Radical economic populism is the only thing that can save the Democrats now
Democrats' only hope is abandoning their policy cowardice and embracing fat welfare benefits — for everyone
Democrats desperately trying to understand Donald Trump's victory are confronting an electorate that, at first glance, seems nonsensical. After all, plenty of white working-class Trump supporters would be destroyed by his agenda. And many Trump voters who desperately need ObamaCare voted for the program's death — while complaining that welfare recipients ought to get a better deal. What gives?
Sociologist A.R. Hochschild observed that many Trump voters feel like they're waiting in line to reach the American dream and the line is slowing down, all while the government is helping particular people — "immigrants, blacks, women, refugees" — to cut ahead.
Many liberals probably think that sounds racist, untrue, or both. But the "deeper story" is actually anchored in reality more than they realize.
America's welfare aid is both skimpier and far more targeted to the poor than most Western safety nets. Ostensibly, that reduces spending and focuses help on the most needy. But it also inevitably leaves most Americans feeling left out.
ObamaCare is illustrative of this reality. Medicaid, which the Affordable Care Act expanded, may be stingy with providers and does not always have great networks, but overall, its recipients have to deal with relatively little cost-sharing — a major plus for those who get Medicaid. But people who make too much to qualify for Medicaid fall into the exchanges, where deductibles are eye-watering and insurance subsidies phase out far too soon. As a result, only the bottom 20 percent of Americans saw their incomes dramatically and systemically improved by the health reform law.
The story is the same for most other major programs: food stamps, TANF, housing assistance, energy assistance, child tax credits, and more. Nearly half of the money goes to the bottom 20 percent of the income ladder.
Government benefits that rise higher up the income ladder are often hidden in the tax code: Think of the deduction for mortgage payments, or the tax break to employers for providing health insurance. Cornell government professor Suzanne Mettler calls this "the submerged state" — an approach to policy design that actively prevents people from realizing they're being helped by the government.
But the plight of white working-class Americans goes beyond the structural problems with government benefits. Decades of wage stagnation, disappearing jobs, and lost benefits have rotted away livelihoods for huge numbers of middle- and lower-middle-class Americans. The costs of education, housing, and health care have skyrocketed, chewing into family budgets. Nearly half of Americans cannot afford an emergency expense of $400, and even many upper-class workers effectively live paycheck to paycheck.
In other words, the financial pressures, stalled livelihoods, dismal futures, and lost jobs brought on by rising inequality and the hollowing job market extend far beyond the bottom 20 percent. Meanwhile, these middle-class Americans experience government aid solely as something that goes to other people. Democrats' increased focus on social uplift for immigrants, black Americans, and working women are infinitely worthy causes, but they also inevitably read to many members of the white working class as further proof that help is going to everyone who isn't them.
Put all this together and Hochschild's "deep story" begins to look considerably less crazy.
The good news for Democrats is there are clear ways out of this trap that will reinforce, not betray, the Democratic Party's relatively newfound ambition for feminist and anti-racist politics.
If targeted welfare publicly marks those who receive aid for social opprobrium, then Democrats should aggressively advocate giving this aid to everyone: a universal child allowance, far more generous cash benefits for unemployment insurance, students, family caretakers, etc. Subsidies for ObamaCare should be far more expansive and generous; or just go all the way and advocate single-payer. Democrats should embrace and defend the belief that big-spending universal programs are better, precisely because they send the political message that we're all in this together.
But this alone is inadequate. The job market must also be rebuilt, with a return to the muscular Keynesian stimulus, sweeping labor organizing, and ambitious industrial policy that characterized the New Deal. Duke economist William Darity Jr. has recommended guaranteeing public-sector employment at dignified wages to every American willing to work, providing a federally financed trust fund to every newborn, and rebuilding education infrastructure to offer gifted-quality K-12 education to all.
What's especially instructive about Darity's plan is it's designed to be universal, while also getting to the root of the labor market exploitation and exclusion that plagues African-Americans more than anyone. Precisely because of that bottom-up design, these policies would also address the basic challenges facing working-class whites as well. That would lay the economic foundation for a multi-ethnic coalition that could appeal to white workers' livelihoods, while also actively challenging the bigotries and resentments that convinced so many of them to vote for Trump.
Of course, to pull this off, the Democrats must reject deficit hawkery once and for all: There's no way to fulfill this sweeping agenda while also promising to balance the budget. The party must constantly and publicly reiterate that government programs do not need to be "paid for," and that the size of the deficit and debt load does not matter so long as inflation is kept under control. The party should also stop thinking of job creation as forever at the mercy of private business, and proudly defend public employment as an active force for good open to all: Whenever the private sector fails, the government can and should shove it aside and create jobs itself.
The Democrats can do this. But first, they must clean house ideologically, and finally abandon the Republican-light, free-market-friendly technocracy that has guided the party for decades.