Presidential candidates, pay attention: A prescription for shared economic growth

What if you put four high-profile economic policy wonks – two Democrats and two Republicans – on stage and asked them what one question they would put to the presidential candidates in a town hall meeting?  What are the odds that they’d agree on what that one question should be?

Well, we were surprised by the outcome when we tried just that earlier this week with Jared Bernstein of the Center on Budget and Policy Priorities and Neera Tanden of the Center for American Progress, both veterans of the Clinton and Obama administrations, and Doug Holtz-Eakin of the American Action Forum and Glenn Hubbard of Columbia University Graduate School of Business, veterans of both Bush administrations.

Despite contrasting prescriptions for the U.S. economy, all four agree that the most important question was outlined by Mr. Bernstein, who asked, “I hear you talking about growth and I’m all for growth, but unless that growth is more equitably shared, it’s not that interesting to me. What steps are you going to take to reconnect growth and more broadly shared prosperity?”

Watch the video clip of all four panelists agreeing:

Infrastructure for All

Increasing investment in infrastructure, the four agreed, is one way to increase the pace and equity of economic growth, in the short-run and more importantly in the long-run. Infrastructure spending, once popular with both Democrats and Republicans, lately has been more of a talking point for Democrats, who are more eager to increase government spending than most Republicans. Both Hillary Clinton and Bernie Sanders have released fairly detailed five-year infrastructure plans. Fewer among the GOP candidates have outlined infrastructure policies, but Marco Rubio has a transportation plan.

During our discussion at Brookings, Republican economists Hubbard and Holtz-Eakin agreed with Democrat Bernstein on the need for a more ambitious infrastructure policy. They agreed that a long-term commitment to infrastructure development would help boost the economy both because of the benefits of high-quality infrastructure and the sense of a return to economic normalcy. Bernstein was mildly critical of Clinton’s idea for developing an infrastructure bank, with Holtz-Eakin arguing more forcefully that such a bank “is an attempt to take federal spending outside of the political process.”

Watch Hubbard’s and Holtz-Eakin’s comments on infrastructure policy:

It’s Especially Important Now

Veterans of Washington policy debates, the individuals who have and will be advising presidential candidates and the next president on economic policy, share one frustration: Nothing much is happening in today’s bitterly polarized Washington.

Tanden, a lawyer by training, has an explanation for the much-maligned gridlock that plagues Washington. The two political parties are moving further apart, a development that she said is unusual in recent history. “Everyone in Washington wants to say political leaders just don’t listen. They are listening too much. The bases of the parties are moving in opposite directions,” Ms. Tanden says.

The root cause, she suggested, is 15 years of wage stagnation. Republicans and Democrats agree on that, but respond in very different ways. “Republican base voters are more anxious about ‘the other’ – immigration, Islamophobia. Democrats are more concerned about rising inequality than at any point in the past 20 years.”

Holtz-Eakin agrees, adding that the parties themselves are increasingly divided. Both parties have “missing middles,” he says.

Watch Tanden’s comments on the politics of the parties moving apart and Holtz-Eakin agreeing:

Watch the entire conversation on what should be the key economic issues in the 2016 presidential campaign: