The perils of incrementalism

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In ordinary times, politics trends toward incrementalism. In extraordinary times, however, incrementalism can be ineffective. The economy prior to the pandemic will not return. If we try to recreate it through gradual steps, we will fail financially and politically. Instead, we need to brace ourselves for the only realistic end point, which is full employment underwritten by the government. We must think imaginatively about what that might take and move there as quickly as possible before the economy turns worse.

The strategy of incrementalism has already lost once to the coronavirus. As the pandemic approached our country, many agencies at all levels of government responded using incremental measures, like banning large gatherings, some travelers, and some services. But none of this worked. There could be no stopping part way. Places that moved quickly to the end point had the best results. Simply compare California to New York.

Something similar is happening now as we approach the other end of the crisis. Applying the mindset of the normal rather than the emergency, we are drawn to incrementalism. If the economy after the pandemic will not replicate the economy before the pandemic, however, these will only be small steps to nowhere. Entire sectors and the millions of jobs that they support have likely vanished, if not forever, at least for a very long time.

There will effectively be no travel, no airlines, no cruises, no hotels, and no vacations. There will be no restaurants, only delivery services. All activities that brought many people together inside of closed spaces will not return, so there will be no sporting events, no concerts, and no theaters. Colleges and universities will have to remake themselves. These sectors supported immense numbers of support services, from janitors to drivers, bankers to lawyers, caterers to event planners, and travel agents to insurance agents.

No stimulus, however significant, can cause obsolete jobs to reappear. No support for the businesses in these sectors can succeed. Even those who have jobs will fear layoffs. So nothing like the old consumer economy can return until there is a vaccine or a safe treatment, any that may take years. The economy could deteriorate too much that any incremental approach will make the decade following the 2008 crisis look like a rapid recovery.

But we do not have that kind of time when it comes to politics. Voters who fail to see a real promise of improvement for themselves and their children will not be patient. They will embrace fantastical ideas, something akin to the rise of fascism in response to the Great Depression. The disruptions to the economy of the last decade, which were minor compared to where we are now, already aided authoritarian electoral victories in places like Brazil and Poland. Sustained frustration and social media is a recipe for disaster.

The efforts to end the Great Depression forced the government to adopt a full employment policy. The aftermath of World War Two meant Americans needed guaranteed work with federal support. The same kind of response is needed today. The government will be pushed to this as incrementalism fails. That which we do reluctantly, however, we are likely to do poorly. The government has to instead act boldly and confidently to come out of this.

The issue we should solve is what full employment through public finance looks like in peacetime. We might begin by turning a substantial portion of the workforce toward our most pressing problem after the pandemic. That is climate change. Absent success in that regard, whatever we do will turn to ruin in a few decades. Rebuilding infrastructure is certainly high on that agenda, but so is energy production from renewable resources. Ensuring our housing and transportation sectors green should also move forward.

A successful program to address climate change must be international. We will have to send an army of green workers overseas to assist others address our shared climate problem. Federal support should also flow to state and local governments. We should invest heavily in our schools and education to make up for the lost pandemic years. We have also learned we need to do a much better job of caring for our elderly and vulnerable populations. There is no other time to take up these tasks than right now.

The right mix of public and private, but subsidized, employment must be settled. We need to help those private businesses that can survive. Once we commit to full employment, there will be a good deal less pressure to support businesses and sectors that cannot survive. The workers in those businesses should know that they will have a secure future. Our recovery requires thinking bigger than ever before. Now the best is not the enemy of the good. It is the only hope for the good. The economy is not only to rebuild but to reimagine. The faster we move, the better it will be for all.

Paul Kahn is the Robert Winner professor at Yale Law School. Kiel Brennan Marquez is a law professor at the University of Connecticut School of Law.

Tags Business Coronavirus Economics Finance Government Health Labor Politics

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