One Troublemaker Can Change a Nation

The Pitch: Economic Update for Aug 5, 2021

Friends,

In a surprising turn of events, the Biden administration announced on Tuesday that they would block evictions, just a few days after the CDC’s pandemic-inspired eviction ban finally lapsed. Extending the eviction ban was absolutely the right thing to do. Millions of families—including many families of color, as Dr. Lisa Brown pointed out on Twitter—were in danger of eviction this week, because the vast majority of the $46 billion in federal funds that were directed toward rent assistance haven’t been distributed at the state level. This new ban, which runs for 60 days, gives more families the opportunity to access those funds and save their housing. And of course extending the ban makes good economic sense. We already have a housing crisis in cities around the country; dumping millions more families on the streets would likely seize up our already-overtaxed local housing assistance systems. 

Much of the credit for this victory has to go to Missouri Representative Cori Bush, who slept on the Capitol steps for five nights to protest the lifting of the eviction ban. Bush, a freshman Representative who has struggled with housing insecurity in her own life, kept pressure on the White House to rise above its fears over the legality of a renewed eviction ban and to do the right thing. Her protest represented the ideal of what the late Rep. John Lewis called “good trouble,” and it’s a reminder that troublemakers are a vital part of the civic conversation. Bush helped change the conversation around what is and is not possible, encouraging the conscience of our leaders through her example.

Now it’s the job of leaders around the country to get the $42 billion in remaining rental relief funds into the hands of renters so they can pay their back rent and avert this crisis. They can’t let Bush’s hard and courageous work go to waste.

The Latest Economic News and Updates

• The Economic Policy Institute has published a damning report on the economic inequality that Black women face in America—and how the pandemic has worsened that inequality. “Nearly one in five Black women lost their jobs between February 2020 and April 2020, compared with 13.2% of white men,” EPI reports. And the recovery has been highly unequal as well: “As of June 2021, Black women’s employment was still 5.1 percentage points below February 2020 levels, while white men were down 3.7 percentage points.” 

  In fact, Black women continue to earn far less than white men in the same occupations, including occupations that have been hit hard by the pandemic. Black women teachers earn almost 7 dollars less per hour than white male teachers, for example. And the pay gap also stretches to include jobs at the higher end of the wage scale, like the medical field…

  

  ...and jobs at the lower end of the wage scale, like the “essential” customer service workers who were heavily impacted by the pandemic and its lockdowns: 

  

• “On Tuesday [August 3rd], the average Black woman will have finally earned the same amount as the average non-Hispanic white man earned a year earlier—eight months later,” Marco Quiroz-Gutierrez writes in Fortune. That means Black women lose out on $900,000 in lifetime earnings compared to white men in the same careers with equivalent experience. This is bad news for the entire economy—if the pay gap were eliminated, that means Black women would have the better part of a million dollars per person that they could invest in their families, communities, and homes—investments that would grow the economy for everyone. You can read more about the economic impact of Black Women’s Equal Pay Day in this roundup at the Washington Center for Equitable Growth. 

  Black women are on the other side of an economic “double gap,” meaning they take economic hits through both systemic racism and systemic sexism. It’s because of that “double gap” that a growing number of economists are suggesting a new economic framework called “Black Women Best,” which argues that if policymakers work to improve outcomes specifically for Black women, the resulting prosperity will be more broadly and equitably shared across the whole economy.

• I’ve expressed strong support in this newsletter for the Biden Administration’s new Child Tax Credit, which puts money directly in the hands of American families. But no program is perfect, and the Center on Budget and Policy Priorities says some four million American families could miss out on the payments because they don’t know that they’re eligible. And many of those families are likely low-income, meaning that they’re the exact people who would benefit most from the cash payments that the program provides. That’s why the CBPP is calling on state and local authorities to provide outreach programs to let families know they are leaving $300 per child per month on the table. 

  Lorie Konish explains that so-called ‘tax hesitancy’ might be keeping low-income parents from filing for the Child Tax Credit, for fear that they’ll be on the hook for big tax charges later. Those fears are understandable, but they are unfounded—which is exactly why local governments should be doing outreach to ensure that people are getting the money they are owed. If we can get that money into the hands of impoverished American families, those checks will turn into deep investments in the communities that need them most.

• “The New Economics is Here,” write Mike Konczal, Steph Sterling, and Felicia Wong in The New Republic. This is a full-throated manifesto for America coming out of the pandemic with a “low-carbon, high-care economy” that invests in people and builds for a better, more optimistic future. The authors call for a huge reconciliation bill from Congress not just because it’s the right thing to do—which it is—but because it makes great economic sense. It’s wonderful to see progressive economists being so forcefully positive in their messaging. Ten years ago, this kind of powerful, confident messaging would have been completely unthinkable from the left side of the aisle, but now it’s rapidly becoming the mainstream economic opinion of the Democratic Party. 

• Despite the Delta variant and fears of breakthrough infections, the U.S. economy grew at annual rate of 6.5% between April and June, but the Washington Post published a great chart showing that just because we managed to recover our economic losses from the pandemic, we still have a long way to go before the economy is fully back on track.

• The only way to really free the economy from pandemic uncertainty is to beat coronavirus back completely. And the only way to do that is to vaccinate everyone who is eligible for vaccination. This week, corporations finally jumped into the conversation, with Microsoft, Tyson Foods, Google, and Disney all calling for employees to get vaccinated.The New York Times notes that “Legally, companies are likely to be on solid ground if they mandate vaccines. Last year, the Equal Employment Opportunity Commission said employers could require immunization,” though of course there are likely to be lawsuits, hastily passed laws in the most public-health-resistant states, and other hurdles for employers. A number of unions, unfortunately, are also fighting company-wide vaccine mandates, though a few of those union protests will likely end once the FDA finally gives full approval, and not just emergency approval, to the vaccines, which is expected to happen this fall. 

Real-Time Economic Analysis 

Civic Ventures provides regular commentary on our content channels, including analysis of the trickle-down policies that have dramatically expanded inequality over the last 40 years, and explanations of policies that will build a stronger and more inclusive economy. Every week I provide a roundup of some of our work here, but you can also subscribe to our podcast, Pitchfork Economics; sign up for the email list of our political action allies at Civic Action; subscribe to our Medium publication, Civic Skunkworks; and follow us on Twitter and Facebook.

• On this week’s episode of Pitchfork Economics, Goldy interviews Kansas state Representative Jason Probst about the three-week strike at a Topeka Frito-Lay factory, which dominated national headlines last month. Probst, a progressive Democrat, discussed what the conditions in the factory were like, why factory workers tend to endure awful working conditions, and why we could be on the verge of many more worker actions like this one in America. It’s a surprising and insightful interview, and well worth your time.

• In his Business Insider article this week, Paul explains why it is a national embarrassment that the federal minimum wage has been stuck at $7.25 per hour for more than 12 years, and he lays out several different options for lawmakers to ensure that the minimum wage goes up on an annual basis, so we don’t find ourselves in this same position ever again. If the minimum wage tracked with productivity, for example, it would be $24 per hour by now.

Closing Thoughts

It’s hard to recall now, but when Civic Ventures founder Nick Hanauer called for the minimum wage to be raised to $15 per hour in 2013, Forbes magazine called him “near insane.” When the Fight for $15 started in the Seattle area, people had a lot of words to describe Hanauer and those of us who fought alongside him. They said it was an absurd idea, one that would close a quarter of the restaurants in Seattle. And those are the polite responses!

So it was shocking—and, not going to lie, more than a little bit gratifying—to see an Axios AM post this week titled “$15 wage becoming norm.” The post notes that employers, “particularly in the restaurant, retail and travel industries, have been offering a $15 wage to try to fill enough jobs to meet surging demand from consumers,” and that while the federal minimum wage is still $7.25 an hour, "The $15 an hour debate...is essentially being resolved through market forces."

But let’s not break our arms patting ourselves on the back: the report cites a CBO study which found that some 17 million American workers will still be below the $15 wage by 2025. This is exactly why minimum wage laws are important—they drag along the stragglers, the exploitative employers who will only pay the absolute minimum that they can get away with. But without all that work to pass $15 in Seattle less than a decade ago, and in cities and states across the country, it seems unlikely that employers would be boasting about their $15 starting pay today. 

When a once-contested idea finds mainstream acceptance like this, it’s time for the pioneers to cast their eyes out to the horizon to see what the next big challenge will be. If you’ve read this far, I’m grateful for your time and attention, and I want to ask you—what do you think the next big progressive economic campaign should be? Is it a higher minimum wage? Health care? Where should we plant our flag next time? Reply to this email with your great ideas for shared prosperity. I look forward to hearing what you have to say.

Be kind. Be brave. Get vaccinated.

Zach