An undercurrent rages beneath both parties’ Presidential campaigns: Is the American Dream dead? Can it be revived?
Our democratic ethos — and the optimism that characterized most of 20th Century America — were built on the promise that individual effort, free markets and our constitutional system could generate and maintain not just national greatness, but also individual success in some way proportional to effort and natural ability. But now it would appear that confidence in the dream has been shattered, with many across the political spectrum — from left to right and in the middle — animated by the sense the system is broken if not rigged, and that the middle class is imperiled. There is palpable anger that the “Great American Bargain” is broken — that hard work and playing by the rules no longer assures economic advancement, and that many make it substantially ahead of the pack by privilege rather than merit or effort.
The Aspen Institute and its Policy Programs have charted the decline of equitable access to economic opportunity over recent decades. But they haven’t reacted with partisanship, blame, or despair. Instead they remain infused with the same optimism that has long characterized our public spirit, and believe that policy innovations can be found that appeal to common and shared values — and that these innovations can restore the American ethos of equal opportunity, reinvigorate and expand our middle class, and renew a greater sense of economic fairness.
One new and timely effort — the Aspen Institute Future of Work Initiative — embodies this approach. Co-chaired by Senator Mark Warner of Virginia and Purdue University President and former Governor of Indiana Mitch Daniels, this initiative is developing new ideas for how to promote the economic interests of American businesses and workers alike in the 21st century by embracing innovation and looking forward, not backward. The initiative will present many specific and achievable policy ideas to the country during the Presidential campaign, setting partisan politics aside to propose a new bargain for the America economy of tomorrow.
At the center of the Initiative’s focus is the growing disconnect between workers and employers in the modern economy. Technological innovation and global competition are disrupting the structure of American businesses and how they interact with workers. Over the last few decades, businesses have refocused on core competencies by contracting out and outsourcing many activities that were previously done in-house.
As the structure of the firm has changed, so too has its relationship with workers, who can no longer count on life-long careers with a single firm that will provide them with rising wages, economic security, and training. Instead, the economy has moved toward shorter-term arrangements and task-based work. Alternative work arrangements are on the rise — by one measure, accounting for all net job growth over the last decade. In the past few years, we have seen the growth of an entire new industry of technology-enabled on-demand companies, such as Uber and Lyft, matching work with demand in real-time. These trends are making the economy more dynamic and efficient in the near-term, but they are also having adverse consequences on the economic well-being, security, and upward mobility of hard-working Americans, and thus for the long-term health of the economy.
This Initiative was created to help strike a new bargain between workers and businesses. It will not seek to limit trade or innovation, nor deny the realities of globalization and the new economy, but instead embrace the march of progress by proposing ideas that can help build a new economic model for American prosperity that promises a better future for workers and businesses alike.
Look for our Initiative to promote a national conversation that could lead to detailed policies that seek to:
- Enable and encourage businesses to make greater investments in workers so they can reach their potential and compete globally;
- Leverage the power of consumers in choosing which businesses to patronize — and workers in choosing for which businesses to work — by proposing greater disclosure of workforce practices;
- Give everyone a stake in business success and promoting long-term value creation by promoting expanded participation in corporate equity to democratize ownership;
- Empower workers — and support entrepreneurship and independence — by giving them greater control over their own benefits and training.
This new model rewards work with higher wages, greater economic security, and stronger investments in skills and training. These are good outcomes for workers, and they drive better outcomes for the economy as a whole. When we invest in workers with skills training, productivity increases. When wages rise for all workers, consumer demand rises too, and so we see economic growth. When workers have access to the critical benefits and protections they need, it reduces stress on our already strained social safety net. And when businesses have the flexibility to make these kinds of investments in their workforces, turnover reduces, corporate culture improves, productivity benefits, managers can find workers with the skills they need – all drivers of long-term value creation throughout the economy.
The Future of Work Initiative and its leaders don’t have all the answers,[1] and no one will love every idea they lift up. But by collecting proposals from experts across the spectrum, and by promoting the concept of a new economic model, this initiative seeks to help spark a more constructive conversation, one that can set the stage for leaders of all types to come together and consider a path forward that can work for everyone.
- [1] Some argue that with globalization and technology, we have passed an inflection point and that we will NEVER again have jobs sufficient in quality or quantity to support a mass middle class. For those who believe that, (as I do), as important as all these proposals are to mitigate the problem, an answer could be the provision of a Uniform Base Income (UBI) – an idea with long roots across the ideological spectrum from Hayek and Friedman to Galbraith and Tobin. Regrettably, the political climate makes this for a time infeasible, even if it may be inevitable. For those interested, see the new book by former Aspen Institute Trustee, Andy Stern, Raising the Floor: How A Uniform Basic Income Can Renew Our Economy And Rebuild The American Dream.
Elliot Gerson is Executive Vice President of Policy and Public Programs at the Aspen Institute. Essays from “Election 2016: America Faces the Issues” will be published on aspeninstitute.org beginning July 14.
