Economics

If You Care About Growing the Economy from the Middle Out, This Is Required Listening

Some of the many guests from The Other Washington season one.

Tomorrow, we’re relaunching the second season of our podcast, The Other Washington, with a fantastic interview with author and progressive truth-teller Thomas Frank. Frank, the author of Listen, Liberal, believes that the Democratic Party has been hijacked by a professional class of elites, at the expense of the working class. I can’t think of a better way to kick off a new (weekly!) season of The Other Washington, and I can’t wait for you to hear it. (You can read a sample of our talk here.)

But while we wait for the second season of the podcast to arrive, I’d like to urge you to visit (or revisit) the first season of The Other Washington. “Why would I want to listen to some old political podcast,” you ask? Well, because the first season of the Other Washington was constructed to be an evergreen listen. It establishes the foundation of our beliefs at Civic Ventures, and explains why we promote the policies that we do.  The first season is a primer that says what we’re all about. The second season will put those bedrock policies into action and show how here in the other Washington  we’re moving forward while leaders over in the other other Washington — that’s Washington DC—keep pushing us back.

Here’s a rundown of our first season:

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The Latest Poster Children for the Anti-$15 Crowd: Low-Quality Restaurants?

Some sage advice for restaurant owners in this screenshot from the Hell’s Kitchen video game.

I simply can’t respond to every single dumb trickle-down take on the $15 minimum wage. If I felt the need to write back to every jerk who took an Econ 101 class and thought it earned them a Nobel laureate in economics, I’d be writing takedowns every hour of every day, with no sleep and no breaks. My fingertips would bleed from all the typing, and I’d need to rent a helper monkey to put drops in my eyes so they wouldn’t dry out as I type.

But when I noticed that someone named Peter Heck published a piece titled “Minimum Wage Hikes are Killing the Poor” — well, how could I just ignore a title as ridiculous as that? Heck says that the “wealthy liberal city of San Francisco” is facing a “coming disaster” as it’s raising its minimum wage to $15 next year. He quotes a new working paper from Harvard Business school which, according to its abstract, finds that…

…lower quality restaurants, which are already closer to the margin of exit, are disproportionately impacted by increases to the minimum wage. Our point estimates suggest that a one dollar increase in the minimum wage leads to a 14 percent increase in the likelihood of exit for a 3.5-star restaurant (which is the median rating), but has no discernible impact for a 5-star restaurant (on a 1 to 5 star scale).

Heck then extrapolates from their abstract:

Bob’s Burgers may not be able to absorb the cost associated with paying $15 an hour for their entry level employees without coming to economic ruin. But swanky, upscale Eagle’s Nest Steakhouse, on the other hand, can simply jack up the cost of their filet by a few bucks and be okay.

In other words, the liberal minimum wage policy lets the rich get richer and the poor lose their job when the business they work for goes under.

Except that’s a really bad misreading of the study. The stars used in the study are taken from Yelp. The quality that they’re measuring is the customer experience, not the cost of the restaurants. Yelp has a second ranking, of dollar signs, to identify prices, but price didn’t really figure into the closures. In fact, the study overtly states that they found (emphasis mine) “evidence that the heterogeneous effects observed earlier are driven by quality rather than by the restaurant prices.”

So if Yelp customers rate Bob’s Burgers 4.5 stars because they like the food and the service, Bob’s Burgers will weather the minimum wage increase just fine. Some comparably rated Seattle businesses on Yelp would be Paseo, which serves no meal over $15.50; Tacos Chukis on Capitol Hill, which serves tacos for under $2 and tortas for $6.90; and Fat Ducks Deli and Bakery in the University District, which sells sandwiches for $8.95 each. (I can say from experience that all three of those restaurants, by the way, are excellent.)

And if the Eagle’s Nest Steakhouse has gotten more than a little gross over the years and customers now give it a 1.5 average star rating, under a minimum wage increase the odds increase for the Eagle’s Nest to go out of business. So even if Bob’s Burgers charges $10 for a burgers-and-fries meal deal and the Eagle’s Nest charges $75 for a steak and a side, it’s the Eagle’s Nest which, according to the study, is much more likely to go out of business.

Heck doesn’t seem to realize that he’s actually arguing against the power of the market. By opposing a decent minimum wage, he’s saying that a city should subsidize low-wage, low-quality employers by allowing them to legally exploit their workers. It’s more than a little weird to me that conservatives are now complaining about the consequences of the free market. For some reason, they hate the idea that businesses which can’t afford to pay their employees a living wage should have to close while other businesses thrive. I would hope that even conservatives like Heck would agree that low-quality employers shouldn’t be subsidized by taxpayers. When businesses pay less than a living wage, those employees often have to rely on government assistance like food stamps and rental subsidies in order to get by.

Look, opening a restaurant is risky business. Everyone knows that restaurants fail with shocking regularity. Every new location requires a confluence of many different qualities (including a good location, an inviting theme, a welcoming staff, an appealing storefront and, uh, one more thing that I can’t remember…oh, yeah — delicious food) to become a success. That’s an understood quantity for anyone opening a business.

The unfortunate truth is that there will always be losers. But by encouraging a smarter, more livable wage, we can ensure that there are more winners. Seattle, which raised the wage before San Francisco, has more eating places than at just about any other time in our history. Our unemployment nunbers are at near-record lows. If we did see the same closures of low-quality restaurants that the Harvard study found, those restaurants were quickly replaced by newer (and better!) ones. Which is exactly how capitalism is supposed to work: business owners are supposed to create new concepts, and consumers are supposed to choose between them. The concepts that don’t draw the most consumers either change into something more appealing, or they fail.

And the thing about raising the minimum wage that Heck really doesn’t get is this: when the minimum wage is increased, workers have more money, and that increases demand. It allows people to try more of their ideas out in the marketplace, and it allows consumers to decide between those ideas. Nobody ever promised that every idea would be a good one, or that every business would succeed. But Seattle’s thriving restaurant scene has proven that there’s more room for winners — among business owners, workers, and consumers — when everyone agrees to pay a living wage.

__

And I wanted to take a second to address Heck’s moronic final claim. He writes: ” If $15 is better than $10 an hour, doesn’t it stand to reason that $20 or $30 an hour is better than $15?” Heck, the poor dear, acts like this is a new concept, but it’s actually as old as the minimum wage itself. Nick Hanauer addressed this concern-trolling best in this piece in the Democracy Journal:

“If $15 is so great, why not $50 or $100?” critics sometimes mockingly ask. Well, because that would be stupid. The positive benefits of a $100 per hour minimum wage would almost certainly be overwhelmed by the costs. So no one is proposing $100; instead we are proposing $15, which is roughly halfway between what the minimum wage would be had it tracked either productivity gains ($21) or inflation ($10).

I hope that passage answers Heck’s question. I also hope he doesn’t misread it as badly as he misread that study.

United Airlines, Economic Inequality, and First-Class Privilege

Fly the horrific skies.

Fly the horrific skies.

You’ve probably by now seen the video of the doctor who was physically beaten and removed from a United flight because United wanted the seat for its employees. If you haven’t, here it is. Be warned: it’s an incredibly disturbing video:

And here’s the story, from Lucas Aulbach at the Courier-Journal:

Bridges said the man became “very upset” and said that he was a doctor who needed to see patients at a hospital in the morning. The manager told him that security would be called if he did not leave willingly, Bridges said, and the man said he was calling his lawyer. One security official came and spoke with him, and then another security officer came when he still refused. Then, she said, a third security official came on the plane and threw the passenger against the armrest before dragging him out of the plane. The man was able to get back on the plane after initially being taken off – his face was bloody and he seemed disoriented, Bridges said, and he ran to the back of the plane. Passengers asked to get off the plane as a medical crew came on to deal with the passenger, she said, and passengers were then told to go back to the gate so that officials could “tidy up” the plane before taking off.

This is a horrifying story, and it’s still unfolding on social media. I’ve noticed something about the reaction to United. People have been making jokes about the incident on Twitter. Which is okay! Jokes are part of the news cycle. They’re how we process things as a culture. And particularly in this case, the jokes are very telling. This one is a perfect example of the tone and tenor of the comedy I’ve been seeing:

Then there’s the business world’s response to the news, which is the exact opposite of everyone else’s response to the news:

And then the content mines immediately chimed in with their hot-take-clickbait. The most horrifying example of the form is this Yahoo Finance story by Ethan Wolff-Mann, headlined “How to reduce the chances of getting dragged off your United flight.” An excerpt:

In plain language under Rule 25—on page 35 if you print it out—the agreement says exactly what happens if the flight is oversold. “If there are not enough volunteers, other Passengers may be denied boarding involuntarily,” the language reads. (Of course, the deplaned man was not denied boarding, he was already boarded.) The language continues however, shining light on how these “other Passengers” are chosen. It’s not random, it’s “in accordance with UA’s boarding priority.” That means that if you have a higher fare class, have a complex itinerary, have status (e.g. gold or platinum), have checked in early, or are a frequent flier, you are less likely to be asked to take the next flight. Even if it’s just a frequent flier card that you never use, it might save you from being forcibly dragged off a plane. Any kind of priority is better than no priority, when it comes to not getting forcibly removed from a plane.

So we’ve got the jokes about air travel being a hellish dystopia for anyone not in first class. We’ve got Wall Street cashing in on the metrics while ignoring the human horror of the story. And we’ve got “helpful” news stories explaining that in order to not have this happen to you, it’s wise to exercise some sort of privilege. It should be clear to anyone who’s paying attention that this story is not about customer service. It’s about income inequality. Helaine Olen posted a very good thread on Twitter about this:

When you get down to it, like everything else in America today, this is about the haves and the have-nots. If you’re in first class, you don’t need to worry about shock troops coming and beating you until you get out of the seat that you bought. If you’re not in first class, you’re on your own. If you’re in the top one percent on Wall Street, you turn a tidy profit off the whole ordeal. This is what class warfare looks like.

I wrote about this topic last month. Visit any department store in America and you’ll see that the corporatization of America has led to a ghastly pursuit for profits over all else. Big Box retailers aren’t interested in providing customer service anymore, they’re interested in profits. This is why shopping at corporate chains has become an awful experience where you have to answer six obnoxious questions about email lists and company credit cards every time you try to check out. You won’t be arrested for refusing to sign up for a Macy’s card, but you will be treated like garbage. Only people who can afford to shop at high-end stores—or people lucky enough to live in quality economies like Seattle that support independent retailers—get to enjoy real customer service anymore.

The situation is heightened on airlines for a couple of reasons. The first, obviously, is the security state that ballooned in size after 9/11. But the other reason is deregulation. Phillip Longman and Lina Khan wrote a great piece for Washington Monthly in 2012 about what trickle-down policies like deregulation have done to the airline experience for non-wealthy passengers:

But now we find ourselves at a moment when nearly all the promises of the airline deregulators have clearly proved false. If you’re a member of the creative class who rarely does business in the nation’s industrial heartland or visits relatives there, you might not notice the magnitude of economic disruption being caused by lost airline service and skyrocketing fares. But if you are in the business of making and trading stuff beyond derivatives and concepts, you probably have to go to places like Cincinnati, Pittsburgh, Memphis, St. Louis, or Minneapolis, and you know firsthand how hard it has become to do business these days in such major heartland cities, which are increasingly cut off from each other and from the global economy.

And it’s about to get worse. Despite a wave of mergers that is fast concentrating control in the hands of three giant carriers, the industry remains essentially insolvent. Absent any coherent outcry, the directors of these private corporations remain free to respond to the crisis in the manner of an electrical utility company that, when it runs short of money, simply cuts off power to the neighborhoods of its own choosing.

The video that made its way across the internet today is what “getting worse” looks like. Here’s the thing: when you support trickle-down economic policies that put people before profits, this is what you get. Low-wage jobs, deregulation, and tax cuts for huge corporations result in a culture in which businesses enjoy a tremendous amount of power over ordinary citizens.

So what can we do about this? I wish I had easy answers for you, but it’s pretty obvious that an online petition isn’t going to resolve the United situation—especially since Wall Street views it as a net win and is rewarding United for its overbooking situation. No, it’s going to take a lot of work to put the power back in the hands of the people.

We must support middle-out policies like higher wages for everyone, higher taxes for corporations and the wealthy, and sensible regulations on business. If every American feels like they have a hand in America’s success, we’ll see less tolerance for intolerable actions like what happened on that United flight. Then, when we’ve moved the balance more toward something resembling equity, we can talk about commonsense ideas like breaking up monopolies and penalizing malicious businesses like United for harming Americans who do everything right and play by the rules.

Maybe the worst thing about that video is how completely believable it was for anyone who’s flown over the last few years. We’ve all experienced the awfulness of flying, and we recognize it as maybe the most literal manifestation of America’s current class situation: the few sit up front in comfort while the many experience more and more discomfort in the back of the plane. We lose inches of legroom, we’re charged more and more for our carry-ons, and we’re offered less and less in return. This situation isn’t going to get any better until we stand up and demand that things change. This isn’t about one airline—hell, it’s not even about air travel. It’s about class in America, and it’s time to demand our fair share.

 

Andrew Puzder Was Terrible, but He’s Not an Aberration

BYE FELICIA

Carls Jr. CEO Andrew Puzder was supposed to sit for Labor Secretary confirmation hearings tomorrow. The Trump administration repeatedly pushed the hearing back—it was originally supposed to happen over a month ago—and Puzder openly complained about how difficult the process has been.

We should have known things were getting serious when Oprah got involved: Politico reports that four Republican senators who were on the fence about Puzder received visits from representatives of the Oprah Winfrey Network. OWN staffers showed the senators a rare video of Puzder’s ex-wife “level[ing] allegations of physical abuse against him” from a decades’ old appearance on Oprah’s talk show. Politico just made that video public this morning.

And news is breaking that Puzder officially withdrew from the nomination entirely.

Screen Shot 2017-02-15 at 11.37.11 AM

This is not because of the lack of Republican Senatorial support, though that is an issue, but because—poor baby—it’s too much work:

Screen Shot 2017-02-15 at 11.37.19 AM

Good riddance. Puzder was an incredibly bad choice for Labor Secretary. In fact, he was possibly the single worst person in the country to be head of the Department of Labor. Justin Miller at the American Prospect wrote a great explainer on why Puzder is such a bad candidate, beginning with the fact that he “made more in one day ($17,192) than one of his full-time minimum wage workers would make in a year ($15,130.)”

This goes further than Puzder’s stance against the $15 minimum wage or commonsense overtime standards. At Carls Jr., Puzder has cultivated a rampant culture of sexual harassment, of dangerous workplaces, and of wage theft. Previous Labor Departments have led to Puzder’s business paying “nearly $150,000 in back pay to workers and more than $80,000 in penalties.”

I want to make no mistake about this so I’m going to restate: Puzder was quite possibly the worst Labor Secretary nominee this country has ever seen. He openly cheers on automation, saying that robots are “always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex or race discrimination case.” He does not have the worker in mind. He is firmly on the side of the CEO and against the average American.

But I have to be clear about another fact, too: Puzder is not an aberration. Now that he’s whined his way out of the confirmation process, he won’t be replaced with a polar opposite. In fact, Puzder was perfectly in line with Donald Trump’s employment policies.

I’m not talking about President Trump’s labor policies; I’m talking about his actual history as an employer. Donald Trump doesn’t pay independent contractors. He cuts corners on his employee pensions. And this week, the news broke that Trump’s organization is hiring foreign workers for his Mar-a-Lago club in Florida:

According to the Palm Beach Post, Trump won approval from the U.S. Labor Department in October to hire 64 foreign workers through the H-2B visa program, which allows eligible U.S. employers to hire foreign nationals to fill temporary jobs… Trump will pay the staff wages comparable to what he offered last year. Though some will make less than they made last year, most will get a 1 percent raise.

So these foreign workers—many of whom will have immediate access to state secrets, if last week is any indication—are getting paid very little, even though Mar-a-Lago recently doubled a significant source of its income:

Mar-a-Lago, the Palm Beach resort owned by the Trump Organization, doubled its initiation fee to $200,000 following the election of Donald Trump as president.

So the rich get richer while the poor get the shaft. That’s Donald Trump’s business philosophy. And even though Puzder didn’t get through the nomination process, that is what Trump’s going to look for in a Secretary of Labor. While today’s news that Puzder can’t stand the heat in this particular kitchen is heartening, we have to remember that the fight isn’t anywhere near over. It’s just beginning.

The Democratic Party Needs a Change in Messaging

Earlier this year, Harvard professor Michael Sandel spoke at the World Economic Forum. I happened to stumble upon his interview this weekend, and ever since watching it I’ve not been able to get it out of my head. During the Q&A, Sandel was asked to give advice to the flailing Democratic Party, which to his mind, has become far too technocratic in their political messaging.

Although the interviewer pressed him to provide bumper sticker policies like “Make America Great Again”, Sandel shrugged off this fascination with abbreviation. “Philosophers are not good at snappy slogans,” he admitted to the audience and then proceeded to show what good philosophers actually do: speak at length. During this fifteen minute back and forth, he presented four political themes which Democrats need to reassess in order to win again.

The first theme he addressed was a need for promoting a sense of national community that was directed towards “a shared common life, restoring public places, public institutions, and class mixing.” Sandel thought Democrats all too often revert to speaking only to urban, elite communities. To take away the conservative movement’s control and manipulation of patriotism, Democrats must develop their inclusive narrative in a way that leads to solidarity, not in a frame designed to end conversations, such as one which frames one side as “progressives” and the other side as deplorable “racists”.

The second theme is one we here at Civic Skunk Works spend a lot of time fretting over: the meaning and dignity of work. “Work is a way of making a living, of generating an income,” Sandel stated, “but is that its only purpose? Or does it confer meaning and identity?” We would argue (and so does Sandel) that Democrats should never, ever think of work as solely an economic concern. We know that “since many of us spend the majority of our waking hours at work, work is a major source of dignity in our lives.” To give the average American worker a sense of self-worth again, Democrats must engender a sense of “recognition and trust, as well as autonomy and self-mastery.”

Thankfully, liberals promote policies that can restore these feelings to the American public. A higher minimum wage and an increased overtime pay threshold strike me as perfect examples of recognizing the importance of all work, while new labor contracts like the Shared Security system would give economic benefits, stability and security to all. That is an effective one-two punch that Democrats should deliver over and over again.

The third theme Sandel elucidated was getting rid of our society’s obsession with meritocracy. “Meritocracy is not an alternative to inequality,” he told the audience, “it is a justification for a certain kind of inequality.” I’m so pleased that he highlighted this, as Americans all too often fall for this myth. A couple of months ago, in fact, I reviewed Thomas Friedman’s latest bookand my biggest criticism came from his faith in hard work and perseverance. I wrote:

Friedman subscribes (a little bit too much) to the myth that life is a meritocracy, where the most adaptable and hard-working win out. In fact, last week when I heard him speak at Seattle Town Hall he remarked, “sometimes no one is to blame but yourself.”

Sandel seems to agree in some ways with my argument. With his finger wagging, he pointed out that Democrats “should shift their emphasis from talking about mobility and perfecting individual opportunity, and instead talk more about solidarity and community and what that means.”

Finally, Sandel’s fourth theme was in relation to inequality and mobility. And in many ways, this connects with his meritocracy theme. He believed that the left needed to think less about mobility and speak about “creating a more equal society where the focus is not on the scramble to the top.” It’s not just economic inequality that Democrats should highlight either. Sandel argued that we need to show how economic inequality is corrosive to our civic life and our public institutions. Unfortunately, he never really developed upon that statement or provided instruction on how to effectively communicate these tensions, which made this theme come off as quite vague.

Nonetheless, I was extremely impressed with his messaging guidance. These broad themes are probably not specific enough (and a little bit too philosophically vague) for today’s focus-grouped Democratic Party. However, if leaders within the DNC listened to Sandel’s prescriptions, the left could offer a much more convincing socio-economic argument to Americans in urban and rural areas.

It’s Time for (Civic) Action

Since we founded Civic Ventures in 2015, lots of people have enjoyed our writings and podcasts. We’ve attracted a loyal audience that’s interested in furthering a progressive, policy-focused agenda. Many of you have gotten in touch over the last two years and asked us how you can help, what you can do with all this newfound knowledge. Sometimes we’d ask you to publicly support secure scheduling, say, or to help debunk some trickle-downers’ bullshit excuse for why the minimum wage should be eliminated. But we were largely happy to spend our time thinking deeply about policy and working behind the scenes to enact change.

Obviously, the election of Donald Trump has changed everything. We can’t just organize and obsess over the future of policy anymore. You know it as well as we do; this isn’t a time to just sit back and read, or to listen to a podcast. The age of passivity ended on November 8th, 2016. People still want to inform themselves, but they also want to take action. You can’t choose one; you have to do both.

Qq1jjVMhThat’s why we’re proud to announce the debut of Civic Action, a new results-oriented partner organization of Civic Ventures. Civic Action is outward-facing and, as the name indicates, action-oriented. If you’re looking for public officials to call, or causes to take up, or information about where to best focus your energy, you’ll want to sign up for our email blasts, or follow us on Facebook and/or Twitter.

For the first few months, we’re going to be figuring out how to make Civic Action the most effective, efficient organizing tool that it can be, but we know what we want it to do. We want to direct people to causes where they can make a substantial difference. We hope to make a big difference in elections by highlighting good work and supporting stellar candidates. We want to continue our efforts to educate people on how the economy really works.

And we want to continue the discussion about what America can be. Resistance is not enough; you also need to rebuild. We have to provide an alternative vision, spotlight the people who are doing positive work, and plan how to recommit to the American Dream for generations to come.

These are confusing times. A person could spend all day every day calling representatives and signing petitions and sharing links. We expect Civic Action to be a signal in the midst of all this noise, a way to direct your energy and make a difference in the world. I hope you’ll follow Civic Action (email, Twitter, Facebook) and let me know what you think.

Is This What Trumponomics Looks Like?

Those eyes, man. They follow you everywhere.

Those eyes, man. They follow you everywhere.

It’s becoming clear in the first week of his presidency that Donald Trump has been telling us exactly who he is for a year and a half now. He did intend to build that wall, unlike what many of his supporters claimed during the 2016 presidential campaign. He really does believe that wealth has direct correlation to intelligence, that the amount of money you have is a perfect indication of your IQ, which is why he has claimed that his cabinet — without question the wealthiest in American history — has “by far, the highest IQ of any cabinet ever.” And he believes that if you cut taxes and regulations, and if you suppress the income of workers, the economy will grow.

 Axios published highlights from a teleprompter-free speech that Trump delivered to a closed-press fundraiser last week, including this snippet where he says exactly that to a room full of wealthy Republican donors:

We’re going to cut your taxes. We’re going to get rid of the regulations that are strangling the economy. [Applause.] … I know the biggest businessmen and the small ones that love me and voted for me, and I love them. … Almost every single person that I ask was more excited about the regulations being cut than the taxes, which is surprising. [Applause.] So, we’re going to do that.

This is not a new philosophy; it’s one that conservatives have been espousing since the days of Ronald Reagan. Regular readers will know that it’s called trickle-down economics, and it’s based on the idea that if you suppress wages for the working class, cut taxes for the wealthy, and slash regulations for business, those wealthy Americans will supposedly then create jobs, that their wealth will trickle down to the poorest Americans. The problem with this economic philosophy, of course, is that it doesn’t work. Democratic presidents create more jobs, for the simple reason that when workers have more money through increased wages, they have more money to spend in their communities. The super-rich tend to sit on their money, keeping it locked up outside the economy, and everyone suffers.

But there’s something especially troubling about Donald Trump’s brand of trickle down economics. In the past, conservatives have generally promoted their trickle-down agenda on behalf of the wealthiest Americans. But Trump’s cabinet is made up of some of the wealthiest Americans — many of whom don’t have any government experience at all — and they’re being placed in charge of the cabinet posts that directly affect them.

I wonder if we’re witnessing the birth of a new stage of trickle down economics. Because when the lawmakers themselves profit from the laws that they pass and strike down and ignore, you’ve passed a simple proxy agreement between politician and power broker. You’ve gone directly into looting territory.

President Trump’s strategy so far seems to be to produce so many moving parts that it’s impossible for anyone to keep track. Are you outraged about the gag orders on the EPA and the USDA? Are you upset about his calls to revive torture? Mad about the wall? Angry that he’s whining about voter fraud and his inauguration attendance? Horrified that he threatened martial law in Chicago? I bet you are. But are you equally mad about all those things? That’s impossible. So your attentions are scattered. And while resisters try to figure out which horror they should focus their energies on, in the background Trump is freezing regulations and raising costs for middle-class home owners by roughly ten bucks a week.

If trickle down economics is entering a full-on looting phase, that can only be bad news for the economy. Because looting doesn’t end organically. You only stop looting at the point when your arms are too full to carry anything else or when the forces of law and order are re-established. The best thing we can do at this early date is to identify what’s going on, and make a lot of noise, and try to keep track of everything that’s happening, so that one day we’ll be able to rebuild what we’re losing.

Study Finds Millennials Earn 20 Percent Less Than Boomers Did at the Same Age

worstgeneration

Josh Boak and Carrie Antlfinger at the Associated Press reported on a new study about generational earning this morning:

With a median household income of $40,581, millennials earn 20 percent less than boomers did at the same stage of life, despite being better educated, according to a new analysis of Federal Reserve data by the advocacy group Young Invincibles. …Education does help boost incomes. But the median college-educated millennial with student debt is only earning slightly more than a baby boomer without a degree did in 1989.

This is important stuff. When we talk about inequality, it’s important to remember that we’re not just talking about a disparity in earnings from the top one percent to the other 99 percent. We’re also talking about a disparity between generations, an income gap that grows over time. It is part of the reason why, though President Obama’s policies did begin to shrink the traditional measures of inequality (link PDF), many Americans don’t feel as though the economy is improving.

This report should serve as a warning to Democrats in the midterm elections and the 2020 presidential election: just because you’re not young enough to feel this inequality, you should understand that it exists. This is a big reason why Senator Bernie Sanders enjoyed the success that he did during the 2016 Democratic primary: he was speaking to a serious problem that most candidates, and most media outlets, didn’t even recognize was a problem.

I realize that I’m not delivering some new insight here. Lots of people—including my colleagues at this here blog—have written extensively about student debt and other economic damages delivered exclusively onto millennials. But this new study is another solid piece of proof that inequality comes in a multitude of varieties, and Democrats need to be able to recognize and address all of them. The future of the party—and the future of this country—is at stake.