Rethinking Domestic Policy

Summary of Remarks

The second panel of the Real State of the Union, "Rethinking Domestic Policy" was moderated by Morton Mondracke, executive editor of Roll Call. The discussion focused on fundamental problems at the core of American domestic policy, including asset management, health care, and improving standards for all Americans.

Ray Boshara, Director of New America's Asset Building Program, led off the discussion by focusing on the "ownership society." Mr. Boshara defined the current economic social status in the United States as one in which only the upper half of society has access to assets, whereas the lower half is shut out of ownership. While Boshara agrees that having an ownership society is beneficial, Americans need to ensure the right progressive tools to ensure equal opportunities. With progressive tools in place, benefits include national savings, productivity gains, and more engaged American citizens who will help shoulder our national debt and social security in the future.

Michael Calabrese, Vice President at New America focused on the problems of the healthcare system in the United States, which hurt productivity gains. He stressed the importance of universal, mandatory health care coverage, regardless of employment status. Mr. Calabrese also said that subsidies for coverage should be individual based, rather than job based. Currently, companies spend around 1/3 of their overall spending on healthcare costs. This healthcare strategy of continuous coverage with an incremental approach would reduce these costs and limit tax exclusion. This healthcare plan has bipartisan support.

Karen Kornbluh, Director of New America's Work and Family Program addressed the rising phenomenon of "juggler families," with 2 working parents or single parents who work. She emphasized that policies haven't changed to reflect new realities of the workplace and that globalization places more pressure on these families. These parents, already disadvantaged, are forced to work impossibly long hours in order to get ahead, negatively impacting our children. Furthermore, these families have difficulties when one parent switches employment or opts to work part-time, because their healthcare plans are not transferable from one job to another. Because of this opportunity gap, Kornbluh proposed solutions including "skill side" investment strategies to benefit children, universal social insurance for families (including health care and pension plans), and enabling flexibility to balance work and family obligations.

Maya MacGuineas, Director or New America's Fiscal Policy Program, focused on tax reform and revenue-neutral ways to improve the tax system. She said the payroll tax was highly regressive and led to a decrease in jobs. MacGuineas proposed eliminating the payroll tax and replacing it with a consumption tax which would enable private and public savings increases. MacGuineas emphasized that taxing corporate entities to increase revenue was the wrong approach for the era of globalization. She suggests adopting the budget to changing health care, education, and other demands. MacGuineas also highlighted the statistic that Americans pay $8 of taxes for each elderly person for every $1 spent on an individual child. She posited that savings from tax reform could be invested in human development.

Synopsis written by Joanna Lederman, Research Associate at the New America Foundation.

Participants

• Ray Boshara
  Director, Asset Building Program, New America Foundation


• Michael Calabrese
  Vice President and Director, Wireless Future Program, New America Foundation


• Karen Kornbluh
  Director, Work and Family Program, New America Foundation


• Maya MacGuineas
  Director, Fiscal Policy Program and President, Committee for a Responsible Federal Budget, New America Foundation


• Morton Kondracke
  Executive Editor, Roll Call