WASHINGTON– As Germany prepares for its snap federal election on February 23, the Progressive Policy Institute (PPI) has released a “German Election Preview,” authored by Claire Ainsley. The report provides a deep dive into the electoral landscape, key policy debates, and the broader lessons for center-left parties globally.
The election marks the first since Olaf Scholz’s Social Democrats (SPD) won the Chancellery in 2021, ending years of Christian Democrat Union (CDU) dominance. However, as Germans return to the polls, the CDU is poised to reclaim power, while the SPD struggles in third place behind the far-right Alternative for Germany (AfD), which has doubled its support since 2021.
“The German election is not just a national event — it has global significance,” said Claire Ainsley, Director of PPI’s Center-Left Renewal Project. “The SPD’s difficulties mirror the broader challenges for center-left parties in balancing economic credibility, climate ambition, and voter concerns over immigration. Their experience provides crucial lessons for Democrats in the U.S. and Labour in the U.K. as they navigate similar political headwinds.”
Key findings from the report include:
A Weakened SPD and a Surging Right: The SPD’s coalition with the Greens and Free Democratic Party (FDP) has fractured, following economic stagnation, unpopular climate policies, and a contentious debate over immigration.
CDU’s Dilemma: If the CDU wins, it must decide whether to maintain Germany’s long-standing firewall against cooperating with the far-right AfD, and balance political risk by forming another three-party coalition.
Economic and Climate Challenges: Germany’s strict “debt brake” has constrained public investment, while the handling of climate policies has fueled voter backlash and who pays for climate ambitions.
Immigration as a Defining Issue: Immigration has overtaken the economy as voters’ top concern, with a YouGov poll showing 80% of Germans believing migration levels have been too high in the past decade.
The report argues that the SPD’s struggles highlight a larger challenge for center-left parties worldwide: the need to deliver tangible economic benefits to working people while avoiding policies that deepen voter alienation.
“With working-class voters moving away from the center-left in multiple democracies, leaders must focus on delivering real results — whether on economic security, immigration, or energy affordability,” said Ainsley. “Otherwise, these voters will continue to look elsewhere, as we’ve seen in the U.S. and across Europe.”
After the U.S. navigated its own electoral challenges in 2024 and focuses on the future, PPI’s report offers critical insights into how progressive parties can adapt and rebuild durable political majorities.
PPI’s project on Center-Left Renewal was launched in January 2023 to catalyze and create a renewal of the center-left, sharing ideas, strategies, and research around the world. Since its inception, the project has facilitated a shared exchange between center-left parties, contributing new ideas and analysis designed to further the prospects of the center-left. The project’s outputs are shared by PPI here: www.progressivepolicy.org/project/project-on-center-left-renewal/. Sign up to our project mailing list at info@ppionline.org.
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. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on X.
On 23 February 2025, Germans will head to the polls in the first federal election since Olaf Scholz’s Social Democrats (SPD) came from third to first to win the Chancellery in October 2021, following the departure of Chancellor Angela Merkel and a long period of Christian Democrat Union (CDU) dominance.
In 2021, the SPD became the lead party in a coalition government with the Green Party and Free Democratic Party (FDP), agreeing on an ambitious government programme based on their ‘four missions for the future’ outlined in the SPD’s winning manifesto.
Yet Sunday’s election looks set to provide a very different outcome, with the CDU back in pole position, and the ruling SPD trailing in a low third with the Greens just behind them in fourth. Second place in the polls is the Alternative for Germany (AfD), a far-right challenger party that has doubled its support since the 2021 federal election, when it came fifth with 10% of the vote.
As attention turns to this historic election, what might we expect from the results? And what lessons can center-left parties elsewhere draw from the German experience?
The Trump Administration’s move to cut overhead funding for National Institutes of Health (NIH) grants will have a devastating effect on research universities and hospitals around the country. It’s a misguided attack on a key part of the innovation system that helps propel U.S. growth.
But it’s important to be wary of government actions that affect other parts of the innovation system as well. One key area is whether the Trump Administration continues to pursue antitrust actions against tech companies, which are essential pillars of innovation investment. Alphabet spent $95 billion on R&D in 2023 and 2024 alone, Meta spent $82 billion, and Apple spent $61 billion.
In a 2022 report done for PPI’s Innovation Frontier Project, Sharon Belenzon and Ashish Arora of Duke University observed: “Antitrust regulations that reduce the size and limit the scope of tech firms weaken their incentives to make the large-scale, long-run investments in science and technology, vital for national security and economic prosperity.” That’s a lesson that policymakers of all political persuasions should take to heart.
In 2009, the Gallup Student Poll of young people in grades five through 12 began documenting what it called the student engagement cliff. This cliff describes how student engagement drops dramatically as young people move from middle through high school.
More evidence for this decline in involvement and enthusiasm comes from recent Gallup polling on Gen Z 12- to 18-year-olds and a Brookings Institution and Transcend analysis. The latter also describes a parent perception gap between students reporting on their school engagement and parents’ perception of student school engagement.
These analyses of the student engagement cliff are troubling. But they also may reveal a rational response by students to a genuine problem in their school environment that must be solved. A solution includes developing an economics of identity based on the hope cycle that entails acquiring the knowledge and relationships that contribute to forming an identity.
Donald Trump’s push for peace in Ukraine has left the West aghast and with good reason. The man expected to pull America off the world stage seems determined to have a hand in every conflict. The candidate who campaigned on fear of World War III is set on upending the rules that prevented it for 80 years. The self-styled master negotiator is giving away the game before it begins, ceding Moscow’s main demands before Vladimir Putin even agrees to come to the table. Long-time American allies—including in all the capitals of Europe—have been left out of talks about Ukraine.
The outcome in Ukraine is to be determined, but what is certain is the damage to the international order—perhaps permanent damage. Tensions between Washington and Europe dominated this weekend’s Munich Security Conference, and on Monday anxious European leaders will gather in Paris to plan a collective response.
The administration’s diplomacy is inscrutable. First, Secretary of Defense Pete Hegseth said one thing—that there could be no return to Ukraine’s prewar 2014 borders, no Ukrainian membership in NATO, and no American peacekeeping troops in Ukraine. John Coale, America’s deputy envoy to Ukraine, said the opposite: the U.S. had not ruled out NATO membership or restoring Ukrainian territory. Then, Vice President J.D. Vance dramatically shifted the tone, threatening increased sanctions on Russia and sending U.S. troops to Ukraine, as Secretary of State Marco Rubio tried to reassure Kyiv, declaring that the U.S. has “a stake in Ukraine’s long-term independence.”
Two government reform advocates, author and lawyer Philip K. Howard and Will Marshall of the Progressive Policy Institute, discuss Trump’s deep state blitz, what DOGE is getting wrong, and their advice for Elon Musk in a forum at Hofstra University.
From our Budget Breakdown series highlighting problems in fiscal policy to inform the 2025 tax and budget debate.
Republicans have spent the last four years decrying deficits during the presidency of Joe Biden and pledged to start bringing those deficits down when they took control of Congress. But those promises proved hollow when the House and Senate Budget Committees both advanced competing budget resolutions this week. Although they differed greatly in their details, both were designed to pave the way for Republicans to pass budget-busting policies on a party-line basis, the biggest of which would be an extension and possible expansion of the Tax Cuts and Jobs Act (TCJA) they passed in 2017.
The budget resolution passed by the House Budget Committee on Thursday would give the Ways & Means Committee the ability to spend $4.5 trillion on tax cuts over 10 years in a filibuster-proof reconciliation bill. It would also give other committees the ability to increase spending by another $300 billion. But the resolution only calls on other committees to identify $2 trillion of offsetting spending cuts, meaning the Republican reconciliation bill is likely to add more than $3 trillion to the national debt over the next decade after including the cost of interest. If passed, this reconciliation bill would add more to deficits than any other bill passed through the filibuster-proof reconciliation process in history.
Supporters of the House budget resolution tried to deflect from their fiscal hypocrisy by claiming that economic growth stemming from tax cuts would generate up to $3 trillion in additional revenue. House Budget Chair Jodey Arrington even went so far as to claim that these savings made their resolution effectively a “balanced budget” in yesterday’s markup. But these figures are farcical: even the most ideologically sympathetic groups find that less than one-seventh of TCJA’s cost could be offset by economic growth. In fact, the official scorekeepers at the nonpartisan Congressional Budget Office estimate that extending TCJA’s non-business tax cuts would actually reduce economic growth and lose additional revenue.
The Senate GOP’s budget resolution was seemingly more measured, calling for “only” $342 billion in new spending on defense, immigration enforcement, and energy. However, while Senate Republicans claim that this spending will be fully paid for, the resolution is light on details and does not specify from which committee(s) offsets will come. Moreover, Republican senators have made clear that, should their budget be adopted, it would only be the first of two. A second resolution would be used to clear a path for a separate tax cut bill, which is likely to be even more fiscally irresponsible than the one proposed by House Republicans.
With federal deficits already hovering near $2 trillion for several years in a row, it is fiscally irresponsible to continue piling on debt for unpaid-for tax cuts. As we saw during the Biden administration, unchecked deficits can exacerbate inflation and raise costs for American households. It was this very bout of inflation that helped propel Republicans to victory this past November. If they successfully implement either the House’s or the Senate’s reconciliation instructions, Republicans will be solely responsible for any price increases it might cause, and would completely abdicate any pretense of being the party of fiscal responsibility.
U.S. inflation rose 0.5% in January — the fastest monthly increase since August 2023 — and was driven by higher costs in groceries, gasoline, and housing. Several components of Trump’s economic agenda, including tariffs and deficit-increasing tax cuts, are likely to put further upward pressure on inflation over the coming months.
Student engagement in K-12 schools drops dramatically as young people move from middle through high school. Evidence for this decline in involvement and enthusiasm—dubbed the engagement cliff—comes from the Gallup Student Poll of young people in grades five through 12, which began in 2009. This engagement cliff can be seen in recent Gallup polling on Gen Z 12- to 18-year-olds and in a Brookings Institution and Transcend analysis describing a parent perception gap in student engagement.
Unfortunately, the problem of disengagement is not limited merely to middle and high school students. Gallup polling of workers paints a similar picture of today’s worker disengagement that it calls “the great detachment.”
To be sure, record-high levels of student and worker disengagement from school and work are disturbing trends. However, these trends may be the symptoms of a rational response by students and workers to problems in their environments that must be solved. One solution lies in developing an economics of identity based on the hope cycle.
On this episode of RAS Reports, Curtis Valentine, the Director of PPI’s Reinventing America’s Schools Project, and Naomi Shelton, CEO of the National Charter Collaborative, sit down with Dr. Lester McCorn, a graduate of Morehouse College and President of Paine College in Augusta, GA.
The group discusses Paine’s role in preparing African-American K-12 students for college, as well as what it would mean for schools like Paine to create schools on campus as an authorizer of public charter schools.
FACT:Extra tariff costs for Valentine’s Day in 2026: $2.5 billion?
THE NUMBERS: Valentine product tariffs, now and (maybe) in 2026 –
2025
2026?
Corset:
23.5%
43.5%?
Rose:
6.5%
26.5%?
Chocolate (boxed confectionery)
5.6%
25.6%?
Gold jewelry with diamonds
5.0%
25.0%?
WHAT THEY MEAN:
Having dropped his campaign-era “stabilize prices and quickly bring down costs,” Mr. Trump’s plan — short form, “there may be some pain” — appears to be threatening tariffs against all and sundry: Colombia, steel, Canada, medicine, small packages, China, etc. We did predict this, and will look at the industrial side in a week or two in light of recent experience. (In short, with steel and aluminum in the news, the main result of the 2018 steel and aluminum tariffs appears to be a ~10% drop in U.S. use of the two metals.) But this Valentine’s eve, here’s a seasonal forward look at what lovers might expect.
The National Retail Federation predicts $27.5 billion in Valentine’s Day spending this year: $14.8 billion on the long-stemmed reds, the dark chocolate, the bling, and the scraps of silk, plus $6.8 billion on cards and evenings out and $6.9 billion on other miscellaneous gifts and entertainment. Using NRF’s predictions and administration hints at a worldwide 20% tariff, the “some pain” program seems likely to raise next year’s V-Day costs by about $2.5 billion. Here’s an explanation, starting with some practical background on tariff payments and how they affect retail prices, and then a look at the four standards:
A tariff is a tax on purchases of goods from abroad, paid by the U.S. buyer — a business or an individual — to Customs and Border Protection. For industrial buyers like auto parts manufacturers or home-builders, the check is part of production cost. For retailers like florists and lingerie shops, it’s part of the “landed cost” from which they mark up to the store price. Taking the hypothetical sweater example in PPI’s Joint Economic Committee testimony last month, and converting appropriately for the season:
Consider a container of $100,000 worth of these sweaters corsets, hypothetically valued at $10 each, arriving at the Long Beach container port from Vietnam this week for a retailer’s Christmas Valentine selection. As the cranes move the container from ship to truck, the buyer reports the arrival to Customs and Border Protection and writes the agency a $19,700 $23,500 check, reflecting the 19.7% 23.5% tariff assigned to the sweaters corsets under HTS line 61051000 62123000. The price increase works like this:
Corset purchase from manufacturer
$100,000
Shipping bill from maritime carrier
$5,000
Retailer’s MFN tariff payment to CBP
$23,500
Total “landed cost”:
$128,500
The buyer then marks up from this $128,500 “landed cost” to profit a bit on each article. In this case, the 23.5% tariff raises the landed cost, and a few days later, the cash register price, by about 22.8%. Dumping another 20% tax on top of this — another $20,000 check — raises the landed cost to $148,500, meaning tariffs would hike store prices by 46%. Assuming tariffs raise store prices by a similar 90% of the actual tariff rate (though in practice this would vary based on freight costs — likely a bit higher for land cargo, and a bit lower for air freight):
Roses: Valentine flower spending is $2.9 billion, roughly a tenth of NRF’s $27.5 billion total. February being a winter month, America’s 11,600 florists buy abroad: about two-thirds of the roses come from Colombia, and most of the rest from Ecuador. Colombian blooms get no tariff — there’s a free trade agreement — while buyers of Ecuadoran roses pay 6.5%. The florists pay about $140 million for flowers in the January/February season, and write CBP tariff-payment checks totaling about $7 million. Had Mr. Trump followed through on his 50% tariff threats against Colombia three weeks ago, they would have taken a $70 million hit, and the store price of a dozen long-stemmed reds would likely have jumped from the roughly $90 current national average to around $125 or $130. Next February, a 20% overall tariff would raise flower prices by perhaps $500 million.
Chocolate: All commercial chocolate ultimately comes from abroad — mostly from West Africa. Patterns are complex, with U.S. chocolatiers buying lots of cocoa beans and paste to make candy and syrup, retailers bringing in boxes of high-end European confectionery, and the chocolate trade regime a maze of sugar and dairy quotas as well as tariffs. To simplify, chocolate confectionery has a 5.6% tariff and import value of $1.3 billion last year. A 20% new tariff might cost buyers $220 million for confectionery only, or $400 million if it hits early enough to raise U.S. manufacturers’ bean, butter, and paste costs.
Diamonds: Jewelry purchases come to $6.5 billion. As with chocolate, virtually all gems come from abroad — diamonds mainly from kimberlite pipes beneath Botswana and South Africa, and colored stones variously from Colombia (emeralds), Thailand and Sri Lanka (sapphires), and Thailand, Cambodia and Myanmar (rubies). Uncut gems are duty-free, while jewelry usually has tariffs from 5.0% to 6.5%, depending on the metal involved. A 20% tariff might hike costs by a billion dollars, depending again on whether it hits early enough to hit New York diamond-cutters as well as jewelry retail.
Lingerie: Lingerie spending by NRF’s estimate will be about $1.6 billion. Asian seamstresses stitch most of the ladies’ underwear worn in the United States, with China providing half and Indonesia, Sri Lanka, Thailand, Vietnam, and Cambodia most of the rest. Trade policy is puritanically tough here, with underwear tariffs averaging 13% — nearly six times the overall U.S. 2.4% average — and (as we’ve earlier noted with strong disapproval) quietly taxing women’s at 15.5% and men’s only 11.5%. With annual lingerie tariff charges already about $650 million, a new 20% tariff might raise prices by $1 billion.
In sum: In love gifts as in industrial metals, the likely outcome is higher prices, then less purchasing. Money isn’t everything, of course. If they’re priced out of higher-cost roses and jewelry next February, younger and lower-income couples can still exchange cards and remind each other that “it’s the thought that counts.” But they might also want to know who’s responsible.
Ghana’s Cocoa Board on chocolate history worldwide and in West Africa:
And an underwear reprise:
Washington Post writer Catherine Rampell on our 2023 V-Day blast against the unfair, gender-biased U.S. underwear tariff system.
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.
WASHINGTON — Across the country, particularly in major cities, there is a stark disparity in energy infrastructure. Many predominantly Black and Latino neighborhoods have older homes that lack energy-efficient, cost-effective appliances, further straining communities already disproportionately impacted by poverty, discrimination, and underinvestment.
Today, the Progressive Policy Institute (PPI) released a new report, Energy Costs Come First: A New Approach to Environmental Justice, authored by Elan Sykes, examining the disproportionate energy burdens faced by low-income Black and Latino communities. The report provides a critical analysis of how current climate and energy policies exacerbate economic hardship for these communities and outlines a pragmatic path forward — one that prioritizes affordability, clean energy deployment, and regulatory reforms to enable rapid progress for all Americans in the energy transition.
“Too many communities of color in the U.S. are stuck with outdated energy infrastructure and sky-high energy bills,” said Elan Sykes, author of the report and Director of Energy and Climate Policy at PPI. “The clean energy transition represents an opportunity to fix this, but we must do it in a way that actually benefits the people who need it most — by lowering costs and emissions while ensuring a reliable, affordable supply of energy.”
The report focuses on Boston and the broader New England region as a case study, revealing how energy policies, infrastructure constraints, and regulatory barriers have compounded energy insecurity in predominantly Black neighborhoods. Key findings include:
Higher Energy Burdens for Black Households: Data shows that energy costs, as a share of household income, increase in proportion to the share of Black residents in a given Boston neighborhood.
Infrastructure Bottlenecks Driving Up Costs: Due to legal and regulatory hurdles, New England remains cut off from lower-cost energy sources, forcing vulnerable communities to rely on expensive and dirtier fuels like diesel and imported liquefied natural gas (LNG).
Flawed Climate Strategies Worsening Inequality: Activist-driven policies focused on blocking new energy infrastructure — without adequate replacement solutions—have made electricity and heating even less affordable for working-class families.
Lessons for National Policy: The dynamics seen in New England are not unique. Across the U.S., a failure to balance climate ambition with affordability is alienating working-class voters and exacerbating economic inequality.
The report highlights how federal, state, and local permitting laws — intended to protect the environment — are instead being weaponized to delay clean energy projects, prolong dependence on expensive fossil fuels, and drive up costs for the very communities that environmental justice advocates seek to protect.
PPI’s recommendations include:
Permitting Reform to Accelerate Clean Energy Deployment: Congress and state governments should streamline approval processes for renewable energy projects, grid expansion, and natural gas infrastructure to lower costs and improve reliability.
Targeted Energy Assistance for Low-Income Families: Expand and modernize programs like the Low Income Home Energy Assistance Program (LIHEAP) and Weatherization Assistance Program (WAP) to better serve households struggling with high energy burdens.
Creation of Community Energy Hubs: Establishing local institutions to provide consumers with trusted information on energy efficiency, clean energy options, and financial assistance programs.
A Balanced, Technology-Neutral Approach: Instead of rigid fossil fuel bans, policymakers should support an energy mix that includes nuclear, wind, solar, geothermal, and natural gas to ensure both emissions reductions and cost stability.
The report also warns that Republican efforts to dismantle clean energy policies, combined with Democratic policies that exacerbate affordability issues, risk deepening political alienation among working-class Black and Latino voters — a shift that was evident in the 2024 elections.
With the Biden administration’s historic clean energy investments now facing potential rollbacks under a second Trump presidency, PPI urges policymakers to adopt a pragmatic, affordability-first approach to the clean energy transition — one that accelerates progress while keeping energy bills manageable for working families.
PPI’s Energy and Climate Solutions Initiative links two vital and inseparable national goals: assuring abundant and affordable energy for Americans while lowering U.S. and global greenhouse gas emissions to combat climate change. These goals must be pursued in tandem because we won’t be able to build majority support for climate action if Americans fear it will lead to higher energy costs at home or free-riding by the world’s major carbon-emitters. Only by tackling both sides of the energy and climate equation can U.S. leaders break today’s political deadlock between climate deniers and fossil prohibitionists and create a politically sustainable strategy for America’s clean energy transition.
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. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on X.
Across the United States, too many communities of color lack access to reliable and affordable energy. Facing the dual problems of inadequate infrastructure serving their neighborhoods and being more likely to live in older, less energy-efficient housing on average, low-earning Black and Latino families are forced to spend higher shares of their smaller incomes on energy compared to wealthier and better-connected neighborhoods around them. As a consequence, they face painfully high energy bills and experience energy insecurity at double the level of white households. This burden is a woeful legacy of poverty, discrimination, and underinvestment in poor urban neighborhoods.
This legacy also includes aging energy and transportation systems like coal-fired power plants and highways that release disproportionate concentrations of harmful local pollution in disadvantaged communities, exacerbating health issues that compound with widespread financial and energy poverty. The clean energy transition offers a historic opportunity to relieve these burdens by replacing older and dirtier resources with new technologies and expanding electricity grids, transit systems, and dense urban housing to meet growing needs. Unfortunately, this opportunity has not yet been taken.
Instead, the green left has pursued a transition strategy that exposes vulnerable communities to higher, less predictable prices while obstructing reforms that would enable faster and wider deployment of clean energy projects. In the name of environmental justice and climate urgency, activists and decisionmakers have urged the abolition of all fossil fuels and used procedural barriers to obstruct new fossil infrastructure. But as explored in this paper, the strategy of procedural obstruction backfires when it adds interminable delays to clean energy projects and prolongs the life of coal- and oil-fired power plants.
Energy prices emerge from a complex mix of geography, markets, and policy choices, which are hard to isolate. This report focuses on Boston and the regional grid of New England more broadly as an initial case study of the special energy burdens of low-income communities. Connected to the rest of the continental U.S. by the state of New York, elected leaders and green activists have combined to lock Boston and New England into a status quo energy system that cuts off access to renewable energy sources like wind, solar, and hydropower as well as domestic natural gas capacity. By opposing local substation upgrades, transmission lines for hydropower imports from Quebec, and pipelines bringing Appalachian shale gas across Pennsylvania and New York, politically powerful elites in one of America’s most progressive regions are using federal laws like the National Environmental Policy Act (NEPA), the Clean Water Act, and state laws like the Massachusetts Environmental Policy Act (MEPA) to subject their lower-income neighbors to unnecessary price volatility and prolonging reliance on coal and oil. When global gas markets are disrupted, as in the 2022 Russian invasion of Ukraine, this import dependence exposes isolated New England to severe price spikes. To make up for the winter power shortfall, Boston and its surrounding areas are forced to use dirtier and more expensive energy resources, burning diesel and imported gas to power the grid and heating homes with fuel oil.
The cost of these spikes does not fall evenly on all New England communities. This paper tracks community impact using the metric of energy burden, or average monthly residential energy costs divided by median household income for a given location, to identify which people and places are hit hardest. According to data from the Census compiled by the Department of Energy’s LEAD (Low-income Energy Affordability Data) tool, the rate of energy burden in a given Boston census tract rises in clear proportion to the share of households identifying as Black. This paper includes an appendix with data for the energy burden in every district represented by a member of the Congressional Black Caucus for further examination. Future reports will examine energy burdens in other communities, starting with a study of congressional districts with significant Latino populations.
The statistical relationship between Black population share and higher energy burdens holds true for Black communities across the country. LEAD’s data definitively show that census tracts with high shares of Black households are more likely to experience higher energy burdens than their neighboring tracts even across states with wide variation in energy infrastructure, resource mix, and housing types in a remarkably strong pattern. These are the results when utopian demands of green activists and environmental groups for a rapid phase-out of fossil fuels — which still supply 83 percent of America’s primary energy and vary in carbon intensity — take precedence over local families’ struggles to pay their electricity and heat bills.
Boston is exemplary, but not unique. National activist groups like the Sierra Club, 350.org, and the Center for Biological Diversity argue for the same policies regionally in New England as they do in policy debates across the country. This includes not just state and local fights over individual projects but also federal policy discussions in Washington, where they sent a joint letter to then-Majority Leader Senator Chuck Schumer (D-N.Y.) opposing federal energy permitting reforms in June 2024. If these activist approaches continue to dominate the Democratic party’s environmental justice and climate policy conversations, low-income voters who do not share their priorities may continue their exodus from the party.
The main challenge facing Democrats is to build broader public support for a more pragmatic energy transition. To win a new hearing among working-class voters, Democrats must discard the utopian visions of Green New Dealers and their failed strategy of trying to scare working-class voters into supporting the premature abolition of fossil fuels. As PPI polling shows, most working-class voters are neither abolitionists nor climate deniers, with 54% majority support for a combination of old and new resources, including nuclear, wind, solar, geothermal, and natural gas, to power our growing economy while reducing greenhouse gases.
On the other extreme, Trump’s so-called “energy dominance” agenda would devastate U.S. clean energy industries and dismantle crucial methane mitigation programs that incentivize oil and gas producers to prevent waste. Such an abrupt shift would not only cede ground to Chinese clean technology producers in global markets, counter to stated administration goals on trade and manufacturing, but would also hurt consumers by depriving them of access to the cheapest and cleanest resources available.
Instead, policymakers should embrace a pragmatic environmental justice vision that brings down costs and emissions by enabling wide and rapid deployment of clean energy technologies and the infrastructure needed to support them. This infrastructure push would include relieving regulatory bottlenecks on clean electricity development, transmission and distribution grid upgrades. It would also include the natural gas pipeline and generation capacity needed to support them, enabling the connection of significantly more clean energy resources to consumers and helping to bring down costs.
Pairing this shift with bolstered subsidies for low-income households and introducing innovative frameworks for community engagement hosted at newly established Community Energy Hubs (see PPI Policy Recommendations below) would ensure that disadvantaged Black households would stand to gain improved access, lower costs, and a more concrete sense that the energy transition is working for them. On top of changes to the federal energy policy landscape, state and local policies that remove barriers not just to the development of clean energy infrastructure but also restrictions on dense housing, mass transit, and multimodal streets would help ensure that Black communities that face concentrated poverty and generations of infrastructural discrimination are not left exposed to the elements by inadequate insulation, higher utility bills on lower incomes, or lack of policy support.
POLICY RECOMMENDATIONS IN BRIEF
Congress, State legislatures, and local governments should enact all-of-the above permitting reforms to accelerate the development of electricity grid expansion, clean energy generation, supply chains for clean energy technologies, low-carbon mass transit and dense housing construction, and the natural gas capacity needed to support the grid while displacing coal and fuel oil combustion.
Congress must also maintain and strengthen LIHEAP and WAP to ensure that households can afford energy services in acute crises and gain access to efficiency upgrades.
State governments should establish pilot Community Energy Hubs that serve as a consumer-facing resource to ease transaction costs and close information gaps on available resources and technologies for homeowners, renters, landlords, workers, and small business owners.
Amid the tide of bilge—lies, personal smears, conspiracy theories, and other drivel—offered by the Trump administration in the last two weeks as an alleged rationale for shutting down USAID and ending America’s decades-long tradition of foreign aid, one legitimate question stands out: How exactly is foreign aid in America’s interest? Or, to put it another way: How and to what extent do we benefit from spending money to improve conditions and better lives in other countries?
Consider USAID’s portfolio in Ukraine, which expanded sharply after Russia’s invasion in 2022—from $200 million in 2021 to $16 billion in 2023, adding up to some $35 billion in the past three years. USAID has served as the primary funnel for America’s nonlethal support for Ukraine, now the agency’s largest recipient worldwide.
The expansion of assistance to Ukraine originally enjoyed strong bipartisan support. According to a public “exit memo” by Biden administration USAID Administrator Samantha Power, the agency leveraged a three-to-one match by other donors, including the private sector and allied countries. Funding was spread across an array of projects, from humanitarian aid for elderly residents holding out in the rubble of ruined frontline cities to digital innovation designed to reduce corruption and keep government services running.
WASHINGTON — Real wages were well below historical trends going into the 2024 election, despite strong economic growth. At the same time, the latest job release from the Bureau of Labor Statistics shows that foreign-born workers now account for more than 19% of U.S. employment, up sharply in recent years.
A new report from the Progressive Policy Institute (PPI), titled “Real Wages, Immigration, and the Election,” explores how the combination of weak real wages and the historic jump in immigration in 2023 and 2024 became a major factor in the 2024 election outcome. Authored by Dr. Michael Mandel and Andrew Fung, the report argues that voters were not misinformed about the economy, as some political analysts suggested. Instead, they accurately recognized that their real wages had fallen behind pre-pandemic trends.
“Our research shows that real wages were far weaker than expected,” said Michael Mandel, PPI Vice President and Chief Economist. “That reality shaped voter attitudes in 2024, and Democrats were unprepared for the backlash.”
Key findings include:
Real wages fell during the post-pandemic inflationary surge, but unexpectedly did not fully recover when inflation abated, leading to what the report calls a “wageless economic boom.”
Legal immigration is a clear positive for the country in the long run. But foreign-born workers accounted for nearly 90% of total employment growth from 2019 to 2024, suggesting a short-term connection between stagnant real wages and the jump in immigration.
Democrats misread the political landscape by touting indicators such as job creation and GDP while failing to address voters’ economic discontent about wage growth.
“Real wages need to be at the center of economic policymaking and political strategy,” said Andrew Fung, PPI Policy Analyst. “If voters feel they’re falling behind financially, no amount of strong GDP numbers or job gains will change their minds.”
With the 2024 election serving as a wake-up call, Democrats must recalibrate their economic message — focusing on real wage growth and cost-of-living improvements — to regain trust among working-class voters.
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. Learn more about PPI by visiting progressivepolicy.org. Find an expert at PPI and follow us on X.
In retrospect, the Biden Administration ran an unprecedented political economy experiment: What happens when a massive jolt of investment spending runs into historic levels of immigration? The outcome turned out to be an odd and confusing mixture of good news and bad news that no one expected. Gross domestic product and employment both soared well above pre-pandemic forecasts. These strong headline macroeconomic indicators gave many Democrats a false sense of security going into the 2024 election.
But despite the unanticipated strength of hiring, real wage growth slowed to a crawl. In its August 2019 economic outlook, the Congressional Budget Office had forecast that private sector wages and salaries, adjusted for inflation, would rise by about five percentage points over the next five years. In fact, by this measure, real wages did not rise at all from 2019 to 2024 — a “wageless economic boom” that soured many voters on Democratic candidates.
Real wages surged during the early days of the pandemic, fell during the inflationary period, and then started to climb again. But, surprisingly, the gap between the projected real wage and the actual real wage did not narrow in 2023 and 2024.
What happened? The obvious answer is inflation. Rising prices for food, energy, housing, and other essentials created a cost-of-living crisis, which eroded real wages. As PPI has written, the surge in inflation was at least partly due to high levels of government spending, including Biden’s hallmark investment legislation.
But government spending alone doesn’t explain the inability of wages to keep up with rising prices, which had such an impact on the election. All other factors being equal, after the initial inflationary shock, strong job growth and lots of job openings should have allowed workers to negotiate higher wages with employers. Instead, wages showed a weak response to inflationary pressures.
So why did real wages not rebound faster in 2023 and 2024? The Federal Reserve’s attack on inflation by raising interest rates is likely part of the cause. But GDP growth stayed strong, and the economy never came close to recession.
Given the timing, one important potential contributor to the real wage slowdown is the historic surge of immigration in 2022, 2023, and 2024, which added millions of new workers to the labor market in a short period of time. New estimates from the Census Bureau, released in December 2024, confirm that foreign-born immigration soared to over 2.5 million in 2023 and over 3 million in 2024.
BLS data shows that foreign-born workers accounted for 89% of employment growth from 2019 to 2024. And a May 2024 paper from the Federal Reserve of Kansas City draws a link
between immigration and wages, at least for the post-pandemic period:
….Industries and states that experienced larger increases of immigrant workers tended to see more deceleration in mean hourly earnings growth rates between 2021 and 2023.
Let’s be very clear. PPI believes that, in the long run, increased legal immigration represents a clear positive for the country in both the economic and social sense. We strongly support expanding pathways for legal immigration to help meet America’s future demographic, workforce, and innovation aspirations, while taking sustained action to minimize illegal immigration in a manner consistent with our values. This balance is necessary for keeping America the vibrant, resilient, and robust culture and nation it is today.
However, it’s increasingly clear that Democrats made a huge political mistake in the 2024 election by not acknowledging the short-term economic impacts of historic levels of immigration. This policy brief will draw connections between the time path of real wages, the unexpected immigration surge of 2023 and 2024, and the outcome of the 2024 elections. We will not be discussing here whether the Biden Administration should have followed different investment spending or immigration policies. These are complicated questions that require weighing a variety of short-term and long-term benefits and costs.
Rather, our goal is to offer a possible explanation of the divergence between the rosy headline macroeconomic indicators in 2024 and the consistent negativity of voters about their economic prospects. This negative real wage shock amplified voter concerns about issues such as immigration, trade, technology, and housing. Immigration is especially important for understanding the election.
We can’t say for certain that the weakness in wage growth in recent years was caused by the latest surge in foreign immigration. Whether or not immigration was responsible for slow wage growth during this period, voters do not think like economists. As such, it is not surprising that many made a connection between the immigration surge and the weakness in real wages, given what they see in their daily lives.
This analysis has several political implications. First, voters were not suffering from misinformation when they blamed Biden for the economy. People knew that their real wages and real incomes were below pre-pandemic trends, and they resented the Democrats telling them how well they were doing.
Second, Democrats likely were held accountable not simply for the 2021-22 inflationary surge but for the inability of real wages to recover back to trend in 2023 and 2024. Third, this analysis offers insight into what could have been done better and how Democrats can avoid the same pitfalls moving forward. In particular, Democrats need to use real wages to help set a political context for policy goals. This time, the issues were government spending, inflation, and immigration. In the next election, the key issues may be different. But taking changes in real wages seriously will help align Democrats with the concerns of working Americans.
Ed Gresser from the Progressive Policy Institute discusses the inflationary impact of tariffs, as he reacts to the Trump administration’s imposition of levies on steel and aluminum imports.
