Sea Change: How a New Economics Went Mainstream
New York, NY — Over the last decade, we have seen the ideological foundations of economic policymaking shift away from neoliberal, trickle-down, approaches toward a new, and overdue, policymaking approach that seeks to ensure that government can shape our markets and our economic outcomes for the public good. To a remarkable extent, the Biden administration has embraced this new approach to policymaking with landmark legislation such as the American Rescue Plan (ARP), the Infrastructure Investment and Jobs Act (IIJA), and the Inflation Reduction Act (IRA). Today, however, policymakers must grapple with how to truly reset our governing paradigm so that these policies don’t serve as limited, one-off investments and actions. The true mark of success for the new economics will be rebalanced power in our economy, with stronger outcomes for workers.
Sea Change: How a New Economics Went Mainstream, a new Roosevelt Institute report by authors Felicia Wong (president and CEO), Suzanne Kahn (managing director of research and policy), Mike Konczal (director, Macroeconomic Analysis), and Matt Hughes (deputy director of editorial strategy), explores how we got to this moment in economic policy. The report is a deep-dive look at the people, institutions, and movements that brought about this new, post-neoliberal approach to economic policymaking. The report provides both hopeful lessons about how far we have come from the days of Reaganomics, and clarity about where the new economics remains unfinished.
“In this report, we try to document some of the changes we’ve witnessed over the last decade—in part, to help prepare for the challenges of the next,” said Wong. “Though the wins of the last three years are significant, ensuring that we not only move beyond neoliberalism but also see the rise of a better, more equitable, and enduring political economy will be the vital project of the decade ahead. We can have a high-care, low-carbon economy. Will we?”
Structured around the administration’s “Bidenomics” pillars—empower and educate workers, invest in America, and promote competitive markets—the report has three main goals:
- First, the report expands the conversation around new economics. Industrial policy and the climate efforts in the IRA are indispensable components of the administration’s Bidenomics framework and have been reported as such. But a focus on industrial policy does not capture all of the ideological shifts over the past decade, from new efforts on antitrust to robust support of a full employment economy.
- Second, the authors recount our recent economic history from Roosevelt’s unique vantage point. They describe the role of key social movements as well as key intellectual and policy pivots.
- Third, the report explores how to ensure that the new economics succeeds on progressive terms. By looking back at the long arc from the early 2010s to now—what were our goals then, and are we making real progress?—the authors explain how we can trace what’s changed and also commit to the work we still need to do.
“Neoliberalism said that government should intervene as little as possible in markets. We now believe something different: that government should rebalance power in the economy by fostering the industries we need and supporting workers’ demands for higher wages and more economic security. Now, we have much work ahead to make sure these changes endure,” said Wong.