Those countries, and most other advanced economies, provide regular payments to families with children based on the recognition that investing in children is an essential public good. Yet here in the United States, though we have a patchwork of programs, the lowest-income children often get no income support, while children in wealthy families benefit from generous tax deductions.
A child allowance of $250 a month per child would cost about $190 billion a year, though half of those costs could be offset by consolidating existing, less-efficient policies. It would cut child poverty by 40 percent and deep child poverty by half, while providing middle-income families raising children with a baseline level of stable income.
Next, even as we close in on full employment, there are parts of America where job growth and labor force participation are well below the national average. Historically, public policy tries to help such left-behind areas through place-based tax credits, but their track record is dismal. If we want to help places with too little labor demand, we must implement direct job creation policies, meaning either jobs created by the government or publicly subsidized private employment.
Infrastructure build-outs can help, but what's really needed is a permanent, scaled-up version of a subsidized jobs program that worked well in the last recession. The program helped create about 250,000 jobs, many of which were in the private sector, by subsidizing wages for a fixed time period. One careful study from Florida's version of the program found that, relative to a control group, participants' work and earnings went up not just during the program, but after it as well.
While direct job creation will help achieve the necessary job quantity, we also must boost job quality. A strong idea in that regard is an expansion of the earned-income tax credit into the working class. The tax credit is both broadly popular and very successful: In 2015, it lifted 6.5 million people, including 3.3 million children, out of poverty.
A recent analysis asked: What would it take for the earned-income tax credit to offset the damage done to low- and moderate-wage earners by the forces of inequality that have steered growth away from them in recent decades? The answer is a $1 trillion expansion in the wage subsidy over the next decade. A family of four making $40,000 would get a tax credit of about $6,000 instead of its current benefit of about $2,000.
Even in Washington, $1 trillion is real money, but I like the way one tax expert, Chuck Marr, put it: "For less than one-fifth of the cost of the Trump tax plan, we could improve the lives of millions of working-class people."
A higher minimum wage is yet another idea drawing broad liberal support.
Remarkably, the federal minimum wage is still $7.25, though most states and many localities have their own higher version of it. Still, 21 states remain on the federal level, and the "fight for $15" has been an important and successful movement by and on behalf of low-wage workers. One new estimate finds that 41 million workers would get a boost from this policy. More of them have college degrees than are teenagers. In other words, the devolution of low-wage work in America means that families often depend on a minimum-wage earner.
Some job displacement is possible given an ambitious increase like this, but a new proposal from congressional Democrats doesn't get to $15 until 2024, giving employers time to adjust.
Though Democrats have written bills for most of these ideas, no one expects them to go anywhere in this Congress. What's important is that such ideas, once the domain of the party's left wing, now face a diminished resistance from centrists, who once viewed them as too expensive and too interventionist. The bold minimum wage increase has 152 supporters in the House and 31 in the Senate.
Progressives will be playing defense for many years to come. But let's also make sure we're ready to roll with a true progressive agenda when our time comes.