Today, too many Americans are not fully sharing in our nation’s prosperity. Real median wages have stagnated, income inequality has increased, and changes in the economy that have brought benefits have also brought new risks and insecurities. In response to these challenges, our nation needs to act now on three fronts.
First, our nation must make the right long-term investments to promote economic growth that is both strong and sustainable.
Second, it is necessary to put in place economic policies that will better achieve broad-based participation in that growth.
Third, for growth to be sustainable, it is necessary to restore sound fiscal policy, moving on a multiyear path to a sustainable fiscal position.
This paper elaborates on the economic challenges and the recommended policy responses. It considers the commonly held view that promoting economic growth, broad-based participation in growth, and economic security may be contradictory policy objectives, but finds instead that these objectives can be mutually reinforcing. It argues that while free markets are the cornerstone of economic growth, there is a necessary role for robust government action to support and supplement market forces and to help share the gains of growth more broadly.
In an effort to advance innovative ideas about how to invest in our nation’s future prosperity and to enhance families’ economic security, The Hamilton Project has released strategy papers offering a broad vision for policy in a range of areas, as well as dozens of discussion papers on a wide variety of topics. These topics include education, health care, income security, science and technology, tax policy, climate change, energy security, infrastructure, workforce training, housing and financial markets, and poverty reduction, among others. These papers have all been written by leading scholars and grounded in real-world evidence about what works, not ideology and doctrine. This paper draws on this body of work to offer a vision for how to achieve opportunity, prosperity, and strong, broad-based economic growth.