I was in a grocery store parking lot, loading bags into the trunk with my daughter. Next to us, another mother-daughter duo was doing the same. The girl said to her mother, loud enough for all four of us to hear, “We spent so much money and it doesn’t look like we have much.”
“No kidding,” her mom said, and then looked over at me. I had about six bags in the trunk by now, and one of the highest grocery bills I’d had in awhile. I nodded. A moment of empathy between strangers. Our resources don’t seem as abundant as they used to.
Abundance is the buzzword in economic policy right now. It’s the title of a new book by pundits Ezra Klein and Derek Thompson, which lays out their vision for Democratic economic policy. As the authors say, “This book is dedicated to a simple idea: To have the future we want, we need to build and invest more of what we need.”
Enough of the overburdensome regulation that chokes off housing supply and spikes cost. Enough of AI’s energy suck that will break an outdated grid once and for all. Enough of congested roads and traffic, polluting the skies. Enough of the right fighting the government at every turn and the left giant-sizing the bureaucracy, which handicaps its efficiency. Enough of inflation’s scarcity and expensive organic food and medicine. Let’s usher in a future of health and plenty.
The authors’ attitude should be commended. I spent a recent weekend in Galveston, Texas. Passing the massive fuming industrial plants on the coast, I found myself dreaming of the book’s vision for a future world with clean energy and fresh desalted ocean water rushing through our pipes. It’s good to dream again.
It feels like ever since the turn of the 21st century, America has been in a bit of a defensive cower. First there was the dot-com bust. Not a decade after came the Great Recession, wiping out jobs and savings. Slightly more than a decade after that, we lived through a global pandemic and the sharpest economic crash since the Great Depression. Then we got sky-high inflation.
Each time, the U.S. economy has come roaring back to life but, it seems to me, with an increasing sense of foreboding. Somewhere along the way, America took on a posture of scarcity, not abundance. We stopped thinking about how to grow the pie and started thinking about how to protect our slices.
Of course, Trump could have chosen — and still could choose — to be the president of abundance. Some Republicans are trying to get us there by slashing through the government bureaucracy with DOGE (albeit much less than promised and cutting erratically), supporting an all-of-the-above energy strategy, and magnifying the successful regulatory restraint of the first Trump term with a supposed elimination of 10 rules for every new one that gets implemented.
But Trump is crowding out his own successes. This go around, he has slapped on global tariffs that all but ensure fewer consumer choices, higher prices and a greater risk of recession. The Yale Budget Lab estimates that the tariffs on China, Canada and Mexico alone will increase costs for each American family by $2,000 a year, far surpassing any goodies that get included in proposed tax legislation. The downgrading of U.S. debt makes it more expensive for businesses and families to borrow. Adding $5 trillion to the deficit with the proposed tax bill doubles down on that error; a quick hit for a long-term drag.
The moment the next president comes in and reverses tariffs for all except for a few strategic levies on China, builds the select critical national security resources we need at home but otherwise lifts the top on trade (and ideally immigration), abundance will soar. The foolishness of our self-imposed scarcity for the next four years will be revealed.
The reality is that we know how to create abundance. It’s the oldest program in the Western economic canon. It’s not massive government spending with less red tape, as Klein and Thompson seem to be suggesting. It’s not kind-of rolling back domestic bureaucracy while clamping down our arteries abroad, as Trump is doing. It’s what Nobel prize winner Edmund Phelps wrote about in his book Mass Flourishing: the idea that each individual is full of creativity and potential and we should strive to ensure that as many people as possible have the opportunity to engage.
Prosperity is unleashed with limited government (something out of vogue on both sides of the aisle) and with checks on executive power and corporate monopolies. We can help give people the tools they need to succeed, like a solid public education and basic infrastructure, but should avoid being heavy-handed, top-down or overly directive. Texas has gotten this right more than most; hence the “Texas miracle” and more migration than to any other U.S. state. I wish Klein and Thompson gave it more credit.
But we also need robust civil society, religious life, community and family ties, because without this connective tissue, it all kind-of crumbles in on itself no matter how much we produce or how efficient the government becomes. Even effective government programs can crowd out these things if we’re not careful; and too often progressives seem especially keen to do so. And we need a dependable political structure because lurching from one extreme to the next is no foundation for growth, irrespective of what policies get put in place.
Until that becomes our economic policy, I’ll hold my breath on dreams of abundance.