 People coming in as we begin Apparently there are two events going on in this building today, and there's some sort of backlog downstairs in Those of you who were able to make it here by 10 and of course we are also live streaming this events So there are people who are viewing remotely and we want to get started For all of you who are here. This is an incredibly important event Roasted in the last year Examining one of the big existential questions that guides not only conversation around this year's political election But really kind of why organizations like EPI exist and it's examining the role of government and there is a Only a few months in its publication which is examining this question You know not just philosophically but using Available evidence and drawing reasonable conclusions, and I'll sort of get into why this is especially Important and relevant to the work that we do here at EPI The panel of people who are going to be speaking to you this afternoon this morning Four of them are authors of said book how big should government be and we do have some copies of it That will be available for sale. I understand that the price that we're able to offer these at it $20 which is cheaper than what you can get at work for you the authors of the book are Jeff magic Lane Kenworthy John Bacchia and Peter Linder Jeff magic is The director of the Bernard Schwartz rediscovering government initiative at the Century Foundation and he is also the Then we have Lane Kenworthy who was a professor professor of sociology and the Yankevich chair and social thought at the University of California in San Diego John Bacchia is a professor of economics a distinguished professor of economics at Williams College in Williamstown, Massachusetts Mine and has been the author of several books mostly looking at the role of taxes and tax policy And then we have economic historian Peter Linder who was the distinguished research professor of economics at the University of California Davis and a research associate at the National Bureau for economic who are Who are going to speak and present their book and then will be followed by? to opinion and and public thought researchers who will examine this within the context of Real people and how real people think about Issue up Salinda Lake was president of Lake research partners Salinda has been been generous enough to join us at many EPI events And she's also one of the Democratic Party's leading political strategists and serves as a tactician and advisor to very opinion expert on several issue areas among the way among which are the economy healthcare Education and educate health care education and the environment And then we also have John Halpin who was a senior fellow at the Center for Economic Progress He also focuses And John is also the author of a year-long study very apropos for today's Conversation on the trust and confidence that people have in the federal government I am not going to take too much thunder away from But in it they They do a great job of looking at this role Not just in the way that most people do just kind of talking about big government small government But really trying to narrow the focus and look at available evidence. They identify four deficiencies that That we have an economy that's Or a public policy that's investing too little in infrastructure, and they don't just use that as a buzzword They unpack that for why it's truly important Identifying that infrastructure investments in infrastructure keeping and creates the growth innovation competitiveness continuity in the economy and also economic Vibrancy not to mention that it's a steady supply of good jobs where those investments occur during market downturns You can keep people at higher living standards So insecurity as a key deficiency of current conditions Looking at too many people who are an economic shock away from utter despair and inability to have basic Consistent living standards Ability for someone who was born into a low-income household to have a reasonable thought of an opportunity of moving into an upper rung And then they look at inequality what growth we do have and how it's distributed and seeing that he disproportionate shares of After identifying those four deficiencies in our current system They kind of examine whether or not it's the market or public investments that should drive remediating them They of course examine the markets inability to deal with these issues and make the case for the types of programs and policies from the public sector which can make a Tile pining about policies that exists in the United States, but also looking at what's done around the world They also examine the question of whether or not we can afford it and what that would look like in terms of its impact on spending an economic growth provocative book by its subject matter, but incredibly Well-reasoned and you know one of the great contributions. I think you all make is Taking this debate beyond just something that people argue about but giving us a frame And whereas most people want to solve this determinatively They acknowledge that may be the standard That we can prove whether or not it's government beyond all reasonable doubt But where we have a preponderance of the evidence that government can be a part of the solution So after the authors present we are going to hear from our opinion researchers who are really gonna Because we can have all of the theoretical discussions we want It's how do you have this conversation? Not just in the house and Senate chambers, but also in living and family rooms across the country houses of worship Civic institutions. What's gonna resonate? What's going to? Impact people in this conversation. So that's what you have before you We are going to begin our conversation with one of the authors Jeff magic and Jeff if you could just turn on that microphone there We'll be ready to go There we go. I've never been good at paying attention until the Thank you for the economic policy Institute for setting this up for us and there are lovely new headquarters I still smell the fresh paint Thank you to my colleagues for going out of their way to come and make this This book I think is quite an important book, but let me tell you specifically what this book is about This book is about how America has constrained itself From doing what has to be done for social justice and the future prosperity View that government by and large should be small At best it should be limited that attitude small as beautiful has infested us I use a Argumentative word, but I think it's true at least since the Reagan years and it is not Supported by the evidence That's what this book is about. This book is about the evidence Why do we believe in small government? That there's the American national character probably built on a distrust of government There is the attitude that social policies almost invariably create dependencies That's always partial It's a very small part of the issue social policies by and large help people I can go on with some of the reasons but the that we Maintain this point of view what I want to emphasize and what I think everyone up here will emphasize is how damaging that case inequality stagnating wages opportunity educational equality From K through 12 an issue. That's not talked about enough talked about but not enough the horrid Infrastructure I live in New York City. I was just talking about trying to make my LaGuardia airport as you know is a nightmare and Those are just our examples in New York City of what's going on and in case hasn't anybody hasn't noticed there's a climate problem We're going to talk about the evidence the evidence is statistical. It's cross-country evidence Let me review only very quickly that the role of government and American history one of the great myths that has Contributed to this idea that government should be small in America is that the 1800s used to be laissez-faire Milton Friedman said Festa capitalism and freedom which really laid out almost every argument from the conservative point of view The truth is we never had any truly laissez-faire government in America You know the story of Jefferson buying the Louisiana territories We know the stories about Alexander Hamilton and Policy that is loans to business and a central bank. That's not laissez-faire There were scores of regulations even in the colonial period regulations concerning product regulation There were scores of regular Government that set up how land should be distributed and paid for a Principle of Jefferson's by the way that I think often gets overlooked then of course the federal government under some of the mythology of Government backed away from serious so-called public improvements, but the states stepped in The most important I believe the states built the education system We were leaders I get some of this from Peter Linderts book growing public 2004 we were leaders in the development of primary education free primary education You know you've been always free in Massachusetts for a while. There was a tuition payment Massachusetts made the radical move to eliminate the Mantid to tuition and have free public education paid for by property taxes. It was a distribution of income a Program before the Civil War well before this Germany France and England on education per child and indeed even more big issue laissez-faire government. Are you kidding me in the 1800s, but here then we'd of course we of course had the the technological Universities we invested in them we gave them Berkeley MIT Ohio State and so forth one important issue in the late 1800s very often ignored was both Sanitation I was basically But New York City was very early in running water and sanitizing its water This allowed for the development of cities without disease without serious disease The development of cities was a source of economic growth in America often ignored. I think by mainstream Interesting and imperative by the work of Jane Jacobs. I think economists have picked up on that Sanitation not made built by GE not built by standard oil built by government Sanitation systems were what allowed cities to develop and become a major source of growth Then we had high schools women went to high school. Then we searched developed by the government even Very early in the 1900s in fact and on and on the story goes No such thing as laissez-faire government. We started the income tax in the early 1900s It grew in size and the economy kept growing at a rapid rise And the economy kept growing at a rapid rate One way of looking at it is The economy with the growing government wasn't an impediment Another way of looking at it is the government government programs were actually of fostered economic growth in that period and I think we can make a strong case for that My point I'm not to present in I'm pretty excited about it and hope this catches on the main point however is Historical evidence suggests the importance of the government role now we're going to turn to statistical evidence cross-country evidence and Evidence about what we need and neglect in this country as a consequence of our saying of And let me make one last point that is Is close to me and I hope it gets picked up more often Government is an agent of change and by thinking government is small. You are suppressing change nobody in the Certainly a few people thought government would have to build all the darn high schools in the country They didn't think that was going to be a role in the government surely. They didn't think government was going to have to subsidize college Sometime down the road time and again. We do not we are not a Change we learn a lot more. We know that young kids need education. That's a new knowledge We need government to to make that happen I'm gonna stop there, but I want to make this point clear Government as an agent of change clearly businesses also But times change knowledge changes needs change Probably has to get bigger to deal with all this So let me pass this on to my colleagues Christian and all thank you Tech help yeah, it's not working Okay Thank you Picking up on the history theme that Jeff has already opened for us Let's go back to the 1960s early 1960s at the time when Milton Friedman wrote capitalism and freedom His kind of conservative challenge against big government was socially responsible It should be even in retrospect a very welcome because at that time they had reasonable theories about How government could be bad that was their chosen slant, but at the same time We didn't have a whole lot of evidence, so they laid down a very good set of issues before us We should note that they didn't doubt big government of all kinds And I had never in the works of Milton and Rose Friedman. Have I ever found any? Catech of big military spending that was left to I have stone and others and by the way I should have added Dwight David Eisenhower and his famous 1960 speech about the military industrial complex But their social their complaint about social programs and the like really does deserve its Day in court. We didn't have the data back then Good news since then It takes a long time The 70 is indeed a long time you can gather the information you can see the actual history you can run the tests and Hopefully sell the results Okay accumulating and that's very good news They've been accumulating next to the computer evolution the rise of government data sub all kinds within our country and Internationally by the OECD and then in the rise of randomized control trials I want to remind folks or have alert them to read about the negative income tax experiments circa 1970 operated out of University of Wisconsin and those experiments Pretty good as randomized tests some glitches in the selection issues and there was of course political debate But they did show you overall when the smoke is cleared that if you Have basic income supports for people in time of need. This is not reducing some labor supply. It is not breaking up families Okay, now however in response to the the new Arrival of evidence the conservative response has been to bluff. They have been bluffing since 1970 That is the best way to say it The critique of large government has tipped away from watching the facts And being more ideological with less interest and confronting that evidence if you look at that literature There's almost no econometrics statistical of The today's standard there's all there's no study of history and even the most responsible conservatives I I often applaud Martin Feldstein's work But he always retreated into theory and simulations really when you read the tax code and you accept my model This should be bad for incentives, but that's as far as it goes. It's not factual Okay, so with what happened was the idea of let's find out about the facts has gotten replaced by a we knew all along and Only the Liberals have just not taken wisdom on this yet. Remember some of the steps in this kind of reasoning Reasoning the Laffer curve of 1971 or so long gone Flunked every empirical test. We are not in that Amazing range of the laffer curve the sneering about welfare Queens Charles Murray's fables in losing ground rush Limbaugh Discovered a whole new industry and it's gone on since then sad These bluffs do need to be called Okay, now Here's some of the lessons that you get from this riot is growing history and from Increasing sophistication of the tests available to us Here it comes. There is as I've said before From history and econometrics. You get a free lunch result That is to say countries with zero cost in terms of their gross domestic product In that sense of free lunch for the aggregate of the country They get many things. Here's a list of them to speak at the international level at the moment They have lower poverty rates than say we Lower inequality. They live longer. They have cleaner government By the way corruption was always supposed to be one of the dangers of big government, etc The largest social spending governments of the world Centered in Northern Europe are always ranked the cleanest least corrupt government when you have interviews of multinational Corporations the United States is not that high, but okay and in addition to all those good things They don't have a bigger any bigger budget deficits. It's not true for example and to quickly put in an intra us note A state like California huge spender on social programs a huge regulator running a surplus And when you ask people how happy they are they seem to be happier than the grumpy Americans and others Okay, how is that possible? How could that happen? Well three three really quick reasons I want to keep all of these my comments as Short as I can to help others Okay, first of all The all the theories about how bad this could be They assume that government is stupid or that it's just Somehow in control of people with the most incredibly bad influences in democracies. That's a strange assumption And the fact is these governments have never adopted the silly kind of anti-growth thing that you model basically Oh here I'll find somebody productive suck everything from them and give it to you who want to strum your guitar on the street for the rest Of your life now that you're leaving school Those are fables and they all assume something They assume that all government spending is either just transferred into the pockets of somebody else or even worse It's actually wasted. It's spent on whatever, you know poison skittles, whatever you want And it doesn't actually work that way It never has and a second big reason See the language here Social benefit programs the you know the part of the controversial part of government are less bureaucratic and less costly to administer Than the private alternatives here are four quick examples Universal health insurance is less bureaucratic than voluntary private health insurance They spend less through a public health insurance program to provide the services than the private Employee usually employer-based programs spend to keep you from getting coverage or the benefits Big broad taxes Cost much less to administer than selective taxes and tax gimmicks and tax breaks like we have a lot of here Big universal pension programs like Social Security cost way less one percent or less is the administrative cost In their their budgets then in privatized systems like Chile or Thatcher's UK where these things will Take up 15% of the total amount of the pensions just into the fees for the In insurance companies Okay income safety nets are less costly to administer than private charity and I've the book documents that at 1.2 Okay, the final quick reason There could have been a longer list, but 10 minutes So the welfare states invest more in mother's career and in newborns development and that's always true and it's still true despite the kind of tiny program being offered by the Trump family Among rich among rich countries the US is last in providing parental leave and public care Public infant care and this should be a no-brainer There's some empirical evidence favor of it that is cited in the fuller version of this But you know it should have been a no-brainer. Look if you have the general public helping people Get parental leave for a while. You're creating more human capital both in child and in caregiving parent Okay, the final quick reality checks to remind you of and John Bacchia's talk is going to get on to this kind of theme too I think even larger If big government's bad for growth then within the US, why don't you see just spiraling into poverty on behalf of? California Connecticut and Maryland and well Mississippi and Oklahoma rise to prosperity in world history. Why are all the welfare states recent? They're since 1960 and why are they rich? Okay. Thank you Here you go, and then we have to switch Okay, thank you. So I'm gonna look Evidence on the question of whether a bigger government would hurt the US economy now Most of what I'm gonna do is show you some pictures and facts that corroborate a lot of what Peter Lindert was just saying Let me start by talking a little bit about the theory of this so The theory for why a bigger government might hurt the economy is simply that higher taxes are going to reduce the incentive to do economically productive things and to the extent that people respond to those incentives For example by working less that's gonna have some cost in terms of economic prosperity on the other hand certainly Government spending on things like education and infrastructure and basic scientific research should have positive effects on economic prosperity Before looking at the evidence, let me also say That if we were to find that for example higher taxes had a negative effect on GDP that wouldn't settle the debate obviously because Government provides lots of benefits that are not measured in GDP including producing greater equality equality of opportunity protection of But are very valuable Okay So my basic theme is that you have to torture the data very hard to get it to confess To a big negative effect of taxes on economic growth so on this chart on the left hand side is showing over the long run of US history to 1870 Some various indicators of taxes so the blue line is federal tax revenues as a percentage of GDP The red line is total general government tax revenues as a percentage of GDP the green line is the corporate statutory tax rate the black line is the top marginal tax rate in the personal income tax and you can see all of these things have Experienced huge changes over time that were very persistent So very large changes in taxes over time taxes were much lower in the late 1800s and early 1900s. They are today Top marginal tax rates went way up and they came back down the right hand side graphs out the log of real GDP per person in the US between 1870 and 2014 and the benefit of showing it in log form is that the slope of the line is the growth rate so we just had a constant growth rate over time this would just be a perfectly straight upward sloping line and What the red dashed line is is the trend from 1870 to 2014 and If you look at the long run of US history It's very very hard to reject the hypothesis that we just have a constant long-run growth rate that we always return to and this is important because because How could it be that these enormous and persistent changes in taxes are having big negative effects on the growth rate if the long-run growth rate is never changing in US history so right off the bat the idea that taxes on net are very harmful to Economic growth once you take into account also the government spending their financing Kind of fails the sniff test when you look at what's happening on the right hand side of this graph now that same Picture is is very similar in other rich countries. So I'll just show I have data going back to the 1800s for 12 rich countries and Basically what this graph is showing is the gray dots are the size of government spending as a percentage of GDP And it's much bigger in the second half of this 1870 to 2013 period that the graphs are showing It's much bigger in the second half than in the first half So the size of government relative to the size of the economy grew dramatically in all rich countries The dashed line is showing The predicted trend in log GDP per person that you would predict based on what the trend was From 1870 through the beginning of the Great Depression in 1820 and 1929 and the black line is the actual log GDP per person in that country And what this shows is that for all these countries that experience a huge growth in the size of government? In the second half of the period when government was much bigger GDP per person rose above its historical trend or stayed right on it There's no evidence that countries that raised the size of government had GDP per person Drop below its historical trend Okay, so very inconsistent with the idea that large increase in government is hurting growth if anything for some of these countries Growth seems to be picking up at least for a while, and then they seem to return to their long-run trend You can see that For another six countries here So the last graph is for the United States and you can see the 1870 1929 trend almost perfectly Predicts today's log of GDP per person despite the fact that government got much much bigger Okay, we could also Look whether over the last hundred years did countries that had larger increases in the size of government experience any loss of economic growth as a result so what this graph shows is on the Horizontal axis it shows the change in the size of government as a percentage of GDP and there's a lot of variation From like 20% for Australia to 45% for Sweden And then and this is over the last hundred years and on the vertical axis it shows the growth rate the annual percentage growth rate in real GDP per person and What you can see is there's there's not any strong correlation here if anything there's an upward sloping relationship The countries that had bigger increases in the size of government also had slightly faster growth rates If you control for the initial incomes of these countries to allow for like poorer countries to converge to rich countries Then you basically find no correlation at all Another piece of evidence is we can look we can get much better data if we if we start at 1960. So this is showing that Back in 1960 the Nordic nations like Denmark Finland Sweden and Norway, and I'll show those The some of those on the next graph had very similar size governments to the US So government is a percentage of GDP and all in the Nordic countries in the US were very similar back in 1960 Okay, since then the Nordic nations increased the size of government dramatically By on the order of 15% of GDP And that's what the bottom two lines in the graph are showing so the blue line in each of these graphs is government spending or sorry taxes as a percentage GDP in the US and The red line is taxes as a percentage of GDP in the Nordic nation that we're looking at So on the left we have Denmark on the right we have Finland the top two lines are showing the log of GDP per person in The red line is the Nordic country The blue line is the US and you can see that basically despite this large divergence in the size of government between the Nordic nations and the US log of GDP per person just Basically follows the same path in both the US and the Nordic nations There's no evidence that the Nordic nations started to fall behind the US as they grew their governments And you can see something similar going on in Norway and in Sweden Okay Looking more generally at about 23 industrialized nations What this graph shows is from 1960 to 2013 on the horrors analogs is it's showing how much did taxes go up as a percentage of GDP? since the early 1960s and on the vertical axis it's showing the average growth rate in real GDP per person since 1960 and there's basically no evidence that the countries that increased the size of government more and taxes more Experienced any decline in their growth rates relative to other countries There's also no correlation across industrialized nations between the 1960s and today Between the change in taxes as a percentage GDP which is shown on the horizontal axis and The percentage change in hours worked per working age adult. So if you look over these 23 Industrialized nations, there's no evidence that countries that had really big tax increases saw hours worked per adult Go down more than the countries that didn't raise taxes so much and that's partly explained by some of the things Peter Lindert is talking about which is like countries like for example the Nordic countries have done a really good job of Fostering female labor force participation by making it a lot easier to stay attached to labor force when you have children so there's government subsidized and provided child care and preschool and Lots of paid family leaves so that you don't have to lose your job when you have a child and so forth So these countries have the highest female labor force participation in the world and that partly compensates for whatever effect taxes might have been having So the last thing I want to say is it's not sure that conservatives have not done any Econometric studies to support their claims that taxes are hurting growth So like for example Martin Feldstein when he wants to argue that taxes are harmful to growth He looks at the following correlation. He shows so the left-hand side graph here is showing that What happened to the marginal tax rates on people at the top of the income distribution? So the top gray line there is the top marginal tax rate in the income tax the thick black line is the tax rate on People in the top 0.1 of the income distribution and then the bottom two lines are for people lower down in the top 10 percent Of the income distribution and what this shows is since 1960 we've cut taxes on the rich tremendous Lee and what Martin Feldstein would point to is well if you look at the right-hand side graph the incomes of the rich Before taxes went up tremendously and Feldstein would say this is a response to incentives Look taxes are really harmful when you have high tax on the rich They don't earn some so much income when you cut taxes they earn more income The problem with that claim is there's so many other things going on that can explain the rising inequality that we see on The right-hand side of the graph including globalization skilled bias technical change Things like when you cut the top tax rate in the personal income tax money comes out of the corporate tax base and goes into the personal tax base and All this data on inequality is measuring income on personal tax returns So there's lots of alternative explanations besides the rich are working harder for this Relationship we do see across countries and what this graph shows is countries that had bigger cuts in tax rates on The rich since the 1960s had bigger increases in the share of income going to the top 1% of the income distribution Which is consistent with what we saw in the last graph However, if we look at the same graph except now looking at economic growth We see the countries that had bigger cuts in tax rates on the rich measured on the horizontal axis did not have faster economic growth overall in GDP and What that suggests is to the extent that Taxes are causing what we saw in the previous graph that tax cuts led to rising incomes for the rich It's not an increase in productive economic activity. So it could be things like an increase in rent seeking So for example corporate executives bargaining harder for higher pay or it could partly also reflect Changes in tax avoidance. Maybe there's less incentive to avoid and evade taxes when we have lower tax rates Which won't change GDP, but it will change reported incomes in these graphs And also shifting of income between the corporate and personal tax basis, which is clearly playing some role here So I think the bottom line is again You really have to torture this data pretty hard to get it to tell a story that taxes are really having big negative Effects on economic prosperity Thank you. Okay, great. Thanks. I'm I'm gonna say I'm gonna Make three points here the the bulk of this book Which is Peter and John's chapters is about the effects or lack thereof of Government size on economic growth rates in the United States and and across these countries so Peter focuses on In terms of government revenues a shared GDP or Expenditures but there are other argument and the punchline I assume you have already gotten is that There's there's no strong indication of of any sort of harm to Economic growth coming from a larger government either in terms of its social policy or overall at the level that exists Over this period of the last hundred years or so doesn't mean there could never be an adverse effect at some level size of government almost certainly would begin to harm the economy, but Countries don't seem to have reached that level as best we can tell from the real-world experience a Bigger government in the United States and Peter deals a little bit with the first of these that I'm going to talk about But I just want to say a little more about three of them. So one is that government programs don't really work Peter talks a little bit about this in his chapter Remarks today and Jeff and I in the first chapter in the book cover this to some extent to We focus on four areas where government could help in the United States These days and where we haven't been doing nearly as well as we should since the late 1970s. So one is Another is a quality of opportunity and then the last is shared prosperity And so I want to say just a few things about each of these. I'm not really going to say anything about infrastructure I think the case for government helping there is is quite obvious if the private sector we're going to solve this problem It would be doing it the the difficulty we've faced Over the last generation is not that we've been spending a lot of money and it's been all on boondoggles It's that we haven't been making the investments Argument there or the conclusion is fairly straightforward We also have a very solid Base of evidence that suggests that more Reducing economic insecurity if we think about economic insecurity as consisting Mainly of not having enough income or enough resources to secure a decent standard of living and then also having a reasonable amount of financial stability It's over time mainly since the 1930s and we began to put government programs into place But also looking across these rich democratic nation. So this first graph that I have up here shows a useful measure of I call it or public insurance programs along the horizontal axis It's just share of GDP with a little bit of an adjustment for the share of the population That's elderly that's going to automatically cause more money to be spent on these programs and also the the unemployment rate and you see the the usual mental European countries further over to the right in the United States among a few others over to the left on the vertical axis is a kind of better more direct measure of poverty or or low level of Government surveys now increasingly will ask a battery of questions about whether for example, you're unable to pay your rent at any point in the last six months You live in a neighborhood that's dangerous But can't afford to move whether you didn't go to see a doctor when you thought you needed to because you couldn't afford it and so on and Those questions to Calculate the share of the population that we might call Experiencing material hardship or material deprivation so higher higher is worse here on the vertical axis and you see a know Relationship or pattern in these data suggesting that countries with bigger welfare states more expansive public insurance programs have tend to have less material hardship if you prefer a more inequality based measure or conception of Economic security or insecurity you can use what's pretty standard in Europe and in a lot of cross-country research Which is a relative poverty measure so you set the poverty line as a certain fraction of the median income in the particular country That's not the way our government measures poverty, but it's very common in comparing across countries Here you see again a very strong Relationship with countries with more expansive public insurance programs tending to have less Relative poverty or less inequality in the the bottom half of the of the income distribution And here's a measure same thing along the horizontal axis on the vertical axis here is a measure of financial stability so What this does is say of? People of individuals in a country who experience an income loss from one year to the next of 20% or more their income so you're earning $50,000 let's say in year one and in the next year you're earning 40,000 or less for whatever reason you lost your job you were out sick became disabled took time off for a Pregnancy but to care for an elderly relative all sorts of things can happen So of people who suffer or experience that kind of income decline excuse me earnings decline what percentage? Experience a similar decline in overall household income So you can you can make up for the individual earning loss by a second earner for example earning more But much more commonly you do it because some public insurance program kicks in and replaces a decent fraction of the individual earnings You lost and here again you see the the US is kind of in the middle upper left there It's right on top of Spain, so it's not easy to to identify But higher is worse here so higher on the vertical axis means a larger fraction where an individual is Experiencing a sizable earnings decline the household income is also declining significantly and once again You see a very straightforward and pretty strong relationship across the countries Okay, so that's economic Insecurity and there's more data. This is just a sampling. What about a quality of opportunity or inequality of opportunity? Well here what we're thinking of mainly is the chances of people who grow up in less advantaged homes where the parents have lower education or lower Income or the neighborhood is not so great and schools are not as good as we'd like them to be their chances of reaching the middle class or Or better and roughly speaking in the United States these days if you grew up in a household in the bottom 20% of the income distribution your odds are about 30 to 40 percent Making it to the middle class the middle 20% or a higher we have varying estimates depending on the the data source That's not the worst possible scenario, but it's not nearly as good as we'd like to and as best we can tell it's not as good as some of these other Rich countries do although there too depending on the data source you look at you can get slightly different results What do we know about the contribution of government programs? Well early education seems to be key we've got a growing base of evidence that increasingly strongly suggests That good universal good quality Universal comprehensive early education available at about 12 months of age It's fine if you do it just for those in the year prior to kindergarten, but seemingly even better if you do it earlier in the life cycle tends to equalize Both cognitive and non-cognitive skills of kids as they enter the formal schooling system and has lasting effects throughout the The life course and it does that mainly by bringing up those at the bottom not by pulling down those at the at the top Secondly, we've got some still very limited But some fairly compelling evidence that simply getting more money to low-income households Tends to improve the the odds of kids from those households reaching the middle class or better We've got some experimental and quasi-experimental evidence that suggests this. It's still I'd say a fairly thin body of evidence, but it's it's getting stronger and Then third reducing the cost of college seems to help There's a big debate here in the United States So mostly on the left about exactly how to do that the best way to do it but but evidence suggests that this too plays a key role in And increasing the odds that those coming from less-advanced backgrounds will will make it to the middle or higher shared prosperity The the story is twofold. So by shared prosperity. I simply mean that given an amount of economic growth Does a decent fraction of that reach ordinary Americans those in the middle and below And that hasn't been happening in the in the last generation or so It did to a considerable extent in the period from the end of World War two up till the mid to late 1970s, but it simply hasn't since and that's simply another way of saying that we've had growing income inequality and a lot of Growth in the amount of income inequality Can government help here well it can in a variety of ways we know from our own experience and that of other rich countries that a Key part of the story in rising incomes for those in the bottom roughly the bottom fourth of the income distribution Since the late 1970s has been government transfers Or net government transfers if you take into account taxes that they they pay And that's not terribly surprising There's a lot of rhetoric and discussion in the United States about how Working your way out of poverty is is always the best strategy But in fact many people who are in the lower fifth of the lower quarter Either don't have jobs or unlikely to have jobs. There's some disability. There's family considerations There's frictional and structural unemployment at any point in time. Some of them are elderly Some of them are still in school So there are lots of reasons to think that while more employment as a solution to poverty can certainly help That's not been the key in most rich countries over the last generation So the countries where there's been more sharing of prosperity to those at the bottom have been those that have raised or increased Their government transfers as their economy has grown not even necessarily Increasing the share of GDP that goes to government transfers, but simply keeping that up Over time as the economy grows for the middle class of course earnings are much much more important than government programs although government programs matter to a non-trivial degree to More than tiny fraction of those in the the middle class But they're they're less important as a mechanism of ensuring shared prosperity here in the United States There are a variety of things that government can do to help the middle class and I'd be happy to talk more about I'm sure others on the panel could and the question and answer the the list is long But I will say here that this is not an easy problem to to solve and that's a big part of the reason why we have Continuing very vibrant. I think debate about exactly the the right strategy or combination of strategies Okay, two other points, and then I'll stop There there are two other arguments that are very frequently raised Against a bigger role for government. One is that they're okay, so maybe it doesn't harm economic growth Maybe it can do some good But maybe there are better alternatives and the ones that are usually offered obviously one is smaller government with the hope that that'll Increase market vitality and increase economic growth again The story of this book is that we don't see evidence in favor of that at the level that exists But other people will argue that we should we should rely much more on families or on intermediary Organizations voluntary association civil society to solve these types of problems. I Think those can help but I but I simply want to mention two things One is that even at their best neither of those solutions is comprehensive enough it's only Wide enough swath of the population to be as comprehensive as we'd like and then the other point here is that both of those Families and voluntary organizations or civil society have been weakening in the United States for the last half century or so and Nobody to my knowledge has come up with a compelling story about how to fix that it would be great if we could don't get me wrong I would fully to the the Already existing porousness of these two proposals and then they're weakening over time The last thing I want to mention is the argument that we can't pay for it that we can't afford it and here Peter Mentioned that there's no The size of government or the size of social programs and government deficits or government debt That's what this picture shows here. So this is government expenditures as a share of GDP across these rich nations over the course of the 21st century so far and on the excuse me Hero GDP and you you don't see the expected pattern the countries then more Not all but most of them tend to pay for this Here's what things look like in the United States compared to other countries So this is government expenditures as a share of GDP The the grayish dots or for each of these countries again averaged over the 21st century so far You often hear the complaint or Worry that well, this is a nice thing to aim for a nice story But the United States can't possibly become anywhere close to Denmark or Sweden or Norway or or any other European nation for that matter The hollow circle here is the United States back in 1920 a century ago What this shows you is a very simple point. We're closer today To Denmark and Sweden and Norway or whatever other countries is your favorite then we are to the United States of a century ago This is not a horribly owners task a terrible slog to get through we could if we have the will and here I lead into our next speakers Move very much in this direction Thank you Lane and thank you also John and Peter and Jeff We are now going to move to a conversation that looks at what the American electorate thinks about this issue big Also small within the context of government policy and also within the context of I'm sure the political choices that they have Before them this year, which must present such a wonderfully rich source of Job Conversation. Thank you very much. Well, first of all one of the things that's great I think about public opinion data is Just as you all were mythbusters and conventional wisdom was wrong About the economy and just terrific presentations. I have to say the conventional 95% of the time plus or minus 5% So I think John and I are here to be mythbusters as well The first I'm gonna make a couple of points about myths and then a couple of points about Barriers Everybody knows that the public is against a role for government And it is certainly true that perceptions of the role for government is the single biggest predictor of Long-term political attitudes in the country right now. So if you want to know why someone is Republican or Democratic and and Asking them the role of government would be the best predictor of that attitude and the public overall Splits although it's tipping slightly more toward role of government The perceptions on the role of government underpin the gender gap the reason that men and women Is women tend to see a partnership in a role for government Men tend to think it's a good day when government hasn't done anything bad to you The biggest gap in this is Among college educated men and women. So when we ask ourselves about a role percent of women say yes, there should be 49% of men say yes, there should be they still split But they are significantly less supportive than men Among college educated women 62% say there should be a role for government in the economy 39% of college And I would make your book is I don't think we should subsidize men in college until they learn more when they're there Radical idea, but just a possibility There is a similar difference between married and single people there is a similar difference I'm in a white man differ a lot on the role for government And in some ways the most interesting is the millennials and john is a real expert on this as well The the age cohort most supportive of a role for government. So if you think about that women That the democrats should be Getting more and more in favor of a role for government But you also understand that demographics are in our favor the the country Is moving despite all the anti-government rhetoric and despite all the distrusting government and both of us are going to mention this in a moment The country is moving over the next couple of decades Solidly in the direction of a role for government. You would not know that If you are living in washington dc right now The second thing and you mentioned it lane um, you may use it some very interesting points that the public is actually an Often particularly women think often you have to move to a government solution because it's more comprehensive because uh, it has enough reach because By yourself, how are you going to take on? um At a global economy, uh, international corporations are now perceived to be more powerful than governments Um, how are you going to take on the big banks as one wonderful woman in a focus group said Uh, about the financing But she has your mortgage and I didn't even know they had my mortgage Uh, Greece makes the decision and my pension declines. I didn't even know I don't even like greek food Now I like greek food, but you get her point, right? These decisions are made completely out of people's control And government is the one place powerful And be on behalf of people You also have increased mobility. So 73 of americans do not live in the county. They were born in Mobility had been depressed during the recession couldn't get out from underneath your house. You couldn't get a job dramatically in the next 10 years It's already on the rise And people think I don't want to move from wisconsin and mississippi and have a dramatically different food safety system or water quality or education system So as mobility increases you also have a desire for a greater role for government regulation and the great News as much as your analysis Conventional wisdom is wrong about where the public is on both of these roles So if you ask the public, do you want to spend tons more dollars and increase your taxes? Yeah, you can get a negative number sure But if you For education, even if it raises your taxes 64 of the people say yes Reduce the deficit 62 percent say yes Social security and medicare 58 percent say yes. This is true even though 60 over 60 percent of millennials don't think social security or medicare will be there for them when they get there We haven't had an epi has been Really a great voice in this we haven't had enough dialogue About the role the government can play in getting the economy going again And john can speak to this in great detail But the point of the matter is across the board even in realms that are perceived primarily To be local as jeff was saying like of increased spending Regulatory everybody knows that the public doesn't want more regulation everybody but the public And I would really commend you to to look at a study that was done Uh by the patricia bowman foundation a great friend of all of us in this room Maybe even supported the book for all I Asked the shows across the board People think uh, they are critical of regulation right now, but not because they think it's too much It's because they don't think it's fair That it's not applied evenly that the big guys get out from underneath it that they pay a small fine That they budget and charge you for by the way anyway Have unsafe food make your working conditions unsafe Everybody knows for example that everybody hates osha, right? Actually, osha is one of the most popular Uh government agencies out there to the great surprise of osha Uh a solid majority of americans are in favor of osha, you know, who likes osha the best The best because they've moved from wisconsin to north carolina They say guess who gets to walk in and see all this toxic shit sitting right next to my workplace We're the ones in those jobs. We know exactly what's at stake here So um the number one thing that people would like more regulation is actually government, which is part of the problem and we'll Water Imports prescription drugs wall street You name it in most areas people are massively in favor of greater regulation fair regulation By which they mean the big guys ought to get hit just as hard as the little guys do So First of all We are not ready to be denmark. In fact americans would be really nervous about being that close to denmark They'd want to move back if they saw that chart lane I think they'd say well, there's the root of all of our problems. We've moved more to our denmark We should move back and The individual but there's nothing contradictory About being for the individual the power of the individual and being for a strong role for government In fact, as everyone is articulated here The government plays a key role in giving the individual don't have power But this country really likes the individual and we won't be having the same conversation As norway sweden and denmark can be successful The second problem is um distrusting government I'm not going to talk about that very much because john's going to talk about that a lot But distrusting government is at an all-time high They think more will get done. They can watch it more carefully and it'll be more representative of them and um People uh, we do have to deal with this issue of distrusting government Which the right has fed for 30 years and a A Universal campaign on message for 30 years does have impact You're not in favor of the status quo and you see that playing out Presidentally and look at advertising, right? Ty doesn't market Um, this is your mother's tide. They market. This is new in America the single biggest word in advertising that is used to market goods is you The second biggest word is new So part of our problem is we always make the government conversations sound like the status quo And I loved it. Jeff when you said government is the agent of change government can be the agent of change Say that everything is perfect. There was a wonderful anthropological study that was done And I and many of you have heard me talk about this before where they asked germans brits and americans um A different things for commercial sloganing and they asked them they use the slogan This beer has been the same formula for 99 Bavarian beer. There's no question about it. 99 years the same. It's the best beer. It's bavarian beer It's our beer the americans were dumbfounded They were absolutely silent in the focus groups and the moderators said, okay Well, what do you think of that and they go 99 years and you couldn't improve it give it to us We'll make it better in six months Um And so as we talk about government we have to talk about what the reform is And what the how government produces change and frankly the other side has been a lot better about that than we Finally last point i'll make uh, how do we find a real question and even some of our base is very tax sensitive Um, latinos for example are very tax sensitive Blue collar voters are tax sensitive because they're out of money if you haven't had a raise in 20 years and cost of living is going up you are But there are lots of revenue sources that people support 66 of americans Supports a top 2 paying more 64 support large corporations paying more Even when you include increases in your tax tax candidate The candidate who is for tax fairness, but increasing taxes to spend on things like education and retirement meets the no tax candidate 56 to 33 and When you juxtapose it against Should have the cuts in these programs instead of increasing taxes in that dialogue Even though people would solve every program by putting waste fraud abuse to source the program um, the candidate who is against the cuts and for tax increases 54 to 38 and Frank who is here in epi have done a tremendous amount of work on this So the point is while people are tax sensitive and we should not take that lightly There are plenty of ways to address that concern So on that note, let me turn it over to john to Thanks, linda and thanks to the authors and epi. We um, uh, this is my first time We share offices. We used to share offices with epi. We missed you guys But it looks like you've you've moved up in the world and have a nice digs over here. So congratulations um, and I encourage you to get the book. It's really well written and I think it'll be useful for for The question when I was invited to this does the public support something of this nature and my answer is yes A potential national majority exists to support much of this agenda Not all of it with three big caveats, uh, and I'm going to get to that in just a second If you look at the abstract debate over big government versus Does not work for progressives I can't find a point at any time in the past 23 years in gala pew polling Where the just the basic question should the government do more uh to solve problems versus Leave more to individuals or businesses. There's one point in the past We had net positive ratings of government. Um So really, you know in the abstract a bigger versus smaller government debate doesn't work That said we've done extensive research on what people would actually what what they want the government Get this agenda and infrastructure security opportunity Shared prosperity. We have large majorities of people across Ideological and partisan lines supporting action on jobs On the environment, uh on on economic security issues And even more specifically we have tested and we did this in in Many of the specific ideas that are listed by lane and cheff on page 29 Which is a really fantastic List of things that uh, we would be doing with this with this new agenda We have very high levels of support for for increasing the minimum wage and indexing it to inflation For paid leave for paid sick days For universe sickness insurance program, but I assume there would be support there wage insurance We tested expanding the EITC dramatically high levels of support there And we even tested a national jobs program and we get majority strong majority support for this So if you have an abstract debate, you will lose if you talk about what you're going to do when we acting Through our pv a better society that provides more security more opportunity more prosperity People could get behind you. Now. What's the problem here? Well, selenna mentioned the biggest problem Is the federal government people? I mean, I just looked at ratings on our members of congress ethical or not. It's it The numbers of congress have have high or very high ethical standards Uh, most people look at the government and they don't see all of these great programs You all are promoting and that you know cap and other support They see a bunch of of rich out of touch politicians pictures line their pockets It's it's really quite bad like the popular sentiment is real and the federal government Uh, you know, it is responsible for most of this. Um, so In the abstract they would love people would love the government to do a lot more Do they trust the government as it exists now to do any of this? No Sanders campaign tried to do Uh, if you combine political reform and a more progressive social democratic agenda I think you have a winning formula, but I absent like serious political reform And it's primarily around money and politics and the outputs of government policy towards special interests It's going to be very hard to move some of this. Um People people feel they pay the right amount of taxes They are all for like massive tax increases on the rich probably ones that exceed even some of the ones being proposed by people on the left But we do see a no one is making the case that there needs to be broader tax increases Uh, I've seen no evidence and there's because there's been no arguments that we should move towards some kinds of Minoric states would would need that we have to start defending that idea. This is a it's a it's an idea that is split on the left I'll talk about that in a minute. Um But people believe the government has plenty of money and that because you know, since it's paying out things to bankers It's paying out things to rich people. It's not Pay more taxes. I want you to fix all this other stuff The third one that I will mention is we're entering a period globally particularly in western democracies of what is called welfare parochialism welfare chauvinism and that in laying your graph on gdp A government expenditures to gdp has all the nordic european states In all of those states you're getting 10 Nationalist parties around the danish people's party UKIP, uh, the fins the austrian freedom party the national front All of them support the basic social welfare provisions of european nations, but None of them wanted to go to anybody but themselves. And so what we're gonna Are in the future for more uh economic security, but real concerns about who's getting it and this is the this is the in in europe It's about refugees here. It's about immigration. There's going to be a big generational divide here Which I want to talk to in a minute younger people clearly want more government spending on opportunity measures Economic security issues the party of the left needs to figure out what the overall Relative balance is this leads to my second point The politics on this is particularly mixed I can get you good numbers and I have lots of them that show republicans republican voters and conservatives supporting Variety of things that progressives believe in as soon as any of their leaders mention big government Or or put it in an ideological context. We lose them We they they go from majority support to majority opposition on something as popular as paid leave and even paid sick days Once you introduce ideological information. So Call opposition who really doesn't want to do this And the problem is that the the broad democratic left Progressive social democratic mainstream democratic party is not at all united behind this type of agenda and part of what good, you know consumption tax is one thing we mentioned there are lots of reasons why People worry about that We get a lot of promises now to do a lot of the spending you all are proposing and we agree with Without much on the tax side. So basically we're going to increase taxes on the rich and do all the stuff We want to do and that's that's unrealistic. So until The progressive left gets serious about defending the need for for In terms of gdp terms No one's going to believe it. Uh, this leads to the another question here is what is the relative balance and how this is structured? We see lots of evidence people like state government expanding Uh, if you look at the relative rankings of federal state and local government, the federal government gets horrible ratings state and local government, they get This has to start by building on our our deep blue progressive states, california, maryland, massachusetts Places like that and continue to show that this model Of greater social economic provisions and involvement by government can The federal level because right now there's too much too much doubt about the federal level for that to happen That said we can expand on the models that are working in the states The other question I would I always grapple with is uh, how should these things be structured? A lot of what we do is very progressive. Now the things that people like are very universal Particularly the economic security strained Revenue period we want to make it more progressive, but really the only way to get support for this is to make make sure everybody gets it And that's a difficult conversation in some ways Just briefly this raises the question of values. I mean again, I I think there's very Move it what do you appeal on is it on security? Is it on inequality? Is it on growth? Is it on some perception of the common good? Is it on individual opportunity? These aren't just buzz words or phrases. These are core things that that people would They so The best available evidence suggests right now that the easiest way in the near term is to expand economic security Measures in a universal manner. That's the evidence. I have now. Obviously you want to move in a variety of other ways I Did mention the generational split young people in particular are very concerned about The diminished prospects on social mobility and opportunity. So there will be some intra-generational Discussion about how we spend our resource In these areas, which I think is is the correct correct way to go But in the near term, I think we're likely to have some fights over this Which leads to my final point, which is we need better More progressive social democratic style institutions and media to promote this because what is outlined and looks pretty There are very few sustained efforts to sort of make this case for how the government Can actually do more to improve your life to improve national prosperity There are tons of good think tanks and and other grassroots organizations, but really Uh forward, what are we seeking to achieve in terms of the country? How will it be structured and what will be the cost and benefits to you in a sustained way for 10 to 20 years? We can make this case, but if we're not thinking in terms of how to sell this Ideologically and in a convincing manner based upon people's real needs. It will be difficult to do So I'll leave it there and thanks again for the book And thank you all very much It's it's a little unusual and different that the empiricists and the social scientists are Pretty optimistic about the path forward and then we get the opinion researchers who tell us. Yeah, not now And that's really going to drive the first question Not now in terms of having the So I just wanted to ask briefly about those impediments You know, john you talked about the public really looking at the federal government Which quite frankly is the nexus for a lot of the solutions and path forward that were offered in the book The the incredibly low 8% That you used but do you have any ideas about how you how you you chip away at that? Is that something that requires its own Uh strategy to deal with or it's a matter of just getting government functioning at a higher level Or is there something immediate and targeted? You know, what would be a progressive populist approach on this which is essentially the warren sanders epi support a cap supported approach of taking the government back to make it work for for average families again And that's a very powerful idea, which is We actively as democratic That we need to work for us work better Um, I think that's part of it. There are there the perennial issues about Waste management fraud things of that nature. Those are real. You know that that stuff is not as compelling as a public message what they really want to see is Does this entity called the federal government actually care about me? Collection as we heard in focus groups Of of millionaires doing the bidding of billionaires that that's the way the u.s. Public views The federal government that we're talking about expanding here. Um, that's a serious challenge So you you need to combine political reform Uh a challenge to the status quo with I think a more progressive social democratic I just want to comment on that I would just add one thing which is I think we would help be helped by separating politics and government When you think about it the critiques actually are really a politics much more than government And when you separate out government Which has been done in in some of the unionization efforts, etc I mean people love their firefighters and they think of them as the I think of They used to love their police. It's more mixed now. They love their child abuse workers. They love their teachers Um, so I think one of the things we had to talk about here An Reform Let's not become part of the problem and hit government too Let's make the distinction between politics and government and who in their right mind would defend politics Right now. I certainly wouldn't um, and I work in it every day. So, um, I think that That's Bring us well as individuals notice that serving us collectively well as our government and we need to change politics All right, and jeff lane john and peter any or all of you if you want to respond to this whole notion that You know part of making the the evidentiary case is looking at international comparison People are looking a little bit more inward and really focused on taking care of Our own however you define that and I just want you to just sort of respond to that in terms of Making this evidentiary case broadly to people who seem to be more inward looking I'll only take one minute Governments more than their federal government. It's probably because they know what State governments are doing for them Same with local governments pretty clear and it's I think an old It's a hobby horse of some good scholars that people don't know what federal government is doing. So that's one issue I About that. I don't think frankly The left or the right candidate is very clear about that But secondly, we are humbled by this idea that we you know, we can't expand government very much So we have For me, I know elizabeth Solicies were quite bold But in fact They're a poultry of things we've talked about for a long time that she is Finally caught up with or willing to talk about publicly But they're not bold in the sense that she's not going out and saying we're gonna This is really going to affect american change it for the better And the problem I think is then people say, okay, how are you going to pay for it? That becomes hobbling. We have some ideas about how to pay for it. We think we can pay for it John and salinder is saying that people don't want to pay for it But I think that because that's a rather serious issue We also think probably most of us on this panel think there's room for the federal deficit to expand here and While we're at it just one very brief point which is that While a lot of the evidence that That is in this book does compare across countries. A good bit of it is Is historical evidence from the, you know Parents as we are from across countries The conclusions lean in exactly the same direction Which is as helpful from an analytic point of view I I I don't know the extent to which that's helpful in selling it politically. I can't really speak to that All right, we'll go to questions from our audience. I could just ask that you uh, you be To you why don't we start closer to you margaret? And then we'll try to move forward as much as we can Jim saying I like peter and academic john's arguments, but can I ask each of them one question? One john, uh, you point out that the other things happened is a very powerful argument Is that doesn't apply to your argument i.e. your 9 1870 to the present includes two-thirds of all Little period and for countries like austria and germany and france It basically includes the rebuilding from world war two So aren't those other things that happened and peter? I have lots of friends in france. They represent the triumph of the french system there Clark technicians and echo no miles who came from working class families and whose children didn't go to echo but then anis and nephews about the french a job situation the sclerosis In the in in in france And I wonder if you comment about that since you talk about how well things are going in europe If we could do the first one maybe I think The dynamics of the french economy at this point so Yeah, so I want Okay, so all responds to the first question and I agree wholeheartedly that other things do matter other things are changing over time And that's the nuance that comes through in the book that I don't have time to do in the 10 minute presentation You know the best Attempts to control for other things that are going on and I'm doing that myself and and So there are some econometric studies that find a negative effect of growth in government on economic growth But you need to do Need to do is you need to focus on the very Recent period after the divergence in size of government across country So you start with data from the mid 1970s or later Okay When pretty much in all these countries the size of government is just fluctuating around And not growing in any sustained way Because then all of your evidence is driven by short-term fluctuations the relationship between like taxes are low at the bottom of a recession and then the economy grows fast But that's not informative about the question of if we had a government that was 10 larger as a percentage of gdp permanently Okay, so if you expand the sample to look back to 1960 at least which is after the the gordon period you're talking about and so forth um You know Econometrically you can't find any long run equilibrium relationship between the size of government and either growth or the level of gdp It's extrapolating from little fluctuations to try to figure out what a persistent change of government would do Much better to look at when government changed a lot And see did growth change and when I do that and also control for many other things I find essentially no relationship. So so that's the best I can do with that Quickly on the uh french fund uh, france has Mixture of policies including defective policies that have nothing to do with the size of government Support programs of the welfare state They're really bad policies are completely separate and they are Just buying off The branches they had the uh, 35 hour a week, which is a terrible idea Um for them to get into in a world that doesn't do that and then they had uh, Like so many mediterranean's and latin americans. They have these employee protection laws that are They're hard for young people to get hired because the senior Typically male workers are so protected by those laws. None of that relates to uh welfare state and the basic I just have to comment that big maybe because it's very Important to me about the bob gordon great invention period. This is a highly Simplified view of why economy Is not least because it it financed the development of the railroads the rapid Productive use of transportation in that period allowed for the expansion of mass economies of scale production That's just one example. Then there was literacy That is a sadly forgive me for my strong language because I think it's very Misleading but it's a Sadly simple view of why economies grow suddenly. There's a spurt of rapid inventions. In fact last point european economic historians correct me if And not in the 1800s in britain But in the 11 and 1200s in flanders when there was a great deal of prosperity due to tech tech textile technologies, but also the advance advances in In uh, uh, transportation and a bunch of other issues With the grain of salt even to We're going to go to the front here this gentleman Judd harriet I had a question for stelenda, but she is split so i'm going to dump on john here uh quickly that the Demographics were propelling our society towards a role for government position Do you agree with that and if you do? Do we have a political system and a core of politicians who can capitalize on that and move us towards a more progressive society? demographics in the country and most of what is commonly known as um president obama's coalition Uh, the rising number of young people millennials communities of color particularly And rising professional groups and things of that nature They Is about government. So if you look at this over time and how the electorate's going to shift The people who are most vehemently anti-government Are shrinking as a share of the electorate and The people who at this moment are are ideologically more open to go government are growing now that that leaves a huge hole Yeah, we should have national health care or higher spending on on tuition free college They have a they have tons of questions about the structure of government who it works for things of that nature So the demographics alone are just trends you can look People who are capitalizing um On these attitudes and and being responsive enough to fix the system to do what what this group of people actually wants It's getting better, but it's not there yet. That's how I would answer it. So, um The shift in population It has to be built in some in some kind of way and it more likely than not it happens In a steady non ideological way where specific problems are dealt with on a state by state level And then something's done at the federal level You know, we don't help soon unless we change the electoral system of the country So what you'll get I think is a steady accretion of people supporting things that expand government in ways that are actually beneficial for their own security and opportunity Can I just say really quickly? I I think that's essentially how it happened in most of the northern When labor social democratic parties set out a platform that said let's go up by 10 percentage points of gdp It was policy by policy incrementally and you look after a generation and all of a sudden You've got more social programs and a bigger state as well Okay, we have time unfortunately for one final question and it's going to be you Yeah, thanks for your presentation But if I think about the title how big is your government? I mean looking at what's the weakness or our system But I didn't hear sort of missing I just wanted if you can address anywhere they can tell you Today we have a nominee from parties. They have approval rating just so low It's meaningless To say they are they are that are leaders and you will mention other than Commander-in-Chief Worldwide, so I just wonder by definition You know the republican and democrat they are thinking about regulation or non-regulation. It's sort of different concept It's totally different and there are data that I think whether you are economic or social Sociology or you are educational experts. I think they are using the data existing data people created for them There's no way to verify them whether they are right or wrong Now we're not enough to chew on because I think we want to address This is a great question to end on because it addresses how we got here And go ahead Peter. Yeah, I wanted to address the question. Go ahead with the final sense to make sure I know the full And the concept or instance The Selena Lake they have survey data, but they don't really have an expansion that people can answer All the data question one two three four is meaningless Okay And agreeing with what I think is the spirit of public opinion question asked about government or federal government Fortunately, they don't use the word washington would be even worse, but government or federal government since the year 2009 Watch out. You should only be interested in the questions that unpack who you're talking about of the government, etc And very few of them ever unpack Congress from the executive, etc Since 2009 it has been an act and now within congress. It has been an active Strategy Never deviated from of the republican party That might make the executive branch look good Since 2009 since obama came into office They had a meeting about it. It was in the news at the time and they've stuck by that plan So watch out between congress and executive. Here's a good quick clue about this Close to the our issue of big government notice Wrong direction and everything's in government are heading in the wrong direction. That'll get like 65 negative feelings. Okay Who is our president? He has a 58 percent approval rating or 54 sometimes only But the public is actually able to make some of this distinction if Fucked than just federal government Jeff if you can just address this whole concept you alluded to in your beginning, you know You can you can point to the Reagan Revolution as a seminal moment, but in fact going before then You know Reagan explains a response to the 70s and the perceptions of you How do how do you opine about the sustained effective assault on government that has been maintained during periods of of economic Growth and vitality and expansion and popular presidents. What are your thoughts about how this has continued to to sort of Have an impact I'm sure my co-authors have a view on this, but what let's begin with the premise of rapid economic growth and prosperity It didn't really work for the last generation or so. We've had stagnation The early Reagan years in fact one of the hallmarks of Alan Greensman's Ten year as chairman has been rising inequality and stagnating wages I just read a biography of Greenspan the word inequality appear in a 675 page biography appears three times So people have suppressed that idea. I think I read history People tend to be more willing to pay taxes and be more progressive about the uses of government When they're better off I recognize The great depression seems like an anomaly there. So I think I you know, I guess I sometimes think I'm too A lot of bitter bitterness people are not doing well that you don't want to pay more taxes When you're not doing well, you need that money for other things. So I I think that's The underlying issue I want us to grow faster through fiscal For the over this period of rising inequality and uh, I'll I could go on a little bit maybe some other people want to contribute On that, thank you all very much. This is an incredibly impressive conversation Like I said, we do have Purchase them and as long as their schedules allow, maybe you can get an unanswered question into the authors. Thank you