By Greg Sargent (01/11/19)
Sen. Sherrod Brown will travel to the early presidential primary states in coming weeks, he confirmed to me in an interview. This will stoke speculation about the presidential ambitions of the Ohio Democrat who is widely seen as an ideal messenger for true economic populism as the antidote to President Trump’s sham version of the same.
At the core of Brown’s message is a simple idea: The way to confer dignity on work is to ensure that it pays well. Due to structural economic factors beyond ordinary Americans’ control, wages have stagnated for millions, with many trapped in the ranks of the working poor; but government can remedy this through the tax code by sending struggling Americans money.
Many progressive economists and Democratic lawmakers are coalescing around a way to do this, through one version or another of expanded tax credits for working people and families, to supplement their income and lift them out of poverty and/or closer to the ranks of the middle-class.
In an interview, Brown told me that in coming weeks he hopes to increasingly push this set of policies to the center of the evolving debates among the Democratic presidential hopefuls.
“Whoever the Democratic nominee is, and through the course of the primaries and caucuses, I think you’ll see an emphasis on lifting people out of poverty,” Brown said. “Whether I run or not,” Brown added, his goal is “to move the narrative to reward work. This rewards work as well as anything we can do.”
This will be one of the big ideas debated among the 2020 Democrats; at its core, it is a collection of proposals that would expand the earned-income tax credit and the child tax credit. Numerous Democrats have versions of this proposal.
Brown’s version includes one proposal to expand the EITC, a federal tax credit for poor and working Americans that is pegged to income, to the point where it would confer more than $6,500 on families with household incomes from around $10,000 to $25,000 per year, with the amount then declining as the proposal reaches deeper into the middle class before phasing out on higher incomes. That would roughly double the number of families benefiting to 47 million, boosting their incomes by $2,800 on average.
A separate Brown proposal would expand the child tax credit to at least $3,000 per child. As Dylan Matthews explains, this would ease strains on lower-income family budgets and dramatically cut child poverty as well. Both proposals would give beneficiaries the option of getting their tax credits in monthly payments, helping struggling families smooth budgets and escape traps such as borrowing to cover basic expenses and then landing on the treadmill of paying down debt.
“The whole idea is that, if you work hard and play by the rules, you ought to be able to get ahead,” Brown said. “Far too many people making 20, 30, 40, 50, 60 thousand dollars are not able to have any kind of a middle-class lifestyle.”
There are numerous core animating goals underlying this type of cash transfer. There’s the idea that it’s a good way to compensate workers who are bearing the brunt of broad economic trends such as automation. There’s the possibility that such transfers have numerous positive societal effects, including improving children’s school performance and long term life prospects.
And there’s the notion that sending people money can be more effective at helping them than providing specific services. This gives it some cross-ideological appeal, with some progressives liking its non-kludgy aspects, and some libertarians and right-leaning “reformocons” liking its low overhead costs and lack of social meddling.
Reframing the argument against Trump
Brown believes Trump’s tax plan has given Democrats a big opening to press these proposals as central to the party’s platform in 2020. Trump campaigned as an economic populist, but went all in with Mitch McConnell and Paul Ryan economics to shower enormous benefits on the wealthy and corporations. The promise was a boom in investments, supercharging wages, but that hasn’t happened.
Democrats, Brown says, can reframe the argument over how government can genuinely act to boost people’s standard of living. "Government has not been on their side on this,” Brown says. “Government is more interested in top down tax cuts that really don’t trickle down. They end up as stock buybacks, enriching the people who are already rich.”
By contrast, Brown says, giving people at those income levels cash ensures that they will “spend that money in the community. That increases way more economic growth than the top-down Trump-McConnell-Ryan way of doing tax reform.” Brown doesn’t discuss pay-fors, in keeping with a new progressive approach of not getting baited into one-sided deficit constraints that Republicans toss overboard with tax cuts for the rich.
For Brown, this approach allows for appeals to working-class white voters without getting mired in the choice between outreach to them or to the rising Democratic electorate of young people, college-educated whites, and minorities (many of whom, it turns out, are also working class).
“A whole lot of Trump voters are making $8, $9, $10, $12 an hour, and their dollars don’t stretch enough,” said Brown, who comfortably won reelection in a state Trump carried by nine points.
Another Democrat considering a run in 2020, Sen. Kamala D. Harris of California, has her own version of this proposal, and so does Rep. Ro Khanna (D-Calif.), a rising progressive star. This will be a part of the progressive debate in the 2020 cycle.
“We now see two major 2020 contenders talking about cash,” says Adam Ruben, the director of campaigns for Economic Security Project. “We’re going to see more. Candidates supporting a $15 minimum wage will need more solutions to help working families meet basic needs. The simplest way is to put more money back in their pockets.”
Another fault line among Democrats
Still, this emphasis risks stepping on another fault line in progressive politics right now. Most Democrats are gravitating toward a deeper diagnosis of the degree to which the ingrained structure of market rules shapes the pre-tax distribution, breaking the link between worker productivity and wages and badly frustrating upward mobility.
But some progressives worry that a single-minded focus on redistributive antidotes distracts from the need for deeper economic reforms that revamp market structures at their roots, making them pre-distributive reforms. This includes more aggressive antitrust to break up concentrated monopoly power and Sen. Elizabeth Warren’s (D-Mass.) corporate governance reform proposal.
The idea behind these 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. 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.”
Brown says Democrats can pursue reforms on both tracks. “It’s not corporations that grow our economy, it’s workers, and there’s no question we need to make serious structural changes," he told me. "We also need to put more money in the pockets of working people right now. We can and we must do both.”
These debates will be hashed out in coming months. But will Brown run? Politico quotes anonymous sources saying he’s planning a trip to Iowa with his wife, Connie, and in our interview, Brown confirmed this.
“Connie and I are going to go into the primary states fairly soon,” Brown told me. “We’ll assess and decide within a couple of months.”