Change for America: Economic Policy
A Progressive Blueprint for the 44th President
Chapters:
Overview:
A Pro-Growth, Progressive Economic Agenda, Gene Sperling
(full chapter available here)
Overview:
A Progressive Agenda for Competitiveness and Trade, Laura D’Andrea Tyson
Overview:
Science, Technology, and Innovation Challenges, Thomas Kalil
Overview:
Economic Opportunity for All or a New Gilded Age? Peter Edelman and Angela Glover Blackwell
Overview:
Meeting the Challenge of the Housing and Credit Crises, Michael S. Barr
Department of the Treasury:
Credibility and Flexibility for Economic Growth, Joshua L. Steiner
(full chapter available here)
Office of Management and Budget:
Ensuring Fiscal Responsibility and Government Accountability, Sally Katzen and Jack Lew
(full chapter available here)
Office of the United States Trade Representative:
Responding to the Changing Global Challenge, Ira Shapiro and Richard Samans
(full chapter available here)
Department of Commerce:
Proving Ground for Sustainable Economic Growth, Jonathan Sallet
(full chapter available here)
Department of Labor:
Promoting Opportunity While Protecting Worker Rights, Edward Montgomery
Securities and Exchange Commission:
Restoring the Capital Markets Regulator and Responding to Crisis, Damon Silvers
A Pro-Growth, Progressive Economic Agenda
Gene Sperling
Full chapter available here.
Overview:
Our new president’s largest challenge: ensure we grow together as a nation so that we do not grow apart as a people. A pro-growth, progressive economic agenda must focus on policies that both raise the economic tide and lift all boats—boosting productivity and our gross national product while fostering the shared prosperity that defines our nation’s values. These progressive values require growth that makes room for those seeking to prosper in America without forcing others to share a smaller slice of the pie. These values support a new social compact that ensures a basic level of dignity in economic life for those who work and take responsibility for their lives. And they offer every worker real opportunity for upward mobility while ensuring that the accident of birth does not severely stack the deck against any child. To this end, the new administration and Congress should enact tax reforms and investments focused on new jobs, especially in alternative energy on our shores, a new Universal 401(k) pension plan to promote savings for working families, a new strategy to promote early intervention in middle school to promote college enrollment and completion for disadvantaged students, a universal health care program, and a broad range of policies designed to both boost our national competitiveness and economic security.
Gene Sperling, senior fellow at the Center for American Progress Action Fund, U.S. chair for the Global Campaign for Education, and co-chair for the Education Partnership for Children of Conflict. Previously, Sperling served as national economic advisor to President Clinton from 1997 to 2001 and deputy national economic advisor from 1993 to 1996.
A Progressive Agenda for Competitiveness and Trade
Laura D’Andrea Tyson
Overview:
Over the past 50 years, trade and economic integration with the rest of the world generated substantial economic and foreign policy benefits for the United States, yet not all Americans shared in the economic benefits. Now, with the rise of emerging market competitors and the outsourcing or offshoring of production, rising imports are causing job losses and wage declines, resulting in increasing insecurity for American workers at all but the highest skill levels. The structural and technological forces making the world economy more competitive and interdependent cannot be reversed, but the federal government can and must do much more to help U.S. workers compete and prosper in the global economy. The new president must work with Congress to enact progressive policies that include sustained investments in education, innovation, infrastructure, energy efficiency, and new energy technologies to strengthen the attractiveness of the United States as a production location and to create and retain good jobs for American workers. The new president must cooperate with Congress to enact a progressive competitiveness agenda with three key components. First, the new administration needs to invest in education, research and development, infrastructure, and energy efficiency and new energy technologies to strengthen the attractiveness of the United States as a production location and to create and retain good jobs for American workers. Second, we need policies to ensure a more equitable sharing of the costs and benefits of globalization through a new social contract that includes increases in the minimum wage linked to increases in inflation, an expansion of unemployment insurance, and healthcare reforms that break the link between employment and access to health care. Third, the new administration’s trade policies must be part of an international economic strategy to promote the broadbased expansion of living standards at home and abroad through enforceable labor and environmental standards in the United States and among our trading partners—standards that foster a global agreement on climate change.
Laura D. Tyson, former chair of the National Economic Council and former chair of the President’s Council of Economic Advisers, is a professor at the Haas School of Business, UC Berkeley and a senior fellow at the Center for American Progress Action Fund.
Science, Technology, and Innovation Challenges
Thomas Kalil
Overview:
The outgoing Bush administration’s hostility toward science has cost our nation dearly. Federal investment in research and development underpins our economy, our national defense, our safety and health, and our future workforce. To ensure that the United States remains an “innovation superpower” in the 21st century, the 44th president must increase funding for research and development, improve the math and science skills of America’s workforce, reform our nation’s immigration laws to attract the “best and brightest,” strengthen incentives for private sector investment in research and development, and expand the role that science, technology, and innovation can play in meeting some of our most important national and global challenges. These goals can be achieved, but only if the new president makes them a top administration priority. The new administration must restore America’s preeminence in science, technology, and innovation.
Tom Kalil, former deputy director of the White House National Economic Council, is special assistant to the chancellor for science and technology at UC Berkeley. Tom is also a senior fellow at the Center for American Progress Action Fund.
Economic Opportunity for All or a New Gilded Age?
Peter Edelman and Angela Glover Blackwell
Overview:
Economic mobility must be a vital priority for the new administration. Fulfilling the promise of equal economic opportunity for all depends on our success in growing the economy justly for all—a task neglected over the past eight years. Stimulating economic growth that benefits everyone and closes ever-widening economic gaps requires a multiplicity of action. Economic mobility policies must invest more successfully in children, youth, and young adults to prepare them for the challenges posed by globalization, in part by preparing them for new careers in a low-carbon economy so essential to the survival of the planet. Children need to be ready to learn when they start school. Schools need to teach 21st-century skills. Postsecondary education must reach far more people. And options for further learning must be available throughout our lives. Responsibility for action depends not just on public policymakers, but also on the full participation of business, labor, faith-based groups, and other civic actors to ensure each of us assumes individual and personal responsibility for ourselves, our families, and our communities.
Peter Edelman, former assistant secretary for planning and evaluation at the Department of Health and Human Services, has been a professor at Georgetown Law since 1982.
Angela Glover Blackwell served as senior vice president of the Rockefeller Foundation, and is founder and CEO of PolicyLink.
Meeting the Challenge of the Housing and Credit Crises
Michael S. Barr
Overview:
The U.S. economy is caught in a vicious downward spiral of declining home prices, escalating foreclosures, rising losses on mortgage-backed securities, and disappearing liquid- ECONOMIC POLICY 109 ity. The crisis spread rapidly from the mortgage market in 2007 to engulf other forms of consumer credit, commercial real estate, and municipal debt, and reached far beyond American soil in the last year of the Bush presidency. Major financial institutions failed. The risk of sustained global economic crisis remains high. The new administration must act aggressively to contain the crisis, reform our home mortgage system, and develop new approaches to broad-scale housing and financial-sector reform—beginning with a clear understanding of the problem itself. Lax regulation, supervisory neglect, lack of transparency, and conflicts of interest all undermined the foundations of our financial system. Financial innovations in securitization and other factors brought increased liquidity but also broadened the wedge between the incentives facing brokers, lenders, borrowers, rating agencies, securitizers, loan servicers, and investors. The lack of transparency and oversight, coupled with rising home prices, hid the problems for some time. When home prices and other assets imploded, credit woes cascaded through the financial system, and the lack of trust in the system meant that even sound financial institutions faced contagion from the crisis. That is why we need fundamental change.
Michael Barr, a senior fellow at the Center for American Progress Action Fund and a law professor at the University of Michigan, is also a non-resident senior fellow at the Brookings Institution and recently co-edited Building Inclusive Financial Systems.
Department of the Treasury
Credibility and Flexibility for Economic Growth
Joshua L. Steiner
Full chapter available here.
The effectiveness of the Department of the Treasury will ultimately depend on the quality of its team, its responsiveness to crises, and its ability to work effectively with other branches of government. Nothing illustrates the importance of these three qualities more acutely than the financial crisis of 2008, during which the Treasury had to demonstrate expertise, flexibility, and political agility. Success in each of these depends on acting quickly in recruiting good people and avoiding the kinds of early mistakes that can permanently damage a secretary’s efficacy. It is equally important, however, that the new treasury secretary, working with the new president, lay out a clear set of economic goals and priorities and then stick to them. The policy agenda will need adjustment to reflect day-to-day crises and changing circumstances, but a clearly articulated set of overarching goals will help ensure that long-term objectives do not fall victim to the inevitable brush fires of domestic and international economics. Simply put, no treasury secretary will see his or her priorities implemented without building the right team, avoiding mistakes that have hobbled his or her predecessors and, perhaps most importantly, building the right relationships.
Joshua L. Steiner, former chief of staff at the Department of Treasury and managing director at Lazard, is a managing principal of Quadrangle Group, LLC.
Office of Management and Budget
Ensuring Fiscal Responsibility and Government Accountability
Sally Katzen and Jack Lew
Full chapter available here.
The Office of Management and Budget is a tremendous resource to a new president, providing deep professional expertise and analytical capacity to help the administration build and execute its new policy agenda. After the election, the work at OMB starts at a run. Even before the Inauguration, the transition team working with OMB should begin preparing the 2010 Budget for transmittal to Congress by the end of February—a task requiring quick decisions on everything from Medicare and budget enforcement rules to the withdrawal of troops from Iraq. The new administration will face a difficult balancing job: to reestablish the importance of fiscal responsibility while simultaneously advancing a core policy agenda for economic growth and opportunity. The presidential transition team and the career OMB staff will also need to prepare to take control over the government regulatory process—a critical undertaking—immediately upon taking office. The 2010 Budget and especially the 2011 Budget will require significant time and attention, but OMB also has the opportunity for direct policy impact through focused attention on fixing government performance in targeted areas, through reform of government outsourcing policies, and through an in-depth review of all presidential Executive Orders issued over the past 8 years.
Sally Katzen, former administrator of the Office of Information and Regulatory Affairs, deputy director of the National Economic Council, and deputy director for management at the Office of Management and Budget, is a lecturer and public interest/public service fellow at the University of Michigan Law School.
Jack Lew was director of the Office of Management and Budget from 1998 to 2001 and executive director of the House Democratic Steering and Policy Committee from 1985 to 1987.
Office of the United States Trade Representative
Responding to the Changing Global Challenge
Ira Shapiro and Richard Samans
Full chapter available here.
Against a backdrop of deep public and congressional skepticism about the benefits of global trade and the collapse of the Doha Round, the Office of the United States Trade Representative must formulate a new and different trade policy—one that takes a strategic approach to making globalization more inclusive and sustainable. This new approach must be developed in league with Congress through a major review of our trade policies and the challenges and economic strategies of other nations. This new approach must build on the recent bipartisan agreement to include enforceable labor and environmental standards in new trade pacts and include a new focus on ensuring that trade rules help combat climate change and do not impede the essential global energy transformation. The new U.S. trade strategy should increase opportunities for cutting-edge U.S. industries in large markets around the world, and it should consider new trade arrangements, including World Trade Organization agreements in key sectors and wide-ranging agreements with those developed countries that share our commitment to open markets, intellectual property protection, labor rights, and environmental and consumer-protection standards. USTR and the new administration should focus intently on our country’s slipping trade position in Asia, as well as be part of an overall effort by the new administration to engage vigorously with China to redress the global economic imbalances exacerbated by China’s export-led growth and currency arrangements. The United States should take a leadership role in working to ensure that the least developed countries have the increased trade opportunities that the Doha Round has failed to deliver.
Ira Shapiro, former general counsel and trade ambassador in the Office of the United States Trade Representative, is an international trade lawyer at Greenberg Traurig, LLP.
Richard Samans, senior fellow at the Center for American Progress Action Fund and managing director of the World Economic Forum. Before joining the forum, Rick served as special assistant to the president for international economic policy in the United States, and was senior director of the National Security Council’s International Economic Affairs directorate in the White House.
The Department of Commerce
Proving Ground for Sustainable Economic Growth
Jonathan Sallet
Full chapter available here.
The Department of Commerce should be the new administration’s proving ground for sustainable economic growth. But meeting global economic challenges will require the new secretary to integrate the department’s multifaceted expertise into a singular force. The department brings together trade, environment, telecommunications, domestic economic development, among other areas of expertise, and it can help forge successful working relationships with businesses and state and local governments to confront pressing national challenges. The department should begin by strengthening its focus on economic and energy issues, developing a Regional Competitiveness Initiative that utilizes the potential and strength of industry clusters, and promoting better coordination among federal agencies on trade. It should also reinstitute the Advanced Technology Program to provide incentives for creating technologies that further national priorities; change the name of the National Telecommunications and Information Administration to the “National Broadband Agency” and refocus its efforts on deploying nationwide broadband; and lead a new 21st century manufacturing strategy. Longer term, Commerce must focus on ensuring that the 2010 and 2020 censuses are as efficient and accurate as possible.
Jonathan Sallet, partner with The Glover Park Group, served under President Clinton as assistant to the secretary and director of the Office of Policy & Strategic Planning of the Department of Commerce, focusing on economic and technology policy.
Department of Labor
Promoting Opportunity While Protecting Worker Rights
Edward Montgomery
The Department of Labor should play a central role in the new administration’s efforts to expand the middle class and protect the rights of working Americans. DOL can begin to do this immediately by effectively enforcing labor and safety laws already on the books and making sure that contracts and grants are awarded to programs with demonstrated effectiveness and the greatest need. Newly motivated DOL leadership can then attack other inherited problems by revamping workforce training programs, restoring the unemployment insurance safety net, boosting the department’s critical labor law enforcement capabilities—which include protecting the unfettered right to form and join unions—and modernizing trade and displaced worker adjustment assistances so that job loss does not lead to economic ruin for workers and their families. Pragmatic, effective, and transparent programs in these arenas will help expand the middle class and remind American workers that they do not have to choose between their health and safety, and their job.
Edward Montgomery, former deputy secretary and chief economist at the Department of Labor, is dean of the College of Behavioral and Social Sciences at the University of Maryland.
Securities and Exchange Commission
Restoring the Capital Markets Regulator and Responding to Crisis
Damon Silvers
The Securities and Exchange Commission has grown increasingly ineffectual since 2004—an increasingly worrisome development since the agency regulates capital markets that allocate tens of trillions of dollars in resources, shaping the U.S. and global economy. Investors look to the commission to protect their savings, not from risk but from fraud and unfair dealing. The commission does so through enforcing securities laws that require transparency, enforce fiduciary duties, and structure fair and well functioning markets. The SEC’s weakness, however, contributed to the 2008 global financial crisis—a crisis caused by deregulation that has forced the federal government to act as the effective financial guarantor of the securities industry. This rolling crisis all but destroyed the five largest investment banks in the space of just six months. The next SEC chair will face the challenge of this severe, continuing capital markets crisis against the backdrop of an increasingly irrelevant SEC during the last years of the Bush administration. A swiss-cheese regulatory structure is a major contributor both to the crisis and to the paralysis of regulators confronting it. The first priority of a new SEC chair must be to restore a comprehensive regulatory approach to the capital markets involving the coverage of all securities, derivatives, and futures, and all investment vehicles—hedge funds, private equity funds, and sovereign wealth funds—under a strong regulatory regime focused on transparency and real oversight over capital in relation to risk. The next SEC chair should bear this approach in mind as he or she enters the sweeping debate over U.S. financial markets regulation next year in the wake of U.S. housing and global credit crises.
Damon Silvers is an Associate General Counsel for the AFL-CIO. Mr. Silvers' responsibilities include corporate governance, pension and general business law issues. Mr. Silvers led the AFL-CIO legal team that won severance payments for laid off Enron and WorldCom workers.
