issue: Economy

CNN: America needs more than populist message

Posted on by The Progressive Policy Institute

With Donald Trump and Ted Cruz locked in a bitter battle for the Republican nomination, the stakes in 2016 rise dramatically. The likely victory of either one of these deeply flawed candidates will give Democrats a chance not only to hold the White House, but also to realign U.S. politics. No wonder Republicans are panicking.

To seize the opportunity, however, Hillary Clinton will need to transcend the limits of a “populist” message based on identity politics, economic victimhood and redistribution. Thus far such themes have dominated the nomination battle with Sen. Bernie Sanders, but they won’t help Democrats forge a broader political coalition that includes suburban moderates, college-educated independents and many Republicans who are aghast at the prospect of branding the White House with a giant “T.”
Of course, with yet another caucus victory on Saturday, this time in Wyoming, Sanders will stay in the race, if only to keep tugging Clinton to the left. But Clinton needs to resist this ideological gravity, because Sanders’ left-wing populism is not an effective answer to the right-wing populism that Trump channels with such diabolic cunning.
Before the Bernie Bots clank into action, let me hasten to say I’m not positing moral equivalence between Sanders and Trump. Sanders is honest, principled and decent; Trump is, well, none of those things. But the lifelong socialist’s dream of turning America into a paternalistic, European-style welfare state isn’t the right prescription for what ails our country.
Continue reading at CNN.

Forbes: The Progressive Policy Institute’s Push to Cut Bureaucracy

Posted on by The Progressive Policy Institute

Forbes contributor Jared Meyer recently interviewed PPI’s chief economic strategist Dr. Michael Mandel on regulatory reform and economic growth.

The Progressive Policy Institute recently released a report titled “Unleashing Innovation & Growth.” The report covers a comprehensive list of public policy topics, including reforming America’s growing level of federal regulation. In what follows, PPI’s chief economic strategist Michael Mandel explains why pro-growth regulatory policies offer an alternative to the populist sentiments that are influencing both sides of the political spectrum.”

Read the interview in its entirety at Forbes.

PPI Tackles Tax Disputes in Europe

Posted on by The Progressive Policy Institute

Last week, PPI led a bipartisan delegation of 10 high-ranking Congressional staffers to London and Brussels, which is still grieving in the aftermath of the March 22 terrorist attacks. Our visit there so soon after the atrocity was greeted warmly as an act of transatlantic solidarity.

The Digital Economy Study Group was the third such delegation PPI has taken to Europe in as many years. Our mission is to engage influential government and private leaders in exploring common ways to tackle our mutual dilemma of slow growth and stalled social mobility. We believe more innovation and growth are the best antidotes to the virulent strains of populism that are warping democratic politics on both sides of the Atlantic.

Our trip began last Tuesday in London at 10 Downing Street, where Daniel Korski, deputy head of policy for Prime Minister David Cameron, briefed our delegation on the government’s efforts—including a low-tax patent or innovation box—to encourage greater digital investment in the UK. Then it was on to Westminster, where Tory MP Ian Liddell-Grainger led the group on an entertaining tour of Parliament, which also included a brisk dissection of Britain’s controversial Pay As You Earn (PAYE) tax.

Also at Parliament, Labour MP Meg Hillier, Chair of the Public Accounts Committee, defended the government’s diverted profits tax as a response to public anger over the tax avoidance strategies of international companies. At breakfast the next day, veteran Labour MP John Spellar offered a trenchant analysis of how economic change and slow growth have scrambled British politics and led directly to June’s “Brexit” referendum. At UK Treasury, Financial Secretary David Gauke explained how recent reforms to corporate tax rules have resulted in greater foreign investment and business creation.

On Thursday, we took the Eurostar to Brussels, where the U.S. Mission to the European Union briefed us on difficult aspects of the US-EU economic relationship, including the new “Privacy Shield” agreement, international tax policy, and the TTIP trade pact. At the European Commission’s powerful Competition directorate, the group had a robust exchange of views with officials overseeing “state aid” investigations that have called into question tax agreements negotiated by EU member states and U.S. companies. We expect these issues resurfaced this week when Commissioner Margarethe Vestager visited Washington for talks with Congress and the administration.

Later, officials at DG CONNECT briefed the group on Europe’s efforts to establish a digital single market and plans for “platform regulation” to create space for European tech companies to grow. On Friday, the DG GROW team discussed their wide-ranging efforts to spur entrepreneurship and digital skills building across Europe. The growing gulf between U.S. and European views on tax policy also was the subject of a lunch with Bart Van Humbeeck, economic advisor to Kris Peeters, Vice-Prime Minister of Belgium, hosted by Paul Hofheinz of the Lisbon Council. Our last official meeting was with PPI friend Ann Mettler, Head of the European Strategy Centre, an in-house think tank for EU President Jean-Claude Junker.

These frank and in-depth discussions enabled us and Congressional staff to get a better understanding of the sometimes byzantine workings of the EU, as well as its often different perspectives on issues vital to both sides—privacy and cross-border data flows, digital innovation, trade, tax, copyright and more. The visits also have impressed on our European friends that U.S. policymakers are paying closer attention to such issues. PPI’s hope is to nudge these sometimes contentious conversations to common ground, and strengthen the fraying bonds of transatlantic economic cooperation.

Washington Examiner: Should we care less about inequality?

Posted on by The Progressive Policy Institute

Jason Russell quotes PPI President Will Marshall on public opinion towards economic inequality and how it can change over time.

“If everybody else is rising then really, in this country, there isn’t a strong appetite for punishing wealth creators,” Will Marshall, president of the liberal Progressive Policy Institute, said Wednesday at an inequality discussion hosted by Economics21 at the Manhattan Institute (my last employer). “Nobody cared about inequality in the late ’90s because all groups were rising.”

Read the full article at the Washington Examiner.

Press Release: PPI Unveils New Blueprint for Shared Prosperity

Posted on by The Progressive Policy Institute

FOR IMMEDIATE RELEASE
March 15, 2016

Contact: Cody Tucker, 202-775-0106
or ctucker@ppionline.org

A Progressive Alternative to Populism

PPI Unveils New Blueprint for Shared Prosperity

WASHINGTON—The Progressive Policy Institute (PPI) today released Unleashing Innovation and Growth: A Progressive Alternative to Populism, a new blueprint for renewing America’s economic dynamism.

The plan offers an array of creative proposals for accelerating the “digitization” of the physical economy; lowering regulatory obstacles to innovation and entrepreneurship; launching a new public works push; adopting pro-growth tax reform; grooming the world’s most talented workers; and enabling working families to escape poverty and build middle class wealth.

The blueprint also takes aim at the populist anger that has figured prominently in campaign 2016:

…[P]opulists do Americans no favors by claiming the economic game is hopelessly rigged against them, that the leaders they elect are incompetents, or that our democracy is rancid with corruption. None of these claims is true, and such demagoguery undermines public confidence in America’s boundless capacity for self-renewal. Populist anger fosters an ‘us versus them’ mentality that, by reinforcing political tribalism and social mistrust, can only make it harder to build consensus around economic initiatives that benefit all Americans.

“We believe progressives owe U.S. voters a hope-inspiring alternative to populist outrage and the false remedies of nativism, protectionism and democratic socialism,” writes Will Marshall, PPI President.

“I encourage anyone looking for optimistic ideas to create more jobs, wealth, and prosperity for hard working Americans to read PPI’s new report using innovation to spur growth,” said Congressman Ron Kind (D-Wis.), Chairman of the New Democrat Coalition. “This report is full of forward thinking policy initiatives that help grow the American economy.”

“In the midst of today’s populist uprising, it’s up to our leaders to recognize the real reasons why our economy isn’t working for everyone and to fight for effective solutions,” said Governor Jack Markell (D-Del.). “PPI’s blueprint gives policymakers a roadmap to create opportunity for all Americans by harnessing the unstoppable forces of globalization and technological innovation, while opposing the impractical, and sometimes dangerous, proposals offered by the political extremes.”

The anger on which populists feed is rooted in a real economic problem: America has been stuck in a slow growth trap since 2000. This long spell of economic stagnation has held down wages and living standards and shrunk the middle class. What the nation needs is a forward-looking plan for moving the U.S. economy into high gear. Instead, as the PPI blueprint notes, today’s populists peddle nostalgia for our country’s past industrial glory but offer few practical ideas for building new American prosperity in today’s global knowledge economy.

Unleashing Innovation and Growth seeks to fill this vacuum in the presidential campaign, offering bold ideas for unleashing the collective ingenuity of the American people—harnessing disruptive change, raising skills, lowering tax and regulatory barriers to individual initiative and creativity, and experimenting with innovative ways to rebuild middle class wealth and enable more Americans to exit poverty.

Summary of Key Proposals

Unleash Innovation
• Spread innovation across the economy: Adopt a new “Innovation Platform” aimed at stimulating public and private investment in new ideas and enterprises, and at diffusing innovation across the entire economy.
• Improve the regulatory climate for innovation: Tackle the mounting costs of regulatory accumulation, the constant layering of new rules atop old ones; Make systemic changes to regulatory agencies to make promoting investment, innovation and new enterprises part of their core mission; Rein in occupational licensing requirements that screen out many low-income entrepreneurs; Lift outdated restrictions on lending to small business; give businesses incentives to offer more flexible work, including paid leave.
• Innovate our way to clean growth: Implement a more innovative energy strategy that simultaneously advances two vital interests: powering economic growth and assuring a healthy environment; Recognize that, for the foreseeable future, the U.S. and the world will have to tap all fuels—renewable, nuclear, and fossil—to meet growing energy demand and sustain global economic growth; Institute a nationwide carbon tax to curb greenhouse emissions while driving investment to clean and efficient energy.
• Democratize trade: Sell more of America’s highly competitive exports to a growing global middle class; promote the free flow of data across global borders; support innovative trade agreements, like the Trans-Pacific Partnership (TPP), that lift labor, environment and human rights standards in developing countries and enable more Americans to benefit from trade; Seize new opportunities for U.S. small businesses and entrepreneurs to use low-cost digital platforms to tap into global growth.

Align Fiscal Policy with Innovation and Growth
• Embrace pro-growth tax reform: Advocate for a dramatic shift from income to consumption taxes to stimulate investment in productive economic activities rather than those favored by the current tax code; Close loopholes that benefit special interests and dramatically simplify taxes for most Americans; Raise enough money to cut corporate income taxes down to globally competitive levels, and reduce taxes that penalize innovation and hiring.
• Modernize public works: Accurately measure the true economic impact of infrastructure spending; open infrastructure markets to private capital; define a strategic role for Washington through a national infrastructure bank; impose firm deadlines on project approvals and licensing process.

Groom the World’s Most Talented Workers
• Reinvent public school: Champion new models of school governance that enable more school autonomy and innovation, more customized learning, rigorous standards, and genuine accountability and results.
• Create new pathways into middle class jobs: Create a more promising approach to “career pathways” by combining classroom training and work experience through a sequence of jobs, within or across firms in an industry, and a sequence of credentials that signal their growing skill levels.
• Cut college costs for everyone: Rein in costs and decrease debt by encouraging colleges to offer three-year degrees rather than the traditional four-year program and focus policies on competency, rather than credit hours.

Build Middle Class Wealth
• Narrow the wealth gap with universal pensions: Champion “universal pension” accounts that would enable all workers to save for retirement, navigate the maze of tax-favored retirement plans, and take their pensions with them when changing jobs.
• Help families save for homeownership: Tackle the twin problems of declining homeownership and souring housing costs for both owners and renters by creating a new, tax-preferred mechanism for down payment savings—“Home K”—to lower obstacles to homeownership, like tight credit and down payment requirements, for first-time homebuyers and to promote savings.

Fight Poverty with Empowerment
• Empower people with smart phones: Use modern technology to cut through bureaucratic barriers to government safety net programs, consolidate benefit streams, enable people living in poverty more access to the information they need, and apply online for social supports; Encourage federal, state, and local governments to create online H.O.P.E. (Health, Opportunity, and Personal Empowerment) accounts and action plans.
• Expand housing choices for low-income Americans: Convert some federal rent subsidies into incentives for homeownership to relieve the burden on low-income families of high housing costs and reduce the waiting list for subsidized housing, without raising taxes or adding to the federal deficit.

Download Unleashing Innovation and Growth: A Progressive Alternative to Populism.

Unleashing Innovation and Growth: A Progressive Alternative to Populism

Posted on by The Progressive Policy Institute

As Americans choose a new president in 2016, populist anger dominates the campaign. To hear Donald Trump or Senator Bernie Sanders tell it, America is either a global doormat or a sham democracy controlled by the “one percent.” These dark narratives are caricatures, but they do stem from a real dilemma: America is stuck in a slow- growth trap that holds down wages and living standards. How to break this long spell of economic stagnation is the central question in this election.

Today’s populists peddle nostalgia for our country’s past industrial glory but offer few practical ideas for building a new American prosperity in today’s global knowledge economy. Progressives owe U.S. voters a hopeful alternative to populist outrage and the false panaceas of nativism, protectionism, and democratic socialism. What America needs is a forward-looking plan to unleash innovation, stimulate productive investment, groom the world’s most talented workers, and put our economy back on a high-growth path. It’s time to banish fear and pessimism and trust instead in the liberal and individualist values and enterprising culture that have always made America great.

Download Unleashing Innovation and Growth: A Progressive Alternative to Populism

Washington Post: The new Democratic Party proposal to rival Bernie Sanders’ socialism

Posted on by The Progressive Policy Institute

Simplicity is one of Bernie Sanders’ great strengths: Corporations and the rich have rigged the economy. His solutions sound simple, even when the plans behind them are complicated: college for all, health care for all, tax the rich, break up big banks. He trails Hillary Clinton in presidential delegates to this point, and he remains an underdog for the Democratic nomination, but Sanders has already pulled Clinton, and the party, toward a more populist, more socialist policy agenda, thanks in part to that clarity of message.

The centrist Democrats who oppose that leftward lurch have struggled to match his simplicity. They tend to view the economy through a lens of skills and adaptation, not power and treachery. Many of them pushed in the 1990s, under President Bill Clinton, to expand global trade and deregulate the financial sector. They now concede those efforts did not go according to script, particularly for middle-class workers, but they are not calling for a full rewrite in response.

Their risk, in this election and moving forward, is to define themselves solely as anti-Democratic-socialist – the folks who don’t like the stuff that a lot of Democrats like about Sanders.

The Progressive Policy Institute is the latest centrist Democratic institution to try to counter that image. Today it will release what its president, Will Marshall, calls a “radical” agenda to get America working for the working class again. The report is called “Unleashing Innovation and Growth: a Progressive Alternative to Populism,” and it is organized around a straightforward, if not perfectly simple, principle.

Read more at The Washington Post

PRESS RELEASE: New PPI Report Links Future U.S. Productivity to Mobile Broadband Availability

Posted on by The Progressive Policy Institute

Study finds that Next-Generation Wireless Networks Could Add Nearly $3 Trillion to U.S. GDP by 2030; Increase Economic Output by 11 Percent

WASHINGTON—A new policy report released today by the Progressive Policy Institute (PPI) examines the long-term relationship between mobile broadband and U.S. economic growth and relates it to current public policy questions.

The report, authored by PPI Chief Economic Strategist Michael Mandel, focuses on the year 2030 and considers the economic implications of next generation wireless networks for long-term productivity growth and living standards. The result could be an acceleration of productivity growth in the physical industries that adds roughly $2.7 trillion (in 2015 dollars) to U.S. GDP by 2030, according to the report. This translates into an 11 percent increase in economic output, which is equivalent to boosting the average annual growth rate by 0.7 percentage points.

“Creating vastly more wireless capacity is essential for getting the United States out of the slow-growth trap we are currently stuck in,” Mandel writes. “In order to catalyze the next round of spectrum-enabled economic expansion, policymakers need to focus on freeing up multiples of the current amount of spectrum—both for licensed and unlicensed uses—while creating an economic environment in which it is profitable to build and maintain a greatly expanded number of cell sites.

“Conversely, if policymakers fail to free up enough spectrum, or free up more spectrum for unlicensed rather than licensed operations, or impose regulations that reduce the return on investment that currently fuels spending on telecom infrastructure build-out, the likely outcome will be that the physical industries—which make up the greater part of the economy—will fail to achieve their productivity potential. In that event, all Americans will suffer.”

“PPI’s paper provides concrete evidence that next-generation wireless networks will be key to transforming our economy and drive economic growth by over 10 percent. This report underscores the importance of the FCC’s upcoming 600 MHz auction and spectrum frontiers effort, as well as the need to identify the next bands of spectrum for wireless use to fuel our mobile-first lives,” said Meredith Attwell Baker, President and CEO, CTIA. “We remain committed to working with all interested parties to free up more spectrum—both licensed and unlicensed—so that the world’s best mobile industry can provide our nation with almost $3 trillion in productivity gains.”

This report makes three main points.

• Slow productivity growth today across much of the economy is correlated with the failure of “physical” industries such as manufacturing, health care, and construction to make good use of digital technologies, compared to “digital” industries such as professional services, finance, and entertainment. PPI estimates that the physical industries, which make up roughly 80 percent of the private sector, account for only 35 percent of private info-tech investment, and only 40 percent of the telecom usage. A recent paper from the McKinsey Global Institute estimates that the United States has only reached 18 percent of its potential for digitization.
• PPI suggests that successfully digitizing physical industries will require a vast increase in remote sensors and remote-controlled devices such as cars, drones, and construction equipment. Cisco forecasts that M2M wireless traffic in the United States, including wearables, will rise from 3 percent to 11 percent of all mobile data by 2020. In this paper, PPI further projects that IoT related M2M communications will account for roughly 35-47 percent of mobile data communications by 2030.
• Achieving this level of connectivity and productivity improvement will require a sharp increase in the capacity of the nation’s mobile broadband networks. The nature of the capacity increase will depend on the development of technology. Using an analysis based on historical trends, we project that by 2030 it will be necessary to have more than 1900 MHz of spectrum in the sub-millimeter wave (mmW) bands (3 times the current availability) and at least 1.2 million cell sites (4 times the current level) in order to fully enable the IoT-driven productivity gains we document in this new paper.

Download “Long-term U.S. Productivity Growth and Mobile Broadband: The Road Ahead”

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Long-term U.S. Productivity Growth and Mobile Broadband: The Road Ahead

Posted on by The Progressive Policy Institute

The next generation of wireless is on the horizon.1 While the standards for 5G are not yet finalized, it’s clear that when 5G does arrive, it will mean faster streaming video, lower latency, and higher capacity. Companies such as AT&T, Verizon, T-Mobile, Ericsson and Nokia are in test mode, with widespread consumer rollout of 5G expected by 2020, or perhaps earlier.

At the same time, the attention of the mobile providers is focused on the spectrum auctions scheduled to start later in 2016. These auctions could make a significant contribution to freeing up spectrum for mobile data, and perhaps help reduce the short-term spectrum deficit.2 Meanwhile, the Federal Communications Commission (FCC) has started exploring the use of “millimeter wave” frequencies (mmW) for mobile services, a move that could potentially open up much more spectrum in the medium- and long-run.3

But nothing is assured. In the short-term, network engineers and others are already indicating that the upcoming auctions are not going to be a complete answer to forestalling capacity crunches in the years ahead. In the medium and long-term, mmW could be the next great swath of spectrum beachfront but the promise of that technology is in its early stages. Policy actions, especially around the availability of spectrum and around business models, can have long lag times. Understanding the broad contours of the long-term relationship between wireless and economic growth may help influence today’s policy decisions.

This paper focuses on 2030 and the potential of future wireless networks to support economic growth in the United States.4 We consider the economic implications of next generation wireless networks for long-term productivity growth and living standards, and relate those to current public policy questions. The result could be an acceleration of productivity growth in the physical industries that adds roughly $2.7 trillion (in 2015 dollars) to U.S. GDP by 2030. This translates into an 11 percent increase in economic output, which is equivalent to boosting the average annual growth rate by 0.7 percentage points.

Download “2016.03-Mandel_Long-term-US-Productivity-Growth-and-Mobile-Broadband_The-Road-Ahead”

PPI WEEKLY WRAP-UP: PPI in Europe, State AGs Abusing Power, & U.S. App Economy Capitol Hill Briefing

Posted on by The Progressive Policy Institute

PPI IN EUROPE: PPI Chief Economic Strategist Dr. Michael Mandel was in Brussels this week, where he was invited to speak at an event on small and medium-sized enterprises (SMEs) and the Digital Single Market. The event was sponsored by the Swedish, Finnish, Irish and Estonian Permanent Missions to the European Union. While there, he and PPI Executive Director Lindsay Lewis held several meetings with the European Commission.

STATE AGs ABUSING POWER: In an op-ed for RealClearPolicy, Phil Goldberg, Director of the Civil Justice Center at PPI, details the evolution of the role of state attorney general over the last 20 years from mere law enforcer to general policymaker:

“Today, both Democratic and Republican AGs use litigation and the powers of the office to regulate. But with this new responsibility comes new opportunities to breach the public trust.

“A particularly alarming development is AGs’ increasing use of private law firms to sue companies under no-bid contracts where the firms get percentages of the settlements or awards. These arrangements were born out of tobacco litigation in the 1990s and have spread to all sorts of actions, leading to several scandals over the connections between AGs and the firms they hire.

“An aggressive way to address the politicization of the state AG is to have the AG selected by the governor, rather than through a popular election where he or she must raise campaign funds. The states that select their chief law enforcement officers this way have seen fewer scandals. For now, though, states should adopt legislation such as [the Transparency in Private Attorney Contract Act] to ensure that law-enforcement actions brought on behalf of the state put the public good above private profits.”

U.S. APP ECONOMY CAPITOL HILL BRIEFING: Please join PPI and TechNet next Thursdayfor a Capitol Hill breakfast briefing on “App Economy Jobs in the United States.” The event will feature remarks by Congressman Mike Bishop (R-MI), followed by a panel discussion featuring:

  • Dr. Michael Mandel, Chief Economic Strategist, PPI
  • Terry Howerton, CEO, TechNexus Venture Collaborative
  • Ron Klain, Executive Vice President & General Counsel, Revolution, LLC
  • Linda Moore, President & CEO, TechNet
  • Brendan Peter, Vice President, Global Government Relations, CA Technologies
  • Karl Rectanus, CEO, Lea(R)n
Thursday, March 3, 2016
10AM to 11:30AM
2226 Rayburn House Office Building
 
RSVP to rsvp@technet.org

Where innovation is falling short

Posted on by The Progressive Policy Institute

The Kauffman Foundation has just published a new book, entitled The New Entrepreneurial Growth Agenda. It is packed full of great essays examining the reasons behind today’s slowdown in growth, innovation, and entrepreneurship, and how these worrisome trends can be reversed.

I’m honored to have an essay in this volume, “Where is Innovation Falling Short?: Using Labor Market Indicators to Map the Successful Innovation Frontier.” In this essay, I suggest that the US is suffering from “uneven innovation.” In areas such as IT, robotics, and oil/gas exploration and production, the innovation frontier is expanding very rapidly. Meanwhile regulatory headwinds, among other factors, has held back the innovation frontier in other critical areas, such as biosciences and materials sciences.To support this argument, the essay uses a new approach based on labor market indicators—specifically, occupational employment from government surveys and online help-wanted ads from aggregators—to map out areas of successful innovation in detail.

This essay was discussed by Greg Ip in the Wall Street Journal last August in a piece called “Beyond the Internet, Innovation Struggles”. In future blog posts, I’m going to discuss the policy and political implications of this analysis.

PRESS RELEASE — PPI President: Law Enforcement Has Not Met Burden of Proof on Encryption

Posted on by The Progressive Policy Institute

WASHINGTON—PPI President Will Marshall today released the following statement after a U.S. federal magistrate ordered Apple to help the Federal Bureau of Investigation unlock the encrypted iPhone of one of the San Bernardino shooters:

“The Progressive Policy Institute has long advocated a forceful U.S. response to the threat of jihadist terrorism. With the rise and spread of the so-called Islamic State, that threat has grown more acute than ever. That’s why we are usually inclined to give U.S. intelligence, military and law enforcement agencies the benefit of the doubt when they seek new tools to keep us safe.

“However, a federal court’s demand that Apple weaken encryption for its iPhones gives us pause. For many Americans, it may seem intuitively obvious that law enforcement should be able to ‘unlock’ a dead terrorists’ cellphone. But weaker encryption wouldn’t just apply to terrorists and criminals; it would jeopardize the privacy of any American with a smart phone.

“What’s more, other governments would doubtless follow Washington’s lead in demanding that phone makers develop software to help them get around encryption. We don’t want to endanger human rights and democracy activists around the world by giving dictators and authoritarian regimes new tools for surveillance and repression.

“We recognize that there is always a trade-off between privacy and security. To justify exposing the private communications of citizens to government scrutiny, U.S. security agencies would have to offer compelling evidence that gathering data from smart phones is essential to defusing the terrorist threat.  In our view, they have yet to meet this burden of proof.”

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Democracy: A New Kind of Public Works

Posted on by The Progressive Policy Institute

Barack Obama is thinking big as his presidency enters the final stretch. The centerpiece of his last budget, unveiled this week, is a $300 billion plan for a “clean transportation system”—the biggest federal infrastructure push since President Eisenhower launched the interstate highway system. Here at last is a fix that’s equal to the magnitude of America’s immobility crisis. In polarized Washington, however, it’s going nowhere.

Obama’s proposal would effectively double U.S. transportation spending, paying for it with a $10-per-barrel oil tax. There’s no way a Republican-dominated Congress will vote for a new energy tax, even with oil prices down to around $30 a barrel. House Speaker Paul Ryan already has dismissed the plan as “an election-year distraction.” Nor can the White House expect many Democratic candidates to rally around what is essentially a middle-class tax hike.

Obama, the arch realist, knows all this. But he seems determined to ensure that two issues on which he’s made frustratingly little headway—clean energy and infrastructure investment—stay high on the nation’s political agenda. And if his visionary proposal injects these issues into campaign 2016, so much the better.

It’s hard to imagine a more urgent national priority than modernizing America’s decrepit transportation and water systems and updating our energy-wasting electrical grid.

With our economy stuck in low gear six years into “recovery,” making such investments now should be a no-brainer. It’s a proven way to create good middle-class jobs, boost the productivity of U.S. businesses and workers, and lay new foundations for future growth.

The deterioration of our country’s economic infrastructure has long been glaringly obvious, but U.S. political leaders have failed to coalesce behind policies for reversing it. A big reason is that Congress is controlled by a new breed of Republicans who regard all federal spending with kneejerk hostility. Conservative lawmakers seem to have lost the ability to distinguish between investments that generate tangible economic returns to society and spending that fuels present consumption.

Continue reading at Democracy.

Financial Times: Democrats struggle to harness economic feelgood factor

Posted on by The Progressive Policy Institute

Will Marshall, president of the Progressive Policy Institute, said that once Democratic strategists have moved past the primaries and into the general election they will need to portray a hopeful economic picture to voters — learning from the 2014 midterm elections in which he said the party had failed to capitalize on economic improvements under Obama.

The great issue in this campaign remains the great stagnation — the slow growth trends in this century,” he said. “But it is not for a semi-incumbent [like Mrs Clinton] to bemoan how terrible things are. You have to give people a sense of hope that the policies put in place in the last eight years have begun to put the country back on the path of full recovery.”

To read more, go to the Financial Times.

Politico: Presidential Politics Loom over TPP Signing

Posted on by The Progressive Policy Institute

Ed Gerwin, PPI’s senior fellow for trade and global opportunity is quoted in Politico talking about how U.S. elections are effecting TPP negotiations:

As the agreement was inked Wednesday, contrarians argue the tough campaign talk on TPP may actually encourage congressional Republicans to embrace it, fearing a historic missed opportunity to anchor the United States strategically and economically in China’s backyard if they fail to act, Pro Trade’s Doug Palmer reports.

“I think the negative views of many presidential candidates create tremendous pressure to get it done this year,” said Ed Gerwin, a senior fellow at the Progressive Policy Institute, a moderate Democratic think tank.

Otherwise, the agreement could remain on the back burner as a new president assembles his or her administration and decides whether to reopen negotiations, Gerwin said. There’s also the risk the deal could never become law at all.

To read more, go to Politico.