Economics and Finance Program

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Pocketbook Issues Such as Raising Minimum Wages, Paid Leave, and Protecting Public Education Could Sway the American Electorate, New Levy Economics Institute Report Says

Long-Term Voting Trends Show Democrats Losing Working Class Support Due to Absence of Clear Vision for Popular Progressive Economic Policies

The Levy Economics Institute of Bard College has published a policy brief outlining economic policies that improve the lives of working-class families and could sway the American electorate. That “Vision Thing”: Formulating a Winning Policy Agenda, Levy Public Policy Brief No. 158, coauthored by Levy Economics Institute President Pavlina R. Tcherneva and Senior Scholar L. Randall Wray, analyzes the shifting allegiances of American voters over the decades as the Democratic Party lost the support of its traditional base—blue-collar and rural counties—and came to be seen as the party of the educated elite, socially liberal, and relatively economically secure.

“Trump was the beneficiary of a long-term retreat of working-class voters from the Democratic Party. But becoming the party of the economically secure in a world of runaway inequality, rising precarity, and widespread frustration with many aspects of the economy does not and will not win elections. Still, as we show in this report, Americans are far more progressive than either party gives them credit for. Whatever path forward Democrats choose, winning back the working class would be a long process without a big and bold vision,” says Tcherneva.

For the first time since 1960, Democrats earned a greater margin of support among the richest third of American voters in 2024 than they did among the poorest or middle third. Meanwhile, Trump gained more vote share in counties rated as distressed—and gained less in prosperous counties—despite those counties benefiting significantly and performing better economically under President Biden’s policies that boosted government assistance. In spite of the Democratic focus on inequality, the party fails to reach the financially disadvantaged (who are the true swing voters) with their message, the report asserts.

“Democrats had neither delivered on nor even highlighted the changes that many voters wanted: policies that would provide economic benefits. They were tired of inflation that reduced purchasing power, wages that remained too low (even in supposedly good labor markets) to support their families, and many other issues related to economic precarity, including the costs of healthcare, prescription drugs, childcare and—for a significant portion—college,” write Tcherneva and Wray.

Assessing ballot measures and polling data, the Levy report identifies worker-friendly policies that would improve the wellbeing of the American working class and win elections. “Americans seem to apply two litmus tests to any proposed policy: (1) how will it impact American jobs and (2) how will it impact American paychecks,” they find. “If tariffs are expected to protect jobs, voters are behind them. If they hurt their paychecks, even conservative-leaning voters are strongly against them.”

Ballot measures indicate voters are more progressive than either party recognizes. Winning policies include: raising minimum wages, lowering taxes on earned income and social security (or eliminating them altogether for tips), making healthcare and education more affordable, protecting funding for public schools, increasing Pell grants, reducing the costs of higher education, and implementing paid sick and family leaves. Importantly, whenever asked, Americans strongly support federal programs of direct employment and on-the-job training—in the form of a federal job guarantee or national service for youths in jobs that support the community and the environment. They also care about rebuilding public infrastructure and investing in arts and culture.

Moreover, voters want policies that protect them from price increases, corporate greed, predatory interest rates, and hidden fees. They support more progressivity in the tax system and fewer tax loopholes for billionaires. They are tired of the dominance of billionaires in lobbying by special interests and campaign finance.

“Employment security, economic mobility, community rehabilitation, and environmental sustainability are winning messages. But they are especially powerful when anchored in concrete policies that directly deliver what they promise—good jobs, good pay, decent benefits, affordable health, education, food, and a peace of mind that Americans can care for loved ones without the threat of unemployment or price shocks or the loss of essential benefits,” the report concludes.

Post Date: 03-10-2025

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Bard Economist L. Randall Wray Discusses the Evolution of Money

L. Randall Wray, professor of economics at Bard and senior scholar at the Levy Institute, spoke with Anastasia Bendebury and Michael Shilo DeLay of the DemystifySci Podcast about the origin of money and what it has meant throughout history. Wray details money’s evolution, from the transition from Medieval tally sticks to modern central banking, and explains how debt plays a crucial role in our economic system. “All money, every form that it takes, is a debt and a credit,” Wray explains. “Banks create money. The state creates money . . . and you can create money. Anyone can create money.” Wray continues, “There are lots of valuable things that are not money. So, gold is valuable in part because it has some useful characteristics . . . it has been prized probably back to the very beginning of humans. But that does not make it money, it is not money. So, money is a debt, it’s an IOU. But you want some evidence of that debt.”

Post Date: 10-16-2024

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Pavlina Tcherneva Joins WAMC’s Roundtable Panel on the State of the US Economy and How it Impacts Voters

Bard Professor of Economics and President of the Levy Economics Institute Pavlina Tcherneva joined a panel of economists on WAMC’s Roundtable to discuss the economic issues that matter to voters and how each of the two presidential candidates’ policy proposals address them. “If you compare the two proposals, it’s very clear where they are directed. Trump’s proposals tend to favor corporations, high income earners, and they deal with a lot of dismantling of public institutions. ‘Defund, deport, deregulate, destroy.’ His message plays on economic fears and anxieties,” said Tcherneva. “In terms of the direction of her policies, Kamala Harris looks like she is trying to address housing issues, food prices, and drug prices but we don’t have concrete details yet.” Tcherneva also points to how deficit rhetoric is weaponized during election cycles as a tactic to scare people. 

Post Date: 09-26-2024

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Business Insider Interviews Bard Economist Pavlina Tcherneva about the Job Guarantee

Bard Professor of Economics and President of the Levy Economics Institute Pavlina Tcherneva spoke to Business Insider about Universal Basic Employment (UBE), which is a job guarantee policy. Many countries around the globe have tested out UBE programs, but support for the policy has yet to catch on in America. “A job guarantee is really a public option for jobs. It’s a basic job that is provided irrespective of what the state of the economy is,” said Tcherneva, who is the author of The Case for a Job Guarantee (Polity 2020). “We can implement it now when the economy is in a relatively calm state and then be ready when business conditions slow down and people are laid off.” Although logistically more complicated to implement than universal basic income programs, UBE has long-lasting economic benefits, argues Tcherneva. UBE would fight inflation by establishing a minimum livable wage without increasing prices elsewhere, prevent labor shortages by supplying a willing and ready workforce, and mitigate sudden financial hardship. She believes UBE is on par with Social Security as a means to shore up economic stability and that pilot programs are unnecessary. “We didn't really pilot public education to figure out whether we wanted it,” Tcherneva said. The first American UBE pilot program will launch in Cleveland in 2026. Advocates see the potential to win more bipartisan support for UBE over simply giving people checks through universal basic income.

Post Date: 08-20-2024

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Pavlina Tcherneva Discusses the Recent Stock Market Sell-Off on Background Briefing with Ian Masters

Bard Professor of Economics and President of the Levy Economics Institute Pavlina Tcherneva spoke with journalist Ian Masters about Monday’s panic on Wall Street and fears that it may presage a recession. “I’m not exactly sure if it’s a panic, or an opportunity to liquidate some positions,” said Tcherneva. “The real question for us is, would that then ripple through the rest of the economy? At this moment, I’m not detecting unsustainable processes in financial markets to cause the kind of effects on the real economy as we saw in 2008.” Tcherneva, who watches the data on labor markets and public investments very closely, believes that the US labor market still has significant room to grow, pointing out that we have yet to recover our employment-to-population ratio or labor force participation rate to pre-COVID levels. She believes the government needs to keep investing in the economy to sustain the recovery. “We set the economy on a really strong growth path in the last four years . . . If we pull out too quickly, if we allow an administration to impose drastic cuts to these public programs, this is where I think we can be certain that a recession will come.”

Post Date: 08-06-2024

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The Levy Economics Institute of Bard College Welcomes Pavlina R. Tcherneva as New President

The Levy Economics Institute of Bard College has appointed Pavlina R. Tcherneva as its next president, succeeding Dimitri B. Papadimitriou, who has held the role since its founding in 1986.

“After 38 years as president of the Levy Institute, the time has come to pass the baton to the new generation,” Papadimitriou announced. “I can think of no one better than Pavlina to lead the Levy Institute into its next phase of development in exploring solutions to the economic challenges that lie ahead.” Papadimitriou will remain at the Institute as president emeritus and senior scholar.

Tcherneva, who first joined the Levy Institute in 1997 as a forecasting fellow, has been a scholar at the Institute since 2007, specializing in modern money and public policy. She is a professor of economics at Bard College and founding director of the Bard-OSUN Economic Democracy Initiative. Her book The Case for a Job Guarantee (Polity 2020), one of the Financial Times economics books of 2020 and published in nine languages, is a timely guide to the benefits of one of the most transformative public policies being discussed today.

“I am honored and energized to take this new role and am grateful to Dimitri Papadimitriou for building a world-class institution that has influenced economic policy in the US and abroad. I am especially excited to support the work of my colleagues whose research has placed the Levy Institute among the most-cited non-profits in the world,” stated Tcherneva. “My mission is clear: to continue to curate cutting-edge research, grow our graduate programs, and amplify the Institute's impact on policy. We have produced some of the most influential work on financial instability, money, inequality, gender, and employment policy and we will continue to make these impacts and expand the Institute's reach.”

She added, “Our work matters. Financial markets crash. Mainstream theories fail. At the Levy Economics Institute, we will continue to do what we do best: make sense of the senseless, find patterns in the chaos of global economics, and produce actionable policies for a safe, sustainable, and stable economy.”

Since 1986, the Levy Institute and its scholars have reinvigorated heterodox economics, with contributions to macroeconomic theory, modeling, and policy targeting financial and economic stability for the US economy and the rest of the world. The Levy Institute has also developed a distinct research program on the distribution of income and wealth featuring two measures of economic well-being (LIMEW) and time and income poverty (LIMTIP) that will help shift official measures of living standards in the years ahead; is one of few institutions with a focus on gender equality and the economy; and has graduated scholars from its MA and MS degree programs in Economic Theory and Policy, who go on to play significant roles in economic think tanks, international organizations, governments, and the world of finance.

Post Date: 07-09-2024