Redefining Who Corporations Serve, Delivering on an Economic Bill of Rights, and a Progressive Rewrite of the Economic Rules
January 11, 2019
By Kendra Bozarth
The Roosevelt Rundown is an email series featuring the Roosevelt Institute’s top 5 stories of the week.
1. Redefining Who Corporations Serve
For decades, business executives have run US companies to benefit themselves and shareholders, largely ignoring the interests of other stakeholders including workers. For The New York Times, Roosevelt Fellow Susan R. Holmberg explores the precedent, both domestically and abroad, of recent proposals to rebalance power within American firms and our economy at large. Senator Elizabeth Warren (D-MA) shared the op-ed on Twitter. “American workers have helped create record corporate profits—but their wages have stayed flat for decades as companies reward CEOs and wealthy shareholders instead. My Accountable Capitalism Act would give workers a real voice in corporate decisions,” she said.
2. Delivering on an Economic Bill of Rights
Seventy-five years ago today, President Franklin D. Roosevelt called for an economic Bill of Rights during his State of the Union address. Political rights alone could not assure “equality in the pursuit of happiness,” he argued. From housing and health care to an economy free of monopoly power, FDR recognized that “true individual freedom cannot exist without [economic] security and independence.” For The Nation, Roosevelt Fellows Andrea Flynn and Susan R. Holmberg argue that, as we endure the second Gilded Age, progressives have an opportunity to put economic rights at the forefront of the debate: “This moment demands a framework for upending the structures that are driving inequality today.”
3. A Progressive Rewrite of the Economic Rules
Senator Sherrod Brown (D-OH) wants to lift Americans out of poverty, and one of his solutions involves expanding programs like the Earned Income Tax Credit (EITC). Washington Post’s Greg Sargent investigates what’s behind this big idea, noting that Brown calls for tackling people’s immediate economic pain as well as the structural problems that are creating that pain in the first place. “The idea behind these [proposals] is that a potent response to Trump’s vow to take on an economy rigged by and for the rich—which turned out to be a sham—is a progressive unrigging of the economy,” writes Sargent. “As Marshall Steinbaum of the Roosevelt Institute puts it, that entails a focus not just on ‘redistribution,’ but also on ‘structuring the economy to deconcentrate corporate power.’”
4. Challenging How We Think and Talk about Economics
In championing bold ideas like a Green New Deal, and thus provoking the “How do we pay for it?” question, Congresswoman Alexandria Ocasio-Cortez (D-NY) is bringing somewhat fringe economic debates into the mainstream conversation, including Modern Monetary Theory (MMT). For New York magazine, columnist Josh Barro provides a helpful examination of MMT and the different ways that some policymakers and economists think about paying for big new social programs. Roosevelt Fellow JW Mason “argues that the key usefulness of MMT is for political economy—to restructure the choices facing policymakers so they’re more likely to achieve the goals of full employment and stable inflation, and less likely to err as they have: on the side of low deficits, high unemployment, and missed inflation targets in the down parts of economic cycles.”
5. Wall Street’s ‘Solution’ to Student Debt
This week, journalist Andrew Ross Sorkin advocated for income share agreements (ISAs), a potential debt alternative to traditional student loans. Through ISA contracts, universities (often with funding from private investors) contribute to the cost of a student’s education in exchange for a cut of their future income over a set number of years. Alongside Yale law students Brittany Farr and Daniel Hornung, Roosevelt Fellow Julie Margetta Morgan explains why this approach may not meet its promise to make higher education more affordable. She examined the idea further in a one-on-one interview with VICE’s Matt Taylor, as well as a Twitter thread—to which Sorkin responded.
What We’re Reading
In Project Syndicate, Roosevelt Chief Economist Joseph E. Stiglitz writes on the international fight for climate change reform. “The grassroots movement behind the Green New Deal offers a ray of hope to the badly battered establishment: they should embrace it, flesh it out, and make it part of the progressive agenda,” he says. “We need something positive to save us from the ugly wave of populism, nativism, and proto-fascism that is sweeping the world.”