Julie Menter is program director at Transform Finance, where her work focuses on challenging traditional investment practices and mobilizing support for Alternative Ownership Enterprises. Transform Finance is a research, education, and implementation partner that works with stakeholders to challenge legacy investment approaches, seed transformative investment models, and build movement power.

Earlier this month, Anthropic CEO Dario Amodei refused the Pentagon’s demand for unrestricted military use of the company’s AI models. He drew a line at autonomous weapons and mass surveillance, even as Defense Secretary Pete Hegseth threatened to blacklist the company.

While the headlines focused on one CEO’s courage, what’s more interesting is how he was able to make that moral stand.

Anthropic is a Public Benefit Corporation with a Long-Term Benefit Trust (LTBT) designed to safeguard its mission against short-term pressures of shareholder returns. Specifically, the LTBT “can ensure that the organizational leadership is incentivized to carefully evaluate future models for catastrophic risks,” according to Anthropic’s website, “rather than prioritizing being the first to market above all other objectives.” These structural features don’t guarantee the company will always make the most socially beneficial decision, but they do help explain why Anthropic could say no to the Department of Defense when others wouldn’t.

Contrast this with 2020, when America’s largest corporations pledged nearly $50 billion toward racial equity after George Floyd’s murder. Walmart, Amazon, and Meta made sweeping commitments to diversity, equity, and inclusion. By 2024, those same companies were rolling them back. Without structural mechanisms to lock in the commitments when they were made, they evaporated when political winds changed.

What makes values-based decisions durable isn’t the whims or courage of select leaders—it’s infrastructure. And the opportunity to build corporate infrastructure that supports public benefit is broader than most people recognize.

More Business Leaders Act on Values Than We Realize

There’s a powerful norm in our economic system: shareholder primacy. That’s the idea that corporate board members and managers are expected, even obligated, to prioritize short-term financial returns for shareholders above everything else. This norm is reinforced by investor expectations, business education, market incentives, policy choices, and anyone who treats profit maximization as inevitable.

But this norm is relatively recent, and more contested than many believe. For much of history, commerce was embedded in community obligations. Medieval European guilds, Islamic waqf endowments, and Indian shreni associations all balanced profit with broader social purposes. The singular focus on short-term shareholder returns intensified only over the past few decades.

Even today, strategic choices guided by values like environmental stewardship, economic inclusion, worker dignity, or community responsibility—even when those choices conflict with short-term returns—happen across industries, ownership structures, and company sizes. In fact, we found and analyzed over 600 such cases.

These decisions are not always motivated by or related to progressive goals—Chick-fil-A, for example, closes on Sundays for religious reasons, forgoing revenue in ways many companies wouldn’t tolerate. But they show that shareholder-first norms can be broken. Dick’s Sporting Goods, a publicly traded company, took a $150 million revenue hit to stop selling assault rifles after the Parkland school shooting. Epic Systems, now valued at over $45 billion, refused outside investment for 45 years to maintain independence and control over its patient-centered mission. Beatrice Dixon left $70 million on the table by agreeing to sell the Honey Pot Company to a buyer committed to preserve its values, for $380 million instead of $450 million.

Business leaders are already making decisions motivated by reasons other than profits, and sometimes to the detriment of profits. And while every business leader who breaks the norm makes it easier for others to follow, individual decisions aren’t enough. Without structural backing, they can be easily reversed.

Structural Mechanisms Can Make Values-Led Decisions Durable

The DEI rollbacks demonstrate the core challenge: When values depend only on ongoing leadership commitment, without structural backing, they can be abandoned when political winds shift, leadership changes, or investor pressure mounts. What makes values stick is whether they’re embedded into mechanisms that can apply them into a company’s day-to-day operations.

Our research identified a range of tools companies use to operationalize values—from mission statements and philanthropic programs that can be easily reversed, to legally binding provisions that are far harder to undo.

Kickstarter, for example, amended its charter in 2015 to become a Public Benefit Corporation, legally obligating directors to consider impact on society, not just shareholders. This requirement has now outlasted leadership changes and market pressures for a decade. When Bob’s Red Mill‘s founder faced succession, he converted the company to employee ownership rather than sell to private equity, ensuring workers would share in long-term success and values would outlast him. CivicaRx, a nonprofit pharmaceutical manufacturer, can offer insulin at a fraction of typical market prices specifically because its nonprofit ownership structure prioritizes access over profits.

These mechanisms—ownership structures, governance provisions, agreements that protect values during acquisitions—are where progress gets locked in. The challenge is making them much more widespread.

How Nonmanagement Stakeholders Can Push for Change

Nonmanagement stakeholders—workers, consumers, investors, and civil society groups—have long pushed companies to act on values. But the outcomes of that pressure vary widely.

Sometimes pressure leads to commitments that quickly evaporate, but other times, it leads to lasting structural change: After the rise of the #MeToo movement, shareholder advocacy groups convinced Microsoft, Google, Facebook, and Wells Fargo to drop forced arbitration clauses. Health-care unions pushed for California’s mandated nurse-to-patient ratios, which became policy that bound the entire industry.

Some business leaders want to prioritize values but lack the models or resources to make those commitments last. We see three promising pathways to address this gap:

1. Build awareness of alternative models. Most business leaders don’t know that options like employee ownership, golden shares, or perpetual purpose trusts exist—or how to implement them. Organizations like the Purpose Foundation, the Employee Ownership Expansion Network, and Doughnut Economics Action Lab are documenting these models and expanding what business leaders see as possible.
   

2. Direct capital toward values-aligned structures. Business leaders interested in values-led structures often struggle to find investors who won’t demand financial returns above all else. These leaders can turn to impact-investing initiatives like the Catalytic Capital Consortium, which supports investors who prioritize values over financial returns. When stakeholders organize to direct this capital, they can create the financial infrastructure that makes alternative models viable.
   

3. Advocate for enabling policy. Policy can make values-based corporate governance mechanisms easier to adopt. The proposed American Ownership and Resilience Act would make employee ownership transitions more financially viable by allowing selling owners to defer capital gains taxes. As an example from abroad, Germany is working to establish a distinct legal form for steward-owned companies—businesses where control stays with active stewards rather than external investors, and profits are supporting the company’s purpose rather than enriching shareholders. Workers, consumers, investors, and civil society groups can advocate for policies that make durable mechanisms for values-based corporate structure the easier path, not the harder one.

None of this replaces the critical need for government action to raise the social and environmental standards for all companies or the need to hold corporations accountable for their actions. But stakeholders can shape the broader ecosystem by influencing norms, building awareness of alternatives, organizing capital, and advocating for enabling policy. Together, they shape the structural conditions that make values-led decisions more possible, more likely, and more durable.

Thanks to Curt Lyon and Andrea Armeni for their guidance and feedback in drafting this article.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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Andrea Prat is the Richard Paul Richman Professor of Business at Columbia Business School and a professor of economics at Columbia University. Fiona Scott Morton is the Theodore Nierenberg Professor of Economics at the Yale University School of Management and an adjunct professor at Yale Law School. Jacob Spitz is a PhD candidate in the Columbia University economics department and Columbia Business School.

Income inequality in the US has risen over the past several decades. This trend has sparked work trying to pin down the causes, including technology that favors high-skilled workers, globalization and trade that reduce demand for low-wage labor, changes in taxes and benefits, and shifts in education. Importantly, many of these forces are shaped by policy choices, such as tax rules, labor regulations, and opportunities for rent-seeking that tend to benefit those at the top.

While Congress is formally in charge of making federal policy, many scholars point out that the Supreme Court has become a key player as well, using its rulings to interpret or strike down laws and influence public opinion. As Congress has become more gridlocked, the Court’s role has arguably grown.

So, a natural question to ask is: What role does the Supreme Court play in redistributing wealth in the United States, and has that role changed over time?

Narrative accounts claim that the Court’s modern trajectory tends to favor economic elites. Adam Cohen’s book Supreme Inequality argues that, starting in the 1970s, the Court has, with striking regularity, sided with the rich and powerful against the poor and weak. Investigative journalism by ProPublica has tracked the size and frequency of undisclosed gifts given to justices by the rich. Recent empirical work by Epstein and Gulati has documented the increasing “pro-business” tendencies of modern courts, most pronounced in the Roberts Court.

A central challenge for this work is over what exactly to measure. This is an area where the tools of political economy can help.

In our new working paper, published by NBER, we offer a novel approach to build a standard against which to hold the Court’s decisions over time. We build a dataset that codes Supreme Court votes by whether the outcome directly shifts resources toward parties more likely to be wealthy (“pro-rich”) or toward parties less likely to be wealthy (“pro-poor”). We then use the same family of statistical tools that underpin widely used measures of judicial ideology—specifically the Bayesian approach pioneered by Martin and Quinn—but with an explicitly economic interpretation.

The basic descriptive pattern is stark. At the start of our sample, in 1953, Democrat- and Republican-appointed justices voted “pro-rich” in a similar share (40–45 percent) of economically coded, nonunanimous cases. By 2022, the average Republican-appointed justice votes pro-rich about 70 percent of the time, while the average Democratic-appointed justice votes pro-rich about 35 percent of the time.

A New Way to Classify Decisions: Pro-Poor, or Pro-Rich?

Our goal is to avoid labels such as “liberal” or “conservative,” which can be self-fulfilling and time-variable. Instead, we focus on outcomes: who gains resources as a result of a ruling.

Specifically, we restrict attention to direct economic incidence. For example, the wealthiest 10 percent of Americans own roughly 90 percent of publicly traded stock—so if a court ruling allocates resources to shareholders, then it is more than likely to be benefiting the rich.

Conversely, cases that grow the social safety net help the poor: The bottom income quintile receives 28 percent of federal government transfers, compared with 7 percent for the top quintile.

Many cases could also have indirect economic consequences (for example, cutting business regulations may lead to long-run innovation). But those indirect channels can be hard to predict, have varying levels of empirical support, and are subjective, which could distract from what can be concretely understood from case opinions.

Here’s a concrete example to illustrate our classification system In Massachusetts v. Environmental Protection Agency (2007), the Court allowed the EPA to regulate greenhouse gases under the Clean Air Act. The cost of complying with the Act falls largely on firms (and, through ownership, on shareholders), while benefits accrue broadly to citizens via improved environmental quality. Under our protocol, this is coded as pro-poor, because it shifts surplus away from the (on average) wealthier shareholders and toward the broader public. The aim of our methodology is to extract this information from each case so we can use it to compare justices’ voting patterns over time.

We begin with the universe of 9,341 Supreme Court cases in the Modern Supreme Court Database (1946–2022). Within this, we focus on the post-1953 period during which there are justices from both parties appointed to the Court. We also consider only nonunanimous cases, since it is from the disagreements that we are able to infer justices’ relative positions. This leaves 5,012 cases across 69 years.

We then hired and trained undergraduate and graduate research assistants to read opinions and determine (1) whether a case has direct economic content and, if so, (2) whether the decision directly moves resources from rich to poor or poor to rich. They also had to assign these cases to a “channel” that describes the type of dispute (these include employees vs. firms, customers vs. firms, competition policy, and the social safety net). The resulting dataset contains 1,782 cases classified as having a direct economic impact that is either “pro-rich” or “pro-poor.”

The raw data tells a clear story: Over time, the share of votes justices cast in favor of the wealthy bifurcates along party lines. Importantly, these trends cut across many different types of cases. When we split the raw data using the Supreme Court’s way of categorizing cases by issue area (which include groupings like unions, economic activity, taxation, civil rights, and federalism), as well as by the channels defined by our own categorization, the same polarization pattern shows up in almost all subcategories.

Standardizing and Applying the New Framework

Descriptive statistics, however, have their limits. Justices’ decisions may appear more polarized than they actually are as a result of the changing types of cases that make it to the Supreme Court. To make meaningful comparisons between decades, we need to separate changes in justices’ underlying voting tendencies from changes in the cases they face over time.

To do this, we impose a common scale on the data using a statistical model. In the spirit of Martin and Quinn, we treat votes as revealing latent preferences. In economics, this modeling approach does not require any information about the intent of the justice, or need to know what they consciously or unconsciously considered. The Martin-Quinn method eliminates the need to guess intention and focuses on action.

The advantage of our classification approach is to give that latent dimension a concrete economic interpretation: a justice’s propensity to vote for outcomes that shift resources toward the wealthier parties. The model interprets the information on each justice, case, party, and appointment date holistically, allowing us to recover a consistent measure of how the Court’s center of gravity has moved.

Our model estimates imply that a “typical” justice appointed by the Republican party in 2022 would be expected to vote pro-rich on a neutral case 74 percent of the time, while a “typical” Democratic appointee in the same year would have a 27 percent likelihood of doing so—an implied 47 percentage-point gap. In the 1950s, statistical tests reject the claim that the typical appointees by the two parties were credibly different when it came to the wealth impact of their decisions. By the end of the period, that difference is a near statistical certainty.

The choices of any given justice only tell half the story. The other half concerns the balance of power on the court, determined by the composition of nine justices. In assessing this, we find helpful the concept of the “median justice.” Decisions depend on majorities, and the median justice on a nine-justice Court will find themselves in the majority. Using our estimates, we highlight the median justice during each SCOTUS term.

Since the 1969 appointment of Warren Burger, the Republican party has made 15 of the 19 appointments to the Court. Combined with the party trends discussed above, the result has been a shift of the median justice—and thus, the overall makeup of the Court—in a distinctly more pro-rich direction. These shifts are particularly associated with three specific presidents’ decisions: by Richard Nixon in 1969–70, by George H.W. Bush in 1990–91, and by Donald Trump in 2018. Because many economically consequential cases are decided by narrow margins, these shifts in the median justice have meaningful implications for regulation, enforcement, and redistribution.

One reason we think this economic metric is useful to policy audiences is that it may be more predictive for many bread-and-butter cases than labels like “textualism” or “originalism,” which—even in legal scholarship—are often not applied consistently. If the wealthy who have provided gifts to members of the Court also benefit from rulings in their favor, the varieties of legal reasoning that justices use to explain their decisions are not as informative as the material result of their decisions.

Supreme Court Reform—an Economic Policy Issue?

Calls to significantly reform the judicial system are growing. Justices have lapsed in their ethical judgments and accepted hugely valuable gifts; it took an award-winning investigation to finally force the adoption of an ethics code on a court that was previously unique in not having one.

Recent decisions reveal a judiciary unafraid to wrest power away from government administration and toward the courts, as shown in overturning the Chevron doctrine, and with an expansive view of presidential power and immunity that many liken to that of a monarch. In this climate, it is more important than ever to be measuring and monitoring the court.

Our work in this area is explicitly descriptive. We provide a benchmark to understand how the institution has changed over time. What we see today is a Supreme Court that is favoring the interests of the ultra-rich more so than at any point in the past, and a judicial appointment process that has been politically captured. This can help policymakers understand the reality of the Court’s current composition, which is significant when thinking about judicial reform. We contribute to a growing body of evidence justifying a total overhaul.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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When the Washington Post announced at the beginning of the month that it was laying off at least a third of its staff, many people saw this as yet another chapter in the decline of print media and an increasingly unstable media landscape. But the shake-up reveals much more: Concentrations of extreme wealth are corroding the free press, even its legacy institutions, and threatening our democracy. Whatever Amazon founder Jeff Bezos wanted when he first bought the Post in 2013, he appears to be increasingly using it as a tool to further his own agenda and grow his power at the expense of the rest of us.

After the layoffs were announced, Tax the Greedy Billionaires—a campaign I run focused on educating the public about the consequences of extreme wealth and building support for taxing it—spoke to staffers rallying outside of the Post building in Washington, DC, about the consequences of a billionaire taking over their newsroom.

Rushard Anderson, who was laid off from his role as social media editor, told us: “These piss-poor decisions made by Jeff Bezos are now not only causing strain on the company, but strain on my former colleagues and my friends.” The day’s layoffs cut the newspaper’s sports and books sections, debilitated both its international and local coverage teams, and left more than 300 union workers jobless.

@taxgreed

Tax the Greedy Billionaires on Instagram: "After mass layoffs a…

Patrick Nielsen, a software engineer and co-chair of the Washington Post Tech Guild, highlighted a pattern that’s all too common in the world of billionaires: Buy something, break it, and then throw it out because it’s broken.

“So much of media depends on reader trust,” Nielsen told us, “and I think the more people see and feel that a billionaire with his own interests is dictating what the paper writes about, [that] destroys our credibility and it destroys our trust.”

Indeed, since taking over, Bezos has reshaped how the paper operates. Under his leadership, changes have included explicitly focusing opinion coverage on “personal liberties and free markets” (Bezos said he believed those “viewpoints are underserved in the current market” and “right for America”) and ending the long-standing tradition of presidential endorsements within weeks of the 2024 election (he wanted to avoid the “perception of bias” that endorsements bring). As a result, the Post hemorrhaged approximately a quarter million readers.

The Bezos-Post story is a perfect illustration of what extreme wealth actually does in the wild. It doesn’t just sit in a vault somewhere. It doesn’t ask or negotiate. It just reshapes the world around it to suit the person holding it, and leaves behind a newspaper with half as many journalists. A hospital that no longer has enough nurses. A neighborhood that no longer has affordable apartments or housing options. Same story, different industries.

We need to say the quiet part out loud: Taxing the ultra-wealthy isn’t just about funding new programs or making them pay their fair share. It’s about chipping away at their wealth, which is warping our economy and democracy alike.

Private Equity Shows Us How This Plays Out in Practice

Over the past decade, private equity—firms that buy companies with the intent to grow their value, sell them, and provide a return to shareholders—has moved aggressively into hospitals, physician practices, nursing homes, and emergency care. The playbook is consistent: acquire, cut costs, raise prices, extract. Their goal isn’t to provide better care to patients; it’s to use the hospital, nursing home, or other institution as a vehicle to accumulate wealth.

Private equity firm Apollo Global Management now owns two of the largest hospital systems in the United States and controls 235 hospitals across 37 states. Under Apollo’s ownership, hospitals have been burdened with sky-high debt, reduced staff, and degraded essential services, including OB-GYN and pediatric care. It’s a story repeated across the country: Billionaire-run private equity loads hospitals with debt, cuts operating costs, and shuts down “unprofitable” services so investors can extract more cash while patients in entire regions lose access to basic care or pay more for what’s left.

And it’s not just hospitals. Major health insurers are in on it too, funneling skyrocketing premiums into shareholder payouts rather than controlling costs. The largest health-care companies increased shareholder dividends and stock buybacks by 315 percent between 2001 and 2022, allocating 95 percent of their profits to Wall Street investors. The result? Premiums for employer-sponsored family coverage climbed to over $25,000 annually.

It’s a similar story in housing. Billionaire-run investment firms currently own at least 1.6 million housing units in the United States. They’ve systematically purchased hundreds of thousands of single-family homes across America, pulling them from the market for would-be buyers and converting them into rental income streams. (As just one dystopian example—in Detroit, the firm RealToken bought up homes and sold them as cryptocurrency tokens to overseas investors, leaving the houses in their care in dire, unsafe conditions.) Private equity firms then deploy aggressive revenue-maximizing tactics to generate returns for their investors while increasing costs for families.

It’s no coincidence that many of the metropolitan areas where private equity landlords own a large share of apartments—Tampa, Phoenix, Dallas, Atlanta, and Charlotte—have experienced some of the sharpest rent increases in the country. Invitation Homes, backed by Blackstone, the world’s largest alternative asset manager, alone owns more than 80,000 single-family homes. When a single entity controls that much of the housing supply in a given market, rents don’t go up by accident.

This is wealth working as intended. It’s what happens when you have enough capital to reshape entire markets in your favor and then use the political influence that same capital buys to make sure no one passes a law to stop you.

This is what gets missed in the “pay your fair share” framing. We’re not just talking about wealthy people holding onto money that should be taxed. We’re talking about the ultra-wealthy actively using that wealth to increase your rent, raise your hospital bill, lower your wages, and reduce the quality of the care and services you receive. The money isn’t sitting still; it’s working against you.

Massive Wealth Is Bad for the Economy

The consequences of extreme wealth also reach into your ability to start a business, compete in a market, and build wealth of your own.

When wealth pools at the top and gets parked in financial assets rather than spent in the real economy, it slows growth, reducing aggregate demand by an estimated 1.5 percent of GDP. Five million people with $100 to spend can buy more goods and services across a broader swath of the economy than one person with $500 million. After all, one person can only eat so many dinners or take so many trips.

That slowdown hits aspiring entrepreneurs especially hard. Billionaire-backed corporations use their concentrated capital to dominate markets, undercut prices on competitors, and sustain losses indefinitely until they’ve captured the market. Would-be competitors, those without access to that kind of capital, simply can’t survive the war of attrition.

The promise of the American economy has always been, at least in theory, that if you have a good idea and you work hard, you can build something. Extreme wealth concentration is quietly dismantling that promise, not through any single dramatic act, but through the steady, grinding pressure of markets that are rigged before you even show up.

Make Greed a Sin Again

In short: Extreme wealth concentration is itself the crisis. It’s not just that billionaires aren’t paying enough taxes to fund public services. It’s that the existence of billionaires, with their capacity to buy newspapers, hospitals, housing stock, and governing institutions (billionaires spent $2.6 billion attempting to influence the 2024 election alone), is actively making the rest of our lives harder.

The fact that 300,000 households sit on more wealth than the entire US national debt isn’t just an inequality statistic. It’s a power structure. And that power structure is being used, every single day, to extract value from the rest of us. Higher rents. Higher medical bills. Lower wages. Less media accountability. More influence with elected officials.

“[Bezos is] one of the richest men in the whole world,” Nielsen, the Post Tech Guild co-chair, said. “He could blink and have the amazing work our journalists do funded in perpetuity. But he chooses not to.” And that’s because Bezos’s ultimate goal isn’t to sustain a media institution that can hold power to account and provide a valuable service to the public; it’s to make more money and amass the power that comes with it.

Taxing extreme wealth is about dismantling these coercive concentrations of power.

They shouldn’t just pay more. They should have less.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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Former FTC commissioner Alvaro Bedoya and former OIRA head K. Sabeel Rahman1 join Roosevelt President and CEO Elizabeth Wilkins to break it down: what it means that ICE has $85 billion of public money at its disposal, and how the country’s biggest corporations benefit from this massive deportation and detention bureaucracy.

This transcript has been edited for clarity.

Elizabeth Wilkins: Hey everybody. I’m Elizabeth Wilkins, president and CEO of Roosevelt Forward, and we’re here today to talk about ICE—Immigration and Customs Enforcement. The country has watched over the past month as a surge of enforcement in Minnesota has resulted in forcing families apart, in community terror, and in death. And while that has captivated public attention, the truth is Minnesota is only the latest and most poignant of a nationwide surge. I myself live here in DC, and in my own community we had families line the streets to ensure that children would feel safe getting to school despite ICE presence. This is what many communities in our country are facing.

Today is the deadline for Congress to strike a deal on funding the Department of Homeland Security. And as we tape, we don’t yet see a deal in sight. This wrangling overfunding for the agency is about using that leverage to ensure some measure of accountability for what has become a national police force run amok. We wanted to take this moment to step back a little from this particular inflection point and to reflect a little bit about how ICE became what it is. We’re going to explore the role that concentrated corporate power has in immigration enforcement and how we should be thinking about government capacity when it comes to functions like police.

To have that conversation, it is my delight that I am joined by two of my former colleagues and good friends. Sabeel Rahman is a professor at Cornell Law and a former official at the Office of Information and Regulatory Affairs, OIRA. He’s also a longtime friend of Roosevelt. And Alvaro Bedoya is a digital privacy expert and a former commissioner at the Federal Trade Commission, who you may remember from when the administration tried to fire him. I am personally just thrilled to have both of you.

So let’s get into it. We of course know, in terms of what’s been happening in Minnesota, about the killing of Renee Good and Alex Pretti, the protests and mutual aid that we have seen rising from ICE’s presence there, particularly in the Twin Cities. Alvaro, I just wanted to start with you maybe on a little bit of a hopeful note, but also to help us understand some of the cleavages in the business community. Could you just say a little bit about what we’re seeing, especially in terms of the role of the small businesses in the community, and how we’re seeing them show up and how that might be different with other businesses?

Alvaro Bedoya: Absolutely. Let’s actually start away from the small businesses, with the massive companies. I was Chief Counsel to Senator Al Franken for five years, I worked for the people of Minnesota for five years, and it was a great experience. And honestly, my politics were a little different then, but I had this experience of working with all these executives from Minnesota companies, companies like 3M—which is actually Minnesota Mining and Manufacturing—sometimes corporate executives from Target, Mayo Clinic, General Mills, all these name-brand companies that most Minnesotans are actually pretty proud of having as hometown companies. And this thing happened after the killing of Alex Pretti where people kept on calling on these companies to do something, say something. These are powerful entities in the American economy. And what they did is issue this letter that didn’t even name what had happened, to Mr. Pretti, didn’t name what had happened to Ms. Good, and just called for a de-escalation of tensions. It was so, just, weak and milquetoast that a whole lot of people in Minnesota, not just lefties, but just regular people, said, “what are you doing? Why did you do this?”

And then it started coming out—The American Prospect[‘s] David Dayen [and Whitney] Curry Wimbish wrote an essay pointing out that, hey, 3M actually backed the Big Beautiful Bill, which sent roughly $70 billion into the deportation machine. Companies like Target are affirmatively allowing ICE to use their facilities. You have all these other companies, through their trade associations, industry associations, backing the Big Beautiful Bill. And so what came out was not just a milquetoast statement out of, certainly, the most community-minded executives you could probably find in the country, in Minnesota. (And yes, I am biased, but I don’t think it’s a crazy thing to say.) Not just that, but an actual degree of complicity in what was happening because they wanted their tax breaks. They wanted the economy to keep chugging along so they could stay in the black, and they affirmatively supported (many of them, not all of them—it’s not like the Minnesota Vikings or the Twins were tied up in this). They ended up helping push forward this legislation that made ICE the third-largest—I think someone described them as being funded possibly as the third-largest military, certainly the largest law enforcement associate organization in this country.

Meanwhile—and you said hopeful—so let’s talk about that. You had donut shops, book shops, random diners on the streets of Minnesota who were becoming de facto food distribution centers, aid distribution centers. I have a lot of friends in Minnesota because I worked for the state for five years. And by the way, I have friends on all sides of the aisle in Minnesota. And to a one, they say, “however it looks in the news, it is so much worse. You have no idea.” And number two, all of my friends whose skin doesn’t look Scandinavian are afraid to walk outside. Even they are not going to the grocery store. So all these mutual aid systems are developing and it is these small businesses that are moving forward to support them. This is why people look at small business—it’s like the most respected institution in our country. I think—recently, it surpassed the American military, which has long been the most respected institution in this country. And so it is this gulf between how these billionaire corporations really can’t find it in them to be brave, and how these small businesses—who are scrappy, who rise and fall with their communities—don’t hesitate to stand up for the people they serve. That for me gives me hope, while that letter made me pretty sad, honestly.

Elizabeth: Well, I’m just going to make you feel sadder. The whole topic might. So we talked a little bit about the corporate response of large Minnesota businesses, specifically, and this tie between corporations that want tax breaks and their complicity with the rest of this administration’s policies. Can you talk a little bit, broader than Minnesota businesses, about the relationship between business and ICE enforcement more directly? When we think about that bill and the funding that went to ICE, how does that funding work? What is the relationship between that enforcement and corporate contracts?

Alvaro: I think it is really, really important for people to understand that this is a business. This is not a small business. This is a deca-centibillion–dollar business. And it is not just these companies like Palantir that lean into that bad-boy, “I’m the one who knocks” persona—to quote Walter White out of Breaking Bad. Palantir loves being the bad guy. They lean—they recruit on the basis of it. They say, “oh, all you wilting lilies are afraid of doing the tough stuff.” They lean into almost the Few Good Men persona, of like, “oh, we’ll do it. We’re not afraid of the tough work in that gray margin.” Right?

My friends, yes, Palantir is getting extraordinarily wealthy thanks to this influx of money flowing to its coffers. Palantir is just that last layer on this massive infrastructure. What they do is just connect dots—or they purport to connect dots because I have a lot of friends in the investment community who say this thing is actually not nearly as powerful or profitable as people think it is—all they’re doing is connecting the dots. Underneath, you have this whole ecosystem of really boring companies that are making this possible and are making money hand over fist. There’s Deloitte, who the Financial Times called out for receiving billions of dollars. Financial Times, okay? This is the industry rag for the world financial industry. Deloitte, this consulting company, is making money hand over fist.

Who is providing this data? Your utility company. When I was at Georgetown, the team I built discovered this because it wasn’t out in the open. Your water company, electricity company, shares your address with a data broker named NCTUE. That data broker shares it initially to a company, and—I forget the order—at one point, it was LexisNexis (every single lawyer listening to this will understand fully well what company that is) and to the Minnesota company Thomson Reuters (and every lawyer listening will understand that to be Westlaw). And it was ICE using their Palantir skin that would plug into those systems. So what I want everyone to understand is—there are some folks saying abolish ICE, other folks saying we need to dramatically restructure ICE. Whatever it is you do, in the same way that companies like TurboTax and H&R Block make damn sure that it’s super hard to file your taxes so that you go to their quote-unquote “free services” that you end up paying $100, $200 for—any shift in ICE that will occur will be stymied by these companies. They’re gonna quietly go in and meet with young Hill staffers, like I was, and say, “oh yeah, ICE is bad. ICE is bad. But all we do is provide data. And so, just don’t mess too much with the underlying system.” And so that is what I want to clarify is that this isn’t just Palantir. It is all these companies that are profiting from the system. [1]

And the very last thing I’ll say—sorry for going on for a little bit—is some people might say: Well, Alvaro, I don’t have a problem with, whatever you wanna call it, ICE, someone else, going out and finding violent criminals. You know what? Neither do I. I have no problem—not with ICE. I’ve got a big problem with ICE. I don’t want people who are violent and are illegally present in this country to be in this country. I don’t want that. But my congressman, Jamie Raskin, just went to a facility. Members of Congress have a power to knock on the door of an ICE facility. One time out of two, ICE honors that request and lets them in. He’s finding people packed 60 to a cell with one open toilet, packed like sardines with aluminum foil for blankets around themselves. And he described in a post yesterday, [he] went and visited the cell reserved for violent criminals. Guess how many people were in that cell? Guess.

Elizabeth: Oh, I don’t know. Don’t tell me it was zero.

Alvaro: It was zero. Zero people. This is not an infrastructure that’s being used to find violent people who are hurting your neighbors. This is an infrastructure that’s being used to find your neighbors. And many of whom have been decades in this—many who are lawful, are lawfully present in this country. So that is what people need to understand.

Elizabeth: Sabeel, I would like to bring you in here for a second because what I am hearing is a couple of things. I actually am hearing—particularly with the data infrastructure, but presumably with other parts of ICE’s infrastructure as well, detention centers, all of these things—that there is a set of companies that have vested interest in the growth and continuation of a set of government functions, because of the way that we have contracted out and depended on those corporate functions for its self-perpetuation. Can you give us a quick sense of, how did we get here? Stepping back from ICE a little bit, how did we get here to a place where our government capacity to operate was dependent on these layers of companies and what that means for how we should think about state capacity more broadly?

Sabeel: This is such a rich conversation already. Thanks, Elizabeth and Alvaro. The disentangling, or peeling back, the layers of private power lurking behind this mass deportation coercive regime is hugely important, and there’s a longer story there as well, to your point, Elizabeth. Part of how we got here is, for many decades, two things have been happening to our government. One is it’s been slowly, steadily privatized and emaciated such that, on all kinds of things, even for the delivery of safety net programs, we actually depend on these private intermediaries who then make big money and, by the way, don’t actually serve the people. And so the story Alvaro just described, on the back end of the surveillance infrastructure—you could tell a similar story about other aspects of government that over time has been disinvested in. At the same time, we’ve had—across many multiple administrations, multiple parties—an increasing concentration of unaccountable coercive power.

ICE itself was created after 9/11. It started off as essentially a service delivery organization to process visas, moved over to the newly created Department of Homeland Security, and given this particular mandate around enforcement. And then that also creates a certain culture to the organization. All the surveillance infrastructure that Alvaro described, I would argue a lot of those roots are in that post-9/11 moment of building a mass national security state. And so this combination of thinning out the state so that we’re more dependent on private capacity in the first place—and that creates opportunities for self-dealing and self-interest and exploitation against the public interest—and at the same time, supercharging other aspects of the state to be unaccountably coercive. Part of why ICE is able to go after peoples’ neighbors is that the Supreme Court itself blessed, basically, open racial profiling in a case earlier in the summer in which Brett Kavanaugh authors this opinion saying how, well, racial profiling doesn’t really happen. And Kavanaugh stops are now all over the country and people are being plucked out of their homes.

And so the point I want to make here is that there’s a private infrastructure that Alvaro described, and legally, structurally, our government has both become dependent on that private infrastructure and at the same time has been essentially shielded from all kinds of legal and democratic accountability for this type of coercive power.

Elizabeth: I just want to pull on a thread that you just said because I want to make clear—I think we are busting up a little bit of a very old trope and myth about the fight over the role of the state in public life. There is this notion that you are either big government or small government. You either believe in deregulation and letting the markets govern themselves, and getting out of their way, and getting out of people’s lives. Or you believe in a stronger, more muscular government, which is more interventionist and, depending on your viewpoints, maybe messes with people’s individual liberties too much. And you are telling a very different story, which is: Actually, behind what might seem like it was a small government, was a massive apparatus all the time. That the whole project of a, quote-unquote, “small deregulatory state” actually had this other looming story behind it. And you were telling a story about this ostensibly conservative state actually being much more interventionist in people’s rights, actually, more interventionist in people’s lives. I just want to call in, Sabeel, you have put forward a framework to say this old-school left versus right, small versus big, deregulatory versus interventionist, is the wrong way to think about the role of the state in society. You’ve put forward an anti-domination framework. Can you just spool that out a little bit more for us?

Sabeel: I appreciate that, Elizabeth. I think it’s very much in tune with what you and Alvaro were saying as well. Look, I’m—at the core of it, I’m a believer in small-d democracy. I believe in people. I believe in communities. I believe that we should govern ourselves, and we are safest and most secure when we are actually able to govern ourselves in politics and in economics. And so if the goal ultimately is that—democracy—the things we should be worried about [are] not about big government, small government as you said. The things we should be worried about are when power is concentrated in ways that we can’t control and we are now subject to someone else’s arbitrary will. That could be the arbitrary will of the ICE agent who rolls in and snatches you off the street. It could be the arbitrary will of the boss who [decides] that a worker can’t have a bathroom break on the shop floor. It could be the arbitrary will of the monopolist who keeps goods from going to market. And in this case, the combination of state power and private power creating this extreme fear and extreme violence against our own neighbors, that is—it’s a combination of both of these types of power.

At the end of the day, the thing we should be most worried about is this idea of domination when power is concentrated and unaccountable. Sometimes that takes a private economic form. Sometimes it takes a governmental form. Either way, it’s a problem. That’s why we want to create different kinds of democratic institutions. We want government to protect us against civil rights violations, protect our privacy, to protect economic equality against mistreatment, and we also need that government to be accountable to us, to we the people. So this thing that we’re seeing, what Alvaro described, is living in the netherworld where it’s not—government’s not accountable to us, and government is making common cause with all these private actors who are also not accountable to us. And between the two of them, it’s pretty big business.

Elizabeth: I think the next thing that I wanted to ask about—and, Alvaro, maybe I can bring you back in for this. Okay, so we’ve talked about the relationship between tax policy and corporate willingness to stand up. We’ve talked about the specific interactions between ICE and the corporate infrastructure behind it. I also think, to Sabeel’s point, right now we are in an extreme moment of consolidation of government and corporate power in a way that we have not seen in a very long time. We both have an authoritarian consolidation at the top of our federal government, in the way that power is being wielded, and it’s coming at a time when economic concentration is just extreme. And in particular, and this goes to your understanding and knowledge of the data infrastructure, the enormity of the power concentrated in the tech sector is reminiscent of Gilded Age railroad-baron type stuff. How do we think about, is this just an evolution of what we have seen in the past, in terms of the relationship between this type of state power and this type of corporate power, or are we seeing something else in the relationship between this administration and these tech titans? Whether it has to do with ICE enforcement or the broader relationship between these two types of power, how should we think about that?

Alvaro: I think we need to honestly, and this is not hyperbole, think about it in terms not just of the Gilded Age, but also not even the Roman Empire. One thing that Roman emperors had was a Praetorian guard. And this sounds hyperbolic, it’s not. The Roman emperors had these private guards around them that kept them safe. And I think, for example, of the fires in Los Angeles when all these billionaires have these private firefighters they could just call on, and others are flying to private islands. They literally own islands. In the same way a Roman emperor would have their own little enclave set off to the side. Absolutely, we’re looking at something like the Gilded Age. We are looking at levels of inequality that haven’t been seen since that age.

Let’s talk about Minnesota for a heartbeat. One of the reasons I was so hopeful about the Minnesotan industrial sector was—and it was naive, it was naive—but I remember when I was a staffer for Sen. Franken. You travel all around the state that you work for. I was in Northfield, Minnesota, home to St. Olaf [College], home to Carleton [College]. My colleague pointed to a house and she said, “you know who lives there?” And I was like, well, clearly, no. I have no idea who lives there. And she said, “the CEO of blank.” And it was this massive company, like GM or 3M, one of these companies. And it was like a real normal, kinda nice house, real normal house. And she said, look, in Minnesota, there’s this culture of egalitarianism. There’s this culture that it’s kinda vulgar to throw around your wealth, and all that has been erased. And instead, what you have now is a culture where it is not just accepted, it’s encouraged. It’s celebrated to put on these, just, vulgar displays of wealth. So look, I’ve talked about it ad nauseam elsewhere, so I won’t here. But what I want to point out is, to what you and Sabeel have been talking about, is [regarding] this merger of authoritarianism and oligarchy, is that our government, our laws, are not prepared for that merger.

I’ll give you two examples. You know, the three of us are lawyers. God help us. We come from a very specific professional tradition that has developed a muscle that people should be proud of, which is a public interest legal muscle. And yes, if you go to a fancy law school, you fall asleep, you’re gonna find yourself at a corporate white-shoe law firm defending the Fortune 500. That is true. It happened to me, happens to a lot of people. But if you’re scrappy and you want to work for the good guys, you can find your way, and there’s an infrastructure that gets you in public-interest institutions. If you’re on the left, there are often civil rights institutions, like Lambda Legal, like MALDEF (the Mexican American Legal Defense Fund), like NAACP Legal Defense Fund, like the National Women’s Law Center. If you care more about voting rights, you might end up at Protect Democracy, Democracy Forward, right? There’s this whole infrastructure, public-interest legal infrastructure, designed to keep the government in check.

There is no such public-interest legal infrastructure to check corporate power. There’s a couple of scrappy nonprofits that are out there. But in general, if it’s not ICE or not CBP that’s hurting you, but one of these other companies we’ve been talking about that helps them or works you on their warehouse floors so that your wrists and your back break. Either your case is worth $100 million and a private plaintiffs’ firm will take it up, or the government at the FTC or CFPB will help you—not anymore—or you’re SOL. At the very basic level, the Freedom of Information Act does not apply to Palantir. I can’t just FOIA Palantir to understand what’s going on there. Now there’s some arguments we should be able to, and I think there’s been some progress made on this. But when I FOIAed—when we FOIAed ICE, when we FOIAed police departments, we not only saw them working very closely with these tech vendors, we also saw them forming nonprofits that are even further insulated from public reporting. Because if you’re a publicly traded company on the stock exchange, you actually have to let people know a little insight, as to what’s going on underneath the hood. Nonprofits file a 990, and it is not equivalent to a 10-K. It is even less transparency. And so, this merger of these tech oligarchs and the government—our public interest legal system, our system of government transparency, just was not designed to meet these ends.

Elizabeth: Sabeel, did you want to jump in?

Sabeel: Just quickly, I think that’s so powerful, Alvaro, and I think this is one of the reasons why—there are many reform proposals being talked about right now, and anything that helps people in the country, in Minnesota and elsewhere, is an advance, a progress. But because of what Alvaro just described, this is why structural solutions have to be part of the conversation. It’s not enough to be like, oh, we need the ICE officers to just have better conduct. Don’t wear a mask, have a little badge. Like, no.

Alvaro: Arbitrary and capricious! Except in arbitrary and capricious circumstances, Sabeel.

Sabeel: Totally. Right, exactly. We need structural solutions both for this unaccountable state authoritarianism and for unaccountable private authoritarianism. There’s just too much wealth, too much money, too much resources flowing into all of this, and we are outgunned in all the reasons that—for all the reasons Alvaro just described.

Elizabeth: That was a perfect segue. I was going to try and end us on a hopeful note, and ask us to talk a little bit about what solutions would look like. But I’m first, I’m gonna—professional prerogative—I’m gonna tell us a short story, which is: In thinking about this topic, I was doing a little research and found that under the FDR administration, under Labor Secretary Frances Perkins, one of the first things she did when she entered the Labor Department was she looked at this group called Section 24. And Section 24, at that time in the Labor Department, was an immigration enforcement group. It found and deported people, and it was, at the time, understood to be basically a mob-like terror organization that was going into immigrant communities, terrorizing people, taking people from their homes, and deporting them. And so one of the first things she did was defund it. She took all the money out, disbanded the group, and then, along with someone that she brought in to help her think more holistically about immigration, created a more humane system for understanding who wanted to come into the country and how to process people humanely.

So it turns out that was an incredible story of thinking about what government should be for, how it is supposed to relate to people, citizens and noncitizens alike, and the idea that the New Deal is still thought of as this time of great creativity for creating new government entities. They didn’t just create new government entities. They thought hard about where we should have more state capacity and also where we should have less, and how to reshape it. So in that spirit, this goes to both of you. You started to talk about the path forward, Sabeel. When you talk about structural solutions, for each of you, what are a couple of things that for our future, for our North Star, should we be thinking about? With respect to ICE, but also more broadly as we think about this anti-domination frame that Sabeel has laid out for us?

Sabeel: I’m happy to start, and then give Alvaro the last word here. So I think it’s exactly right. I’ll say a couple things about it. One is just, I love this Frances Perkins story. In a next governing moment, whenever that comes, we have to be thinking very seriously about administrative reorganization. Some—ICE shouldn’t exist, there are other agencies that need to be reduced in capacity, and we’re going to have to build up the power of agencies that protect us against other kinds of private domination. Of course, FTC, CFPB, and others. We have to reallocate resources. You can’t put 70-plus billion dollars into ICE and expect that to be okay. That money has to go away. And I think we’re gonna need a lot of—a very different legal framework on data and data privacy and surveillance. Alvaro is an expert there, so I’ll defer to him on that. And then one last thing I’ll say is not about the state reorganization, but also just about people. I think both, Elizabeth and Alvaro, you talked a lot about the way communities have shown up. And one thing just to note, Minnesota has a very rich civic infrastructure. People have been organizing in Minnesota on the ground for years in faith communities, in multiracial coalitions, in labor, and that infrastructure is a big part of, I think, why you’ve seen the community be able to stand up and defend one another. And so I think as we build our way out of this, we need to reconfigure the state in dramatic ways. The Perkins example is a great one. And I think we need to look for other ways to resource and build up the civic infrastructure, so that—I believe in democracy. It’s the people themselves who are going to actually get us out of this.

Elizabeth: Alvaro?

Alvaro: I want to take a step back and zoom out and talk about the underlying wound that we are trying to staunch and heal. Because I think a mistake we can make is [to] stop what Trump is trying to do, what this administration is trying to do to fix that wound, and not treat the underlying wound. And let me be clear, the wound is not immigrants and immigration. The wound is working people in this country who are here legally or looking at the work options they used to have and [saying], “what the heck happened to that job? That job used to pay well, used to have benefits. Not only now do I not have that job, it is dominated by men from Central and South America.” And what Trump did is look at that. What this president did is look at that and say, “there exactly: That’s the problem. The problem is those immigrants. We’re gonna deport those immigrants. We’re gonna call them criminals. We’re gonna get them out of the country.” And so that was what he said he was going to do. Now the big lie here is that this is not going to bring those jobs back. It’s not going—simultaneously, there was an essay in UnHerd where they are dramatically expanding the number of H-2B manual guest workers, and moving them into this country. They are—and so here’s the thing. You can’t deport your way out of a rigged economy. You deport that rideshare driver, construction worker, off the street brutally. You brutalize their family, you brutalize their neighbors, you brutalize a neighbor standing up to them. Those jobs aren’t going to suddenly start paying benefits and overtime and unemployment insurance. What’s just going to happen is they’re gonna be still terrible jobs that maybe for a little bit pay a little bit more, but still keep people—and again, that is assuming all of these assumptions are true—keep people in a place where they’re constantly struggling to keep their heads above water. What we need to do is look at why that wound is there, and the wound is not there because of undocumented immigration. Although, yes, it doesn’t help. The wound is there because decades ago, American corporate executives decided they could wave a little wand and decide all their employees were actually independent business owners. And I don’t need to pay minimum wage, and I don’t need to pay overtime, and I don’t need to pay unemployment insurance and workers’ compensation to these workers because they’re independent business owners. And guess what also happens when you magically wave that wand and turn all of your workers into independent business owners? You also—the requirements for hiring your tax accountant. Do you check the passport of the tax company that’s doing your taxes? You don’t. You don’t necessarily need to check all the documents for those people who are independent business owners who are working for you. And that is how those companies are getting rich. And that is also facilitating the hiring of this undocumented workforce.

If we want to staunch that bleeding, we need to go at these centimillionaire, billionaire developers and their corporate conglomerate owners that have hollowed out what used to be decent—hard, but decent—manual and blue-collar jobs into a shadow of what they used to be. And I think once we do that, some of these inequalities are going to start fading away. And also, some of the hiring of undocumented labor is necessarily going to go away as well. So that is what I think needs to happen. We need to understand who’s getting rich, talk about that, talk about the structural problems of the American economy, to what you said, Sabeel. Right now, what Trump is doing is saying, “oh, there’s a wound. I got a stapler. This stapler is called ICE. I’m just gonna staple the wound, just like this.” Put the stapler down. Stop making this worse. But you also gotta get at why that wound exists in the first place, I would say.

Sabeel: I think that’s great, Alvaro. And maybe just one thing I would add there. I love this notion of “you can’t deport your way out of a rigged economy.” And to that, I would just also add that, once we’re actually solving the actual source of who is hoarding all the wealth and opportunity, there’s more than enough wealth and opportunity for us to actually have an inclusive society in which people can come, and make lives, and build [and] contribute to communities. That is totally possible. This notion of a zero-sum fight is a construction by people who want to profit by hoarding more and more of that wealth and opportunity. And so it is not about immigration at all, actually. This is a way for that wealth to continue to be hoarded.

Elizabeth: Just to close, I will say, to me what I take away from this is the idea both that there is a problem with the way that state power has been consolidated in an authoritarian moment. There has been, for a long time, an enormous problem with the way in which corporate power has been consolidated at the expense of workers of all backgrounds and consumers and small businesses. We see that at work in a couple of ways. The story about the difference between small and big businesses in this moment, the idea that small businesses are being good community members while big businesses are interested in maintaining their relationship to a coercive state, and that the future lies in figuring out how to deconstruct both some of that state power and that corporate power, and how to, to your point Sabeel, construct more community power at the same time. Some of that is, to me, getting into these questions of what actually are the natures of the powers over us and how do we make sure to have the right countervailing powers to enable the rest of us to live the lives we wanna live, are the real lessons here. And we are seeing the worst version of how that can play out badly, in Minnesota in this moment.

I just have to thank both of you for helping us remember that there’s a best version of this, if we are imaginative enough to seek those structural solutions, think big about them, and really reimagine how we could orchestrate those powers to our benefit rather than [other ends]. So that was a long way of saying thank you for helping us think through the big picture here. And in a real moment of pain and potential despair to remind us, yes, we’ve gotta fight this fight for today about funding an agency, but we also have to keep our eye on the future for a fundamentally different relationship between people and their government. So thank you both.

Sabeel: Thank you so much.

Elizabeth: Thank you, Elizabeth, for having us. Good to see you, Sabeel.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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The Tax Filing System Was Designed to Fail Taxpayers

The tax preparation industry is highly concentrated, with over 90 percent of sales in 2021 belonging to just two companies: Intuit (the parent company of TurboTax) and its closest competitor, H&R Block. As of 2025, Intuit alone holds a 60 percent market share for US consumer tax software.

Despite years of lobbying by the tax filing industry, the IRS piloted a free e-filing service in 2024—and it worked. Direct File allowed nearly 300,000 taxpayers in 25 states to file taxes for free in 2025, with 94 percent reporting a positive experience, and more than two-thirds saying it improved their trust in the IRS.

More than a technical fix, Direct File shifted the cost of tax filing away from individuals and back onto a public system, helping to bring down the unusually high taxpayer burden, in both time and money, Americans face.

But Direct File was swiftly killed by the Trump administration. For Intuit and H&R Block, this was good news. In 2024, the first year of Direct File, Intuit reported losing one million users of its free software, though it didn’t publicly attribute any of the decline to Direct File. Just after the November 2024 election, when the (then) newly envisioned Department of Government Efficiency floated the idea of creating its own free tax-filing app, stock prices for Intuit and H&R Block fell.

Before Donald Trump was even inaugurated, the tax prep industry began its lobbying campaign. In December 2024, 29 Republican representatives—who together had received nearly $2 million in career contributions from Intuit, H&R Block, and associated lobbyists and trade groups—sent a letter asking him to immediately eliminate Direct File. Around the same time, Intuit donated $1 million to the inauguration fund.

By November 2025, the IRS had officially suspended Direct File, and it’s not available to filers for the 2026 tax season.

When Complexity Becomes a Profit Strategy

But the end of Direct File isn’t the only reason the consumer tax preparation industry is set for a windfall in 2026. Trump’s budget bill introduced a number of new, complicated provisions that particularly impact low- and middle-income taxpayers, such as deductions for tips, overtime pay, and car loan interest and a new excise tax on remittances.

Complexity appears to be a feature, not a bug, for the companies that sell tax preparation services. The tips and overtime provision, for instance, is confusing and lacks guidance. Because the bill was passed midyear, in many cases neither taxpayers nor their employers have the documents needed to claim the deduction. When combined with the bill’s other regressive elements, the changes will actually leave most tipped workers worse off.

If the goal is to reduce the tax burden on low- and middle-income taxpayers who are paid in tips, there are better ways to do it.

On the other hand, for Intuit and H&R Block, tax code complexity is a bonus. In fact, the CFO of H&R Block called the new tax provisions a “tailwind” for his company, and both companies are already raking in exceptional earnings this year.

More complicated tax returns mean more clients will be upsold paid services, and, although taxpayers (including those who take the tip or overtime deductions) can sometimes file for free (depending on their income level and tax situation), these companies still use them to make a profit. They aim to convert tax prep clients into year-round financial services clients, and they use the information they glean from tax returns to sell debt products like refund loans and credit cards.

This business model depends on misleading customers, and regulator inquiries appear to confirm it. In 2023, Intuit settled a lawsuit for $141 million after allegedly upselling customers to paid services when they were eligible to file for free. Similarly, in January 2025, the Federal Trade Commission ordered H&R Block to stop making it difficult for customers to downgrade from paid services and to end deceptive advertising practices around which services are “free.”

To cap it all off, their tax-filing software itself is far from reliable. Both TurboTax and H&R Block recently introduced AI chatbots to “help” answer customers’ tax questions, but one reporter found the chatbots gave him the wrong answer more than a quarter of the time. And storefront tax prep businesses like H&R Block appear to target low-income communities with high percentages of nonwhite residents. Studies have found that these businesses employ untrained, unregulated preparers who have high error and fraud rates. This invites the possibility of expensive, stressful audits upon those who can least afford it, on top of the fees these preparers charge that take large chunks out of their refunds.

What Tax Filing Could Look Like Instead

Paying a private company to file your taxes is the norm in the US, but it shouldn’t be.

In other countries, doing taxes is as easy as clicking a button. The IRS could send you a form (or, as they do in Japan, a postcard) saying how much you owe, and you could sign it to file—no intermediary needed.

In fact, a recent study found that 42 to 48 percent of all returns could already be accurately pre-populated by the IRS using just the prior year’s return and the current year’s information return (what your employer, or bank, submits). As anyone who has had a tax return rejected for getting a number wrong knows, it’s frustrating (and bizarre) to learn that the IRS already knew the right answer.

Countries with return-free filing tend to have simpler tax codes than the US, and reforms such as eliminating joint filing and consolidating tax credits would likely be necessary to bring it closer to reality. But as long as return-free filing remains out of reach, there’s another, simpler fix: Direct File. The IRS already succeeded in developing a tool to dramatically reduce the taxpayer burden.

All they need to do is bring it back.

Similarly, the often overlooked Volunteer Income Tax Assistance (VITA) program provides free tax prep services, usually for low- and moderate-income taxpayers, by preparers who are trained and regulated by the IRS. Increasing funding, visibility, and support for VITA would reduce reliance on private tax prep companies.

Instead, the Trump administration has gutted the IRS and handed the tax filing system back to the companies that profit from making you waste time and money filing your taxes.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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As a leader charged with modernizing the legacy of Franklin D. Roosevelt, and as a former federal official who worked to limit corporate overreach, I can see that the new mayoral administration already knows what the 32nd president knew: Affordability crises aren’t solved by rhetoric alone—they abate when leaders use government to benefit people first. Economic well-being is ultimately about power. That’s why the administration’s early moves to protect tenants and investigate landlords, go after junk fees and hidden charges, and empower Commissioner Samuel Levine to lead an aggressive Department of Consumer and Worker Protection matter: They center everyday New Yorkers, shifting power toward them and away from concentrated wealth.

These plans to treat affordability as a question of using the levers of government, not just good intentions, were put into action well before Mamdani took the oath of office. Under Lina Khan’s leadership, the transition team moved quickly to identify tools the city government already has to curb corporate power, rein in exploitative pricing, ease regulatory burdens that fall heaviest on small businesses, and enforce the law in ways that lower prices for consumers. That’s the difference between promising affordability and building the capacity to deliver it.

Equally important was defining the problem correctly and approaching it comprehensively. The mayor has tied proposals like a rent freeze, public grocery stores, and free buses to the real cost pressures facing younger and lower- and middle-income New Yorkers. He also named the side of the affordability crisis that often gets ignored: incomes. That’s why he has proposed a wage floor—raising the city’s minimum wage to $30 by 2030—so that affordability isn’t just about lowering costs, but increasing what people take home for their hard work.

What truly distinguishes this approach is that Mamdani treats people-centered policymaking as a source of governing power, not just popular appeal. He has invested in building a sense of belonging that is now translating into sustained civic engagement. Knocking on doors offered young people not only a political platform, but a way to connect with one another and to the work of governing. For many of the city’s youngest voters, the campaign became an entry point into civic participation. This organizing wasn’t purely transactional. It was relational, bringing people together and building durable community ties. It was the Aunties for Zohran—older immigrant women—who set up tables, talked to neighbors, and tapped in people who might otherwise have remained isolated from the political process. The result is a base of supporters who are connected, organized, and able to maintain momentum through implementation. Just one example is the organization Our Time NYC, which was established to sustain pressure around the campaign’s core demands.

Already, the mayor is empowering this network to support policy implementation by establishing direct lines of communication with the city’s residents through a new Office of Mass Engagement. This matters because it makes clear that the government’s policymaking priorities should align with the problems people actually experience. When people see private equity firms scoop up housing or landlords use algorithmic tracking to jack up rents and threaten eviction, they expect their government to act. That’s the expectation that Rental Ripoff Hearings are meant to fulfill—to give people an opportunity to voice the impact of landlord abuse and shape the policy response to it.

I’ve seen, up close, the difference between a government that confronts powerful interests and one that looks the other way. That choice—whether to act or to defer—shapes how much control people ultimately have over their own lives. The mayor’s success will depend on whether New Yorkers feel more secure in their finances and less at the mercy of companies and employers. It will be seen in how they are able to spend not just their money, but their free time. By not only vowing to take on the affordability crisis but bringing people along for the fight, the Mamdani administration hopes to restore power to New Yorkers in all aspects of their life: in their jobs, on the subway, and at Yankees games.

What happens in America’s biggest city matters because it shows how other leaders can use the authority they already have to listen, act, and change the possibilities for how people can live their lives. From Virginia to Seattle, policymakers are adopting Mamdani’s people-first approach, and as he turns vision into results, he’s paving the way for greater economic freedom nationwide.

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Beginning this month, 19 states raised their minimum wages, with 13 increasing because of annual inflation adjustments. While these are welcome steps forward, it’s hard to miss a glaring gap: Only 5 of those 19 states are also adjusting overtime salary thresholds, which are core protections for middle-class workers.

States have raised the minimum wage because they recognize two simple facts: (1) The federal minimum wage rate is not sufficient in their state, requiring a higher standard to protect workers, and (2) state minimum wage rates need to keep pace with inflation in order for them to remain effective.

Among states that have long had the clarity to recognize these simple truths, it’s particularly puzzling that the majority have failed to apply the same logic to their overtime laws. By failing to revise the salary thresholds under which most employees are entitled to overtime pay, most states let middle-class workers begin 2026 with an exacerbation of the affordability crisis. But it doesn’t need to be this way.

Background on Overtime

The vast majority of employees are covered by the Fair Labor Standards Act and may be entitled to overtime pay (1.5 times their regular rate of pay) when they work over 40 hours in a week. This federal law, however, exempts individuals from overtime if they are in certain occupations, such as doctors and lawyers, as well as individuals who are “employed in a bona fide executive, administrative, or professional capacity.” Under long-standing federal regulations, someone meets this exemption if they (1) are paid on a salaried basis, (2) earn more than a minimum salary level, and (3) meet a set of criteria indicating that they indeed perform specific executive, administrative, or professional activities on the job.

This exemption is premised, in part, on the idea that “exempt workers typically earn salaries well above the minimum wage and are presumed to enjoy other privileges to compensate them for their long hours of work” [emphasis added], such as better fringe benefits and opportunities for advancement, as the Department of Labor has explained.

Like the federal minimum wage, the federal overtime salary threshold hasn’t adequately kept up with rising incomes, despite efforts by the Obama and Biden administrations. The result is that with each passing year, more employees are working long hours without receiving time-and-a-half pay.

When State Minimum Wages Rise but Overtime Doesn’t

Raising minimum wages and ensuring strong overtime protections are a cornerstone of employment protections in the US and help ensure a basic standard of living and fairness for workers. One can intuitively understand why many states have set higher minimum wages to better align with local labor markets and the cost of living in their state. That’s why it’s all the more baffling when states that have consistently set their minimum wage rate well above the federal level (a paltry $7.25/hr) ignore their overtime salary thresholds or peg their standard to the insufficient federal regulations.

Take New Jersey for example. In 2026, the minimum wage in New Jersey automatically increased to $15.92 per hour to keep up with inflation. However, the state’s overtime laws do not function the same way. Instead, New Jersey regulations governing who is eligible for overtime simply adopt the federal regulations. The result is a glaring disconnect between what the state recognizes as an adequate minimum wage and who is eligible for overtime pay. Remember that explanation from the Department of Labor that says “exempt workers typically earn salaries well above the minimum wage”? Not so in New Jersey.

In fact, the difference is less than $50 a week! A minimum-wage worker in New Jersey working 40 hours a week will earn $636.80 per week (or about $33,114 annually) in 2026. Yet, the overtime salary threshold in New Jersey is still stuck at the low federal level of $684 per week (or $35,568 annually). For many workers in New Jersey, where average wages are higher than the national average, the relevance of an overtime salary threshold is all but nonexistent.

Consider the more than 55,000 first-line supervisors of retail sales and food service workers in New Jersey, like those at Walmart or McDonalds. These supervisors, who are often salaried and many work more than 40 hours a week, should be entitled to overtime protections given their relatively low salary. In fact, that’s exactly how it plays out right across the border in New York, where the average worker in these occupations earns roughly the same amount as someone in New Jersey.

Yet, because the salary threshold in New York is higher, at $1,199 per week or $62,348 annually (and even higher in the New York City region), the majority of these New York workers will automatically be covered by overtime protections, since most earn less than the threshold.1 All the while, in New Jersey, these relatively lower-salaried workers too often don’t receive overtime pay because they earn more than the outdated salary threshold in their state ($35,568 annually) and might perform certain managerial activities in their job.

Outdated Overtime Rules Are Holding Workers Back

But it’s not just supervisors in retail or food service industries who are left behind in New Jersey. Workers across a range of occupations—such as social workers, health technicians, human resource specialists, and certain workers in the construction, manufacturing, and hospitality sectors—are too frequently ineligible for overtime pay.

New Jersey is far from the only state in which overtime laws are in dire need of updating. Virginia similarly pegs its overtime protections to federal standards, even as its minimum wage rose to $12.77 in 2026, 76 percent above the federal minimum wage rate. In Minnesota, overtime rules are so outdated that they serve no real purpose, since the standards on the books are less generous than the federal protections.

Policymakers are right to focus on making life more affordable for families across the country. But those who are serious about providing real results must pull all the policy levers available to them, including those that have been sitting right in front of us for nearly 90 years.

In many states, governors and legislators who want to deliver for workers in the short term have an obvious opportunity available: Update overtime standards to ensure workers are paid fairly for the hours they work.

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But what I now understand, through my own life, advocacy, and thousands of conversations in town halls and community events across the country, is that what we label as “individual failure” is so often a public policy failure: institutions, systems, and policies that allow the rich to keep getting richer while the rest of us fall further behind. The result is a vicious cycle in which shame for falling behind is trained inward, causing people to blame themselves for the hardships they face. And bad policy thrives on the silence that shame fosters.

Shame Is the Billionaire Class’s Most Reliable Shield

As the executive director of Fair Share America, I’ve spent the last year traveling across the country on the Stop the Billionaire Giveaway bus tour to hear from Americans directly about how the Trump administration’s reconciliation bill is harming their families through lost health coverage, rising premiums, food insecurity, and higher household costs. These events were the first public outlet many of these people had to speak out against the billionaire-first agenda in Washington.

From churches to community centers, rural front porches to packed town halls, I attended over 55 community events in 17 states to engage with people impacted by the relentless assault on what remains of our social programs. Over and over again, I heard my own experience reflected back as participants described what losing their health care or food assistance would mean for them, their children, and their entire communities. I could sense pain and shame blooming in their stories as they shared them in a room full of strangers.

Someone’s voice shakes as they talk about choosing between rent and medicine. A parent admits they skip meals so their kids can eat. A senior describes the quiet terror of watching their grocery bill rise faster than their Social Security check. And almost always, they preface their story with an apology: “I should have done better. I wish this wasn’t happening to me.”

That apology is the most devastating lie our political culture has ever sold.

Shame is a powerful tool of social control. It tells people their suffering is private, that their struggle reflects bad choices instead of public policy failures. Shame isolates and silences us. It keeps us from demanding better. The corporations and the billionaire class at the top of that system thrive off of—in fact, depend on—our fear, our shame, and our isolation.

Breaking the Neoliberal Script—and Rewriting It Ourselves

For decades, neoliberalism has heavily shaped our culture and our economy. This culture glorifies “free” markets (with fewer rules and guardrails for big companies), treats public support as inherently suspect, and teaches us to see financial struggle as personal failure rather than structural design. It falsely promises security through self-sufficiency but, in reality, delivers widespread uncertainty, loneliness, and shame.

The Stop the Billionaire Giveaway town halls explicitly disrupted this toxic neoliberal script—that suffering is shameful, that asking for help is weakness, that economic hardship reflects personal failure. There is power in putting a fine point on exactly who is profiting from their suffering. While a data center’s tax burden is subsidized, a single mom turns off her heat for fear of an unaffordable utility bill. While a local food pantry watches its shelves go bare, the White House is breaking ground on a ballroom.

Again and again, I watched people experience an almost physical release when they realized: This isn’t just happening to me. Once one person breaks the silence, more follow. This collective recognition is where real power begins—where we can connect the dots between our personal suffering and the policy decisions that have not only enabled but encouraged it.

They begin to reframe their story from “Why did I mess up?” to “Why does the system keep setting us up to fail?” They start to see that the barriers they’ve faced—not lack of will, but lack of good policy, safety nets, and collective investment in dignity—are shared. My team has worked hard to make sure these communities leave events knowing explicitly who they’re up against—that their private pain is evidence of structural failure.

I know this because I’ve experienced that release and recognition myself. At one town hall, I chose to share my deepest shame: how an $886 dental bill led to a medical debt doom loop and ultimately the foreclosure of my home. After sharing my story, I realized that it wasn’t a shortfall in my work to be this vulnerable, but rather a superpower. I’d always been an organizer, but now I could finally channel the energy I once spent blaming myself directly toward the people and systems that caused my economic suffering.

In this sense, what we’re doing in town halls and community rooms is not just organizing—it’s building a new culture, a new moral order, that rejects shame and isolation and instead builds solidarity. That means reimagining what it means to be supported. What it means to belong. What it means to be worthy. And then building institutions, workplaces, communities, and governments that embody those values.

What Better Policymaking Looks Like When We Break Silence and Shame

At a forum Fair Share America hosted in October, Roosevelt Institute President and CEO Elizabeth Wilkins said, “If we are building a new kind of world, then policy has to be deeply informed by—motivated by—the lived experiences of people.”

If we want better policymaking, we need more policymakers and more advocates who are willing to say, “This happened to me” or “Listen to this person’s experience.” We must refuse to hide the parts of our own stories that contradict the myth of endless self-sufficiency. Because every time someone with power breaks that silence, they widen the doorway for everyone else. Just as importantly, we need policy imagined and written by the people who actually live it. Lived experience is expertise, and it’s time we started treating it that way.

We must also understand that we don’t just need better programs—we need a better story about why people are entitled to those programs in the first place. That story is not about dependency, scarcity, or who “earned” help. It’s about decency, autonomy, and living a life that is enjoyable, not one to be suffered through.

When people leave these town halls, they don’t walk out as victims. They walk out as authors who understand their story differently. They see how their struggle connects to others. They recognize that change is not something done to them or for them but something that we are capable of shaping.

That mental shift is cultural. It is political. And, with the right tools and the right folks in leadership, it’s scalable. We are still early in this work. When it comes to the 2025 reconciliation bill, we are just beginning the process of transforming private shame into public demand, turning diagnosis into design, and imagining policies that grow out of lived reality instead of economic theory detached from human life.

But I am convinced of this much: The future of effective policymaking will not be built in boardrooms in Washington, DC. It will be built in circles of chairs, in church basements, in public spaces where communities gather with a clear understanding of their problems and what it will take to fix them. It will be built by people who no longer believe their suffering is a personal flaw and who now know, together, that they have the power to change the systems that caused it and create something better, something more equitable, something more just.

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Tax-Code Tweaks Won’t Solve the Health-Care Affordability Crisis

After a historic government shutdown, the battle over the extension of the enhanced ACA subsidies remains unresolved. Now the 24.3 million Americans currently enrolled in ACA plans face massive premium hikes due to the expiration of enhanced premium tax credits (EPTCs). In fact, those currently receiving subsidies (that is, those earning up to 400 percent of the federal poverty level) could face a 114 percent increase in their monthly premium, on average.

To put this in real dollar amounts, a 40-year-old in Pittsburgh, PA, earning $50,000 annually would go from paying $270 per month to paying $415 for a silver plan. And this is happening at a time when people are facing the financial strain of job losses and higher grocery bills.

Sen. Hawley may have voted for the Senate’s recent bill to extend enhanced marketplace subsidies, but he has not been a proponent of making the marketplace stronger for Americans. For instance, despite being familiar with the struggle of those enrolling in health plans during this open enrollment period, recently noting that “health care is just out-of-control expensive,” he has actively campaigned in support of ACA repeal.

So, how would he address these costs?

Hawley’s plan would allow individuals to deduct up to $25,000 per person for medical expenses from the income they report for tax purposes. The deduction doesn’t appear to be refundable, meaning that individuals with no tax liability will see no further benefit from the deduction. This is a shift from the current policy, whereby taxpayers who itemize can deduct unreimbursed medical expenses that exceed 7.5 percent of their adjusted gross income.

This is not the first time that a conservative in Congress has sought to use the tax code to advance policies to address acute needs. Earlier this year Sen. Katie Britt (R-AL) successfully introduced legislation to extend childcare tax credits, allowing for the deduction of up to $7,500 in child care expenses.

While efforts to reduce health-care and childcare costs are a start, reliance on tax deductions as the primary mechanism for reform fails to address some obvious and fundamental problems. Namely, it assumes people will be able to access the benefit in the first place, and that people will have cash to manage these large up-front expenses while they wait for an eventual tax refund. However, much of the American public is not positioned to reap the benefits of this approach to policymaking.

Tax Deductions Don’t Insure People

The Tax Policy Center estimates that 40 percent of Americans will not pay federal income tax in 2025. Thus any tax policy intervention immediately misses a vast swath of Americans who simply won’t claim the benefit (and even if they did, they would get no money back, since Hawley’s health expense deduction does not appear to be refundable).

What’s more, a tax deduction doesn’t help keep people insured on the marketplace as premiums increase. Researchers at the Brookings Institution estimated that 34 percent of marketplace enrollees currently have a $0 net premium, which helps promote health insurance access. In fact, scholars at Harvard University found that compared to Massachusetts’s insurance plans that maintained $0 premiums, those that introduced a nominal monthly premium (under $10 per month) saw enrollment fall by 14 percent.

In addition, reliance on tax deductions is a poor substitute for comprehensive health insurance offered through the ACA. The uninsured don’t benefit from lower rates negotiated with health insurers, and thus often face higher cash prices. With the average American unable to afford a $1,000 emergency expense, it is notable that without insurance, the typical emergency department visit costs in the neighborhood of $2,500. These costs may inevitably overwhelm family’s budgets, strain hospitals’ bottom lines, and force the same families into medical debt.

In fact, challenges with medical debt are felt throughout the US population. The Commonwealth Fund estimates that an astonishing 79 million Americans have problems with medical bills or are paying off medical debt. Those with medical debt are more likely to forgo additional needed medical care to avoid accumulating additional debts, and they often struggle to meet basic needs. And like so many inequities in America, these challenges are not only particularly prominent among the poorest, but also among communities of color and in particular, Black Americans.

What Looks Generous on Paper Will Fail in Practice

Sen. Hawley’s proposal to allow for more expansive deductions for medical care may well be a sincere effort to expand health-care access. However, it reflects a fundamental lack of appreciation for not only the tax filing status of the target population, but also the difficulty that so many face in affording rising health-care costs.

If the average American can’t cover an unexpected $1,000 emergency medical expense, how can they be expected to shoulder up to $25,000 in medical expenses with the hope of recouping that amount when they file their taxes?

Indeed, the maximum deduction in Sen. Hawley’s plan is more than double the out-of-pocket maximum of the average silver plan. And in the meantime, to absorb these additional health-care costs, it will require millions to go into medical debt—putting them at risk of worse credit ratings, among other financial impacts—or forgo or delay needed care. Simply put, this tax deduction is an empty gesture that papers over the systemic harm that is about to unfold for those enrolled in ACA plans.

Without comprehensive and affordable health insurance protections, a seemingly generous tax deduction will still leave behind the millions of Americans who require health care and cannot afford to wait for reimbursement later.

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It’s something millions of Americans want to believe. Because the American Dream feels further out of reach than ever and this new proposal looks like it might offer a way in, even as it sets off alarm bells.

The Scam Works Because the Crisis Is Real

People don’t just fall for scams when they’re careless. They fall for them when they’re exhausted, stretched thin, and desperate for relief, especially in a housing market designed to push hope further and further out of reach.

Right at the beginning of the holiday season, when financial anxiety spikes and scams spread, the president floated a 50-year mortgage policy, a message echoed on social media by Bill Pulte, lackey-in-chief of the Federal Housing Finance Agency (FHFA).

The housing affordability crisis is real, and 30-year mortgage products have not delivered the generational wealth–building opportunities promised to American families—especially for Black families. But serious solutions are on the table. Stretching a mortgage to half a century is not one of them.

A 50-year mortgage would fundamentally reshape a family’s financial life, especially for Black families. Homeownership remains one of the most powerful pathways to stability and generational wealth. But this proposal would lock Black families into cycles of generational debt and stalled economic mobility. The average life expectancy for Black people is four years lower than that of white people. The median age of first-time homebuyers recently reached an all-time high of 40, while the median age for repeat homebuyers is 62.

The administration’s 50-year proposal is a return to the literal meaning of the word “mortgage”: a death pledge. A 50-year mortgage is a death pledge that follows a family to the grave instead of building something they can pass on. With a 50-year mortgage, someone buying a first home at 40 would most likely die still owing at least a decade of payments without passing down the generational wealth the American Dream promises to homeowners.

A 50-Year Mortgage Turns Today’s Pressures into Generational Debt

As terrible as the implications of this proposal are, the length is not even the most damaging thing about it. Longer mortgages don’t address the factors driving up the real costs of homeownership: insurance and taxes.

A 2025 J.D. Power study found that nearly half of homeowners saw insurer-initiated premium increases last year. Industry data show double-digit premium hikes two years in a row—an 11.6 percent year-over-year increase from 2022 to 2023, followed by an 18.8 percent increase the following year.

Over roughly the same period, property taxes surged. ATTOM’s 2023 US Property Tax Report found that taxes on single-family homes jumped 6.9 percent in a single year, with the average annual bill rising to more than $4,000. Together, these insurance and tax increases outpace inflation and wage growth, quietly driving up the real cost of homeownership even before a family makes a single mortgage payment.

What does this have to do with the 50-year mortgage proposal? It means families would be locking themselves into half a century of payments while additional drivers of housing costs—taxes and insurance—keep rising faster than wages.

A longer mortgage doesn’t shield homeowners from these increases; it exposes them to even more years of them. Instead of providing stability, a 50-year mortgage stretches financial vulnerability across two generations, guaranteeing that families will pay more over time for a home that grows less affordable every year.

Black Families Face Higher Costs and Fewer Protections by Design

But what makes this moment even more alarming is what’s happening alongside the 50-year mortgage proposal.

As the regime tries to sell a multigenerational loan under the guise of “access,” FHFA is simultaneously attempting to eliminate or weaken Special Purpose Credit Programs (SPCPs). These programs were first authorized as a tool for lenders under the Equal Credit Opportunity Act of 1974 to provide flexibility in underwriting criteria and financial support, including assistance with down payments and closing costs, to help marginalized buyers purchase homes.

Although these programs have been around for over 50 years, they have become more popular in the past five years after the Consumer Financial Protection Bureau issued clarifying guidance to help banks establish these programs and remain compliant.

SPCPs exist because discrimination is real, ongoing, and measurable. Black borrowers continue to face higher interest rates, more denials, and biased appraisals, even with the same financial profile as white borrowers. The establishment of SPCPs acknowledged this history of discrimination and showed what can happen when we interrupt those patterns: Black families secure safe, affordable mortgages. They build equity in communities long shut out by redlining.

Yet the Trump FHFA wants them gone. So at the exact moment a 50-year mortgage is being pitched as a path to homeownership, the actual pathways to fair credit and equitable housing access are being dismantled. The communities most harmed by discrimination, especially Black families, are being set up to face a housing market where the only “solution” is a mortgage that outlives them.

This Isn’t a Policy Mistake—It’s Policy Design

Look at the pieces together—the 50-year mortgage, the dismantling of SPCPs, the weakening of civil rights enforcement, the cuts to federal programs—and a pattern emerges. This appears to be a coordinated effort to usher in policies that would disproportionately harm Black communities.

Black homebuyers already carry heavier burdens. We rely more on savings and retirement accounts for down payments. We face lower appraisals and higher interest rates. We fight through discriminatory credit scoring, predatory lending, and decades of policies that made homeownership the primary engine of wealth for white families and the primary barrier for us.

And that is exactly how these policies are designed to work.

This is a coordinated effort to push through policies that would keep Black families indebted, immobile, and economically vulnerable for the next half-century. A country that expects people to take on 50 years of debt while dismantling the programs that make fair access possible isn’t trying to build a stronger future. It’s building a future where fewer people have one.

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First, the vibes are bad (just ask anyone coming out of a grocery store). Second, the real economy—prices, jobs, and consumer and business spending, among other factors—is worse than it was a year ago, but holding up OK (4.4 percent unemployment, GDP growth over 2 percent, and inflation around 3 percent is hardly the stuff of recession). Third, a small number of people and companies are doing extremely well.

Depending on where you stand, you’re hearing very different things about the economy, but a pretty consistent theme is an administration that has not delivered on promises made to voters—while delivering to the president’s family and friends.

Under the Hood, the Story Gets More Complicated

It’s been a predictably rough year for the US economy. Tariffs have raised goods prices and hit manufacturing jobs, immigration crackdowns have crippled the labor force, and reversing energy policies dramatically has unwound an energy investment boom. As a result, the job market is softer, prices are still high, and inflation is up and apparently rising based on the data flow that has (finally) started to trickle back in.

That said, if the data are weaker, the economic mood of the country is, in a word, awful. Consumer sentiment in October was only exceeded by lows from the worst of the early 1980s recession, the peak of the 2022 inflation, and the months following the “Liberation Day” tariff announcement this year. Since January, consumer sentiment has plunged, giving up essentially all gains from a steady rise after the inflation peak of 2022.

That pessimism isn’t purely emotional—it reflects months of higher grocery and utility bills. In fact, across both the major household expectations surveys, families expect inflation to keep going up next year—which most economists expect as well. And roughly twice as many consumers surveyed by the Conference Board expect the jobs picture to be weaker rather than stronger in the next six months.

This view is both pessimistic and realistic given the data we’ve seen so far this year. It’s unmistakably true that the labor market and the inflation picture are weaker than last fall. What’s worrying to the wonkier economy watchers, however, is that the pressures on both inflation and unemployment are in the wrong direction. There are real risks that both inflation and the jobs picture could get worse, but (short of policy reversals) few predictable shocks are likely to make either improve in the near term.

Job growth has stayed positive but slowed dramatically, from an average 167,000 jobs a month in January to just 109,000 in September (and will likely be revised down further with annual revisions early next year). Over 87 percent of all jobs added this year are in health care and social assistance (a given in an aging country), while the rest of the economy has added just 71,000 jobs all year. And there’s little sign that tariffs are about to bring down prices, nor are there signs that the demand side of the economy is about to pick up.

It’s Not Great, but There’s Plenty of Time to Panic Later

The closer you are to the data, the less pessimistic you probably are right now. But, as we can see in recent Fed meeting minutes, the debate is largely between two camps: The first is those who think the labor market is middling and the risks of rising inflation are serious. The second is those who think the risks of rising inflation are less worrisome than the chances the labor market deteriorates further.

It’s clearly too soon to panic about a recession, and the best labor market data we have say things are holding up well by historical standards—September’s 4.4 percent unemployment is better than about 80 percent of months since 2000—it’s just that there’s little to suggest things are about to improve significantly.

That said, the economy continues to chug along on the strength of spending by resilient, yet quite frustrated, consumers. The final reading on second quarter GDP shows US consumer spending keeping the economy going, even as savings deplete.

Early holiday spending numbers look strong, so it seems like US consumers are going to muddle through tariffs. The distribution of consumer spending remains pretty narrow—high earners are doing much more of the broad-based spending in the economy

However, if you get your news from stock markets, or even from retirement statements, the world is different entirely, and much more optimistic—at least from a high level. After a massive swoon in April, the US stock market has had a great year, powered by tax cuts for corporations and the wealthy and an AI investment boom that looks bubble-like to some inside it.

Yet, like in the real economy, the more you dig into the data the farther from the extremes your views can go. Job and corporate earnings growth are concentrated in increasingly narrow slices of the economy. Corporate earnings are notoriously concentrated at this point, with the top 1.4 percent of S&P 500 companies accounting for almost all of stock market gains this year—just seven companies are now one-third of the value of S&P 500.

How Do We Square These Takes?

Overall, the data are on a more even keel than either the awful vibes most Americans are feeling from an affordability crisis or the anxiously warm vibes of investors. We’re not living through the economic boom tech investors see everywhere, nor the near-term dystopia consumers are feeling. The economy is weaker than last year and likely to continue to soften a bit more over the first part of next year, but the good news is at least for now things are not as bad in the data as in the headlines. The bad news is . . . that’s the good news.

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The policy debates of the day suggest that there is widespread support for taxing the vast resources of the very wealthy to ensure basic levels of care and security for children and families. We can see this playing out in New York City, where Mayor-elect Zohran Mamdani has championed care-centered policies to tackle affordability, and in Colorado, where voters approved a wealth tax to fund school meals.

People Know What’s Possible

Time and again, the American people have told almost anyone who will listen that they are deeply concerned about the fact that households in the top 10 percent hold over two-thirds of the country’s wealth, while many families can’t afford childcare or eldercare, children go hungry, and so many live in tenuous precarity because we lack a true social safety net. Surveys show not only that most Americans are concerned about affordability and economic insecurity, but also that most people support raising taxes on corporations and higher-income households.

Americans know that it’s not that we lack the resources to deliver economic security. It’s that lawmakers appear to lack the will to collect those resources. Since 1981, the US tax code has favored tax cuts for corporations and wealthy individuals, despite evidence suggesting that tax cuts for the wealthy have little effect on economic growth or employment levels.

Meanwhile, taxing the wealthy to ensure that the government can tackle major social problems is very popular. This popularity is pushing Americans to redefine what’s possible—especially when it comes to caring for the most vulnerable.

New York Is Betting Big on Families

Mayor-elect Mamdani has shown how policies like universal childcare and paid family leave draw broad support. In fact, in the same week that voters expressed their support for investments in childcare, New Mexico launched its first-in-the-nation statewide universal childcare program, proving that, regardless of the naysayers, this is indeed possible.

Crucially, Mamdani’s new administration is packaging childcare as an affordability issue and has proposed solutions to enable the government to deliver. For instance, his administration aims to generate $9 billion in revenue by raising taxes on the city’s wealthiest through a 2 percent tax on incomes more than $1 million and an increased state corporate tax rate that would match neighboring New Jersey’s.

Many New Yorkers have expressed an eagerness for this kind of progressive tax policy in the face of so much economic hardship. And for all the concern in the media about billionaires fleeing the city in the wake of a wealth tax, the reality is it’s not the wealthy fleeing New York—or anywhere else, for that matter—it’s the parents of young children. Parents with children under age six are 40 percent more likely than other groups to leave New York State. And that isn’t good for the local economy. The exit of young families costs the city an estimated $23 billion in lost economic productivity each year.

Simply put, childcare is an affordability issue, and Mamdani’s administration is rightly focused on connecting childcare policy to a larger platform that also includes rent freezes, public transit reform, and city-run grocery stores. These are policies that can make the lives of those who need them most a little easier.

Colorado Votes for Universal Meals

Two successful ballot measures in Colorado are also significant. Colorado voters overwhelmingly approved two tax measures that will boost funding for the state’s free school meals program, which provides free school breakfast and lunch for all children, regardless of income.

Though the program has been in place since 2022, funding it has become difficult in recent years, thanks to rising inflation and other state budget shortfalls. In the absence of more revenue, school districts in Colorado were preparing to have to limit meals to only certain students next year.

Rather than accept this outcome, Coloradans voted to raise income taxes on households making $300,000 or more, which will only impact about 6 percent of households but will raise as much as $95 million more a year for the school meals program. A second proposition that passed will also allow Colorado to keep millions in excess revenue raised for the program to ensure that these meal programs are built to last. These propositions will also allow Colorado to use some of the tax revenue to fund any future gaps in the Supplemental Nutrition Assistance Program (SNAP), the federal food program that has been under increasing strain.

Notably, there was no organized opposition to the propositions. Instead of accepting the school lunch program’s slow decline, Colorado voters overwhelmingly came together to willingly raise taxes to feed children. This is also largely a nationally popular policy: A 2023 poll found that 57 percent of Americans support providing free breakfasts for all students, and 60 percent support free lunch.

A Care Agenda Worth Fighting For

As these new policies are implemented, they’ll help redefine what’s possible—and perhaps help rebuild trust for those who have felt abandoned by a government that’s artificially constrained itself with the notion that it can’t take big swings on behalf of its people.

People have made clear that they don’t want to live in a country where children go to bed hungry or parents can’t make ends meet because they lack childcare, while the richest among us keep getting richer. Rather, they want the government to make sure everyone can build a good life for themselves. These emerging policy agendas and public budgets centered on building systems of collective care are a bold step in that direction.

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A significant body of research suggests that they will not. But this question has come into sharper focus as Mayor-elect Zohran Mamdani prepares to take office after months of the richest New Yorkers suggesting that they’ll pick up and leave if he succeeds at raising the corporate tax rate and adding a new 2 percent tax on millionaires.

Yet, before debating who might leave, it’s worth asking: Why are these taxes needed in the first place?

While Mamdani’s proposals are also pitched to fund vital government services, it is ever-widening wealth inequality that has kept federal tax reform on the docket.

Between 2018 and 2020, the top 400 earners in the US paid an average of 24 percent of every dollar earned in tax. This is significantly less than the national average tax rate of 30 percent—and even lower than what many middle- and working-class Americans pay. Regressive tax reforms, like President Donald Trump’s recent budget reconciliation bill, increased taxes for the poorest Americans while lowering them for the richest.

The result is an average tax rate that is progressive until the very top of the distribution, where it starts bending down, as shown below.

This ultra-wealthy class of individuals—the top 0.1 or even 0.01 percent—earns in a very different way than the median earner. Most of their income comes from capital, including pass-through business income, capital gains, dividends from stocks, and rent—compared with almost everyone else, who mostly earn income through labor. Income derived from capital is generally taxed at a lower rate compared to labor income, leading top earners to face a very different tax landscape.

Jeff Bezos, for instance, paid himself a little over $80,000 per year as Amazon’s CEO, because, in his words, “I just didn’t feel good about taking more.” The move likely saved him millions in taxes: ProPublica analysis of leaked tax records from 2014 to 2018 estimated Bezos’s own personal federal tax rate at less than 1 percent, compared with the top federal tax rate of 37 percent. He likely avoided that top rate again this past July when he sold $666 million of Amazon stock, a transaction subject to the 23.6 percent capital gains rate with no state tax at all, since he lives in Florida (an intentional move on Bezos’s part, which supports the argument for higher federal rates).

The Fear That Shapes Our Tax Debates

Any discussion of tax must, however, engage with the idea of distortion—that is, the potential for taxes to change behavior by altering incentives. And one particular distortion seems to dominate every debate: capital flight.

The rich pay a large share of total taxes, even if their average rates can be low; the top 1 percent of Americans (earning $663k or more in 2022) paid 40 percent of all income tax in 2022. If these taxpayers left, the story goes, their absence would reduce the overall tax base, undermining essential government services.

If the goal of a government is to address rising inequality, however, then a tax that raises exactly as much revenue as it loses through tax flight would be a good policy if it reduces the wealth gap while remaining revenue neutral. A tax that shrinks the tax base may also be acceptable, if a government is willing to “spend” money in the form of reduced revenue.

For cash-strapped countries, this trade-off is less palatable, but it becomes more viable during periods of high growth. So, what weight should we give to threats by billionaires to leave in response to tax reform, as they have been making in New York since Mamdani’s election?

Research from the Fiscal Policy Institute highlights just how sticky location preferences can be. Their report found no evidence of an increase in mobility among the rich in response to city tax increases in 2017 and 2021. In general, the top 1 percent of New York’s earners migrate at one-quarter of the rate of the rest of the population. And when they do move, it is disproportionately to other high-tax states like Connecticut, California, and New Jersey.

If anything, research suggests that it is the middle class who are leaving New York, and the affordability crisis seems to be a stronger push factor than tax. Households with young children are more than twice as likely to move out of New York City, and 36 percent of households leaving the state cited unaffordable housing as the reason. We will be able to measure the actual extent of wealth flight in time, but some of Andrew Cuomo’s high-profile backers are already striking a more conciliatory tone.

Willingness to move is context dependent, yes, but wider evidence supports the conclusion that even outside of New York City this is not as serious a problem as many fear. Relatively few may actually be prepared to become former New Yorkers.

Moreover, after a millionaire’s tax in Massachusetts and a capital gains hike in Washington in 2022, the number of millionaires actually grew by 39 and 47 percent respectively, with the taxes raising billions for those states.

And outside the US, a new paper analyzes Scandinavian administrative data, the gold standard in empirical economics research. While the authors found modest evidence of mobility (perhaps aided by the free movement of people and capital within the EU’s common market), only 20 cents of every dollar raised by the new tax was lost to capital flight. It would have needed much larger migration responses than those observed for the taxes not to raise substantial revenue.

This new work suggests previous findings that people are reluctant to migrate apply to the rich as well. The authors note that distortions of a tax—changes to savings and investment decisions, and a rise in avoidance and evasion—are more important than migration threats.

How to Tax Without Fear

Certain policy levers can mitigate migration. The US is one of the only countries to apply its full tax code internationally on the basis of citizenship and not only residence. This creates a stronger disincentive to leaving, which other countries could emulate. Coordination could also help. The US could (re)join 130 other countries that have agreed to minimum global corporate tax rates, and one could imagine a similar agreement targeting high-net-worth individuals too.

Yet, the myth of millionaire mobility has done its job: It’s made policymakers nervous and kept billionaires comfortable. The evidence tells a simpler story—most of them stay put.

Several serious reforms are being discussed, including changing capital gains or estate taxes; introducing new measures such as wealth taxes on unrealized gains, land taxes, or consumption taxes; or even a more holistic reform of the tax system. The first challenge, however, shouldn’t be figuring out whether the rich will flee; it’s whether we’ll finally stop letting that fear write our tax policy.

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Its lead author, Hannah Garden-Monheit, is a seasoned policymaker who treats the subject not as an abstract institutional problem but as a democratic one. If the government can’t deliver quickly and visibly for ordinary people, its legitimacy erodes.

Learn more about the report in Fireside Stacks’s inaugural video conversation, featuring Hannah Garden-Monheit, below.

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Part of my trip included a stop at the Michigan Union—the same place where President Lyndon B. Johnson outlined his vision for a Great Society 60 years ago—and it was hard not to feel the echoes of that moment. The students filling that room reminded me that greatness still depends on moral clarity—the kind that demands empathy, urgency, and imagination.

We need that boldness again, not as nostalgia, but as the foundation for a response this moment demands. If we’re looking for boldness, young progressives are an essential voice.

As in generations past, the student left remains “the most reliably correct constituency in America.” Over and over—often at great personal sacrifice—they’ve held the line on what is moral, only to see institutions and leaders catch up. Columbia University is one example: It once worked to crush its 1968 student uprising, and now it markets that same protest as a symbol of its “activist Ivy” legacy.

Far too often, young people have been treated as “nice to have” in the strategy of a progressive ecosystem—when they’re not being painted as an actual threat to the success of the progressive movement. This time, instead of treating students’ moral conviction as a challenge to pragmatic politics, what if we saw it as the foundation of any civic movement capable of meeting this moment?

Listening to the Generation That’s Getting It Right

My time in Michigan crystallized my understanding of something that’s been building for more than a decade. Far from giving in to resignation, the student left today—alongside their millennial predecessors—feels a profound sense of betrayal toward the leaders, institutions, and organizations whose choices have enabled the twin economic and authoritarian crises we are confronting.

In my time thinking about what drives the student left, I have yet to come up with something shorter or clearer than “People like people / They want alive people,” lines in a song by The 1975. Progressive young people are looking for honesty and emotional intelligence from leaders who are willing to fight for people—while also being alive to, or energized and animated by, their concerns.

When you live under the current status quo—students snatched off the street, a climate crisis denied, families left to the whims of the market—isn’t empathy for that pain, and honesty about its scale, the bare minimum we should expect from our leaders? That’s the spirit that should guide how progressive institutions and leaders approach policy: starting from what is necessary, not what polls as popular.

For instance, in a recent conversation I had with students and organizers, one student told me: “People [in my community] were more scared of poverty than death. They were trying to escape a certain condition of life by working themselves to death.” To the student left, the question isn’t whether a minimum wage increase is popular or which mechanism makes it happen; it’s that our economy makes working yourself to death seem necessary. They want their leaders to name that violence and refuse it.

The students in Michigan saw the country’s deepest divide not as ideological, but economic. They pointed to complacency in Washington as proof: Most political leaders have the wealth to weather a crisis, but most people do not. As one student put it in another conversation: “When eggs are more than an hour of minimum wage work, it doesn’t matter to me that inflation is less bad here than across the world.”

That’s why having conversations with young people on the ground around the country is vital—rebuilding trust in democracy requires listening to the people whose future is on the line. Young progressives aren’t just a constituency; they’re a source of institutional renewal. Unbound by the habits of the past, and with a clear moral compass, they can help us imagine what government could be if it finally worked for everyone.

And we know that the student left of this generation has never known “normal” times: Their adolescence was shaped by COVID isolation and uncertainty, their college years shaped by the horror in Gaza and increasing repression at home. Now they face a job market that can’t deliver stability, rents that defy reason, and debts that will define adulthood.

And yet, despite it all, they are building new forms of solidarity, imagination, and civic courage. They remind us that moral clarity is not naive—it’s the starting point for renewal. If we’re serious about a people-powered future, we have to meet their urgency with our own.

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UnitedHealthcare, Cigna, and Humana face lawsuits over their use of AI models such as nH Predict and PxDx, which can review coverage decisions in seconds. The companies argue that AI only assists, not decides. The lawsuit alleges these AI-assisted claims are error-prone: In some cases, up to 90 percent of AI-related denials are reversed on appeal to the insurer—if patients can manage the onerous process to appeal, which many do not.

These AI-driven denials are just the newest layer of bureaucracy between Americans and their health care. What few realize is that when this system fails, patients have almost no way to fight back. This is because a little-known 1974 law, the Employee Retirement Income Security Act (ERISA), shields most employer-sponsored plans from accountability.

As these AI tools spread across plan types, the risk of wrongful denials only amplifies.

ERISA Makes Wrongful Insurance Denials More Likely and More Burdensome on Patients

Originally passed to curb pension fraud and mismanagement, ERISA unexpectedly reshaped the health insurance industry by governing self-insured employer plans—where companies pay claims directly or through a third-party administrator, like an insurer. When ERISA was enacted in 1974, only about 6 percent of plans were self-insured. Today, roughly two-thirds of covered workers are on self-insured employer plans, meaning most Americans with employer health coverage now fall under ERISA’s limited protections.

Though ERISA was designed to protect workers, its structure—specifically its limitation on damages and preemption of state law—has created major unintended consequences for health policy, making it extraordinarily difficult to challenge insurance denials and reform prior authorization.

Take, for instance, Frank Wurzbacher, whose story was highlighted in a 1998 Senate hearing on the need for a Patients’ Bill of Rights. He didn’t realize how vulnerable he was when his employer switched insurance carriers as he fought prostate cancer. The new insurer denied coverage for the costly injections that kept his cancer in check, approving only full coverage for castration surgery—a permanent procedure designed to suppress testosterone. Unable to afford the injections, he underwent surgery, only to learn soon after that the insurer reversed its decision.

Because ERISA’s remedy and preemption provisions remain largely unchanged decades later, Frank couldn’t recover monetary damages if he brought a claim, and attorney’s fees would be left to a judge’s discretion. Even if he won, his only remedy would have been approval for the injections he no longer needed.

How ERISA Shields Insurers from Accountability

Frank’s story underscores how little protection nearly 100 million Americans have when navigating health insurance barriers, despite ERISA’s original aim to safeguard workers. The law not only harms less affluent employees but also weakens insurer accountability, allowing wrongful denials to persist.

This is because ERISA bars patients from recovering damages for pain and suffering or lost wages, for instance, allowing only the denied treatment and possible attorney’s fees as a remedy.

As a result, few patients have an incentive to sue. After all, lawyers have every reason to avoid cases that lack a monetary value, and poorer (and even middle-class) workers can’t usually risk bringing a lawsuit on their own. With few lawsuits and no real penalty for wrongful denials, insurers face little incentive to change, especially as AI promises faster, cheaper claim reviews at the patients’ expense.

In May 2025, I surveyed 2,569 US adults, asking whether they would sue over a coverage denial if they could receive the treatment but not money damages, and whether they would sue if they weren’t guaranteed to recover the costs of the lawsuit. Only 6 percent said they would be content to receive the health benefit only—the sole relief ERISA guarantees successful plaintiffs.

Rather, nearly all respondents indicated that, if bringing a case, they would want to recover damages, which ERISA precludes. Lower-income, less-educated, and less healthy respondents were far less inclined to sue under these conditions. In fact, respondents earning $50,000 or less annually were 13 points less likely than wealthier respondents to pursue cases without damages, and 11 points less likely if attorney’s fees were uncertain.

ERISA not only discourages patients from suing—shielding insurers from consequences for wrongful denials—but also disproportionately harms lower-income and marginalized workers, offering no real protection from legal costs.

ERISA Stops States from Improving Health Policy

States have begun addressing the causes of coverage denials—especially prior authorization—and are now moving to oversee insurers’ use of AI tools.

For example, California recently enacted Senate Bill 1120, requiring that any AI-based denial be reviewed by a physician in the appropriate specialty, joining dozens of other states that have adopted similar standards.

Sounds great on paper. But here’s the catch:

Because of how ERISA was written, these reforms don’t apply to most employer-sponsored health plans. Unlike other areas of health federalism—such as marijuana decriminalization, Medicaid expansion, or abortion—ERISA preempts any state law that “relate[s] to” self-insured health plans. As a result, state efforts to expand access or oversight leave the biggest coverage gaps untouched, even as insurers’ use of AI deepens workers’ vulnerability to denial of coverage.

Thus, any health insurance reforms meant to affect the majority of employer-sponsored insurance must come from the notoriously gridlocked Congress.

A 1974 Law That Washington Still Won’t Touch

In the late 1990s, lawmakers tried to fix ERISA through a Patients’ Bill of Rights, but the effort collapsed amid fears of “frivolous lawsuits,” concerns about rising premiums, and Bill Clinton’s impeachment. A decade later, congressional Democrats focused the Affordable Care Act on expanding coverage rather than strengthening protections for the already insured, leaving ERISA’s limits intact.

Insurers are hardly alone in using AI as a cheap substitute for labor-intensive procedures, but when these tools wrongly deny coverage, patients have little legal recourse. Without the ability to recover damages for pain and suffering, insurers face almost no serious penalty for error—errors that are likely to only increase given such tools’ imperfect track record. And because ERISA preempts state law, even the most ambitious state reforms can’t protect most workers.

As AI-driven prior authorization expands—even into traditional Medicare—Americans might finally confront a deeper question behind their coverage barriers: Why do they persist? The answer lies in a 1974 law shielding health plans, fair and unfair alike, from real accountability.

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Beyond the data blackout, the broader economy was already hard to read. Job growth has slowed, manufacturing and construction are sagging, and many state economies are struggling.

Bottom line: We’re flying blind in a turbulent economy where dark clouds have been gathering for most of the year. In this week’s post, I detail why shutting down data collection in this economy is particularly foolhardy, how to think about alternative sources in the interim, and what we should demand from the government when this shutdown ends.

The State of the Economy: Uneven, Fragile, with a Weaker Inflation and Jobs Picture

The economy has clearly slowed this year, but enough odd crosscurrents make it hard to pinpoint what’s driving the slowdown—or how bad it is. Tariffs are pushing up inflation and slowing hiring, particularly in manufacturing, though not by enough to trigger a recession on their own (though this fluid situation seems to be changing by the day).

Rising costs are fueling anxiety for families and frustrating economists and policymakers who are seeing hard-won gains reverse. After declining for years, inflation was basically at the Fed’s 2 percent target a year ago. But this year it’s reversed, and has been creeping higher for months. Cheaper eggs and OPEC’s push for much lower gas prices (designed to crush US oil producers) have been outweighed by rising prices and slower wage growth elsewhere.

Housing and food inflation still outpace overall inflation, and utilities are up almost 8 percent year over year as of August. The long-running cost-of-living crisis in housing, education, and care persists, and policy changes are making things worse. For instance, health-care inflation—already above 4 percent—will likely rise further once the effects of the administration’s tax bill kick in this November, dramatically increasing health-care premiums for millions. And harsher immigration policy is throttling labor force growth.

The State of Economic Data: The Lights Are Out

With this much volatility, it’s precisely the wrong time to turn off the data tap. And it really is shut off, making the economy harder to read in addition to gumming up the work of straightforward governing.

For instance, aggressive shutdown plans have sent home entire statistical agencies, delaying key economic data releases and risking deeper disruption in the months to come. The shutdown reduced the entire Bureau of Labor Statistics (BLS)—the agency that produces inflation and job market data, among others—to a single employee. When it became clear that Wednesday’s missed consumer price index (CPI) report would jeopardize annual cost-of-living benefit increases for 71 million Social Security recipients, the White House recalled additional BLS employees to compile and release the previously collected September data, now planned for next week. This is a necessary step, but a skeleton crew of unpaid staff can only finalize the statistics thousands collect and process—that’s not a recipe for reliable statistics (and the field collection for next month’s data is already lost).

Private data firms—or at least their marketing departments—have sprung forward to offer assistance. What they can offer is limited. Virtually all useful private data exists as a branch of the broader federal data project (the trunk, which has been under-resourced for years). While this public data infrastructure may lack the novelty some private data have, that infrastructure remains the backbone of everything else we measure—including essentially all new and buzzy stats being pitched right now.

It’s not just that private data depends on federal data; it’s that no one—no matter how smart—can match the work of a capable state. Roughly five years on from a pandemic that set off the greatest surge of innovative economic data production in history, almost all of those projects—even those from the most impressive teams—were abandoned. With federal statistics offline, markets and experts are doing our best with what we have, yet there’s little effort to relaunch these projects—just a chorus begging for the best data we have to come back online.

Reading the Economy Without the Dashboard

The first rule of flying without instruments is…don’t! That’s good advice for policymakers too, and the rest of us should be especially wary of buzzy new statistics. Still, a few data sources that are still being compiled, or that don’t rely on federal statistics, can, in the right hands, provide limited information in the short term.

The Department of Energy’s weekly reports (and higher-frequency API) are still updating and provide one of the best commodity pictures of energy demand and prices in the US, a proxy for activity in the real economy and a public source that makes market data on many commodities informative.

Other data can still be useful, either telling us things federal data can’t or—at least historically—predicting or correlating with official data. The Baltic Dry Index proxies demand for goods shipping (it’s doing well this year, but obviously trade data are going through unusual times).

Auto sales—reported by manufacturers—are strongly correlated with consumption spending, partly because auto sales are sensitive to the economy (read: you don’t lose your job and buy a new car). Auto sales also make up a large fraction of total consumption spending. (Again, things are weird right now: Expiring electric vehicle tax credits boosted sales through September, but these data look solid.)

Yet, as the pandemic taught us, if analyzing alternative data feels like reading tea leaves, that instinct isn’t wrong. Caution is crucial. Still, there’s potential insight to be found in the noise.

Why the Data Must Be Restored

This data blackout, however, should be a wake-up call. Even under stress, federal economic data remain a crucial piece of our economic foundation and one of the last objective truths in America. Building on the legacy of statistics introduced to monitor the Great Depression and war mobilization, the US has the institutional knowledge and professionalism to expand and improve its open access federal statistics. For less than a cup of (pre-tariff) coffee, this world-leading state capacity gives a competitive edge to American small businesses, families, and taxpayers, who enjoy the lowest interest rates in the world due to trust built through years of independent statistical reporting.

We don’t need bespoke private data. We need to keep public servants in place, doing the hard work that keeps our economy running and makes effective policy possible. We didn’t give up federal statistics during World War II—if we had, we may well have lost! Protecting public data from the informational breakdown and factional politics that have infected too much of the public sphere is a crucial step in maintaining the civic infrastructure that allows a democratic society to choose political leaders who can deliver better economic outcomes.

An Open Call

We want to hear from you in these trying statistical times. What are your best recommendations for proxy stats to monitor the US economy in the interim? We’ll be asking our network of policymakers and economists over the weeks to come, but, much as it pains me to say it, there are no wrong (or right) answers right now.

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So it’s fitting that the YIMBYtown conference garners more attendees with each passing year. The 2022 YIMBYtown in Portland, Oregon, was the biggest year on record—until the 2024 gathering in Austin, Texas, brought in more than 400 attendees. This year, over 1,000 people descended on New Haven, Connecticut.

There’s always a fair amount to celebrate at YIMBYtown, and this year was no exception. It was the first since New York City enacted its comprehensive land-use-reform plan, City of Yes. Just days before the conference, the California legislature passed a major bill to spur more homebuilding in transit-rich areas. Those two high-profile wins from the past year show how YIMBY organizations have achieved a remarkable amount during an otherwise dark period for reform-minded activism.

The Scrappy Roots of the YIMBY Movement

A visit to YIMBYtown tells you why the movement has been so successful. The lessons it offers may even point the way to a broader democratic renewal. Progressive groups and policymakers should study YIMBY strategy as they work to strengthen civil society and other bulwarks against NIMBYism and other regressive policies.

They can start with the movement’s DIY roots and ethos. Like the YIMBY movement itself, YIMBYtown has gotten more professionalized as its ranks have grown; this year’s conference, partially backed by Yale University, took place in a wood-paneled downtown New Haven hotel and featured legendary climate activist Bill McKibben as a keynote.

But the polish belied a certain fundamental scrappiness. YIMBYtown 2025, like all previous iterations, was hosted by a small, local YIMBY organization—in this case, DesegregateCT, which has all of two full-time staff members. DesegregateCT’s director Pete Harrison, alongside Karen DuBois-Walton of the Community Foundation for Greater New Haven, sported “Co-Mayor, YIMBYtown” sashes as they darted from room to room, making sure the events were going smoothly.

This scrappiness is one of the YIMBY movement’s greatest strengths. Even after notching local and state-level wins nationwide—and attracting influential national allies—YIMBY remains powered by local activists and volunteers. Larger, more professionalized groups such as my former employer California YIMBY still draw much of their influence from the unpaid grassroots YIMBYs who knock on doors, call representatives, and speak at public meetings.

Because the YIMBY movement can’t pay all its foot soldiers, it needs to offer them something else: Community and purpose. It offers the chance to make their neighborhoods more vibrant, inclusive, and affordable. But that’s only part of the bargain. Attend YIMBYtown—or one of the many local happy hours—and you’ll notice that being a YIMBY is also a lot of fun. YIMBYism is a movement, but it’s also a social club for nerds who love cities.

Joy as Infrastructure

The social club factor may seem like a frivolous fringe benefit, but it’s what keeps people mobilized and draws new members in. Happy hours and pizza nights are a key source of movement power.

This isn’t a new idea: Many 19th- and 20th-century movements were yoked together through similar social bonds. For example, “red saloons“—bars that catered to a socialist clientele—were an important part of the labor movement’s infrastructure in Gilded Age Chicago. And as political scientist Theda Skocpol extensively documented in her book, Diminished Democracy, the decline of membership-based social organizations has contributed to the overall decay of mass democratic politics.

This decay forms the unacknowledged backdrop to many internecine fights over the Democratic Party’s future. Progressives and moderates have different policy and communications visions, but their arguments are often nearly identical in structure. Both think the party needs a new policy agenda and a different way to sell it, yet neither really emphasizes building civic institutions that turn passive voters into active party members.

Here, Democratic power brokers in Washington could learn something from grassroots YIMBY organizations. Many of those power brokers have embraced “abundance,” which began as an effort to apply YIMBY policy thinking to other, non-housing policy domains. But they’ve paid less attention to how YIMBYs have turned those ideas into real-world wins.

YIMBYism’s success is more evidence that a polling-calibrated policy platform is no guarantee of victory, and a technical or radical-sounding one is no guarantee of defeat. Proposals like “upzone single-family neighborhoods” or “reform building codes that require multiple staircases in most apartment buildings” are not exactly designed to please affluent homeowners—the country’s most politically engaged voters.

Yet YIMBYs have won repeatedly while advancing policies that conventional wisdom deems politically toxic or too abstruse to generate grassroots energy. That is largely thanks to the volunteers—many of whom had their first exposure to organized YIMBY politics at a local happy hour—who have taken time out of their weekends and evenings to speak at public hearings, knock on doors, write to their local papers, and even descend on their state legislatures to lobby their representatives in person.

While local conditions can explain some of the wins, a consistent theme is that YIMBY groups have a knack for hosting fun social gatherings where they can, and often do, persuade skeptics and convert sympathizers into activists. YIMBYtown is a case in point. The next one will probably be the biggest YIMBYtown yet.

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Shutdowns were once rare. After the 1996 lapse, none occurred for nearly two decades. Yet, since 2013, they have grown more frequent and severe: a 16-day standoff in 2013 and back-to-back shutdowns in 2018, the second lasting a record 34 days. Each left real economic scars.

What makes this one different is the Trump administration’s embrace of shutdown politics as a governing strategy. It is not a breakdown of negotiations but a way to paint the government as incapable, demoralize its workers, and shift the burden of dysfunction onto the public—a continuation of chaotic DOGE tactics.

One of the first places this shows up is industrial policy, where ambitious public-private projects are being thrown into uncertainty.

Industrial Policy Interrupted

The state’s industrial turn—from the CHIPS Act to mining strategic minerals—depends on government agencies that can plan, partner, and deliver. A shutdown undercuts that foundation.

The Departments of Energy and Commerce, as well as the the Environmental Protection Agency, are central to launching new projects and enforcing environmental standards. Yet these and many other agencies have not even posted updated shutdown contingency plans as of this post, which are typically issued annually.

Without clear staffing, grants go unsigned, permits stall, and contracts are left in limbo. These delays may look technical, but to the communities waiting for a semiconductor fabrication plant to break ground, they will mean jobs lost and rising costs starting at midnight tonight.

It is worth remembering how different this is from moments of national ambition in the past. In the 1930s, the New Deal’s industrial expansion, from rural electrification to wartime production, required steady government capacity. Agencies did not shutter every few years. They operated continuously, building trust as they built infrastructure.

Yet, these industrial delays bleed into a broader problem: the deliberate weakening of state capacity and the legitimacy of government itself.

Shredding Capacity and Losing Legitimacy

Shutdowns have always meant furloughs. In past lapses, hundreds of thousands of federal employees have been sidelined, some sent home, others forced to work without pay.

This time, the threat is deeper. The White House directed agencies to prepare legally dubious reduction-in-force plans, permanent layoffs tied to whether jobs align with its own priorities. If carried out, the cuts would hollow agencies far beyond this shutdown.

The effects don’t stop with the federal workforce. Benefit checks may still go out, but a shutdown snarls the administrative machinery people depend on every day. Disability claim reviews for SSI and SSDI can pause. Call centers close. Small Business Administration loans freeze. During the 2019 shutdown, SBA was unable to process over $2 billion in loans.

For the people waiting—a disabled worker, a small business owner, a family navigating Social Security—these aren’t abstractions. They are weeks of anxiety, bills delayed, or opportunities foregone.

Over time, governance by crisis erodes democratic legitimacy itself. During the 2018–19 shutdown, consumer confidence fell sharply and the country’s credit rating came under threat. Each new standoff reinforces a sense that the government is unstable, which serves the agenda of those eager to discredit public power.

The economic toll, however, brings this fragility home. The shutdown is not just a fight over government operations. It is a direct hit to families, businesses, and communities.

Economic Consequences: The Real-Time Shockwaves

The most immediate pain of a shutdown comes from vanished paychecks. When federal workers miss paydays, retailers lose customers. Mortgage payments are delayed. For contractors, the blow is even harsher: Unlike federal employees, many may never see back pay. And this pain is not concentrated in DC. Roughly 80 percent of federal workers live outside of the District.

A shutdown ripples through regional economies. The National Flood Insurance Program depends on appropriations. If it lapses, as it has in past shutdowns, an estimated 1,300 home closings per day cannot proceed in flood-prone areas. Aviation and travel are slowed as Federal Aviation Administration training and hiring pipelines freeze. Each delay compounds into lost wages, lost growth, and lost confidence that harm the economy.

Layered on top is the looming health-care premium cliff. On November 1, Affordable Care Act health insurance plans will no longer include enhanced subsidies for those buying policies for next year. Families will begin receiving notices of steep hikes: premiums up an average 75 percent, with over 4 million at risk of losing coverage. Republicans have floated a “clean” continuing resolution through late November, which would blow past this deadline. The poor sleight of hand is glaring. By delaying budget negotiations while ignoring the cliff, they are setting up families to face both a government shutdown and unaffordable health insurance, all at once.

Capacity Is the Precondition for Progress

If every major policy must be fought through a hostage crisis, effective democracy itself is impossible. Shutdowns may start as political gambits, but they end as human harm: a paycheck missed in Virginia, a disability claim delayed in Ohio, a mortgage stalled in Louisiana, a health plan priced out in Arizona.

A functional government is not a luxury; it is the precondition for every other ambition. Industrial renewal will not happen if the lights are off at Energy and Commerce. Trust in democracy will not rebound if citizens are left on hold or furloughed without pay. The good life that progressives fight for cannot be realized if families face lost income and rising costs because of deliberate sabotage.

The GOP’s choice to run out the clock and punt real decisions into November would mean stalled factories, missed paychecks, closed home sales, and skyrocketing premiums. The alternative is simple: stop ruling by crisis, fortify the capacity to govern, and restore government as a force that can lead. Anything less sets us up to fail at the very moment we need bold public power the most.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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Elizabeth points to the crisis in care, including childcare, as well the failures of our nation’s pension systems. I would add another: The shocking inadequacy of our safety net for disabled Americans, found in Social Security’s least discussed program.

American politicians have long divided the poor into “deserving” and “undeserving” camps. The category of “able-bodied adults without dependents” exemplifies the latter: People expected to prove their work ethic before receiving meager, temporary aid.

Politicians then contrast these so-called able-bodied adults with other groups, like children, the elderly, and the disabled: Individuals deemed poor through no fault of their own. During the debate on the 2025 GOP reconciliation bill, Republican lawmakers argued that cutting aid for able-bodied adults would free resources for “those that truly need it.”

Yet, that money has never reached disabled people, whose safety net remains deeply frayed.

A Promising Program Left to Crumble

Supplemental Security Income (SSI) is a program supporting more than 7.4 million people and often called “the safety net America forgot.” Created in 1972 as part of the Social Security Act, SSI replaced a patchwork of state programs for disabled children, disabled adults, and impoverished seniors.

At its launch, it marked a major step forward: Benefits were pegged to about 75 percent of the federal poverty line, and states with more generous programs were required to maintain supplemental benefits for existing beneficiaries. SSI thus established a new national floor and, at the time, helped to lift millions of people with disabilities out of deep poverty.

Today, SSI supports children with severe disabilities, adults unable to work due to illness or injury, and older Americans living on incomes too low to survive. For many, these monthly checks are the only thing keeping food on the table or the lights on.

Yet, the creation of SSI also marked the end of a broader era of safety net expansion that produced Medicaid, Medicare, and Social Security Disability Insurance. Instead of building on SSI, policymakers let it languish.

States gradually cut their supplements, since they were only required to provide them to existing, not new, beneficiaries. While monthly benefits rose with inflation each year (and remained inadequate), the program’s asset limits and monthly income disregards (the portion of income that doesn’t count toward determining benefits) stayed frozen.

Combined with steep earnings phaseouts—and even penalties for meals cooked by friends, which are counted as “in-kind support and maintenance” and actually lower benefits—this led to a world where more than 50 percent of SSI recipients (more than 4 million people) now live in households below the federal poverty line.

Advocates mounted a big push around SSI’s 50th anniversary, but little changed.

For instance, the Biden administration eased some eligibility and means testing rules, but the Trump administration is actively dismantling even these modest improvements, making it harder for people to qualify.

For its part, Congress has not passed major SSI legislation since 1989, despite repeated attempts. The SSI Savings Penalty Elimination Act—bipartisan, popular, and costing less than a billion dollars a year—would finally fix the program’s broken asset limits. I once called it “the closest thing to a no-brainer in federal policy.” But this bill went nowhere.

Solutions Are Straightforward

In an upcoming paper, Jack Landry of the Jain Family Institute and I use microsimulations from Census data to analyze another piece of legislation that is currently before Congress—the Supplemental Security Income Restoration Act of 2024 (SSIRA). The SSIRA builds on the SSI Savings Penalty Elimination Act, but goes further. It raises income disregards, eliminates punitive “in-kind support” rules, and sets the maximum monthly benefit at the federal poverty line for a single adult—double that for married couples both on SSI.

In short, our analysis shows how the SSIRA would modernize benefit levels while removing outdated penalties that keep recipients in poverty. Our preliminary findings show that the SSIRA would lift about 3.2 million individuals out of poverty, including direct beneficiaries and their families. Using the Supplemental Poverty Measure, the poverty rate for SSI households would fall from about 26 percent to 13 percent, nearly the national rate of 12.6 percent.

While the plan might seem costly at about $50 billion a year, it’s less than the cost of a single provision in Trump’s budget bill: Making the business income deduction permanent will alone cost over $73 billion a year. The same politicians who claim we “can’t afford” to lift disabled Americans out of poverty had no trouble spending more to lower business tax rates.

Bringing millions of disabled folks and their families above the poverty line matters, but we shouldn’t settle for barely keeping them afloat. SSI still imposes punishing phaseouts, and the Social Security Administration’s backlog of disability determinations leaves 30,000 people to die each year while waiting for aid.

As Elizabeth reminds us in her essay, if we want government to shield Americans from life’s vicissitudes, we must begin with those whose dignity has been ignored for far too long. Disabled people must be at the core of any people-powered future we create together.

Correction: The original title of this piece misstated the number of disabled SSI recipients that would be raised out of poverty under proposed legislation. The correct figure is 3.2 million individuals, which includes beneficiaries and their families.

Fireside Stacks is a weekly newsletter from Roosevelt Forward about progressive politics, policy, and economics. If you enjoyed this installment, consider sharing it with your friends.

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