Decades of Subsidies Have Made the Essentials of Middle-Class Life Increasingly Difficult To AffordThe basics of middle-class life are too expensive. But more subsidies won't help.
PETER SUDERMAN
3.2.2023
Perhaps the simplest way to diagnose the problem with American politics right now is that it is out of touch. Democrats and Republicans have spent the better part of the last decade arguing about partisan peccadillos and culture war obsessions, while middle-class concerns have languished. And thus a new movement has risen mostly but not exclusively on the technocratic center-left, intent on refocusing liberal politics in general and Democratic politicians in particular on workaday economic concerns.
This movement has many strains and individual obsessions, but it is united by a shared thesis: The basics of middle-class life—especially but not only housing, education, and health care—have become too expensive, and politicians should seek to remedy this via policy interventions.
Their ask is for politicians to focus more on policies intended to make it easier for nonpoor, nonwealthy Americans to afford what amounts to a consensus middle-class lifestyle: a home, access to health care, quality schooling for the kids. They want the American Dream, more or less, and they want most ordinary families to be able to afford it.
This movement has banded together around a loosely defined "abundance agenda." At its best, this movement offers a critique of poor liberal governance, especially in urban areas. For libertarians, there is much to like and much to agree with, particularly on housing, where some liberal pundits have begun to argue that the most direct path to lowering housing prices is increasing supply by eliminating artificial constraints, like regulatory requirements and environmental reviews on development.
Yet what's notable about all of these middle-class basics is that they have already been subject to decades of policy interventions, often though not always from Democrats. These elements of middle-class life have become unaffordable in tandem with, and in some cases because of, decades of policy interventions designed specifically to make them more accessible and more affordable to the middle class. And today's elected Democrats seem intent on repeating the mistakes that brought America to this point.
Consider higher education, where the presence of decades of federally backed grants and loan programs has coincided with dramatic increases in the cost of college since the 1970s. From 1980 to 2016, higher education costs rose 238 percent, far faster than inflation. Student loan programs designed to make college more affordable have contributed to the escalating price of a degree, making it possible for universities to charge ever-higher tuition fees. A policy nominally geared toward affordability begat decades of unaffordability.
And rather than unwind it, many of today's Democrats seem ready to double down: Hence, President Joe Biden's move to cancel $400 billion in student loan debt and tweak payment rules in ways that will, if anything, further raise the cost of higher education while incentivizing degree choices with lower earning potential.
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Source:
https://reason.com/2023/03/02/decades-of-subsidies-have-made-the-essentials-of-middle-class-life-increasingly-difficult-to-afford/
