OH YEAH? ...

OH YEAH? YOU AND WHAT ECONOMY? Because TAP loves you and wants you to be rich, we're hosting an argument between eminent economists Larry Mishel and Steve Rose over whether the economy is eleven types of awful or seven styles of awesome (all numbers gleaned through counting bullet points). Mishel is arguing that the economy is getting worse, while Rose is declaring that, for the median American, it's still pretty good. Rose thinks Democrats need to focus more on the relatively prosperous middle class; Mishel thinks the economy requires fundamental reform to curb inequality and encourage broad growth.

Well, I'd need to see Mishel's solutions to evaluate his argument; as of now, it's little more than a snapshot of economic trends. Rose, however, offers a more interesting challenge as well as, I think, a fundamental error. He's firmly planted in the DLC tradition that accuses Democrats of forsaking the middle class to focus on the poor. And his case, to be sure, is strong. But his conclusions are not. If the economy is basically acceptable for the vast majority of the country, incrementalist policies toward paid family leave and tuition tax relief will not, as he argues, "go a long way toward winning back the middle class."

It may be hard for an economist who spends his days immersed in social policy to admit, but if folks are feeling fiscally comfortable, the key to reaching them isn't through minor tweaks to the tax code. In that case, it would make perfect sense for them to choose sides based on national security or cultural preferences. And that's been the story of the past few years. I respect Rose's impulse to provide an economic policy antidote to his diagnosis, but his own work rejects such conclusions. Taken on its own merits, it suggests that progressives need to figure out a way to make economic concerns more salient to the middle class. It's their relative comfort, not our solutions, that pose the problem.

That said, I'm not sure Rose's studied description of the objective economic reality matches the subjective experience of the contemporary American economy, which complicates his solutions. New polling shows that a solid majority feel their incomes aren't keeping up with inflation (largely because, as this graphic shows, they're not), most Americans are unhappy with the state of the economy, and the consumer comfort index is at a dismal -19 (right before the 2004 election it was at -5). Meanwhile, rising insecurity may leave Americans feeling less rich than they actually are -- studies routinely show that we fear economic loss far more than we cherish economic gain, so even the slightest decrease in incomes may be wreaking havoc on the American psyche.

As for Rose's belief that the programs Democrats tout are too focused on the poor, there are two responses. First, Democrats do support paid family leave and tuition relief, but they also realize those programs don't make for inspiring slogans. And second, we should remember Mark Schmitt's dictum: It's not what you say about the issues, but what the issues say about you. Focusing on the poor may reassure the middle class that Democrats are sensitive to economic concerns the Republicans dismiss.

--Ezra Klein