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Paul Brandus: The U.S. government, until Reagan, used to do big things. Biden thinks it still can

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President Biden said something revealing in his recent news conference, something with broad and potentially long-lasting implications. 

“I want to change the paradigm,” he said. “We start to reward work, not just wealth. I want to change the paradigm.” He said it three times. 

What does that mean?

Here’s what it means. Biden, the product of a less-than-gilded upbringing in Pennsylvania and Delaware, is quick to remind everyone that there are more people on the middle and lower rungs of the ladder than the hard-to-obtain upper rungs.

Average Joes

By virtue of his younger, leaner years — though long since eclipsed by wealth, of course — the president identifies deeply with these average Joes. This is not some born-on-third-base-thinking-he-hit-a-triple kind of president. A bigger slice of the pie is what those average Joes deserve, he believes. He wants to change this, change the way in which we view work, the value it creates, and the relationship between employer and employee. 

The second big paradigm that Biden wants to change is the increasingly malignant way in which we view the federal government and the role it plays in our lives. I’ll get to that in a moment. 

In the first instance, the president doesn’t believe those average workers have gotten that bigger slice of the pie. Why? He points to the demise of labor unions, corporate pensions and the flatlining of inflation-adjusted wages.  

Biden speaks proudly of unions, and the power they have (or had) to protect workers when times are rough and to squeeze more from employers when they are not. But unions have been fading for decades. For example, the percentage of Americans who are in a union has essentially been cut in half since 1983, based on Labor Department data. 

As for pensions, just 12% of private-sector workers were in a pension plan in 2018, says the Pension Rights Center, a Washington, D.C.-based nonprofit. This share has also fallen sharply in recent decades.   

Biden also cites blue-collar wages. In absolute terms, they may be higher, but in terms of purchasing power — which is what counts — they have barely budged.

Meantime, while millions of workers try to stay afloat, corporate profits, relative to gross domestic product (GDP), have marched ever higher. And stock prices? The S&P 500
SPX,
-0.06%
,
which stood at 102 points in August 1982, closed Tuesday at 4,073. You do the math. 

Has this rising tide lifted all boats? Of course not. The top 1% of Americans, said a Federal Reserve analysis earlier this year, control about 38% of the value of financial accounts holding stocks, while the top 10% control about 84%.

So when Biden says he wants to “change the paradigm,” and “reward work, not just wealth,” this is what he’s talking about.

Government’s big wins

The second big paradigm that Biden wants to change is the way we see, and relate to, the federal government. 

Over a half century, starting with the inauguration of Franklin D. Roosevelt in 1933, a series of both Republican and Democratic presidents, and Republican and Democratic Congresses, did the following — and this is just a partial list: Managed the Great Depression, World War II, the Cold War, built the interstate highway system, and safely put astronauts on the moon just eight years after deciding to do so.

Further, it passed civil rights laws, created a social safety net that kept millions out of poverty, helped millions more attend college, guaranteed mortgages that enabled still others to achieve the dream of owning their own home.

It provided economic incentives, and in some cases the first and only market, for dazzling new technologies that lifted productivity and living standards by a staggering amount. 

Enter Reagan

And then along came Ronald Reagan. Inaugurated in 1981, and having had absolutely nothing to do with any of the above five decades worth of achievements, he told us that government is the problem. 

In the four decades since, this attitude seems to have seeped into the mainstream culture. Yes, it’s the problem, millions today think. It’s the accepted wisdom. If anything, the anti-government attitudes have gotten worse — federal workers are somehow made to be villains, enemies of the people. 

Spirit of FDR

To use one of Biden’s words, this is malarkey. Does the government make mistakes? Of course. Does it waste money? You bet. But are federal workers “enemies” and “stooges” who are part of some “deep state”? No. Believe what you wish. 

It’s telling that Biden has decorated the Oval Office with portraits of several presidents. But the biggest portrait of all he has on display is that of FDR. Biden believes, as Roosevelt and other presidents proved, that the government can do big things. The president’s skillful handling of the Covid19 mess he inherited is an early sign that it can, and perhaps a template for other big problems, like climate change.

Government is the problem? Four decades in the making, that paradigm could soon change as well. 

The Margin: The number of Americans identifying as Republican is the lowest it has been in a decade: Gallup poll

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