Progressive industrial policy is the ticket.
The Roosevelt Rundown is an email series featuring the Roosevelt Institute’s top 5 stories of the week.
1. How We Prioritize Labor in Trade
The Democratic presidential candidates are increasingly in agreement: Progressive industrial policy is the next frontier of trade. As Roosevelt Fellow Todd Tucker writes, Beto O’Rourke’s “Trade for America” plan is the latest evidence that fresh visions of trade are emerging—with a new focus on workers, the environment, and racial equity. “Trade policy didn’t come from heaven. It’s built by humans, and we can choose whose interests it serves,” writes Tucker.
2. Why the Student Debt Crisis Could Get Worse
The revolving door spins on: The Consumer Financial Protection Bureau’s new student loan watchdog, Robert Cameron, is a former lawyer for one of the nation’s largest student loan servicers. Cameron’s appointment comes amidst the rise of incoming sharing agreements (ISAs), a debt model that could push students’ interest rates above 18 percent. As loan servicers lobby for ISAs, Roosevelt Fellow Julie Margetta Morgan is sounding the alarm. “By making the case to Congress that these agreements are not loans, providers can essentially charge interest rates higher than many states allow,” she told CNBC.
3. Rewriting the Rules of Shareholder Capitalism
Momentum against shareholder power is building, as the Business Roundtable’s “Statement on the Purpose of a Corporation” proved. But while CEOs’ verbal commitments to all Americans are welcome, shareholder capitalism is embedded in our legal system, as Roosevelt Chief Economist Joseph Stiglitz writes for Project Syndicate. “That must change, so that corporations are not just allowed but actually required to consider the effects of their behavior on other stakeholders.”
4. The Role of Unconditional Cash
In making the case for his “freedom dividend,” presidential candidate Andrew Yang has often referenced a 2017 Roosevelt analysis of universal basic income. For the blog, Roosevelt President and CEO Felicia Wong and Vice President of Policy and Strategy Nell Abernathy clarify what that research actually said. Two takeaways: Public spending can grow the economy, and the way it’s financed is an essential driver of that growth. “To be clear: The assumption in our 2017 analysis was that cash payments would augment current social safety net spending. We did not consider the scenario proposed by Mr. Yang in which existing social benefits to individuals are cut in exchange for cash.”
5. How the Fed Can Step Up
As fears of an impending recession mount, Roosevelt Fellow JW Mason argues that, even now, the Fed can boost an under-capacity economy. With a relatively low labor force participation rate and still-lagging wage gains, the economy has much more room to grow, he writes. “We need a much longer period of strong growth to make up for the very weak demand in the years after the 2007 financial crisis. This calls for more expansionary monetary policy—that is, lower rates.”
What We’re Listening To
On the latest Business of Giving podcast, Roosevelt’s Felicia Wong explains how Roosevelt’s one-two punch can curb corporate power and reclaim public power and touts the role of think tanks in making change: “Think tanks fill really important gaps in both the development and the transmission of ideas from pure thinkers, pure academicians, to the public.”