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Marshall: Making America Work Again

Posted on by The Progressive Policy Institute

As the midterm election draws near, Democrats and Republicans are locked in a race to the bottom of the public’s esteem. A majority of voters (51%) take an unfavorable view of Democrats – the party’s lowest rating since 1984, according to a new ABC News poll. Meanwhile, President Obama’s job approval has fallen to a nadir of 40%.

Republicans are even less popular, but their midterm prospects look better because their voters – older, white and married – seem more motivated to turn out on election day. The poll shows that likely voters give GOP the edge on key issues like the economy, immigration, the deficit and security. Since Republicans have done little to earn such confidence, it seems reasonable to conclude that the voters’ mood is more anti-incumbent – i.e., President Obama — than pro-GOP.

That’s usually the case six years into any President’s tenure, and the media has called the poll bad news for Obama and the Democrats.

No doubt, but what really stands out is growing public revulsion with the nation’s political leadership, regardless of party. Despite an improving economy, 71% of voters say the country is on the wrong track. And a whopping 83% are dissatisfied with the way the U.S. political system is working. Here again the Republicans get an undeserved pass, as likely midterm voters divide about equally when asked which party is more to blame for political deadlock.

In any case, the poll’s big takeaway is the public’s profound antipathy toward the hyper-partisan and dogmatic approach to politics that has come to characterize what I’ve called the Polarized States of America. The politics of polarization has been good for ideologues, uber-rich activists and narrowly focused pressure groups, but it’s been a colossal bust with the American people.

Republicans have led the charge toward ideological purity and extremism, but some Democrats seem anxious to follow suit. They want the party to embrace a polarizing populism centered on top-down redistribution, knee-jerk hostility to the private sector and class grievance. But matching the GOP’s right-wing populism with a left-wing populism is a dead end for Democrats. It would repel the moderate voters Democrats must have to build electoral majorities, and perpetuate the partisan stalemate in Washington.

As I argued recently in an essay for Politico Magazine, what today’s partisan holy warriors don’t understand is that the U.S. political system is biased toward pragmatism. By creating a government of separated and divided powers, the Constitution’s architects made it exceedingly difficult for one faction or party to dominate national politics. Unlike a parliamentary system, where the victorious side wins all the marbles and can enact its agenda, America’s political operating system is geared power-sharing and compromise. Our country is best governed from the pragmatic center, not the polar extremes.

For all their frustration with Washington, Americans ultimately are pragmatists — they want a government that works. The party that can make the most convincing case for restoring our political system’s ability to solve problems will have the upper hand going into 2016. And that’s why progressives should spend the next two years crafting a strategy for breaking the paralyzing grip of polarization and getting America moving forward again.

Exporting U.S. Natural Gas: The Benefits Outweigh the Risk

Posted on by The Progressive Policy Institute

In a remarkably brief period, America has become awash in oil and natural gas. According to the U.S. Energy Information Agency (EIA) we have surpassed Russia as the world’s leading energy superpower, producing more oil and natural gas combined than any other country. This newfound abundance has turned old assumptions about U.S. energy scarcity and security on their head. For the first time since the energy crisis of the 1970s, there is mounting pressure—both domestically and abroad—for the United States to once again become a major energy exporter.

According to the EIA, America’s proved reserves of natural gas have increased in each of the last 15 years to a total of 308.4 trillion cubic feet (Tcf) in 2013, up 84% from 1999 estimates. The agency also estimates that unproved natural gas resources were at an increased level of 1,903.7 Tcf in 2009. These U.S. government estimates are in line with other assessments reported by several respected sources.

Most of these reserves are unconventional resources like coal bed methane, tight gas, and shale that have become more accessible due to significant advances in gas extraction technologies. As a result, the oil and gas industry, including expanding gas and oil production, have accounted for more than 9 million full- and part-time American jobs over the past few years.

The energy revolution also shows up in the results of the Progressive Policy Institute’s recently released 2014 U.S. Investment Heroes, an annual survey of the top 25 U.S. companies that invest most in the United States. On that list are 10 energy companies, involved in the exploration and production of oil and gas or energy distribution and power, that invested a total of $57 billion in 2013, representing 37% of the top 25 investment.

Download “2014.10-Freeman_Exporting-Natural-Gas“

Politico Magazine: How to Seize Back the Political Center

Posted on by The Progressive Policy Institute

For all the roller coaster drama of the battle to control the Senate, the midterm elections won’t really change much. No matter which party ends up with a majority, Americans will still wake up on Nov. 5 to a seemingly immutable stalemate in Washington. But pragmatic progressives should take heart. Over the next two years they have an historic opportunity: to build a broad center-left majority that can break the paralyzing grip of polarization and get America moving forward again.

Not so long ago, U.S. politicians who robotically toed the party line were considered shameless hacks. And ideologues were seen as wingnuts—self-righteous cranks unable to cope with life’s complexities. Today, such people dominate our national politics. How are they doing? If the measure is simplifying and sharpening dueling political narratives, they are doing a fine job. If it is governing, they are failing miserably.

The more polarized our politics, it seems, the less productive our government. In this sense, polarization serves conservative rather than progressive ends. If you hate government, you probably don’t mind that Washington has degenerated into Fight Club. Conservatives come to fight liberal schemes to enlarge government; liberals come to fight conservative schemes to succor the rich and screw everyone else. And the fight is what matters, not getting things done, because the fight is how you raise money, energize supporters and get media attention. Compared with the give and take of governing, partisan combat is easy, because you never have to think independently, face inconvenient facts or accomplish anything more than keep the other side down. Plus, you get to pose as a paragon of deep conviction.

 In this Manichean hothouse, the battle lines are clear and everyone knows their place. To break ranks on any major issue is treason, to see merit in the other side’s point of view is heresy, to compromise is to sell out and to engage in political horse-trading is corrupt. Finding common ground? That’s so 20th century. Don’t bore us with intellectual honesty, nuance or shades of grey—just pick a side, slug it out and let the best team win.

Such are the new rules of political competition in the Polarized States of America. There’s just one hitch: They clash with the basic design of our democracy. Winner-take-all outcomes are better suited to parliamentary systems. When a party wins a parliamentary majority, it is expected to enact its platform unilaterally or with minor party partners. America’s political operating system is different: With three separate and distinct branches of government, our constitutional frame is rife with divided powers, checks and balances and constraints on majority rule.

Our system is intended, in other words, to thwart just what today’s polarizers dream of: imposing their philosophy in all its undiluted glory on the nation. The Founders, who really were wise in these matters, didn’t trust what they called political “factions” to wield that much power. “Great innovations,” warned Thomas Jefferson, “should not be forced on slender majorities.” Our political system isn’t supposed to produce ideological coherence; it’s geared to yield outcomes that balance competing values and interests, and in consequence are broadly accepted as fair and legitimate. Our system is built for pragmatists. And absent the pragmatist’s values—power-sharing, the willingness to compromise, regard for minority rights and some measure of comity between the branches and parties—our democracy doesn’t work very well.

The Affordable Care Act (ACA) is an exception that proves the rule. In 2010, Democrats resorted to an unusual legislative tactic, budget reconciliation, to pass the law without a single Republican vote. Since then the GOP has waged an obsessive campaign to demonize “Obamacare” as a naked partisan power grab—even though their mean-spirited refusal to offer a serious alternative for covering the uninsured forced the majority’s hand. So while the ACA is a landmark achievement, as a strictly partisan one it rests on a wobbly political foundation. Most voters say they oppose the law, and conservative legal challenges are working their way through the courts. Should they win a Senate majority this year, Republicans say they’ll exact payback by using reconciliation to kill or nullify the law.

The GOP’s implacable hatred of Obamacare also underscores an oft-noted fact about polarization: It is asymmetrical. Surveys confirm what impartial observers of U.S. politics can readily observe: Republicans are more ideologically extreme and more stridently partisan than Democrats. Conservatives also are significantly less interested than liberals in political compromise. Under the sway of a new breed of anti-government zealots, the GOP is chiefly responsible for blocking action on some of the most pressing issues we face, from tax and fiscal reform to immigration and climate change.

The Democrats aren’t blameless. Many liberals, for example, are just as theologically opposed to modernizing entitlements as conservatives are to raising taxes. The result of this demagogic stance is anything but progressive. It means Washington will continue to direct a growing share of the country’s resources to seniors while starving investment in children and families and future growth.

In any case, Democrats have been moving steadily to the left, about as fast but not nearly as far as Republicans have shifted rightwards. The share of Democrats holding consistently liberal views, for example, has quadrupled from 5 percent in 1994 to 23 percent today. This leftward movement is a big problem for the party. If Democrats follow the GOP into the fever swamps of ideological purity, the nation’s political crisis will only grow deeper. Absent a fundamental and highly improbable revamping of our constitutional system, America can’t be governed from either ideological pole. Only by leading from the pragmatic center can Democrats capitalize on GOP extremism and rally broad public support behind new ideas for breaking the partisan log jam in Washington.

Continue reading at Politico Magazine.

Washington Examiner: Think Tanks: College graduates struggle in current economy

Posted on by The Progressive Policy Institute

In a collection of think tank reports on employment for recent college graduates, the Washington Examiner extensively quoted PPI Economist Diana G. Carew’s blog post “Surprising New Data on Young College Graduates.”

Diana Carew for the Progressive Policy Institute: Despite falling unemployment and a recovering labor market, young college graduates continue to struggle in today’s economy.

Analysis of new data reveals the real wages of young college graduates surprisingly fell in 2013, by 1.3 percent. The decline reverses a slight uptick in 2012, and continues along a 10-year trend in which real average earnings for young college graduates have fallen by a sizeable 12 percent since 2003.

Read the rest of the piece on Washington Examiner.

Economist: Silver Lining ‘How the digital revolution can help some of the workers it displaces’

Posted on by The Progressive Policy Institute

The PPI was cited by The Economist in a special report discussing the digital revolution and the potential job opportunities it provides to the very artisans it originally displaced:

“The ‘app economy’ has since grown by leaps and bounds. According to an estimate by the Progressive Policy Institute, a think-tank, in 2013 it provided work for more than 750,000 people in America alone. Many more take part in it from elsewhere in the world, including employees at Rovio, the Finnish firm behind the wildly popular “Angry Birds” line of mobile games, and people like Dong Nguyen, a young programmer in Vietnam who scored an unlikely app hit with “Flappy Bird”, a simple but addictive game that was at one point earning him $50,000 a day.”

Dr. Michael Mandel, Chief Economic Strategist at PPI, was also quoted:

Michael Mandel, a technology expert at the Progressive Policy Institute, reckons that innovation is generally followed by growth in employment. That is most obviously true in ICT, but also in sectors like energy, where fracking technology has generated an oil boom and a jobs bonanza in states such as North Dakota and Texas. Mr Mandel invites sceptics to imagine a future in which doctors can 3D-print livers (and other organs) on demand—a technology that looks increasingly realistic. 

Read the whole story at The Economist.

New York Daily News: Hong Kong screams, America is silent

Posted on by The Progressive Policy Institute

Listening to our government’s weaselly evasions on the protests in Hong Kong makes me wish America had an Aaron Neville Doctrine. Neville is the New Orleans crooner whose soul classic, “Tell It Like It Is,” topped the charts in 1966 and has been covered more than a dozen times since.

White House and State Department officials seem unfamiliar with the concept.

Hong Kong’s students and thousands of others have taken to the streets to protest the Chinese government’s plan to curtail their democratic rights. It began more than a week ago with class boycotts. By this Wednesday, the 65th anniversary of Communist rule in China, more than 100,000 people flooded the city, many of them toting now-symbolic umbrellas.

What they want is simple and universal: the right to genuine self-determination.

Beijing says it is perfectly willing to let Hong Kong residents continue to vote to choose their own leaders — but only for its pre-approved slate of candidates. That’s a blatant violation of the 1984 agreement between China and Britain under which the British colony would revert to Beijing’s control when its 100-year lease expired in 1997.

For its part, China agreed to permit “universal suffrage” in Hong Kong under a new policy of “one country, two systems.” The United States stood as a guarantor of that agreement, which preserved Hong Kong as a little island of political freedom within a vast communist monolith.

Continue reading at the New York Daily News.

PPI’s Hal Singer Joins FCC Open Internet Roundtable; Argues For Case-by-Case Adjudication

Posted on by The Progressive Policy Institute

WASHINGTON—Progressive Policy Institute Senior Fellow and Economist Hal Singer today served as a panelist for an Open Internet roundtable discussion hosted by the Federal Communications Commission (FCC). The roundtable, titled “Economics of Broadband: Market Successes and Market Failures,” first considered incentives to provide high quality open Internet access service and the relevance of market power. It then turned to policies to address market power, consumer protection, and shared benefits of the Internet.

Singer has long called for the FCC to eschew the heavy-handed approach of Title II regulation, and lean instead on its Section 706 authority to regulate potential abuses by ISPs on a case-by-case basis. Investment across both edge and content providers, he argues, will be greater compared to Title II, and the FCC can avoid any unintended consequences, such as creeping regulation, that encompasses content providers or other ISP services. Even an imperfect case-by-case approach to Internet discrimination is better and less costly than blanket prohibition, according to Singer.

“I would like to make five simple points in favor of a case-by-case approach to adjudicating discrimination complaints on the Internet,” Singer said in his remarks. “First, economists and engineers who have studied the issue of priority service unanimously believe that a market for priority could be a good thing for all parties to the transaction, including broadband customers. Second, not only do all parties to the priority transaction benefit, no third party is worse off with priority.

“Third, the leading proponent of strong net neutrality acknowledged in last week’s FCC Roundtable that priority could be a good thing so long as it is user-directed and users pick up the tab. Fourth, even if the FCC wanted to ban priority outright, there is no guarantee that Title II is up for the task. Fifth, the critiques of case-by-case should not persuade the Commission to embrace a blanket prohibition on priority.”

Download Singer’s prepared remarks.

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ABC Action News: To cut college costs – cut college

Posted on by The Progressive Policy Institute

ABC Action News interviewed PPI Senior Fellow Paul Weisntein regarding his recent policy report, Give Our Kids a Break: How Three-Year Degrees Can Cut the Cost of College. By promoting the three-year degree and consolidating all higher ed tax breaks into a single grant, Weinstein argues, policymakers can go a long way in making the college affordability dream a reality all while improving graduation rates and making sure our universities remain the most competitive in the world.

While the a year of college is irreplaceable in terms of frat parties and tailgates, Weinstein said most students are continuing their education in graduate school. Taken alongside a masters or doctorate, a lost year of undergraduate study may be a drop in the bucket.

“We need to acknowledge that when more people feel the need to get a masters or more, this is not the end of school,” Weinstein said.

College costs have soared in large part because states cut funding to their public colleges, which are attended by about half of university students.

Read more at ABC Action News

Multichannel News: Singer Makes Case For Case-By Case Approach to Discrimination

Posted on by The Progressive Policy Institute

Multichannel News discusses PPI Senior Fellow Hal Singer’s stance on the FCC’s upcoming Network Neutrality forum:

“Singer, who points out that he has worked with independent cable nets on a number of discrimination complaints before the FCC, plans to say that economists and engineers who have looked at the issue believe paid priority could (emphasis Singer’s) be a good thing  for all concerned, including consumers. He says they could be used for “bad” as well as good, like anticompetitive favoring of an ISP’s own content. But that, for instance, the packets associated with telemedicine demand better treatment than those carrying a cat video. That is why all priority deals should not be banned.”

Read the entire story at Multichannel News.

The Hill: Leading out front

Posted on by The Progressive Policy Institute

President Obama’s forceful speech to the United Nations last week appeared to mark a sharp—and welcome—turn in his thinking about Islamist terrorism and the wisdom of U.S. retrenchment.

Rather than dwell on the things a war-weary United States can’t do, Obama spoke with resolve and passion about what America must do. He called out Russia for its aggression against Ukraine and the patent mendacity of its propaganda, promised U.S. help in rolling back the Islamic State, and said Washington would play a leading role in in combating Ebola and climate change.

Gone was the ambivalent note that often creeps into the president’s meditations on American power and the global responsibilities that go with it. Nothing in this speech smacked of “leading from behind.”

Crucially, Obama also brought a new and deeper sense of realism to America’s approach to Middle East turmoil. Up until now, his foreign policy has revolved around the conceit that his administration is “ending America’s wars.” Six years later, it’s glaringly apparent that wars don’t end and terrorists don’t stop killing just because we’ve decided to pack it in.

Continue reading at the Hill.

 

Telegraph: New US tax inversion rules usher in era of forced ‘economic patriotism’

Posted on by The Progressive Policy Institute

Michael Mandel, PPI’s chief economic strategist, was quoted by the Telegraph in an article on U.S. companies moving their headquarters overseas to avoid American taxes. Last week, the White House introduced new measures intended to make so-called” tax inversion” more difficult:

However, another school of thought claims American companies will continue moving their headquarters overseas – only with the foreign firms calling the shots.

“The legislation encourages activist investors and foreign companies to work together to make takeover bids for US multinationals with large amounts of cash outside the country,” says Michael Mandel, chief economist at the Progressive Policy Institute. “No company, no matter how large, would be safe.

Read more on Telegraph.co.uk

Forbes: Net Neutrality at Home, TTIP Abroad. Moving Towards the Center?

Posted on by The Progressive Policy Institute

In an article on net neutrality and the Transatlantic Trade and Investment Partnership, Forbes contributor Larry Downes mentioned speaking at “Growing the Transatlantic Digital Economy,” an event hosted last week by the Progressive Policy Institute and the Lisbon Council:

Later in the week, I spoke at a program co-sponsored by the Progressive Policy Institute, the Lisbon Council, and the Georgetown Center for Business and Public Policy on “Growing the Transatlantic Digital Economy,” which reviewed efforts to bridge what have often been large gaps in policy that make digital trade between the U.S. and the E.U. difficult, including differences our respective approaches to competition, privacy, and communications infrastructure regulation between the two economies.

Read the full piece on Forbes.com

Surprising New Data on Young College Graduates

Posted on by The Progressive Policy Institute

Despite falling unemployment and a recovering labor market, young college graduates continue to struggle in today’s economy.

Analysis of new data reveals the real wages of young college graduates surprisingly fell in 2013, by 1.3 percent. The decline reverses a slight uptick in 2012, and continues along a ten-year trend in which real average earnings for young college graduates has fallen by a sizeable 12 percent since 2003. The chart below shows real average annual earnings for college graduates aged 25-34 working full-time with a Bachelor’s degree only.

realearningsfallchart

This troubling trend presents significant political and economic challenges that policymakers can no longer afford to ignore. As consumers and taxpayers in their prime earning years, young college graduates represent one of the most important segments of the working population.

Politically, the continued struggle of well-educated Millennials sends a clear warning to progressives to support a more convincing growth agenda. A pro-growth agenda must be based on investment and innovation, instead of redistribution and more of the same debt-driven consumption of the last decade. Otherwise, young Americans, the vast majority of which voted overwhelmingly for Obama in 2008 and 2012, may change parties or stay home on Election Day.

Economically, falling real wages for young college graduates is resulting from what I call The Great Squeeze. That is, more young college graduates are finding themselves underemployed – taking lower skill jobs for less pay at the expense of their less educated peers. The continuation of this trend, five years after the Great Recession, suggests this problem is more than just temporary. (While this is for BA only, the trend is the same for those with a BA or higher.)

The Great Squeeze is rooted in demand-side and supply-side factors. On the demand-side, the high underemployment plaguing young college graduates is connected back to the slow-growth economy. Our education, tax, and regulatory policies have failed to adapt to the realities of a data-driven world, keeping investment and high-wage job creation on the sidelines. Here simply having a college degree is not enough to guarantee success. In fact, a recent study from the Federal Reserve found that one-quarter of college graduates earned the same amount as those with a high school diploma or GED.

And on the supply-side, colleges are failing to adequately prepare college graduates for the high-skill, high-wage jobs that are being created in fields like data analytics and tech. For example, although far more women were awarded degrees in 2013 than men, most majored in business, health-related disciplines, education, and psychology.* It is hardly surprising that more data and tech employers are turning to alternative training models to meet their workforce needs. Yet in spite of the mismatch, if anything, our federal student aid system is exacerbating the imbalance.

In short, there are two main takeaways here for policymakers: (1) we need better policies in place to encourage employers to invest and create jobs domestically, and (2) young Americans need a postsecondary education system that is better aligned with the shifting nature of the labor force.

*Author’s tabulation of 2013 IPEDS data.

Daily Record: The three-year bachelor’s degree?

Posted on by The Progressive Policy Institute

In an article on education reform, The Daily Record discussed PPI Senior Fellow Paul Weinstein’s paper on three-year college degrees:

What if the traditional four-year undergraduate degree went away?

What if getting a bachelor’s degree in just three years became the norm?

That’s the proposal put forth by Paul Weinstein, director of the public management program at Johns Hopkins University.

Weinstein suggests that moving to three-year degree programs would solve many of higher education’s ills, namely the soaring cost of a college education and the staggering levels of student loan debt.

The Progressive Policy Institute in Washington recently published Weinstein’s proposal in a paper titled “Give Our Kids a Break: How Three-Year Degrees Can Cut the Cost of College.”

“For generations of Americans, earning a college degree was considered the surest way to achieve the American Dream,” he writes. “But the rising cost of college and the tremendous debt burden it will place on our children is now threatening to derail that track to prosperity. While many policymakers have focused on ways to augment financial aid, the question of how to cut the actual cost of getting a degree has been largely ignored. We can no longer afford to discount that crucial second question.”

Continue reading at The Daily Record.

Houston Chronicle: Could student debt crisis cure be a 3-year degree?

Posted on by The Progressive Policy Institute

PPI Senior Fellow Paul Weinstein’s new paper supporting three-year degree models was the subject of a Houston Chronicle article. Weinstein argues that “the four-year model is based on tradition and little else”:

A researcher at Johns Hopkins University says he has the cure for America’s growing student debt crisis: cut a year off college.

Paul Weinstein, director of the university’s graduate program in public management, is the latest to push for a three-year degree model. He argues in a new paper for the Progressive Policy Institute that American universities should shift their standards away from the arguably arbitrary four years it takes to graduate.

Students could save 25 percent by attending college for three-quarters of the time, Weinstein argues. They could also save on interest on student loans, and existing grants could be streamlined to save them even more, he writes.

“People are realizing we’re reaching a point where the system is no longer going to be viable.
People understand we’ve got to do something,” Weinstein said in an interview with the Houston Chronicle. “A number of ideas are being put out there, so there’s a real acknowledgment.”

Read the entire story on The Houston Chronicle.

Baltimore Fishbowl: What If College Lasted Three Years Instead of Four?

Posted on by The Progressive Policy Institute

PPI Senior Fellow and Johns Hopkins University director Paul Weinstein was quoted by the Baltimore Fishbowl, discussing his new proposal for three-year bachelor degrees:

“The three-year degree is the only higher education reform plan that would cut the cost of a college degree while ensuring our higher education system remains the best in the world,” Weinstein told the Hopkins Hub. “Students at public institutions would save on average almost $9,000 over the course of their studies while students at private schools could save as much as $30,000.”

Read more on Baltimore Fishbowl.