'America depends on it': Nobel-winning economist reveals key lesson Dems must learn from 2024

28 November 2024

Democrats were hoping to convince enough Americans that their management of the post-pandemic economy was good enough to keep them in power. But after a majority of voters instead chose to send President-elect Donald Trump back to the White House, one top economist argues that Democrats have an important lesson to learn if they hope to win future elections.

In a Thursday op-ed for the Guardian, Joseph Stiglitz — the former chief economist for the World Bank who won the Nobel Prize for Economics in 2001 — said Democrats merely offering tweaks to the current economic order is no longer sufficient. While he credited President Joe Biden's administration for guiding the United States through the initial post-Covid spike in inflation rates and maintaining a near-full employment economy (the U.S. had the best economic recovery of all G7 nations in the wake of the pandemic), it "wasn't good enough."

"Americans haven’t forgotten that the Democrats let loose the financial sector (Clinton), then bailed out the banks while homeowners and workers who lost their jobs in the Great Recession carried the cost (Barack Obama). Moreover, it was Clinton who unleashed globalization, tacitly believing in a trickle-down economics that would ultimately benefit everyone," Stiglitz wrote. "The only real difference between Democrats and Republicans on this score is that Democrats claimed to feel the pain of those who were losing out."

Stiglitz emphasized that Trump's economy won't be friendly for most working-class Americans. He noted that Trump ran on and may enact another tax cut package that will overwhelmingly benefit the rich at the expense of workers, repeal the Affordable Care Act and implement broad tariffs that will harm both consumers and small businesses alike. He defined Trump's economic vision as "ersatz capitalism, run for and by the powerful" with the guiding principle that "money matters above all else."

"Like nationalists everywhere, Trump blames America’s problems on outside forces, from immigration to 'unfair' trade' But while it is true that neither issue has been managed very well, his proposed solutions would be disastrous for the US economy and the world," Stiglitz argued. "The extent to which his voters understood this is unclear. Most seem to have been drawn to the political theatre. They wanted to send a message of dissatisfaction, and now they have done so."

According to Stiglitz, the opportunity for Democrats in future elections lies in "abandon[ing] neoliberalism and return[ing] to your progressive roots." He cited sweeping economic visions by former Presidents Lyndon Johnson and Franklin Delano Roosevelt, which he said "offer[ed] education and opportunity for all; where markets compete to better products that enhance living standards, rather than to devise better ways of exploiting workers, customers and the environment; where we recognize that we have moved on from the industrial age to an economy oriented around services, knowledge, innovation and care."

"A new economy needs new rules and new roles for government," Stiglitz wrote.

The Nobel Prize-winning economist criticized Vice President Kamala Harris' piecemeal fixes for the economy as "a little more education funding here, and a few dollars to help first-time homebuyers there." He argued that Democrats should instead be unafraid to propose bold new visions that will inspire millions of American voters who want drastic changes in the economic order.

"Articulating a robust program will not be easy, and implementing it would be harder still," he acknowledged. "But the future of America depends on it being done."

Click here to read Stiglitz's op-ed in full.

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