirement security they can depend on.

Read the full report.

 

Jacoby for Washington Monthly: Ukrainian Fighters Aren’t Expecting Much from the Trump-Putin Summit

Posted on by Max Sherrill

The city of Sloviansk, prewar population just over 100,00, sits smack in the middle of the territory Donald Trump and Vladimir Putin will discuss “swapping” when they meet on Friday in Alaska—the first U.S.-Russia summit since Russia invaded Ukraine in 2022. Moscow and Kyiv have been fighting over Sloviansk more or less nonstop for more than 11 years, since Russian proxies first tried to take over the Donetsk province in 2014. With one exception—three months in spring 2014—the city has remained in Ukrainian hands.

Now, as world leaders talk over Ukrainians’ heads about giving up Sloviansk without another shot fired, I sat down with two soldiers who have been defending the city for over a year. Vlad Huma, 38, and Hlib Velitchenko, 32, say a swap of the kind Putin has proposed is unthinkable. But they know the conversation won’t end there, and they are girding for the worst.

Keep reading in Washington Monthly.

Moss for ProMarket: Weaponizing Antitrust and Regulation Will Hurt US Consumers

Posted on by Max Sherrill

Making deals is a hallmark of the Trump administration. Take import tariffs, where much touted “dealmaking” translates to threats and coercion as the major tactic for igniting and fighting a trade war. The result has been market volatility and higher prices for consumer goods that will, in the end, hit working Americans in their paychecks and pocketbooks. This approach is spilling into antitrust and regulation, with interference by the Trump White House in government oversight of corporate consolidation. We see it in the granting of favors to companies that curry favor with the administration, the weaponization of enforcement and policy levers to punish corporations that are perceived enemies, and exercising political power simply for the sake of doing so.

Interference risks disruption to markets and competition. And the burden of these distortions will be borne by American consumers through higher prices and slower economic growth—raising their already high cost of living and embattled standard of living. Decisions on whether mergers or business practices violate federal antitrust law or regulatory statutes have—at all other times—been reserved for independent enforcers at the Department of Justice (DOJ) and the Federal Trade Commission (FTC), sector regulators with competition mandates, and even the Committee on Foreign Investment in the United States (CFIUS).

This is changing. Interference by the Trump White House in these important decisions is trending up. Usurpation of antitrust enforcement and regulatory decision-making deprives American consumers of the benefits of independent, expert government agency oversight. This risks compromising due process, the rule of law and, ultimately, the benefits of promoting competition and protecting consumer welfare. There are mounting examples of how antitrust and regulation are being weaponized by the Trump agencies.

Keep reading in ProMarket.

Manno for RealClearEducation: 20 Years After Hurricane Katrina: What New Orleans Teaches America About K-12 School Reform

Posted on by Alex Terr

On August 29, 2005, Hurricane Katrina made landfall and began its destructive path through the Gulf Coast. New Orleans bore the brunt of the devastation, not only in the loss of homes and lives, but also in the destruction of its public infrastructure, especially its schools. Over the next two decades, the governance of New Orleans’ K-12 public schools underwent a significant reinvention.

This effort produced one of the most innovative and ambitious approaches to K-12 school reform in modern American education: a system of public charter schools funded by taxpayers and independently operated as schools of choice. This reinvention of the New Orleans K-12 public school system sparked a nationwide conversation about public school governance, autonomy, school choice, and accountability.

Now, with twenty years of evidence and the return of schools to a locally elected board, the question is no longer whether New Orleans succeeded or failed. What will U.S. K-12 public education learn from this unparalleled innovation to improve the lives of New Orleans’ young people? While the New Orleans model was born of crisis, the lessons it offers extend well beyond The Big Easy.

Tulane University economist Douglas Harris and his colleagues have led the effort to understand these lessons. Harris is the founding director of the University’s Education Research Alliance for New Orleans, whose reports serve as the primary sources of information for the discussion that follows.

Read more in RealClearEducation.

Marshall for The Hill: In a Liberal Society, Equity is a False Idol

Posted on by Alex Terr

Over the last two decades, progressive activists have introduced lots of sententious words and euphemisms into the U.S. political lexicon.

Examples include microaggression, intersectionality, cisgender, BIPOC, Latinx, “the unhoused” (that is, the homeless), returning citizens (ex-convicts) and “pregnant persons” (formerly “women”).

For those not up to speed on the latest academic conceits and ideological fads, including non-college voters streaming out of the Democratic Party, progressives might as well be speaking Esperanto.

They have also infused old words with new meanings. Take “equity.” Specifically, it means ownership in a house or stocks. But in its new meaning, it is used more generally as a synonym for fairness.

Now, it has become a pillar of DEI — the hallowed trinity of diversity, equity and inclusion that defines today’s “social justice” ethos. In this context, “equity” conveys a demand for something stronger than mere equality.

Read more in The Hill.

Moss for Jacksonville Journal-Courier: Antitrust Immunity for the NCAA? That’s a Foul

Posted on by Max Sherrill

If a billion-dollar organization breaks the law, should Congress reward it with immunity from the antitrust laws? The NCAA and some lawmakers seem to think so, and the recently introduced House bill — The Student Compensation and Opportunity through Rights and Endorsements Act — does just this.

College sports are at a crossroads. Student-athletes have only recently gained the right to earn money from their name, image and likeness. Just as this progress gains steam, Congress may undermine it by granting the NCAA a sweeping exemption from antitrust law.

Buried in the legislation is a clause that would make “compliance” with it broadly immune from enforcement of federal antitrust law and any state law or rules that have the same effect, no matter how anti-competitive its rules may be.

Translation? The NCAA could collude to cap athlete earnings and enact other rules that work to suppress competition harmfully, and no one could stop them.

Keep reading in the Jacksonville Journal-Courier.

Main likely impacts of Trump administration trade ‘deals’: higher prices, uncertain export and investment benefits, policy instability

Posted on by Alex Terr

FACT: Main likely impacts of Trump administration trade ‘deals’:
higher prices, uncertain export and investment benefits, policy instability.

THE NUMBERS: Extra tariff burden, February to mid-July 2025 –

From all “IEEPA” emergency decrees $51.6 billion
China and Hong Kong $23.2 billion
Worldwide 10% $22.2 billion
Canada and Mexico:   $6.3 billion

* Customs and Border Protection summary, through July 13th .

WHAT THEY MEAN: 

Though the administration has announced lots of July’s trade “deals” — the European Union, Japan, Korea, Vietnam, Thailand, Cambodia, Malaysia, Indonesia, the Philippines, Pakistan, Bangladesh — it hasn’t posted any actual agreement texts. In only one case (Indonesia) has published a “Joint Statement” with an agreed description of the contents. So lots about them is uncertain. With that noted, though, the arrangements appear to have three main features: higher prices for Americans, some commitments for exporters/intellectual property holders/investment seekers; and more future policy instability. More details and initial reactions to each –

1. Higher prices: First, bluntly put, most Americans will lose from these “deals.” Their common feature is a very high tariff, imposed by decree rather than legislation, on goods bought from abroad. Vietnamese-made goods like shoes and consumer electronics, for example, will get a 20% tax. So will pretty much everything from Taiwan and Bangladesh. Japanese and Korean products — cars, boats, matcha, MRI machines — get a modestly lower 15%, while things from the Philippines, Thailand, Cambodia, Indonesia, and Pakistan are at 19%. All are loaded on top of the regular, Congressionally authorized “MFN” tariff system. (“MFN,” the acronym for “most favored nation,” the term of art for the standard non-discriminatory approach to tariff rates.) The EU “deal” is somewhat different, imposing a 15% fee which replaces rather than being added to the regular MFN tariff rates. (Unless the regular rate is above 15%, in which case it just stays in place unchanged.)

For historical context, the overall average resembles the 19.8% tariff Franklin Roosevelt inherited from his predecessor Herbert Hoover in 1933. Alternatively, some specific product examples illustrate the daily-life impacts. Asian grocery stores buying cans of straw mushrooms from Vietnam, for example, will now pay 28.5% plus 6 cents per kilo. That’s three times the 8.5% plus 6 cents they were paying in March under the MFN tariff system. Auto repair shops buying Japanese or Korean brake-pads and fanbelts will pay 17.5% rather than 2.5% (and 15% for the German or Swedish equivalents); lovers of Dutch Gouda and Edam cheese, meanwhile, will pay 15% rather than the 10%. Or, in dollar terms, three months’ worth of “emergency decree” tariffs have already cost American buyers about $52 billion.

Tentative conclusion: Expect to pay more for things.

2a. Export commitments: Second, some Americans will benefit from export, intellectual property, and/or foreign investment commitments. Until the “deals” are published, we won’t know what these really are. But if the July 22 arrangement with Indonesia is a representative example, it includes some useful benefits and a lot of murkier “agreements to talk.” On the “useful” side, the U.S.-Indonesia “Joint Statement on Framework for United States-Indonesia Reciprocal Trade” unambiguously says Indonesia will “support a permanent moratorium on customs duties on electronic transmissions at the WTO immediately and without conditions”. (PPI view on the 30-year-old WTO “moratorium” and its value here.) The clauses on tariff and non-tariff issues, by contrast, lack timelines and feature cryptic phrasing: the U.S. and Indonesia “will work together to address Indonesia’s non-tariff barriers that affect bilateral trade and investment in priority areas” such as cars and agriculture, and “will negotiate facilitative rules of origin that ensure that the benefits of the agreement accrue primarily to the United States and Indonesia.”

Tentative conclusion: Wait to see the agreement texts before drawing any conclusions.

2b. Investment commitments: The arrangements with high-income allies also feature some commitments to invest in the United States, in the form of headline numbers: “$600 billion” from the EU, a “$350 billion” Korean investment fund, and “Japan will invest $550 billion directed by the United States to rebuild core American industries.” To put this in context, in 2024, Japanese firms invested $39 billion in U.S. industries through FDI, and Japan’s holdings of long-term securities grew by $91 billion. So new Japanese investment in the U.S. would likely hit $550 billion naturally over a few years, and the commitment might mean very little in real life. Alternatively, and more positively, the U.S. and Japanese governments might encourage specific private-sector investments like Nippon Steel’s purchase of the troubled U.S. Steel corporation.

Tentative conclusion: Don’t expect much.

3. Uncertainty: Finally, the so-called deals’ lives may be short. They all originate in the April 2 decree declaring the U.S. trade balance to be a “national emergency,” and then using the International Emergency Economic Powers Act to override Congressionally set tariff rates. The specialized U.S. Court of International Trade’s “V.O.S. Selections vs. Trump” decision struck down all the “IEEPA” tariffs on May 28 as an impermissible grab at Congress’ Constitutional power to set rates for “Taxes, Duties, Imposts, and Excises.” The Court of Appeals heard oral argument on this ruling last Thursday, and the Supreme Court will probably get the case this fall. If the C.I.T.’s view holds up, the “deals,” tariffs, costs, and (probably) commitments could be gone by Christmas.

Nor are the courts the sole source of uncertainty — the administration itself is another. The “deals” originate in a belief that the U.S. trade balance is a “national emergency.” (Professional economists pretty much shred that idea here.) But the effect of any deals on trade balance will be only marginal. This is because (a) a country’s trade balance equals the gap between its savings and its investment; (b) combining July’s tax cut bill with higher tariffs almost certainly means a higher U.S. fiscal deficit, and therefore (all else equal) a somewhat lower U.S. national savings rate, and (c) barring some unexpected surge in family savings, or a collapse in investment, the trade deficit will probably rise. If that’s the case, the administration might rip up this year’s arrangements and start all over again next summer — as it has done with the first Trump administration’s 2018 renegotiation of the U.S.-Korea Free Trade Agreement, which it wrongly advertised at the time as having “secured changes that will reduce the trade deficit”.

Tentative conclusion: Don’t expect policy stability soon.

FURTHER READING

PPI’s four principles for response to tariffs and economic isolationism:

  • Defend the Constitution and oppose rule by decree;
  • Connect tariff policy to growth, work, prices and family budgets, and living standards;
  • Stand by America’s neighbors and allies;
  • Offer a positive alternative.

Compare and contrast:

The National Archives’ official Constitution transcript; see Article I, Sec. 8 for power to set rates for “Taxes, Duties, Imposts, and Excises”, and to “regulate Commerce with foreign Nations”.

And from the administration, the “Joint Statement” with Indonesia; “Fact Sheets” for Japan, Korea, and the European Union; and an overall summary.

Legal update:

Court of Appeals oral arguments from last Thursday.

The administration’s Court of Appeals filing.

Amicus brief from House and Senate Democrats defending Congressional tariff authority.

Economists’ amicus brief explaining that trade balances are not emergencies.

The Court of International Trade’s May 28th decision (see V.O.S. Selections v. Trump, #25-66)

… or direct to the V.O.S. Selections v. Trump opinion in a PDF.

International Emergency Economic Powers Act text.

A solution:

Rep. Linda Sanchez (D-Cal.) and all other Ways and Means Committee Democrats propose a revision of IEEPA, Section 301, and Section 232 to require Congressional approval of any new tariffs, quotas, or other trade limits under these laws.

And some econ. and stat background:

The IMF on the basics of savings, investment, trade balance, current accounts, when they might matter, and when they probably don’t.

And from the Census, a one-page sheet with U.S. exports, imports, and trade balances from 1960 to 2024.

ABOUT ED

Ed Gresser is Vice President and Director for Trade and Global Markets at PPI.

Ed returns to PPI after working for the think tank from 2001-2011. He most recently served as the Assistant U.S. Trade Representative for Trade Policy and Economics at the Office of the United States Trade Representative (USTR). In this position, he led USTR’s economic research unit from 2015-2021, and chaired the 21-agency Trade Policy Staff Committee.

Ed began his career on Capitol Hill before serving USTR as Policy Advisor to USTR Charlene Barshefsky from 1998 to 2001. He then led PPI’s Trade and Global Markets Project from 2001 to 2011. After PPI, he co-founded and directed the independent think tank ProgressiveEconomy until rejoining USTR in 2015. In 2013, the Washington International Trade Association presented him with its Lighthouse Award, awarded annually to an individual or group for significant contributions to trade policy.

Ed is the author of Freedom from Want: American Liberalism and the Global Economy (2007). He has published in a variety of journals and newspapers, and his research has been cited by leading academics and international organizations including the WTO, World Bank, and International Monetary Fund. He is a graduate of Stanford University and holds a Master’s Degree in International Affairs from Columbia Universities and a certificate from the Averell Harriman Institute for Advanced Study of the Soviet Union.

Read the full email and sign up for the Trade Fact of the Week.

Manno for Forbes: Workforce Pell Expands Access To Education, Training, And Opportunity

Posted on by Alex Terr

Finally—A Win For Political Bipartisanship

“We just expanded the definition of college,” writes Kathleen deLaski, capturing the spirit behind the new Workforce Pell legislation in President Trump’s One Big Beautiful Bill Act, signed into law on July 4. The legislation extends post-secondary Pell Grant financial eligibility to short-term training programs that currently are not eligible to be paid for using federal aid.

While the Beautiful Bill Act passed with a mostly party-line vote, Workforce Pell has long had bipartisan legislative support at the federal level in both the U.S. Senate and House of Representatives. Additionally, this approach has strong support from many quarters, including working-class voters, broadly defined as those without a four-year college degree.

A Progressive Policy Institute/YouGov Survey of working-class voters reports that when given five options to choose what would most help them have a good job, career, and get ahead, the number one response of nearly half (46%) was “affordable, short-term training programs that combine work and learning,” followed by “more opportunities for apprenticeships with companies” (23%). Only 9% said a four-year college degree, which came in four out of five.

As Lisa Larson, CEO of the Education Design Lab, writes in Community College Daily, “Workforce Pell has finally become law after years of advocacy, stalled negotiations in Congress and a groundswell of support from educators, employers, and learners.”

Read more in Forbes.

Kahlenberg in the NYT: Columbia and Brown to Disclose Admissions and Race Data in Trump Deal

Posted on by Alyssa Brown

“I think transparency is a good thing, and if Columbia is not using racial preferences, they should have nothing to hide,” said Richard Kahlenberg, director of the American Identity Project at the Progressive Policy Institute, a left-of-center think tank. Mr. Kahlenberg has pushed for class-conscious rather than race-conscious college admissions. But the data the government is demanding could be misused, he said, to suggest that “any attempt to create racial diversity even by race-neutral means is problematic.”

Read the full article in The New York Times.

Ritz for InsideSources: Work requirements increase bureaucracy more than accountability

Posted on by Alex Terr

When Republicans were looking for ways to reduce the cost of their One Big Beautiful Bill, one of the first offsets they incorporated was a federal work requirement for Medicaid.

Proponents claimed this “common-sense” policy would grow the economy by increasing employment and cut wasteful spending on “lazy,” able-bodied people who chose not to seek work.

However, in the states that have tried them, Medicaid work requirements did little to boost employment. Instead, they merely created complex layers of reporting and verification that made it difficult for people to maintain coverage, even if they were still eligible for coverage or would qualify for an exemption from work requirements.

Read more in Inside Sources.

New PPI Report Warns that the U.S. Rocket Launch Market is Heading Toward a Monopoly

Posted on by Alex Terr

WASHINGTON — As demand for space launches surges — from satellite constellations to national security payloads — the U.S. launch market is becoming dangerously concentrated. According to Payload, in 2024, SpaceX accounted for more than 95% of U.S. launches. That includes roughly two-thirds of NASA’s orbital missions and a hefty percentage of national security missions.

Today, the Progressive Policy Institute (PPI) released a new report warning that the growing dominance of a single provider threatens national security, suppresses innovation, inflates costs, and jeopardizes long-term access to space. Authored by Mary Guenther, PPI’s Head of Space Policy, “Reigniting Rocket Competition: The Case for Refocusing on Domestic Competition in the Launch Sector” finds that without deliberate action to foster competition, U.S. policy aimed at ensuring a resilient and innovative launch market could be undone.

“Competition in the space launch market requires intentionality and the U.S. Government appears to have taken its eye off the prize in this arena,” said Guenther. “A vibrant and competitive launch ecosystem is essential to maintaining America’s leadership in space, securing fair prices for taxpayers, and ensuring we can get critical payloads into orbit whenever the nation needs them.”

The report urges federal policymakers to:

  • Overhaul acquisition strategies to cap single-vendor dominance and strengthen industrial base resilience.
  • Reject funding cuts for space agencies that are driving a healthy percentage of growth in the space sector.
  • Modernize outdated launch regulations and boost staffing to speed licensing.
  • Invest in launch infrastructure to accommodate more providers and higher launch rates.
Guenther emphasized that demand for launches has never been higher, driven by defense, commercial, and scientific missions. Yet outdated rules, infrastructure bottlenecks, and concentrated government contracting risk locking in a single dominant player, stifling innovation, and raising costs. And this is all at risk if funding cuts at NASA, the DoD, and the Office of Space Commerce proposed by President Trump for FY26 and beyond are implemented.

“The U.S. government has the leverage and responsibility to keep the launch market competitive,” said Guenther. “If we make the right policy choices now, we can secure a space economy that is innovative, resilient, and open for business.”

Read and download the report here.

Founded in 1989, PPI is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock. Find an expert and learn more about PPI by visiting progressivepolicy.org. Follow us @PPI.

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Media Contact: Ian O’Keefe – iokeefe@ppionline.org

Reigniting Rocket Competition: The Case for Refocusing on Domestic Competition in the Launch Sector

Posted on by Alex Terr

Launch underpins anything being done in space, from spy satellites and NASA science spacecraft to the GPS satellites that help civilians and the military navigate. Given this substantial national interest in secure access to space, the U.S. government has worked for decades to develop the domestic rocket launch industry and ensure it is sufficiently robust to serve the nation.

The U.S. government is a major customer for orbital launch and accordingly has substantial sway over the market — experts have estimated that Department of Defense (DoD) launch purchases alone will be 30-50% of the market for new rockets. As a result, new companies are unlikely to succeed if they can’t break into government contracting in a meaningful way.

U.S. government programs fostering this market have had their fair share of hiccups and shifting goals over the years. At various times, the government has expressed a strong preference for a single launch provider. At others, it sought diversity within the launch market for the exact same reasons: increasing reliability and reducing launch costs.

There is clear evidence that competition serves the nation well so long as there is sufficient demand to sustain multiple launch providers through a combination of government and commercial launches. Simply put, the government cannot sustain multiple launch providers through government business alone. Luckily, demand for launches has never been higher than today–and it’s poised to continue growing so long as the Trump administration’s ill-advised cuts to space agencies and the office dedicated to promoting space at home and abroad are avoided.

Beyond those disastrous proposed cuts, the government has not offered enough support for continued competition and dissimilar redundancy in the launch market. Without a change of course, the U.S. government could wind up supporting the emergence of a monopoly company — the opposite outcome of stated policy. Federal agencies that buy launches — the DoD and NASA — need to act quickly in order to continue harnessing the benefits of competition in launch, including favorable pricing, assured access to space, and continued innovation.

This includes:

  • Continuing to bring new providers into DoD launch procurements and ensuring newer operators are able to secure a meaningful number of launches
  • Changing NASA’s procurement policies related to launch to prioritize competition
  • Expanding access to launch infrastructure for new actors
  • Streamlining regulatory processes
  • Increasing spending on space activities

Read the full publication.

The Future of Antitrust Conference and Contributions by the Panelists

Posted on by Alyssa Brown

 

Antitrust is in transition. A change in political administration, broader support for a stronger role for antitrust, and the pressures of existing and emerging competition issues raise critical questions around the process and substance of enforcement. These range from challenges to U.S. enforcement institutions, to what a pragmatic, balanced enforcement approach that supports consumers and workers looks like, and lessons from recent cases.

On July 16, 2025, PPI convened the half-day “Future of Antitrust” conference, where we heard from leading antitrust, business, legislative, and academic experts to explore how antitrust will navigate key issues. The morning event kicked off with keynote remarks from Hillary Greene, Senior Counsel, House Congressional Committee. Next, an expert panel, moderated by PPI’s Director of Competition Policy, Diana Moss, had a robust and productive conversation about antitrust enforcement trends, the state of play on competition advocacy, and guiding principles for enforcement moving forward.

Panelists included: Gwendolyn Cooley, Founder of Taimet LLC, former NAAG Antitrust Task Force Chair and former Wisconsin Assistant Attorney General; Andrew Gavil, Professor, Howard University School of Law, Senior Of Counsel at Crowell & Moring LLP and former Director of the Office of Policy Planning at the FTC; Erik Hovenkamp, Professor, Cornell Law School; William Kovacic, Professor, George Washington University Law School and former Chairman of the FTC; and Nancy Rose, Professor of Applied Economics, MIT Department of Economics and Former Deputy Assistant Attorney General for Economics at U.S. DOJ.

PPI is delighted to share two reports, below, that served as the foundation for the panel discussion at the Future of Antitrust conference panel. Please also read Gwendolyn Cooley’s post responding to major themes and takeaways from the event. 

 

 

 

A Defense of the ‘For Cause’ Termination Provisions of the Federal Trade Commission Act

Posted on by Alyssa Brown

INTRODUCTION

On March 18, 2025, President Donald Trump purported to dismiss Commissioners Rebecca Kelly Slaughter and Alvaro M. Bedoya from their seats on the Federal Trade Commission (FTC) without cause and prior to the expiration of their terms. His actions contravened Section 1 of the FTC Act, 15 U.S.C. § 41, which provides that “[a]ny Commissioner may be removed by the President for inefficiency, neglect of duty, or malfeasance in office,” and rested upon the bare assertion that he was exercising his authority under Article II of the Constitution.

The President’s assertion of authority to treat the Commissioners as “at will” employees of the Executive deliberately challenged the constitutionality of the “for cause” termination provisions of Section 1 and other similar statutes. By design, it also provoked the affected Commissioners to challenge the Administration’s action in federal court, where the Administration intends to invite the Supreme Court to reconsider Humphrey’s Executor v. United States, 295 U.S. 602 (1935). In Humphrey’s Executor, the Court rejected a similar constitutional challenge to the FTC Act’s protection against removal of commissioners except for good cause.

The attempted dismissals of the two Democratic Commissioners implicates more than the “for cause” constraints on presidential removal powers under the FTC Act, or the relative independence of the agency from political interference in its decision-making. They are instead an outgrowth of a broadly conceived and long-planned effort by the Administration to expand the Executive’s power to control what has derisively been labelled the “administrative state,” especially with respect to the “independent” federal administrative agencies. Other relevant steps in this campaign include the Administration’s attempt to shrink the federal government and assert plenary presidential authority over the entire federal civil service, placing a wide range of personnel decisions beyond the reach of judicial review.

The Administration revealed its aims in a February 18, 2025, Executive Order titled “Ensuring Accountability of All Agencies,” and in repeated efforts to dismiss commissioners and members of other federal multi-member boards. And a February 12, 2025 letter to Senator Richard J. Durbin from the then Acting Solicitor General of the Justice Department left no doubt of its view of Humphrey’s Executor: “I am writing to advise you that the Department of Justice has determined that certain for-cause removal provisions that apply to multi-member regulatory commissions are unconstitutional and that the Department will no longer defend their constitutionality.” The letter went on to refer to the FTC Act and Humphrey’s Executor.

Collectively, these actions seek to implement a charged version of the “Unitary Executive Theory,” which posits that the president possesses sole and plenary authority over the Executive Branch. The theory argues that the president’s authority must, as a constitutional matter, include unencumbered removal power. Its proponents contend that the theory has roots in the Constitutional Convention and historical practice, yet their arguments ultimately rest on inference and political theory. The Constitution provides for the president’s authority to appoint commission members (with Senate approval) but is entirely silent about removal. The theory thus depends upon structural arguments about the proper distribution of authority within the government.

Critics note this lack of textual support, point to contrary history, and argue that the current version of the Unitary Executive Theory is a more recent construct, first developed and advocated in its modern form during the Reagan Administration. Embraced by Project 2025, which includes a dedicated discussion of the FTC, it is the theoretical basis for the Administration’s effort to impose greater presidential control over administrative agencies. The campaign focuses heavily upon the “independent agencies,” which, like the FTC, are defined, in part, by “for cause” protections for their board members to provide them with a degree of insulation from political interference.

The independent federal agencies will not be the sole casualties if the effort succeeds; they are merely the immediate targets. If the Supreme Court embraces the Unitary Executive Theory without qualification, it will transfer substantial additional power to the president and deprive Congress and future presidents of a valuable approach to collaborative governance that the Nation has employed broadly for more than a century. As Justice Kagan’s dissent in Seila Law observed, it would “commit the Nation to a static version of governance, incapable of responding to new conditions and challenges.” Among other effects, this move will diminish the country’s capacity to respond effectively to special challenges posed by the fast-expanding role that digital technology plays in the economy.

The Administration would welcome such a reallocation of powers; indeed, it is the motivation for its actions and its ultimate objective. The Administration assigns primacy to a siloed conception of the three branches of the federal government that is integral to the Unitary Executive and other, related theories. Under the silo postulate, the administrative agencies are extra-constitutional – an unauthorized “fourth” branch of government. It also denigrates the public administration model that views shared authority and collaboration between Congress and the Executive as essential to effective governance.

In the case of the FTC and other similarly structured agencies, the debate reduces to a single assertion: separation of powers dictates that the president must have plenary authority to remove any Commissioner without cause and without regard to their statutory term. The removal power is claimed to be absolute, regardless of the institutional design agreed to by Congress and accepted by previous presidents. By statute, that design specifies the make-up of the FTC, the terms and duration of appointments of commissioners, and the prerequisites for removal. In accordance with the Constitution, it also establishes an appointment process that requires Senate approval of Commissioners nominated by presidents.

These and other measures that limit Executive authority reflect a well-considered assessment of the appropriate allocation of tasks between the Congress and the Executive – and they are firmly anchored in the Constitution. As we describe more fully below, the original design of 1914 and its subsequent amendments still give the Executive significant control over the operation of the FTC. At issue in the debate today is not whether the Executive has any control over these institutions (it does); the question is whether that control must be unqualified.

The Administration argues that Section 1 of the FTC Act is unconstitutional because it allegedly encroaches on this President’s Executive prerogative. But President Woodrow Wilson and his advisors played a central part in designing the Commission and signed the FTC Act into law rather than veto it. The basic model of public administration that the FTC Act adopts has received the support of subsequent presidents who approved major amendments to the Act. Moreover, the demand for still greater Executive control ignores the president’s existing capacity to influence the institution’s operations. The president’s political party typically controls three of the Commission’s five seats. The president alone has the authority to nominate FTC Commissioners, who have staggered terms so that every president is likely to have opportunities to nominate its members. And the president proposes the agency’s annual budget to Congress.

The individual non-Chair FTC Commissioners exercise virtually no “Executive” power on their own. That power lies in the hands of the Chair, and the president alone has the authority to designate the Chair, who serves in that role at will. By statute and regulation, the FTC Chair is the chief executive of the Commission and has complete authority to designate the agency’s senior leadership and manage its various Bureaus and Offices. The Administration contends that these instruments of influence are inadequate, that the Constitution also mandates plenary removal power of non-chair Commissioners.

In this paper, we argue that “independent” is a misleading description of the relationship of the FTC to the political process. Even when viewed through the lens of 2025 instead of 1935 when Humphrey’s Executor was decided, the agency is subject to extensive oversight and control by both the president and Congress. As the Commission’s authority has expanded since 1914, so too have the controls by which Congress and the Executive oversee and influence its operations. This framework, as it has evolved over 110 years, does not “unduly interfere with the functioning of the Executive Branch.” It is democratically accountable in numerous ways to both the Congress and the Executive. The organization, procedures, and individual actions of the Commission, including the constitutionality of its structure, are also fully accountable to the federal courts.

As a policy matter, Section 1 of the FTC Act remains vital to the credibility, integrity, and effectiveness of FTC decision-making and the protection of American consumers. Its consumer protection authority is unmatched in the federal government, and its importance for the U.S. economy has only increased over time. With respect to its competition mission, the FTC also provides added institutional capacity, a wider range of tools, and expertise to complement the work of the Antitrust Division of the Justice Department. Subject to judicial review, the Commission has made major contributions to the development of important foundations of antitrust doctrine.

Moreover, the FTC’s structure is one of its key virtues. For more than a hundred years, the FTC’s bipartisan structure has facilitated collaborative decision-making, allowed for dissent, and helped to build the agency’s expertise and reputation. One properly can criticize the FTC for failing to fulfill all the expectations that led Congress to create the agency in 1914. There is no basis to assert, however, that the agency has encroached on the prerogatives of the president. Its limited “independence” should not be sacrificed in the service of a debatable, formalistic interpretation of the Constitution and an activist political agenda.

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Invigorating Antitrust Without Stifling Economic Progress

Posted on by Alyssa Brown

ABSTRACT

In recent decades, antitrust law has become harder and harder to enforce. This brief article proposes a number of sensible and practical antitrust reforms that would help to invigorate antitrust enforcement against a wide range of anticompetitive practices, including by dominant tech firms. However, I also caution against more radical populist antitrust proposals, which are concerned primarily with how big a firm is and not whether it is engaging in harmful conduct. By failing to distinguish between anticompetitive behavior and desirable economic growth, such policies would cause severe economic damage. More judicious antitrust reforms, like those advocated here, would invigorate competition without stifling economic progress.

INTRODUCTION

In the last decade, antitrust has surged into the public spotlight. There is a widespread view that antitrust law must do more to address the abuses of large companies. This is fueled in large part by the rising prominence of Big Tech companies, whose vast web of products and services touch upon many aspects of our daily lives and public discourse.

As an economist and law professor specializing in antitrust, I have written many articles advocating pro-enforcement policies in a range of areas, including the tech sector. Below, I outline a number of policy measures that would generate substantial economic benefits for the public. These are sensible, practical opportunities for reform that could be implemented on top of existing laws, avoiding the need for a comprehensive overhaul of the antitrust system.

However, not all reform ideas are equal. A more radical reform effort seeks to reshape antitrust from the ground up, deemphasizing economic harms like high prices and focusing instead on how large corporations might undermine democracy.1 Grounded in the populist belief that big businesses are inherently bad for society, these proposals advocate drastic preventative measures, such as breaking up large firms or prohibiting them from introducing new products, even if they have not engaged in anticompetitive behavior. Although well-intentioned, these proposals are impulsive and reckless. If enacted, they would have disastrous effects on the public: higher prices, worse products, fewer jobs, and reduced innovation and growth.

Effective antitrust reforms would enhance our economic prosperity, not diminish it. Antitrust’s job is to protect competition so that markets produce desirable results for the public. The prevailing antitrust system falls short of that goal, leading to worse economic outcomes for many Americans. However, the solution is not to throttle our most productive businesses just because they’re big, but rather to police them and ensure they play by the rules. We don’t have to choose between a level playing field and a thriving business sector. By enacting sensible antitrust reforms, we can have both.

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What is the Future of Antitrust? Reflections on PPI’s 2025 Antitrust Conference

Posted on by Alyssa Brown

Is worrying about the Future of Antitrust like redecorating the Titanic’s ballroom five minutes before the ship hit the iceberg? At The Future of Antitrust Conference, hosted by the Progressive Policy Institute (PPI) on July 16, 2025, on the whole, we thought not.

To be sure, there remain some concerns about the future of antitrust. Will it turn entirely political, swinging between mandates to either care about or repudiate DEI/ESG/etc.? Will the federal government take its foot entirely off the gas and stop enforcing the antitrust laws?

While the philosophical battle for the soul of antitrust rages elsewhere, Andrew Gavil, Erik Hovenkamp, Nancy Rose, Bill Kovacic, and I — moderated by Diana Moss of PPI — gathered to discuss practical ideas as the Future of Antitrust unfolds before us.

Almost impossibly, we had productive conversations about things that are agreed upon by all those in the philosophical antitrust battles, and had conversations about where the differences lie, and what’s next.  This was a refreshing conference about solutions, rather than just problems.

So, what was different?  The conference generated constructive conversations about which substantive measures Congress should take to enhance antitrust enforcement in the next 10 years.

This includes the little, big, and giant things that Congress could consider instead of the bright and shiny things (my words, said with respect to our elected officials) that they are currently focused upon like ESG (pros and cons), ad placement, or the benefits of international cooperation.

While I recognize the practical reality that elected officials — much to their chagrin — have to raise money, outside of a specific donor profile, these issues don’t matter to Americans out here in middle America nearly as much as fundamental issues like housing, food prices, and healthcare.

I’ll take areas of agreement for both parties first, starting with a little thing. Funding for the agencies needs to be addressed.  The latest Congressional proposals do that, at least in part, and there is always a need for more boots on the ground in antitrust enforcement.  My co-panelists and I all agreed: good for Congress and the President for moving in that direction.

Nancy Rose raised another little area of broad agreement, at least amongst the panelists and the current Trump administration antitrust officials. Namely, economics matters, and we all applaud the U.S. Department of Justice re-elevating economic analysis to the Deputy Assistant Attorney General level.

From my perspective, economics matters because it matters to judges.  Judges like the clarity and non-arbitrariness that comes from the use of economics.  But judges also like practical things too, to help them discern a winner in the battle of the experts, and that is why we are seeing courts frequently use things like the Brown Shoe practical indicia and cross-elasticity of demand analysis for market definition in their decisions.[1]

While we were able to applaud some easy things that have already been done, Congress has some harder work to do.

First, Congress should consider passing legislation that would ban pharmaceutical reverse payments, also known as “pay-for-delay” settlements.  Erik Hovenkamp’s paper clearly articulates the rationale for why these need to be banned, “These deals delay entry by generic competitors. This forces the public to spend tens or hundreds of millions of dollars more for a drug than they would otherwise pay.”[2]

While there is broad agreement across the political spectrum, the Trump Administration’s Federal Trade Commission (FTC) is interested in lowering prescription drug prices, and Democrats in Congress are interested in lowering prescription drug prices. However, there has been little forward momentum on this.

Second, there is a huge need to act on agricultural consolidation at the enforcement agencies ¾ something they have struggled to get their arms around because of the technical expertise required to analyze these industries and because, in my opinion, there is significant regulatory capture.  Except for PPI’s Diana Moss and a handful of others, too many of the people who know about competition in agriculture are paid by Big Ag.

However, the need to overcome this hurdle is more serious than ever, as food is a national security issue.  Without more competition amongst agricultural producers, processors, distributors, technologies, machinery ¾ essentially the entire value chain ¾ the potential to have “infant formula” or “COVID-19 beef-packing” breakdown scenarios for Americans, and dare I say, voters, could have potentially catastrophic consequences.  We will need to see real leadership and accountability from the political class before this can become a true top priority.

Third, housing also needs to be a priority.  Somewhere in the region of one-third of the nation’s households are living in rental properties.[3] In light of this, some in the audience viewed the current efforts to take on various rental companies for alleged algorithmic pricing conspiracies as insufficient to address the needs of ordinary Americans and controlling high rents set by giant corporate landlords.

While there is agreement about the urgency of this competition problem, it is clear from the number of newly passed statutes that the current thinking is that passing statutes banning algorithmic pricing will somehow solve the rental price increase problems. I fear that this may not be the case.

For example, in the same way that there was a recent vogue to blame high prices in pharmaceuticals on lax antitrust enforcement, rather than the root cause (i.e., greed) high rents are also multifactorial. Notably, greed, supply and demand, inflation, restrictive building codes, and a generation unable to afford homes all indicate that the economy is more complicated than a simple “antitrust can fix it” model would allow.

Algorithmic pricing statutes, like Colorado’s groundbreaking one, limit discrimination against protected classes.[4]  But they do not ban rent increases.  Even the proposed statute that Colorado’s governor vetoed would have banned use of an “algorithm” to set prices. This does not mean that landlords won’t find other ways to raise prices.[5]

We also don’t see low prices in cities where algorithmic pricing software utilization is less common,[6] like New York City (average price for a one bedroom: $4034),[7] versus Atlanta ($1900)[8]. So while versions of these statutes might be a necessary effort, they are not sufficient to solve the complex problem of high housing prices.

Now to the disagreements, from “little,” to “big,” to “huge.”

What does the future of antitrust look like for the consequential but still “little” reforms that have been made to the Hart Scott Rodino (HSR) merger reporting form, or cooperation amongst agencies at home and abroad, or early termination for benign deals?  While we seemed to have unanimity on the panel, it is clear that the political parties don’t agree about these things, and if there was anything that felt more like redecorating the Titanic ballroom than this, I am hard pressed to find it.

Having a longer or shorter HSR form is a bright and shiny (albeit little) but important thing.  Regardless of which form the FTC uses for premerger notification under HSR, the fact of the matter is that there are not enough people in the pre-merger notification office to completely review the approximately eight merger filings per day that land on their desks.

Even the best “chicken sexer,[9]” as one of my former colleagues described the folks who review merger transactions quickly and correctly, cannot realistically keep up with that demand.  This means that Type II errors are abundant with agency “second requests” for more information because the volume means that one does not always know what one is looking for- and there is less consistency amongst the various reviewers.

What is the solution?  As I advocated at the conference, technology will play a large role.  Congress should mandate that the agencies use a form that is either long or short- (or whatever they want) but preliminarily reviews should be done by technology, with human review thereafter, so that merging parties can have some clarity about their transactions more consistently within the 30-day shot clock that the HSR statute contemplates.[10]

Erik Hovenkamp raised other big ideas for the future of antitrust at the conference, albeit without universal agreement about his proposed solutions.  Amongst the biggest is tackling monopoly leveraging with a one-sentence Sherman Act amendment.  “All that is necessary is to stipulate that it is unlawful for a firm with monopoly power in one market to exploit that power to impair competition in a second market, even if its conduct is purely unilateral.”[11]

Monopoly leveraging is amongst the allegations that were raised against Microsoft in the early 2000s, and the difficulties of that case are the reason why there has been a limited amount of Sherman Act §2 caselaw, until recently.  Decisions related to both tying and the kinds of platform abuses involving self-preferencing that are easily addressed under European competition law, are not as easily addressed in the U.S.[12]  And while there is little appetite for adopting a Digital Markets Act-style regulatory framework in the U.S., using our existing system with a minor tweak might reduce the high burdens of proving this kind of conduct.

One of the most surprising parts of PPI’s Future of Antitrust conference was related to our creative ideas about potentially huge reforms on the horizon. This is particularly true for the FTC in the analysis framed by Andrew Gavil and Bill Kovacic’s paper, “A Defense of the ‘For Cause’ Termination Provisions of the Federal Trade Commission Act.”

While there was disagreement about whether recent developments under the Trump 2.0 Administration are the “end of the world” as we know it for the FTC, there are a range of ideas about whether the FTC really is something worth fighting for, or whether (in my view) there might be some opportunities to rethink the structure of the agencies themselves.

For example, which agency should really be left standing if the “One Agency Act” gains steam in Congress?  Where does antitrust expertise really lie?  Should the FTC get back to its founding mission and diversify its Commissioners’ expertise beyond former congressional staffers?  I personally have a soft spot for congressional staffers, having been one myself in the last century.  The Gavil-Kovacic paper on the potential outcomes of the Supreme Court’s likely case about the applicability of Humphrey’s Executor to the firings of two Democratic FTC commissioners is only the beginning of the conversation.[13]

And just like the Titanic’s sinking was not the end of global transport, I expect that these conversations about the Future of Antitrust are just the tip of the iceberg.

Gwendolyn Lindsay Cooley, a Contributing Author at PPI, is the Founder and CEO of Taimet, an antitrust technology company, and spent nearly 20 years as Wisconsin’s antitrust enforcer.

 

[1] Brown Shoe Co., Inc. v. United States, 370 U.S. 294 (1962).

[2] Hovenkamp, Erik, “Invigorating Antitrust Without Stifling Progress,” PPI, July 2025.

[3] Desilver, Drew, “As national rental eviction ban expires, a look at who rents and who owns in the US.” Pew Research, 2021 available at: https://www.pewresearch.org/short-reads/2021/08/02/as-national-eviction-ban-expires-a-look-at-who-rents-and-who-owns-in-the-u-s/.

[4] Colo. Rev. Stat. § 6-1-1701 et seq. (2024)

[5] Colorado Bill HB25-1004.

[6] Council of Economic Advisors, “The Cost of Anticompetitive Pricing Algorithms in Housing,” Fig. 1, p. Dec. 17, 2024, available at https://bidenwhitehouse.archives.gov/cea/written-materials/2024/12/17/the-cost-of-anticompetitive-pricing-algorithms-in-rental-housing/.

[7] Rental Market Trends in New York, NY (one bedroom) available at: https://www.apartments.com/rent-market-trends/new-york-ny/.

[8] Rent Price Summary for Atlanta, Georgia (one bedroom) available at https://www.zumper.com/rent-research/atlanta-ga.

[9] https://en.wikipedia.org/wiki/Chick_sexing.

[10] Disclaimer: my company, Taimet (www.taimet.us), uses artificial intelligence to review merger transactions in order to reduce human review time.

[11] Hovenkamp, Invigorating Antitrust, at 7.

[12] See e.g. Chee, Foo Yun, “Rival Browsers Allege Microsoft’s Practices on Edge Unfair, Should Be Subject To EU Tech Rules,” Reuters, Oct. 3, 2024, https://www.reuters.com/technology/rival-browsers-allege-microsofts-practices-edge-unfair-should-be-subject-eu-tech-2024-10-03/.

[13] U.S. 602 (1935).