A new report gathers insights from over 170 activists on the frontlines of inequality struggles in 23 countries on how to build and sustain their movements.
Progressives should take a lesson from President Clinton’s 1992 campaign: it’s still the economy, stupid.
When Bill Clinton ran for President in 1992, Democratic strategist James Carville famously posted a large sign in the campaign’s “war room” that read: “It’s the economy, stupid!” Carville wanted to remind his candidate and those working for him to keep their focus where he felt it belonged: the economy.
Fast forward to escalating debates over American inequality, the diminishing numbers of people who can be categorized as middle class, and the widening gap between wealthy Americans and everyone else. As Ryan Cooper noted in a recent article in The Week, progressives arguing for measures to reduce that gap have forgotten Carville’s lesson, and in the process have neglected the most potent argument for those measures.
That argument is the economy.
As Cooper notes: “A growing body of evidence suggests that inequality isn’t just an issue of fairness, but is actually hampering general prosperity. And that, in turn, ought to have enormous knock-on political effects. That inequality is choking growth is the conclusion of the new issue of the Washington Monthly, including articles by Heather Boushey, Mike Konczal, Alan Blinder, and Joe Stiglitz. It comes on the heels of several other studies, even one from the IMF, traditionally a very orthodox institution, that reach the same conclusion.” [pullquote] When misguided policies reduce the disposable incomes of millions of people, demand suffers. [/pullquote]
Modern economic systems depend upon consumerism. Many of us in the progressive camp are less than enthusiastic about that fact. Certainly there is much to criticize in consumer culture. But in the system we inhabit, consumer demand is a critical element of economic health. When misguided policies reduce the disposable incomes of millions of people, demand suffers.
When the great majority of people have very little disposable income, there is no mass market. No matter how entrepreneurial a given individual may be, s/he is unlikely to start a business—or get financing to start a business—if the success of that business is dependent upon mass sales. It’s not just new business starts, either; when consumers aren’t spending, existing businesses aren’t likely to invest and grow, and they are equally unlikely to be “job creators” hiring more workers. [pullquote] When the great majority of people have very little disposable income, there is no mass market. [/pullquote]
When debates about growing inequality are framed as issues of fairness (compelling as some of us may find such arguments), we fail to deploy the most effective weapon at our disposal—the fact that the current policies intended to privilege the supposed “makers” aren’t just harming those who are scorned as “takers.” They are actually harming us all, “makers” included, by depressing demand and retarding economic growth.
When I was in law school, the most valuable lesson I learned was “he who frames the issue wins the debate.”
For example, when we argue for raising the minimum wage only on fairness grounds, the typical response is that higher wages will depress job creation. (Even though evidence rebuts this, it is a widely accepted meme because it seems so self-evident.) [pullquote] He who frames the issue wins the debate. [/pullquote] If, however, we frame the argument for a higher minimum wage as an argument for a more robust economy benefiting everyone—an argument that has the added merit of being demonstrably true—we win.
As James Carville reminded us: It’s the economy, stupid!
Sheila Suess Kennedy, J.D. is Professor of Law and Public Policy in the School of Public and Environmental Affairs at Indiana University Purdue University at Indianapolis. Her scholarly publications include eight books and numerous law review and journal articles. Professor Kennedy is a columnist for the Indianapolis Business Journal and a frequent lecturer, public speaker and contributor to popular periodicals. She blogs at www.sheilakennedy.net