Inclusive Economy Talks: Ameya Pawar
The Inclusive Economy Lab’s Carmelo Barbaro sits down with the Lab’s Special Adviser Ameya Pawar, who, as a Chicago alderman, led nearly all labor policy and worker rights legislation passed in Chicago from 2011 to 2019. Pawar is currently working on narrative change efforts around guaranteed income and public options as a Senior Fellow at the Economic Security Project and a Leadership in Government Fellow at Open Society Foundations.
Carmelo Barbaro: I’m going to start with the trillion-dollar question: What would an inclusive economy look like to you?
Ameya Pawar: One that allows everyone to share in the successes and the gains that we’ve realized over the last 50 years. Before Covid, only 4 in 10 Americans had $400 in the bank, a majority of Americans were living check to check, and this was during a time where we had historically low unemployment and booming stock market and corporate gains, so the economy really wasn’t working for most working people.
There are pressure points on working people and — the cost of housing, the cost of childcare, and student debt are just three. So what does an inclusive economy look like? One where you have a living wage, housing is accessible to everybody, and childcare is not something we’re taking for granted. And then really thinking about racial and economic justice by centering people who have been left behind over the last 50 years by the economic policy choices we’ve made.
The version of capitalism and the market-based economy we have right now is actually quite new. The way we think about deregulation and a lack of government investment in jobs to control inflation, supply-side privatization, tax cuts for the wealthy austerity — these trends are really like 50 years old. Before that, from the New Deal onward, you had a different mindset. Where we are today is the result of policy choices that have put public institutions as sort of passive bystanders to the market.
CB: Policies like the stimulus checks, or the child tax credit that’s putting cash in the pockets of eligible families, seemed like very unlikely events a year and a half ago. What opportunities do you see to take this unique moment that we find ourselves in and address some of these longer-term structural issues that you’ve highlighted?
AP: There are a few things we can make permanent very quickly. First, we know that cash has worked over the last years. We’ve provided stimulus checks to a majority of working people. We know that has prevented people from falling off a cliff, and so we should be thinking about adding cash payments as a part of our social safety net.
We should be thinking about automatic stabilizers so that we don’t have to go through the political rigmarole every single time there’s an economic crisis. A boost to unemployment insurance, a boost to cash and other benefits the second you have an economic issue that starts winding down as the economy recovers — those should be automatic and countercyclical. We don’t need to debate over it.
The child tax credit, which the Biden administration and many policy experts say will reduce child poverty in half — we should make that permanent and expand that. The care economy needs to have actual attention. We need to include caregivers, domestic help, and students as part of our earned income tax credit.
There are explicit policy solutions towards the racial wealth gap that we need to start having a real conversation around. One is baby bonds — it’s a way to seed a young person with cash so that they have an opportunity at age 18 to go to post-secondary, start a business, buy a home.
Finally, reparations cannot be this far-off conversation that is aspirational. The time is now to have a real conversation about reparations and start moving from conversations to policy. We need to be able to create the same circumstances that made it possible for white people to live the American dream — a good job that paid enough to live, save, buy a home cheaply with little money down, and a federally backed mortgage that allowed you to create wealth over time. That’s the same equation that would work today. But then to play catch-up for the money that was lost over the last three or four generations and beyond, it really comes down to one massive payment, along with baby bonds.
CB: From the local government perspective, what sorts of policies should we be considering to get to a more inclusive economy for Chicago?
AP: Three years ago, the Resilient Families Task Force recommended starting a guaranteed income pilot. Now, with the state and the city receiving billions of dollars in cash supports, Mayor Lightfoot has a really big opportunity to advance one of the largest cash programs at the local level should she seize on it. The City Council seems to be moving in that direction.
I believe we should be canceling student debt, because I think that gets at the racial and ethnic wealth gap right away, but in the absence of federal action, I think state and local governments should refinance student loans to make it possible for college graduates to stay in the city and put money back in people’s pockets. Local versions of baby bonds can help as well.
And we have to go big on issues like affordable housing. The tools that we have today just work on the margins, whether it’s low-income housing tax credits, TIF, ARO reforms, or inclusionary zoning. If the government believes it is important to have affordable housing and childcare options, then we should establish local public options to do that, and there are models from across the world that can be implemented easily here in Chicago and at the state level. It’s just a matter of being creative and finding the financing mechanism to do that.
CB: The guaranteed income pilot was a very bold recommendation at the time of the task force, and suddenly we’re actively discussing it, and other cities are doing it. What do you see as the prospects for that kind of policy? Is the goal to motivate federal policy, or could universal basic income be implemented on a more sustained basis by local government?
AP: A couple of years ago, I don’t think people had reconciled how expensive it was to be poor with this idea that the economy looks great, so why are people struggling, and why are we giving people cash? Today, I don’t think we need a pilot; we need policy action. My guess is that the billions of dollars we’re going to see at the state and local level are just the first round of dollars that the federal government will provide. As those dollars flow locally, we should be having a real conversation about how you build local and neighborhood resilience.
We know from the last year that getting cash into people’s pockets is the best way to stabilize people’s lives. They’re going to use that money to pay bills, pay for medical care, pay for childcare, buffer against any loss of income. Economic Security for Illinois and the Illinois Cash Coalition are working on expanding the earned income tax credit here in Illinois to add cash to the safety net and expand it. That is one meaningful policy solution that can come from some of the federal action.
CB: How can nonprofits encourage philanthropy to fund these sorts of pilots, which are increasingly common but still tough to do and scale?
AP: Part of it is engaging with funders so that they can see what’s actually happening on the ground — that programs and services are needed, but cash is also incredibly important. It’s about working with board members to connect what’s happening with economic data on a macro level and understanding what’s happening at a local level. Finally, there is often a paternalistic view when it comes to viewing people we’re trying to help — instead of just viewing people as our neighbors, and trying to understand that there are structural reasons why some people are able to get ahead and some people aren’t, and attacking those structures. Philanthropy plays a major role in that, because sometimes they have reinforced those structures.
CB: How do you build political will among people who are benefiting from the current system — or at least think they’re benefiting from the current system — towards some of these bolder solutions?
AP: If you look around the country, big cities are really great on issues like raising the minimum wage and paid sick leave, but really bad on issues like affordable housing. Some of it is convincing people that they need different housing at different stages of their life. You might need rental housing early on, then you might want to own. You might need affordable workforce housing at some point, and you might need affordable housing that’s subsidized at some point. Having every kind of housing available within a community makes a more stable community.
We often think about the policies that impact vulnerable people as, “How do we make sure we provide enough but not too much? How do we prevent people from gaming the system?” If you come at it from a different angle — “How do we build more resilient communities and what does that look like?” — you probably end up with better research, better policy, better narratives, and hopefully better politics. We all have to do our part, and we have to be better neighbors.
Inclusive Economy Talks is an event series that puts the Inclusive Economy Lab in conversation with community members about what an inclusive economy looks like, and how we get there. The opinions expressed in this interview are those of Ameya Pawar and not necessarily of the Inclusive Economy Lab. This interview has been transcribed, condensed, and edited from its original format for length and clarity. Some questions were submitted by event attendees.
