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America's economy has been an awesome engine of wealth creation over the past two generations, but the new prosperity has disproportionately gone to the wealthiest. Between 1979 and 2010, according to the
According to much research, social mobility--the very essence of the American idea--has remained stagnant for decades, and many of our global competitors are now performing far better on what we have long considered to be the American Dream. n4 For example, young men are earning
The rising inequality of wealth and income that threaten shared prosperity and democracy long preceded the financial crash of2008 and the downturn that followed. As a result of major economic and policy changes over the past three decades, the gap between the richest and the rest of America has become a chasm. Many jobs do not pay enough to cover basic living expenses, much less allow workers to save and build for the future. In fact, a quarter of full-time working-age adults are still not earning enough money to meet basic economic needs like housing, utilities, food, health care, and transportation for themselves or their families. n7
A host of public policy choices have driven inequality and insecurity--including tax cuts that disproportionately benefitted the wealthy, state divestment in public higher education, financial deregulation, and the weakening of labor protections, to name only a few. Job growth on its own will not reverse inequality: the shift to a low-pay service economy has in fact accelerated during the economic recovery. Over the next two decades, the
Even as inequality has worsened, national action has been lacking. Over recent decades, many political leaders have failed to reckon with a basic fact of the new economic era--for millions of Americans, no amount of individual effort or self-improvement or thrift can guarantee a secure middle-class life. The American social contract--a promise of opportunity and security for those willing to work hard--is fundamentally broken.
Dramatic new public policy initiatives are needed to accomplish two broad interrelated goals: to ensure that all Americans have a chance to move into the middle class and, second, to ensure greater security for those in the middle class. Such initiatives must move far beyond incremental measures, and be of sufficient scale to permanently address the economic insecurities of what is now a vast number of U.S. households.
Patricia Locks and
To understand the impact of rapidly rising inequality on the American economy, there is no better place to look than the nation's largest private employer, the world's biggest public corporation, and a company whose customers and employees struggle on the opposite side of the economic divide from its owners. Many of
Patricia's is not the only
The picture of growing inequality between work and wealth epitomized by
II. How Inequality is Experienced at the Household Level
The following sections describe the effect of inequality and the related rise of economic insecurity for most Americans at the household level.
A. Stagnating Real Incomes for All but the Richest
In the years after World War II, as economic growth and productivity increased, the workers contributing to that prosperity saw commensurate gains in wages, across the income spectrum. However, that connection has broken down over the last thirty years: while productivity increased 65 percent in the three decades between 1979 and 2013, the inflation-adjusted wages of the median worker grew just eight percent, and that growth occurred exclusively as a result of the strong economy of the late 1990s, according to analysis by the
Part of the story is the increasing economic returns to education, which left workers without a college degree lagging further behind in income and employment. For example, as chronicled in Demos' State of Young America report, in 1980, a young man with a bachelor's degree earned roughly
A bigger part of the story has to do with the rising share of the nation's gross domestic product flowing to corporate profits rather than wages and the larger share of overall income going to the highest one percent of income earners. Until 1975, wages generally accounted for the majority of the nation's GDP, but by 2013 wages had declined to a record low of 42.2 percent. n26 Research from
Personal income has become far more concentrated among the richest, a trend that has also accelerated rapidly since the end of the Great Recession. Economist
Finally, while the real wage data above is adjusted for inflation, this story does not fully account for the cost of health care, child care and higher education, which have seen their costs grow far more quickly than the Consumer Price Index. For example, the average annual employee contribution to health premiums has more than tripled since 1999, growing from
B. Priced Out of Upward Mobility
During the post-war industrial era, a post-secondary education was not required for a single breadwinner to support a family. For example, in 1970 male high school graduates earned a median income equivalent to
A major factor in the rise of public college costs is declining state support for higher education. Demos' report The Great Cost Shift finds that, despite appropriating
Although increasingly large numbers of high school graduates enroll in some type of college, college completion has stagnated: today more than half of students who begin college never complete their degrees. Financial barriers are the primary reason why students do not finish college. n38 The high cost of college is particularly prohibitive for students from lower-income families, and shifts away from need-based aid are only exacerbating the challenge. In 2013, just 32 percent of all federal student aid was grant-based, down from 55 percent in 1980. Similarly, in 2003-2004, the maximum Pell grant covered 87 percent of the costs of a four-year public college, compared to just 63 percent in 2013-2014. n39
Rising tuition and limited financial aid has more students than ever financing their college education with debt and at ever-increasing amounts. In addition, students are struggling to meet rising college costs by enrolling part-time and working long hours. Two-thirds of community college students and 46 percent of four-year college students work more than 20 hours a week while attending school, greatly increasing their risk of dropping out. n40
C. The Debt-for-Diploma System
Student loan debt is another area of growing economic concern. Due to rising college costs and diminishing grant aid, students are increasingly reliant on interest-accruing loans to pay for college, a dramatic shift in norms over the course of a single generation. In 2012, 71 percent of college seniors (at public or non-profit schools) graduated with debt, with borrowers carrying an average burden of
The consequences of student loan debt can have a profound impact on the economy as a whole. According to Demos study, At What Cost?,
D. Wealth and Debt
Student debt is just one aspect of the overall divergence between compounding wealth for the rich and compounding debt for the average American. Wealth--home equity and savings nest eggs--provide a buffer against hard times and increase household economic stability, helping to fuel middle-class optimism and self-improvement. Household assets have a particularly powerful effect on how well children will do in their own independent lives. n48
The wealthiest one percent have seen their share of American assets increase dramatically over the past three decades, and within that one percent, the top 0.1 percent has grown even more rapidly. n49 Thomas Piketty estimates that in
On the other side of the equation, most Americans are increasingly burdened by debt. In recent decades, financial deregulation and the aggressive marketing of toxic loans preyed on Americans' aspirations to build assets, fueling an unsustainable housing bubble that began to deflate in 2006. The bubble and the economic crash that followed decimated the wealth of American families, causing more than 2.7 million homeowners to lose their single largest asset to foreclosure and tens of millions of others to see their homes' value drop dramatically. n54 The crash hit those who had carefully saved and invested in their homes as well as speculators who gambled on a rising real estate market. Overall, the nation lost more than
Not having enough money for retirement became Americans' biggest financial worry. n56 Even as Americans saw their assets diminished, the dramatic and long-lasting rise in unemployment and underemployment contributed to Americans' difficulty paying back their debts.
The prevalence of asset poverty in America is dramatic. The Federal Reserve, Report on the Economic Well-Being of U.S. Households in 2013, released in
This degree of insecurity threatens to reverse one of the great policy victories of the 20th century: the creation of a middle-class senior citizen population. As a result of employers shifting from traditional defined benefit pensions to defined contribution plans, Americans' retirement security is now more at risk than any time since
Instead of saving for the future, millions of working- and middle-class Americans are struggling just to service their debts. Demos has been chronicling the rapid rise in debt for nearly a decade: as wages stagnated and lagged behind the cost of living, Americans increasingly turned to borrowing--from credit card debt to loans against the value of their homes--to make ends meet and to try to get ahead. n61 The deregulation of consumer lending that began in the 1980s meant that many of these loans included deceptive and predatory terms that were highly profitable for lenders but led to record bankruptcies and debt-to-income ratios. Lenders aggressively marketed high-interest credit cards with hidden fees, exorbitant payday loans, and costly subprime mortgages (even to homebuyers who could have qualified for a better rate--particularly if they were African American or Latino). n62 While some of the worst practices unleashed by deregulation have been curbed by regulatory enforcement, the Credit CARD Act of2009, and the Dodd-Frank Act of 2010, Americans remain vulnerable to the hangover of the deregulatory experiment: widespread servicer and debt collector abuse. n63
Even today, as credit card debt has declined post-crash, 40 percent of among low- and middle-income households carrying credit card debt still rely on their cards to pay basic living expenses because they do not have enough money in their checking or savings accounts, according to Demos' own national household survey, The Plastic Safety Net. n64 Credit cards are also widely used to pay medical bills and cope with spells of unemployment, in effect a high-interest way to make up for gaps in the public safety net. n65
Another problem arises from the prevalence of employment credit checks. Despite a lack of evidence that personal credit history predicts employee performance or likelihood to steal or commit fraud, nearly half of all employers now conduct credit checks as part of their hiring process. n66 As a result, job seekers with credit damaged as a result of medical debts, divorce, layoffs or identity theft are screened out of jobs they are otherwise qualified for. Employment credit checks disproportionately harm people of color because of damage done by predatory lending that continues to target communities of color, as well as the enduring impact of racial discrimination in employment, lending, education, and housing. The result is a vicious cycle: it's hard to pay your bills if you can't get a job, but unpaid bills may also prevent you from getting a job. n67
Fortunately for these borrowers, smart regulation has recently made credit cards a better, fairer financial product for American consumers. The Credit CARD Act of2009 has benefited millions of households in ways that directly affect their monthly budgets. A recent study by
The following section describes the effects of inequality on three economic goals--economic growth, mobility, and opportunity.
III. The Impact of Inequality on Our Economy
A. Inequality and Growth
The previous sections have detailed inequality's effect on households, but it is worthwhile to note that evidence is mounting that inequality harms our nation's overall GDP growth rates as well. Standard and Poor's recently reduced its ten year U.S. growth forecast by 0.3 percentage points, citing "extreme" income inequality. n70 A 2011
A 2014 IMF follow-up study finds that redistributing income doesn't have a large effect on growth, and therefore increasing redistribution can be pro-growth (since inequality stifles growth). n72 This supports a growing literature on the subject. n73
The literature shows that when consumers don't have money to spend, growth slows. Because the wealthy are more likely to save n74 than the poor and middle class, a higher concentration of wealth in their hands will stifle demand, cutting off the recovery. Even conservative
B. Inequality and Mobility
A large literature shows that inequality also reduces upward mobility. In both international comparisons and within the U.S., higher levels of inequality have been tied to lower levels of mobility. n79 Within the U.S., mobility varies widely by census tract, with the lowest levels of mobility in the south. n80
C. Inheriting Opportunity
Inequality hinders mobility in numerous ways. As
Children of wealthy parents already have much more access to opportunities to succeed than children of poor families, and this is likely to be increasingly the case in the future unless we take steps to ensure that all children have access to quality education, health care, a safe environment and other opportunities that are necessary to have a fair shot at economic success. n85
There are myriad reasons why inequality reduces upward mobility. As inequality increases, the cost of falling behind becomes higher, leading parents to invest heavily in their children and possibly discourage public investment in other children through the public education system. n86 Higher income families spend far more money on enrichment (such as tutors, camps or private schools) for their children than can parents with fewer resources. n87 As inequality has increased in
Parents can also provide children with starter jobs, help pay off debts or support their children during an internship or low-paid starting position. n88
IV. Megatrends: How America Became So Unequal
The following sections lay out five megatrends contributing to inequality's rise: racial inequality, financialization, the loss of collective bargaining, underinvestment, and perhaps the most far-reaching factor: political inequality.
A. Increasing U.S. Diversity Without a Commitment to Equity
A major societal trend with implications for economic policy has been the rapid demographic change over the past four decades. After the Immigration Act of 1965 removed race-restrictive entry quotas, the share of immigrants from non-European countries climbed. n93 The white population was 83 percent in 1970 and 76 percent in 1990; it now stands at 64 percent. n94 By 2043, whites will no longer be a majority in the U.S. n95 Already, 46.6 percent of Americans under the age of 24 are not white. n96
The country has only grown more diverse since the end of the
These implicit and explicit prejudices have real economic consequences for our diverse population. Approximately 3.7 million fair housing violations occur annually against African Americans, Latinos, Native Americans, and Asian Pacific Islanders as they seek to rent and purchase housing--yet HUD processed only 2,123 complaints in 2008. n99 In financial services, after decades of credit unavailability due to private and government redlining, the 1990s and 2000s saw communities of color experience a wealth-stripping phenomenon known as reverse redlining. Lenders and brokers targeted segregated neighborhoods with under-regulated financial products, particularly mortgages with features such as exploding adjustable rates, deceptive teaser rates, and balloon payments. Households of color were more than three times as likely as white households to end up with riskier loans. n100 Federal policymakers and regulators declined to protect these communities for years as foreclosures rose, even acting to pre-empt state anti-predatory lending efforts in the 2000s. n101 The resulting loss of wealth--66 percent average loss for Latino households, 53 percent for African Americans compared to just 16 percent for white households n102 --stands as a grave and lasting blight on the future of our diverse middle class. For every dollar in assets that the typical white family owns, the typical Latino family has just
A recent study n105 by Chetty, Raj,
Over 200 medium-sized and large districts were released from desegregation court orders from 1991 to 2009. We find that racial school segregation in these districts increased gradually following release from court order, relative to the trends in segregation in districts remaining under court order. These increases are more pronounced in the South, in elementary grades, and in districts where pre-release school segregation levels were low. n111
The benefits of integration are well established. A seminal study by
Finally, numerous studies n118 have shown that job discrimination plays a role in the higher incidence of unemployment among non-whites (while the seasonally-adjusted unemployment rate for whites is 5.3 percent, it is 11.4 percent for blacks and 7.8 percent for Hispanics). n119 As just one striking example of this literature, a 2005
B. The Rules of Globalization
The way that policymakers have chosen to structure the rules of globalization has contributed significantly to increased inequality over the past three decades. Our trade policies have been written and enforced in ways that advantage multi-national firms seeking lower-cost labor, directly resulting in fewer and lower-paying jobs for the American middle class. Increasingly, white-collar jobs are also moving overseas as
Over the past few decades, increased trade with low-wage countries has been responsible for fully a third of the depression in wages of non-bachelors degree holders relative to degree-holders since 1979; tracking just since 1995 (one year after the North American Free Trade Agreement came into force), low-wage country trade accounts for over 90 percent of the wage depression. n121
MEDIAN EARNINGS, AGES 25-34, HIGH SCHOOL GRADUATES
source: Demos anal
The downward pressure on wages affects not just workers who are directly competing with foreign production workers. When multi-national firms layoff American manufacturing workers in favor of less expensive employees in our trading partner countries, these laid-off workers compete for lower-paying jobs in non-offshorable sectors, such as landscaping or food service. n122 Thus the effect of our trade policy ripples throughout the working and middle class, beyond just those directly affected by plant closings.
The broader economic dynamic of high corporate profits amidst weak job growth and declining wages for most Americans is in large part a result of our global trade policies. The North American Free Trade Agreement turned a slight trade surplus with
C. The Financialization of the Economy
Another, less often-cited megatrend driving inequality has been the financialization of the American economy. The deregulatory movement that transformed consumer finance also revolutionized commercial and investment banking and trading in ways that have dramatically increased finance's share of the U.S. economy, from 3.8 percent to 8.2 percent of GDP. n127 Financial sector profits have also increased as a share of total corporate profits, with the non-financial business sector transferring increasing income to the financial sector. Research from
The relative growth of the financial sector is not necessarily a problem if the services provided by the sector add commensurate value to the overall economy. With the cost of intermediation rising despite technological advances that should be increasing efficiency--and with economic performance worsening, particularly as measured by the employment recovery time post-recessions--it is becoming apparent that value is being simply reallocated to the beneficial owners of financial firms. This drains resources that could be put to uses that would increase the productivity of the overall economy and create jobs and wealth. Demos Senior Fellow
In fact, the growing financialization of the U.S. economy and its impact on publicly traded corporations has exacerbated inequality in a number of ways. A focus on "shareholder value" has trumped all other goals for the modern corporation since the 1980s--a shift that
D. Increased Corporate Resistance to Employee Collective Bargaining
Organized labor has traditionally played a critical role in slowing the tide of rising inequality. Unions bargain collectively for better wages and benefits for their members. But unions also raise compensation for workers they do not represent: a recent study by Bruce Western and
However, the percentage of Americans belonging to unions has declined steadily, falling by 44 percent between 1983 and 2012, so that today, just 6.6 percent of private sector workers belong to unions. Western and Rosenfeld estimate that the decline of unionization has contributed as much as third to the growth of income inequality among working men since 1973. n136
Union decline can be attributed to the growth of corporate opposition to unionization and the weakening of laws intended to protect employees' right to organize. Today, the system meant to defend the rights of employees to form unions barely functions. Weak and slow-moving enforcement of labor rights allows employers to routinely violate the law by threatening and harassing employees who attempt to organize. An analysis of union elections from 1999 to 2003 revealed that when workers attempted to organize a union, 96 percent of employers mounted a campaign against their effort. n137 Three quarters of employers hired outside anti-union consultants. So while workers might wish to join unions, they often fail to persist in the effort after an intimidating one-on-one anti-union meeting with their direct supervisor once a week or more leading up to a union election (a tactic employers used in 66 percent of organizing campaigns), after their boss threatens to close down the workplace if workers decide to unionize (57 percent of organizing campaigns), or after those co-workers who most openly support the union are fired (34 percent of organizing campaigns).
E. Underinvestment in Infrastructure
As financialization has sapped resources from the real economy the government has pursued austerity policies that have further reduced national investment. Infrastructure spending has plummeted to levels not seen since World War II and is set to fall even further. n138 Because the poor and middle class rely more on public goods, they suffer the most from our increasingly inadequate infrastructure.
Public investment is crucial to future growth. The economic boom in the 1950s and 60s relied on government investments in education (for example, the G.I. Bill), infrastructure (for example, the National Highway System) and science (
Investments in science produce huge benefits, both in terms of well-being and economic growth.
Our infrastructure is aging, and the
Public investment spending provides immediate stimulus and productivity growth in the future. A major
V. Inequality Undermines Democracy
We have reviewed the data showing that inequality has detrimental effects on our society and how intentional policy shifts, not inevitable contingencies, are primarily responsible. Meanwhile, evidence abounds that the U.S. political system is increasingly dominated by wealthy interests, and strong, bipartisan majorities of the public believe the deck is stacked against ordinary voters. n147 What is less understood, however, is the interplay between these two problems and how a growing chasm of income and wealth translates into diminished opportunities for most Americans.
As Demos outlines in our foundational report, Stacked Deck: How the Dominance of Politics by the Affluent and Business Undermines Economic Mobility in America, this tilting of political life toward those the well-connected and already-wealthy has served to undermine economic mobility as a whole. As private interests have come to wield more influence over public policy, with ever larger sums of money shaping elections and the policymaking process, our political system has become less responsive to those looking for a shot to improve their lives and move upward. This is in part because wealthy interests are keenly focused on concerns not shared by the rest of the American public and often oppose policies that would foster upward mobility among lower-income citizens, such as raising the minimum wage.
A. Different Incomes, Different Priorities
Significant differences between the wealthy and the general public exist in such areas as tax and budget, trade and globalization, regulation of business, labor, the social safety net, and the overall role of government. The general public is more open than the wealthy to a variety of policies designed to reduce inequality and strengthen economic opportunity, including: raising the minimum wage, increasing the Earned Income Tax Credit, providing generous unemployment benefits, and directly creating jobs. For example, as the table below reports, only 40 percent of the wealthy think the minimum wage should be high enough to prevent full-time workers from being in poverty, while 78 percent of the general public holds this view. Affluent voters are also less supportive of labor unions and less likely to support laws that make it easier for workers to join unions--even as research shows that unions are crucial to reducing inequality. Governors elected with strong support from affluent voters and business groups have prioritized tax cuts over funding for primary and secondary public education. n148
B. Unequal Political Voice
These differences in policy preference by class create distortions in our policymaking precisely because the affluent are over-represented among both donors and voters (not to mention lobbyists, media influencers and other categories with outsized influence in our political system). Working and middle-class citizens are more susceptible to the disenfranchising effects of our needlessly bureaucratic system of voter registration, a system which leads to 51 million eligible Americans being unregistered to vote.
There is a large literature on the how low voter turnout influences policy outcomes. A recent study by
Franko compared the adoption of these policies to voter participation rates across incomes and found that states with higher levels of inequality in turnout were less likely to pass legislation beneficial to the poor. n152
Non-wealthy Americans are even less likely to contribute to political campaigns. Just 0.07 percent of the U.S. population made campaign donations of
For example, despite the important role a strong minimum wage plays in economic mobility,
This slide in the minimum wage should be no surprise when one takes a close look at the data on lobbying expenditures. The data suggests that low-wage workers have very few paid advocates in the corridors of Washington. Labor unions often speak up for these Americans, but otherwise, lobbying by groups that explicitly advocate for low-wage workers or non-elderly low-income people is so small that it doesn't even merit its own category in records compiled by the
The most important study in this area is by the political scientist
In the other affluent democracies, net support for spending cuts was virtually constant across income groups, from the very poor to the very affluent. In
Gilens shows that, in many cases, public policy outcomes would have been quite different if
VI. Policy Recommendations
A. Strengthen Upward Mobility
Reversing the trend towards greater inequality in America and shoring up a middle class that fully reflects America's diversity will require policies that:
* Invest in human capital and education. Investing in education and human development, ensuring that future generations are well cared for and well educated, and that working people have the time they need to be caregivers to the people they love is a key starting point for moving millions of Americans into the middle class. For example, employees who need flexibility in their work lives to care for a child or other family member often face economic hardship. A system of family leave insurance--like the successful model in
* Increase employees' power in the workplace. Since the 1970s, a growing share of national income has gone to corporate profits while the proportion going to labor compensation has decreased. This shift has greatly accelerated in the last decade. To reverse the trend, employees need more power in the workplace. The bottom of the labor market should be bolstered by raising the minimum wage, guaranteeing paid sick days to working people, and ensuring that worker protections are effective and apply to everyone. At the same time, weakened labor laws should be reconstituted so that Americans can exercise their right to organize unions and negotiate for pay and benefits that will allow them to enter the middle class. Finally, the U.S. should create a short-term public jobs program and long-term public investment plan to promote full employment.
* Use tax policy to strengthen and expand the middle class. Too often, the nation's tax policy bolsters the already wealthy rather than supporting Americans trying to work their way into the middle class. A more progressive tax system could increase economic mobility and reduce inequality. The Earned Income Tax Credit and the Child Tax Credit, which benefit low-income workers and their families, should be expanded. To ensure that the home mortgage tax credit helps middle-class families rather than subsidizing the super-wealthy, its value should be capped. Meanwhile, taxes on capital gains and dividends--income which disproportionately flows to the wealthiest Americans--should be increased, and corporate tax loopholes should be eliminated. To reduce the transfer of tremendous wealth from one generation to the next, estate taxes should be increased.
* Enable Americans to build assets. Owning assets--from a retirement account, to a home, to an emergency savings fund--is crucial to middle-class security. Yet American families have lost trillions of dollars in home equity as a result of the housing crash, and one in three say that if they lost their jobs, they could not make housing payments for more than a month. n167 To help distressed homeowners, a new public agency should be established to acquire and refinance under-water mortgages. To increase retirement security,
B. Limit the Economic Policy-Distorting Influence of Money in Politics
To achieve and preserve these reforms, we must also limit the influence of money in politics. One critical way to reduce the disproportionate influence of the wealthy on public policy is to create a system for financing election campaigns that lives up to the idea of one-person, one-vote by leveling the playing field between rich and poor and giving every American a strong voice. Such a system requires several key reforms:
* Amend the U.S. Constitution to restore the ability of the people to enact common-sense, content-neutral restrictions on political contributions and spending to promote political equality.
* Enact strict limits on the amount that wealthy individuals and interests can contribute and spend on U.S. politics. Millionaires, billionaires, and large corporations have no inherent right to drown out the voices of the rest of the population. After amending the Constitution or educating the next generation of Justices,
* Match small contributions with public resources to empower small donors and help grassroots candidates run viable campaigns. Under a system of public financing (proposed in the House Government by the People Act or the Senate Fair Elections Now Act), candidates for
* Encourage small political contributions by providing vouchers or tax credits. Encouraging millions of average-earning Americans to make small contributions can help counterbalance the influence of the wealthy few. Several states provide refunds or tax credits for small political contributions, and the federal tax code did the same between 1972 and 1986. Past experience suggests that a well-designed program can motivate more small donors to participate. n168 An ideal program would provide vouchers to citizens up front, eliminating disposable income as a factor in political giving.
* Require greater transparency around political spending.
* Strengthen rules governing lobbying to reduce the influence of well-heeled special interests.
C. Address Class Gaps in Voting by Expanding the Freedom to Vote
A legitimate government "of the people, by the people, and for the people" must vigorously promote and protect the freedom to vote so that all eligible persons can participate in self-government. But today, too many bureaucratic barriers still block the ability of millions of eligible persons to register and vote, and too many politicians are actively seeking to shrink the electorate with unnecessary and discriminatory restrictions on political participation. Reversing this trend entails:
* Removing barriers to registration and voting. Voter registration is a particularly important target for reform, given that almost one of four eligible Americans was not registered to vote in the period leading up to the 2012 elections. In particular, the following should be adopted:
* Same-Day Registration: Implementing Same Day Voter Registration, which allows eligible individuals to register and vote at the same time, is a proven method to increase participation and turnout among eligible voters. n169 States with Same Day Registration record consistently higher voter turnout and participation than states without it. n170 Same Day Registration has also been shown to reduce class gaps in turnout. n171
* Expand agency registration and automate the registration process: States should modernize the voter registration system to remove administrative burdens and costs by taking the initiative to place eligible voters on the registration rolls rather than leaving the burden on individual citizens to navigate the voter registration process. Motor Voter has also been linked to reductions in turnout inequality. n172
* Make registration permanent and portable: Almost 36.5 million U.S. residents moved between 2011 and 2012. n173 Low-income individuals are twice as likely to move as those above the poverty line. Voter registration should become portable and permanent for persons who move within a state, by automatically updating registration records as citizens change their addresses.
* Protections against intimidation and wrongful challenges: States should put measures in place to protect voters from intimidation tactics, including clear rules and procedures to protect voters from improper removal from voting rolls, intimidating behavior at polls, and deceptive practices that discourage voting.
n3 CBO, The Distribution of Household Income and Federal Taxes, 2010.
n4 See (as examples):
n5 Demos, The State of Young America: Economic Barriers to the American Dream (
n7 Wider Opportunities for Women, "Living Below the Line: Economic Insecurity and America's Families" (2011), http://www.wowonline.org/documents/WOWUSBESTLivingBelowtheLine201Lpdf.
n10 Brianna Cardiff-Hicks,
n13 David U. Himmelstein et al., "Medical Bankruptcy in
n16 Forbes, "The Forbes 400," (2013), http://www.forbes.com/forbes-400/#page:1_sort:0_direction:asc_search:_filter:Allpercent20industries_filter:Allpercent20states_filter:Allpercent20categories.
n20 Thomas Piketty, Capital in the 21st Century (
n23 Demos, State of Young America: Jobs and the Economy (
n26 Federal Reserve Bank of
n27 Andrew Sum,
n29 "Employer Health Benefits: 2014 Annual Survey,"
n30 "Parents and the High Cost of Child Care: 2012 Report," Child Care Aware of America (2012), http://www.naccrra.org/sites/default/files/default_site_pages/2012/cost_report_2012_final_081012_0.pdf.
n34 Author's calculations based on U.S. Census Historical Income Tables P16 and P17.
n35 See The
n39 See "The State of Young America: Economic Barriers to the American Dream," Demos and Young Invincibles (
n43 "Quarterly Report on Household Debt and Credit," Federal Reserve Bank of
n46 "Background Checking--The Use of Credit Background Checks in Hiring Decisions,"
n50 Thomas Piketty, Capital in the
n51 Gabriel Zucman, "The Missing Wealth of Nations: Are Europe and the U.S. Net Debtors or Net Creditors?"
n55 "Flow of Funds Accounts of
n57 "Report on the Economic Well-Being of U.S. Households in 2013,"
n60 "Retirement Costs for Defined benefit Plans Higher Than for Defined Contribution Plans,"
n63 For examples of abusive practices, see "Servicers Continue to Wrongfully Initiate Foreclosures: All Types of Loans Affected,"
n70 Standard & Poor's, "How Increasing Income Inequality Is Dampening U.S. Economic Growth, And Possible Ways to Change the Tide," Standard & Poor Capital IQ (
n90 Nicolas Pistoles, "Inequality of Opportunity in the Land of Opportunity, 1968-2001,"
n93 In 1960, there were fewer than 1 million foreign born from
n99 "Fair Housing Enforcement: Time for a Change--2009 Fair Housing Trends Report,"
n106 Mobility is also lower for whites in these census tracts.
n110 "Many of the changes accomplished in the civil rights era have had some enduring impact." See
n120 Devah Pager , "The Mark of a Criminal Record,"
n131 Ozgur Orhangazi, "Financialization and Capital Accumulation in the Non-Financial Corporate Sector: A Theoretical and Empirical Investigation on the U.S. Economy: 1973-2003,"
n134 Bruce Western and
n137 Kate Brofenbrenner, "No Holds Barred--The Intensification of Employer Opposition to Organizing,"
n146 Demos, "Investing in America's Economy: A Budget Blueprint for Economic Recovery and Fiscal Responsibility," (
n158 OpenSecrets, "2012 Overview: Donor Demographics,"
n169 Demos, "Same Day Registration: A Demos.org Factsheet" (
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