“Bidenomics” is closely aligned with many—probably even most—of the middle-out economic principles that we discuss on this podcast every week. Much to our surprise and delight, Joe Biden has become the first President in 40 years to reject trickle-down economics in favor of building the economy from the middle out, and the results speak for themselves: Since the pandemic began, America has seen the strongest growth of any leading economy in the world. The economy has added 13 million jobs, inflation has fallen for 12 straight months, and a recession is no longer on the horizon. National Economic Council Deputy Director Bharat Ramamurti returns to the show to explain why Bidenomics has been so successful.

Bharat Ramamurti is the Deputy Director of National Economic Council (NEC) for The White House. He previously served as a Member of the Congressional Oversight Commission for the CARES Act, and as the Managing Director of the Corporate Power program at the Roosevelt Institute.

Twitter: @BharatRamamurti

Nick Hanauer:

Bharat, we are super enthused to have you on the podcast to talk about Bidenomics, or as we call it middle out economics.

Bharat Ramamurti:

The one sentence description is that Bidenomics is about trying to grow the economy from the bottom up and the middle out rather than from the top down.

David Goldstein:

What about the billionaires Bharat?

Bharat Ramamurti:

Yeah, Exactly. Well-

Nick Hanauer:

Yeah, what about us?

Bharat Ramamurti:

The president cares about everyone. But when he evaluates how the economy is doing, his question is how is your typical middle class person, middle class family doing?

Speaker 4:

From the home offices of Civic Ventures in downtown Seattle? This is Pitchfork Economics with Nick Hanauer, the best place to get the truth about who gets what and why.

Nick Hanauer:

I’m Nick Hanauer, Founder of Civic Ventures.

David Goldstein:

I’m David Goldstein, Senior Fellow at Civic Ventures. Back when I first started working with you, Nick, more than nine years ago, if you can believe that, nine years.

Nick Hanauer:

Good God.

David Goldstein:

Nobody’s ever employed me this long. I don’t know what’s wrong with you. But you gave me a book to read. In fact, I had two books on my reading assignment. One was Picketty’s gargantuan Capital in the Twenty-First Century.

Nick Hanauer:

That was a test.

David Goldstein:

And the other was this teeny tiny book that you co-wrote with Eric Liu called Gardens of Democracy. And in that book-

Nick Hanauer:

I think we published that in 2010 or 11. I can’t remember. Yeah, I think… Yeah.

David Goldstein:

So in that book, you coined the term middle out economics.

Nick Hanauer:

That is correct. And we did that because we knew that if you wanted to win the day on political economy, you had to build a counter narrative to the trickle down neoliberal worldview that dominated both politics and policymaking in both political parties. You had to frame the choices as a choice. You have to provide a contrast between what the bad people believe and what the good people believe, and to try to get people to see economic cause and effect differently. And holy crap, as you know, we have been at it for a long time, but-

David Goldstein:

Right. That’s-

Nick Hanauer:

…here we are.

David Goldstein:

We’re in the middle out people. That’s most of what we’ve been doing here, I know for the past nine years. And who would’ve thought?

Nick Hanauer:

Not me. That we would get there.

David Goldstein:

The guy who would advance it, the person who would advance it most would be Joe Biden.

Nick Hanauer:

Yeah. Wouldn’t have guessed it. But today we get to talk to Bharat Ramamurti, who’s been on the pod before. Amazing economist who’s the Deputy Director of the National Economic Council for the White House. And he previously served as a member of the Congressional Oversight Commission for the Cares Act and Managing Director of the Corporate Power Program at the Roosevelt Institute. A really smart, really interesting guy to talk about Bidenomics and what it means and what they’re doing.

Bharat Ramamurti:

It’s Bharat Ramamurti. I’m the Deputy Director of the National Economic Council at the White House. I don’t have any books or podcasts of my own to plug, but I will plug that, we got another good jobs report today showing that we’re over 200,000 jobs created last month, and our total since the president took office is now over 13 million, which is more in two and a half years than any president has had in a four-year term. So good news on that front.

David Goldstein:

Oh, sure. You’ve delivered 13 million in jobs, but where’s that recession I’ve been promised?

Bharat Ramamurti:

I was joking with somebody earlier today that pundits have predicted nine out of the last zero recessions. And that I remember sitting at this exact desk a year ago and people were saying that a recession was imminent, and now here we are about a year later with literally millions of new jobs created during that time. Wages going up and inflation coming down substantially and still no recession. I know it is a favorite of some folks to continually predict that a recession is imminent, but there’s certainly little evidence that we’re in a recession now and the folks who’ve been projecting one for the last year have been wrong.

David Goldstein:

The great thing about predicting recession is that eventually you’ll be right.

Nick Hanauer:

That’s true.

David Goldstein:

It may take a decade, but eventually… It may take a pandemic, but eventually.

Nick Hanauer:

So bar, we’re super enthused to have you on the podcast to talk about Bidenomics or as we call it middle out economics, being the same thing, but describe for our listeners how the White House is thinking about this, what the planks are and what the policies are that you’re prosecuting.

Bharat Ramamurti:

Sure. So I think the one sentence description is that Bidenomics is about trying to grow the economy from the bottom up in the middle out rather than from the top down. And as we tried to put it down on a piece of paper what it really meant, we identified three areas that are, in our view, very unique to this president’s economic approach. Number one, he more than recent presidents I would say, is really focused on investing in America and building more in America. We see that in not only the infrastructure bill that he passed in 2021 with bipartisan support, but also the CHIPS Act, which is about semiconductor manufacturing in the United States and the Inflation Reduction Act, which has significant provisions about clean energy production in the United States. You also see it in his really steadfast determination to use our Made in America laws and to not waive them as some administrations have done in the past, but to make sure that if we are spending US taxpayer dollars, that we are buying American made products to the largest extent possible.

Second, he really focuses on empowering workers. You’ve heard the president probably say that he is the most pro-union president in history, and I think that his actions bear that out. But another really important way of empowering workers is to have a full employment economy. In other words, having a job market where employers are having to compete to attract workers rather than the other way around. And for a lot of the last 30 or 40 years we’ve had the opposite. We’ve had a market where workers are scrapping and clawing with each other to try and get access to jobs, which means that employers can often get away with paying lower wages and offering worse schedules and so on. The president wanted to flip that power dynamic and make sure that workers were the ones who had the upper hand. And I think we’re seeing that now with wages rising, particularly at the lower end of the income spectrum, with job satisfaction, this is one of my favorite stats, job satisfaction at a 36 year-high.

And the third is really an emphasis on restoring competition to the heart of the economy. For the last 20 years, we’ve seen 75% of industries grow more concentrated, we’ve seen consumer options dwindle in certain areas, we’ve seen options for workers in many areas dwindle. All of that means higher prices and it means lower wages for workers as well. Now, one study found that the combination of those two things, higher prices and lower wages, was costing the typical family $5,000 a year. And the president wanted to get back into the tradition of the Roosevelts, both Teddy and FDR, in having a really robust competition policy. Which means not only on the enforcement side, where obviously we don’t direct enforcement actions, but he wanted to put in place really strong enforcers at the FTC and the Department of Justice. But also there’s a ton of regulatory tools that we can use to promote competition. And that was part of his executive order on competition in 2021, and a set of steps that have brought more competition to everything from the healthcare market to airlines, to electric vehicles.

Nick Hanauer:

That’s fabulous. And I want to expand on each of these planks because I think that they’re dead right. But let’s pause and just talk about the broader state of the economy. Because if you, again, if you read the newspapers or watch TV, you’re often not given an accurate picture of how strong the economy is both relative to prior administrations, but also relative to the rest of the industrial world.

Bharat Ramamurti:

Yeah, so let me start there, because the truth of the matter is that coming out of the pandemic, there was a set of global challenges. There were all sorts of supply chain issues that were causing prices to rise in every country, not just in the United States. And then on top of that, you had Russia’s invasion of Ukraine, which led to a massive surge in commodity prices for food and obviously for oil and gas. Every country was dealing with those challenges. And so the question is, how is the US done relative to other leading economies during this period of turbulence? And the answer is, since the pandemic began, the US has the highest rate of economic growth out of any of the leading economies, and it currently has the lowest level of inflation. So by those two very important metrics, I would argue the US has had the most effective economic recovery out of any of the world’s leading economists.

If you just look at objectively where we are today, the unemployment rate is under 4%. It’s been under 4% for 17 months now, which is the longest stretch of sub 4% unemployment that we’ve had in 50 years. Wages have gone up across the board, but particularly for folks at the low end of the income spectrum, a lot of people who have not gotten a real wage increase in the long time. Such that we’re meaningfully closing wage inequality in this country just in the last two years. Number three, we are seeing the prospect of good jobs attract people off of the sidelines in a way that we haven’t seen in a long time. So a way of measuring that is called the labor force participation rate. In other words, it’s the percentage of people who are either employed or actively looking for work. And if you look at that for prime age workers, in other words, people between the ages of 25 and 54, it’s at the highest level it’s been in 20 years.

And it’s the highest it’s ever been for women. It’s at the highest rate it’s ever been for people with disabilities. All of that is indicative of a job market that is so strong, where the quality of jobs is so good that people want to get back into the workforce, are actively looking for work. And that’s the kind of economy the president wants to build. That kind of dynamic is not only good for individual workers, it’s good for the US economy as a whole. That’s what middle out economics means, because when your typical working class person has a good paying job, has money to spend, they’re spending it on things that businesses produce. And that creates an incentive for businesses to invest more in making more things, which means that they want to hire more people and on and on and on. You get this virtuous cycle and that’s the kind of dynamic we want to create. We want to move the economy into a new and better equilibrium where you have higher wage growth and more productivity and more economic growth than we did pre-pandemic.

Nick Hanauer:

So can we go back to the first plank, which is investment? For our listeners, if you can characterize the size of these in investments that are taking place today and will take place over the next probably 10 years, don’t you think? Is that about right?

Bharat Ramamurti:

Oh, absolutely.

Nick Hanauer:

Yeah. Both the public and private investments that are happening, and if you can compare them to what’s been in the past, because I think what people don’t understand is how huge this is relative to what we’ve done over the last 50 years.

Bharat Ramamurti:

Yes. Let me give you an example in construction of manufacturing facilities, right? This is a relatively narrow category, but an important one because it means that obviously if you’re investing in creating new manufacturing facilities, that means that you’re going to be producing more things at that facility in the future, you’re going to be bringing more jobs into those areas. The previous president talked a lot about making more things in the United States and manufacturing and so on. Over the course of his presidency up until the pandemic, investment in manufacturing facilities went up 2%. And under this president, it has gone up nearly 100%. In other words, it’s doubled. This is unprecedented. I wish I could show you a graph right now because it would basically be a line bouncing up and down for the last four years then just shooting straight up over the last two years.

That was the plan, that was what was intended with the CHIPS Act, with the Inflation Reduction Act. That was to encourage by putting public dollars behind it, it was to encourage more private investment. In total, what we have seen since those bills were passed, and it was just about a year ago, is $500 billion worth of private sector commitments to invest in the United States. And these are companies that have their choice of where to invest. These are companies that may well have chosen to invest in production in Asia or in Europe previously, but now they’re choosing to invest in the United States because under President Biden, we have made it an attractive place to investigate.

David Goldstein:

I don’t understand. My econ textbook tells me that all this public investment should crowd out private investment, and you’re telling me that it’s crowded it in.

Bharat Ramamurti:

Yes. I mean, look, I think that what that textbook may have mentioned in passing, but is a really important point, is that that’s based on certain assumptions about how our global economy operates. And I think what we have seen, at least based on recent circumstances, is that those assumptions don’t necessarily hold. And that when the American government, with all of the advantages that we have in America, we have really strong capital markets, we have an incredibly well-trained workforce. We have a great court system and rule of law. We’re a very attractive place to invest as it is. And so when the federal government gives folks a little bit of a nudge and says, this is where we think you should be in investing, people are more than happy to follow. That’s what we see over the last year or so. And it matters.

It matters because as the president has identified, it matters where you make things, not everything necessarily, but it matters where you make really important inputs for our supply chain. One of the reasons why we wanted to make sure that semiconductor production was happening in the United States was that during the pandemic, we had a shortage of semiconductors and we were relying on production abroad in countries that, for example, China that were locked down and weren’t producing semiconductors. And it led to all sorts of disruptions to the supply chain. And almost every major product relies on semiconductors in one form or another. Cars washing machines, toasters, everything. And so when there was a shortage of those chips, we made less of all of those other products or the prices went way up, and American consumers pay the price. And so if we make that here in the United States, we have more control over our supply chain, we have fewer disruptions in the future. That’s really valuable.

Another important thing is clean energy. Of course, there’s going to be a strong need for clean energy in not just in the United States, but globally. And there’s real benefits for America being the place where we make that clean energy, where we create the products that are going to be necessary, whether it’s batteries or solar panels or wind energy or so on. We want to be the ones leading the efforts to create this product to drive down the price of clean energy so that every country in the world benefits. And there’s going to be a multi-trillion dollar global market for clean energy in the decades to come. We want to be the ones who are leading that and exporting those goods to countries that need it, rather than being in a position to have to import that maybe from countries that don’t share our values. So there’s important economic benefits and there’s important national security and strategic benefits.

Nick Hanauer:

Yeah. But in aggregate, it’s going to be trillions of dollars that are invested in the country over the next years. And I think this is super relevant to a lot of this recession talk. Because I mean, my instinct, I’m going to say it on the pod, I’m going to say it to you Bharat. People may laugh at me in the future, but my personal prediction is that we will not see a recession for quite a long time, barring some extraordinary exogenous event like an asteroid impact. Because the amount of investment that’s taking place right now is go going to balance out other business cycles.

That’s the first thing. And the second thing is that I also believe that you’re going to see GDP growth rates in the United States go back up to the levels that they were in the 60s as these investments begin to turn into productivity increasing activity. I just don’t see how it could not be so. So I think the American people actually do not know what’s about to hit them. It’s going to be big.

Bharat Ramamurti:

Yeah. In a good way.

David Goldstein:

Nick, the congressional budget office models have a bone to pick with you.

Nick Hanauer:

Yeah, I know. I know what’s in those models. I know.

Bharat Ramamurti:

Yeah. I mean, look, I think that you are correct that the investment that is in many ways just starting to hit the system is going to have a positive effect, I mean, I’m trying not to overstate it. And you see it show up in different ways. So one of the reasons I suspect that you are continuing to see big increases in construction and manufacturing jobs, we’ve gained about 800,000 manufacturing jobs since the beginning of this administration, is that a lot of these companies, even if they’re not using those workers immediately, they know that they’re going to use them in the future. And they want to hold onto them, because they know that they will use them, and they know that they may be in a situation if they try to let go of some of them that six months from now when they need them, it’s going to be hard to hire because we have such a strong job market that those people are going to have a lot of choices about where to go.

And so it does kind of put a floor under the economy in some sense, because companies have a lot of investment in the pipeline, they have a lot of workers that they want to keep on their books because they know that there’s going to be work to do. And that’s really important. And the other thing is just the president likes to talk about how these are generational investments. And I think that that’s underrated in the sense that FDRs Rural Electrification Act, about a hundred years ago, you had millions of families, millions of households that didn’t have access to electricity. And so there was an effort to go out and build poles and wires and to connect to every household in America, which they did. And that obviously created jobs, people who built the poles and put them up and put up the wires. But then think about the benefits long term of connecting all of those millions of households to electricity and what those folks could then do thereafter that they weren’t able to do before.

Nick Hanauer:

Those jobs created other jobs.

Bharat Ramamurti:

Exactly.

Nick Hanauer:

Which is the point.

Bharat Ramamurti:

[inaudible 00:20:31] fact that the analog now is that you’ve got 10 million or so households in the United States that don’t have internet access at all. There’s no infrastructure in their area. And what we are doing for the infrastructure bill is connecting every single one of those households to high speed, reliable internet. So that’s going to create jobs in many cases, union jobs, going out and laying that fiber, fiber optic cable to connect people to the internet. But then think about what the benefit is of having 10 million additional households who can do telemedicine or can start a small business and sell things online or can stay connected to their families and the social benefits and the economic benefits that provides. So these are important generational investments that are going to pay off not only with the short term job creation, but long term with, in my view, productivity enhancing benefits.

Nick Hanauer:

Yeah. So can we turn to competition? This is probably the wonkiest, hardest to understand and most invisible part in many cases of Bidenomics. But it’s so important and so crucial to both economic growth, but also to both higher wages and lower costs for Americans.

Bharat Ramamurti:

Yep.

Nick Hanauer:

And is it 72 separate executive orders working their way through agencies aimed at this kind of stuff?

Bharat Ramamurti:

And so it’s one executive order, but 72, it directs.

Nick Hanauer:

Oh, it direct, okay. Yeah, but it’s massive. And a fantastic example of that is the prohibition against non-competes for example, just speak to that.

Bharat Ramamurti:

Yeah. This is something that’s really near and dear to the President’s heart. He’s been talking about it for years now. But believe it or not, there are 30 million workers roughly speaking in the United States that are subject to these non-compete agreements. And just so if folks don’t know what those are, they’re basically clauses in an employment contract that says, you can’t leave this job in this field and go to a competitor in the same field. And maybe for a certain period of time, for a year or two. And you might think, okay, well that makes sense if you’re the CEO of a technology firm that has highly proprietary information and wants to take all of that to a competitor. But no, it applies to security guards, to people working in the retail sector and applies all across the journalism space, it applies to people in the medical space to nurses.

Nick Hanauer:

To the woman who cuts my hair.

Bharat Ramamurti:

Yeah. And it applies to people who work at one hair salon and can’t go work at the hair salon across the street and make $2 more per hour. It’s a real deterrent, obviously, for workers trading up into better paying jobs. And so I think the president who personally finds that offensive and thinks that is bad for workers, it’s bad for a country that prides itself on giving people the freedom to choose where they work and under what conditions. And so-

Nick Hanauer:

It’s bad for innovation.

Bharat Ramamurti:

It is. Yeah, it’s [inaudible 00:23:44]

Nick Hanauer:

It’s bad for competition. The only thing it’s good for is the big shareholders of giant companies.

Bharat Ramamurti:

Exactly. And so the Federal Trade Commission has proposed a rule that would completely ban these non-compete agreements, and right now it’s in the midst of the rule making process, which means that they’re taking comments from the public on this proposal, and an overwhelming percentage of the comments that they’re receiving are positive. And it’s incredible. If you take a look at them, it’s just from every walk of life, you’ve got cardiologists and surgeons talking about how non-competes make it harder for them to switch jobs to maybe even to areas of the country that really need their services, but they can’t do it. You’ve got, like you said, people who work at hair salons saying they can’t go start a small business that tries to compete with their previous employer. And so hopefully the FTC will move to the final stages of that, finalize the rule, and it will then take effect at some point in the future.

But we have this really strong job market right now that we’ve talked about already. We want to make sure that everyone can take advantage of it. And the fact that 30 million Americans right now can’t really fully take advantage of it because they can’t find a better paying job in their same field because they could get a lawsuit, that’s just wrong and we want to make sure that we’re doing something about it. Another thing, just because I know folks are really focused on prices as well, encouraging competition is really about, in many ways, also about bringing prices down. Because if you have, one data point that I always found interesting is that we talked about the fact that there’s about 10 million households that don’t have any access to the internet. Well, something like 70 million Americans have access to the internet, but there’s only one provider where they live.

And this is not surprising, I’m sure. But the people who have a only have access to one provider on average are paying way more for monthly service than people who live in areas where there’s two or three providers. That’s what competition does. If you have to compete with some other internet service provider, you’re going to have to bring your prices down. And so, one of the things that we’ve tried to do is bring that competition back into more fields. One area that we’re very proud of is that we finalize rules that allow hearing aids to be sold over the counter instead of previously they were only available by a prescription from a specialist. When you had to go to a specialist and go through that process, and there was all sorts of arrangements between doctors and specific manufacturers, the average pair of hearing aids cost $5,000 and often not covered by insurance.

And so when you have about 40 million Americans who have mild to moderate hearing loss, how many of them can afford $5,000 out of pocket for hearing aids? The answer is not that many. We changed the rules so now that now hearing aids can be sold over the counter. You’ve got all of these companies, innovative new companies, companies like Apple and Bose, innovating in this space, offering over the counter hearing aid options. And now you can go into a convenience store, you can go into a store like Best Buy, and you can pick up a pair of really good high quality hearing aids for something like a few hundred dollars instead of a few thousand dollars. That’s just one really tangible example of how bringing more competition to a space, opening it up the market to more entrant can lead to better product choices and lower prices for folks.

Nick Hanauer:

This is a great segue to, I think a really important point, which is, how different this administration’s approach has been to economic policy-making than prior administrations, certainly Republican administrations, but if we’re honest other democratic administrations too? Don’t you think?

Bharat Ramamurti:

I, the most obvious differences are with the Republican trickle down approach. And that’s certainly what the president has focused on. The idea that if we maximize corporate profits, maximize tax cuts for the rich and big corporations, that all of those benefits for those at the very top will flow down to everybody else. And that’s the smart way of growing the economy. That’s not our approach. And I think that that approach has definitively failed.

Nick Hanauer:

Yes.

Bharat Ramamurti:

It didn’t produce higher growth. It certainly made the economy less equal.

Nick Hanauer:

It grew one thing, which was the bank accounts of people like me.

Bharat Ramamurti:

Yeah, exactly.

Nick Hanauer:

Super good at that.

Bharat Ramamurti:

[inaudible 00:28:07].

Nick Hanauer:

It was super effective.

David Goldstein:

What about the billionaires Bharat?

Bharat Ramamurti:

Yeah, exactly.

David Goldstein:

Yeah. What about us?

Bharat Ramamurti:

Right.

Nick Hanauer:

I’m sorry.

Bharat Ramamurti:

The president cares about everyone, but he wants to sure that you work, that your typical… When he evaluates how the economy is doing, his question is, how is your typical middle class person, middle class family doing? Do they have financial security? Do they have the ability to get a good paying job that supports themselves and their family? Do they have the ability to save a little bit of money for retirement so they can retire with dignity? And if you look at those types of metrics, this economic recovery has been an incredible success. The middle class, the sort of working class has seen the highest wage growth, they have seen the opportunity to trade up into better paying jobs. As I had mentioned before, job satisfaction is at a 36-year high. And these new jobs that are being created by these new investment programs are the kinds of jobs that can support a family, even if you don’t have a college degree.

The typical job that’s being created by these investments in semiconductor manufacturing pay about a hundred thousand dollars or more. And a lot of those jobs don’t require a college degree. So one of the things the president has said is that his goal is to make sure that no matter where you live in America, whether it’s on the coasts or in the heartland or in a big city or a small town, rural or suburban, that you can find a good paying job with dignity where you live that allows you to stay in the place where you grew up if you want to do that. And what we don’t want is an economy where everyone has to flock to a handful of big cities because that’s where the good paying jobs are. And so again, we are seeing that, we are seeing investment return to some of these communities that have been hollowed out by the loss of good paying manufacturing jobs over the last 20 years.

And I think it’s a very different approach that really focuses on the wellbeing of the typical American worker. I think that’s what really drives this president. How is that person doing? Do they have job opportunities? Do they have the opportunity to live with dignity, retire with dignity, take care of their kids, pass along a better life to their kids than the one that they had? There’s been a lot of questions about what is Bidenomics, I think, beyond some of the wonkier details that we’ve discussed today. That’s really it. Are we delivering for that person, that family?

Nick Hanauer:

That’s right. And Bharat I don’t know the president that well, but I had one two hour one-on-one with him one time. And what really struck me was how emotional he gets about that, right?

Bharat Ramamurti:

Yep.

Nick Hanauer:

He just really cares about that. It’s just so refreshing to have somebody who down to their molecules, is committed to the idea that when the typical family thrives, the country prospers and we do well. It’s just so great, it’s just been so long, frankly since we’ve had somebody who cared about this in this way. And I think what’s so important, the distinction is, it’s not like we are choosing between chocolate and vanilla here. They want to grow the economy from the top down. We want to grow it from the middle out. He’s making a much stronger claim, which is the only way you really grow an economy is from the middle out and the bottom up.

Bharat Ramamurti:

Exactly.

Nick Hanauer:

The other thing was a scam designed to enrich the few

David Goldstein:

Or less malevolently it was a mistake.

Nick Hanauer:

Yes.

David Goldstein:

I mean, because there are Democrats who believed it and I think, Bharat that what really characterizes Bidenomics, what makes it different from what we saw under Presidents Obama and Clinton, is that this is an argument about cause and effect that the president truly understands and makes the argument that the economy grows from the bottom up and the middle out. That emphasis on growth, not that doing things for the bottom and the middle are the right thing to do or the fair thing to do, or the most deserving thing to do, but this is how you grow the economy. And I don’t believe that Presidents Obama and Clinton believed that. I think they believed it was the right thing to do. I just don’t believe they thought that’s where growth primarily came from. They largely believed it came from freeing private investors and the market to do its magic.

Bharat Ramamurti:

Look, I will say this, which is that there’s been this thinking that there is a trade-off between economic fairness and economic growth, that you can have a more fair economy, but you have to live with lower growth or you can have a really fast-growing economy, but then you’re going to have to live with an unfair distribution of that growth. And I think that what the data really shows, and I think what the president believes is that there isn’t that trade off, that a fairer economy grows faster.

And again, as we talked about earlier, that it makes sense. Because if you have more people who have more financial security, more disposable income, more money to spend, guess who benefits from that? Your local small businesses, your local big businesses that are going to have more people coming in the doors to buy whatever they’re selling, which means that they in turn are going to want to produce more and hire more people and so on and so forth. If you have an economy where some people at the top have it all or most of it, and everyone else is hanging on by their fingernails, who’s going to buy all the stuff? Right?

Nick Hanauer:

Right.

David Goldstein:

Nick tries, God bless him, but he just can’t do it. There just isn’t the time and the day for Nick to buy all the stuff.

Bharat Ramamurti:

And so this is a president who cares a lot about economic growth and wants to see the economy grow quickly. And in fact, we have seen it grow quickly in the last two years. We had nearly 6% growth in 2021. But the way to do that is to make sure that your typical middle class family that as the president said, is to grow the middle class so that the poor have a ladder up and because the wealthy still do well in that situation. That’s really what this is about. And I will say this to the president’s great credit, there’s been a lot of people who have attacked him for taking this approach and have said that the American rescue plan was poorly designed and it was too big and was this thing and that thing.

And I think that his approach has been vindicated because we have had, among the world’s leading economies, the best and fastest economic growth and a really equitable recovery. We’ve hit record low unemployment for black workers, for Hispanic workers. As I said earlier, we’ve hit the lowest level in 70 years for female labor force participation. Some of the workers who have been left behind in previous economic recoveries have actually done the best in this economic recovery, and that matters a lot too.

Nick Hanauer:

Absolutely. Fantastic.

David Goldstein:

Final question?

Nick Hanauer:

Yeah. Why do you do this work?

Bharat Ramamurti:

Look, I do it because there’s no better feeling than seeing the American public benefit from some of the things that you do. I remember after we worked hard on finishing those hearing aid rules and getting them in place/fall, walking into an electronic store and seeing a booth set up where people were talking to the store employees and trying on different hearing aids and realizing that, “Hey, maybe that was a person who couldn’t afford a $5,000 pair of hearing aids and maybe missed some conversations and couldn’t fully participate in social interactions because they were having trouble hearing, but now we’d given them an option for a lower cost hearing aid that they could afford, and now they would be able to do all of those things.”

That means a lot when I see workers with disabilities working at the highest rate that they’ve ever worked at. I think you think about all the people who’ve been maybe excluded from economic opportunity in the past who are now getting that chance to show what they can do. That’s a good feeling to wake up to every morning is the feeling that maybe you can do something good for people out there. And we’re what we’re working on, not everything, but most of what we’ve done has really worked, and that’s a good feeling.

Nick Hanauer:

So awesome. Well, congratulations. I mean, you guys have crushed it, and we thank you for your work and thank you for spending the time to talk to us about it on the pod.

Bharat Ramamurti:

Absolutely. Thank you guys. It’s been good talking with you again. And hope we can keep in touch.

David Goldstein:

Bidenomics Nick. Is it a real thing? What do you think?

Nick Hanauer:

Yeah, I do think it’s a real thing. And the way I like to think about Bidenomics is that Bidenomics is what we think of as middle out economics as Reaganomics, was the trickle down economics. They’re one and the same, but one of the things that we actually didn’t really cover in the pod probably worth exploring at some other time, is the amount of his historical empirical evidence that supports these claims,

David Goldstein:

Right.

Nick Hanauer:

Because if you look back in history when the country did the best, whether you want to call it Bidenomics or middle out economics or whatever you want to call it, those things, pointing policy at middle class people, believing that a thriving middle class causes economic growth, when we did those things, we had massive amounts of growth. When inequality was lowest, GDP growth rates were highest. And I’d like to claim that we are like galactic geniuses who thought up this new thing that has never existed in the world. It’s not true. This is what built the United States in many ways, certainly what built the middle class. And it’s just great to have a president who’s so old, he remembers that. And prefers it to the neoliberal health scape that we’ve been living through for the last 50 years.

David Goldstein:

I think what’s important pointing out here, Nick, also, is that, you know what, you don’t have to believe it. I mean, there is this empirical fact that the economy does better under Democratic presidents than under Republican presidents.

Nick Hanauer:

Yeah.

David Goldstein:

Universally, by every metric you want to use. GDP growth, productivity growth, wage growth-

Nick Hanauer:

Job creation.

David Goldstein:

Job creation, stock market indexes. Every metric that people use to measure the economy, it has done better under Democratic presidents than under Republican presidents. And I think it’s fair to say that from Carter, to Clinton, to Obama, they have generally fallen under the benevolent neoliberal ideology, right?

Nick Hanauer:

Correct.

David Goldstein:

They were softer neoliberals. They believed what they were taught in Econ 101, that the way you grow the economies to free up capital to do its thing. And so it’s generally a trickle down approach. But one thing you can say about Democratic administrations is that across the board, economic and non-economic policies, Democratic policies have been more inclusive than Republican policies. On education, on gender issues, on race issues, on housing, on just about everything you can think of, the progressive ideology is more inclusive. And that means including more people in our democracy, including more people in our economy. And that inclusivity that is part of middle out economics is pro-growth.

Nick Hanauer:

Yes.

David Goldstein:

And I think, you think, I know we’ve talked about it, we’ve written about it. Even if they don’t understand that cause and effect-

Nick Hanauer:

The mechanism.

David Goldstein:

…they have been promoting inclusive middle out policies. Not as much as they should have, not perfectly. I’m not saying that they’re perfect, that things have been great for everybody, but better than Republicans, and so therefore the economy has done better under than Republicans. And I want to get back to that comparison you made about Bidenomics being to middle out what Reaganomics was to trickle down. What we are seeing here is a paradigm shift in the way, not just we talk and think about the economy, but the way we run the economy. And in the 1980s, we had the Reagan revolution, and we have been suffering the consequences ever since. And I think that 40 years from now, we’re going to look back on this and it’s going to be the Biden.

Nick Hanauer:

It’s a Biden revolution.

David Goldstein:

It’s the Biden Revolution. I think this is a paradigm shift, this is a tipping point in the way we manage the economy. Yeah, because what you were talking about with Bharat are those long-term investments are going to pay off.

Nick Hanauer:

They are.

David Goldstein:

And as they pay off, people are going to come to realize how different and how consequential these policies and these policy narratives are. And I think we’re not there yet, we haven’t won, but I think over the next decade, middle out, Bidenomics is going to be the dominant narrative for decades to come.

Nick Hanauer:

Yeah. Hopefully, a very long time.

Speaker 4:

Pitchfork Economics is produced by Civic Ventures. If you like the show, make sure to subscribe, rate and review us wherever you get your podcasts. Find us on Twitter and Facebook @Civic Action and Nick Hanauer, follow our writing on Medium @civicskunkworks and peek behind the podcast scenes on Instagram @pitchforkeconomics. As always, from our team at Civic Ventures, thanks for listening. See you next week.