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February 5, 2020

Not Capitalism, But Regulation to Blame at IOP Talk

On Wednesday, January 29, the University of Chicago Institute of Politics (IOP) hosted Pulitzer Prize–winning journalists and partners Nicholas Kristof and Sheryl WuDunn for a discussion of their new book, Tightrope: Americans Reaching for Hope. Moderated by IOP director David Axelrod, the event shed light onto its titular question, “The Future of Capitalism: Is Individualism Killing Opportunity in America?”

For Kristof and WuDunn, who have seen poverty’s ability to destroy lives firsthand, the answer is personal. The event kicked off with a discussion of the coauthors’ history with economic plight. WuDunn’s grandparents fled China in poverty, and Kristof grew up on a farm in rural Oregon with his father, an Armenian immigrant. “A quarter of the kids on my number six bus died from drugs, alcohol [and] suicide,” Kristof recounted. He and WuDunn count these among what they call “deaths of despair,” or deaths related to issues from living below the poverty line, like drug abuse, depression, and PTSD.

WuDunn pointed to researchthat indicates a decrease in the life expectancy of middle-aged white people, a group she claims is especially afflicted by this despair. “Even in the Great Depression, there was rising life expectancy. We’re likening this to a social Great Depression,” she said.WuDunn asserted that this is not linked directly to capitalism. Rather, she and Kristof argue that it is our model of capitalism that is failing.

“From 1945 to the 1970s, we had a capitalist system in the U.S. that delivered extremely well. Inequality was actually declining,” Kristof said. He also pointed to other capitalist countries, like Germany and Canada, that were able to fix the same problems he now sees in America.

“Life expectancy isn’t falling in those countries,” he added. “For many Americans, the American dream is broken,” said WuDunn, who blames failing policy around healthcare and other economic safety nets for this sinking life expectancy.

"There’s a misperception in the U.S. that this is the inevitable consequence of automation and globalization, and it’s not,” Kristof said. “It’s the consequence of bad policy driven by a bad narrative.”

To illustrate this, WuDunn used an example of two groups of auto workers—one from Detroit, Michigan, and the other from Windsor, Ontario—who were laid off following the 2008 recession. The U.S. workers received unemployment benefits, but lost their healthcare; the Canadian workersnot only kept their healthcare but were reincorporated into the labor force with public training and guidance.

“The government takes a much more active role there,” she said. “Years later, they didn’t have the problems, like self-medication, depression, and PTSD, the same way that the people in Detroit did.”

The coauthors pointed out that the people who need these benefits the most are often the ones who vote against them. “People in counties that had higher rates of death by despair were substantially more likely to vote for Trump,” Kristof said, adding that one of the factors that increase despair is inadequate healthcare, which she said Trump is fueling.

Kristof’s critique extended to Democrats as well. “These issues come from 50 years of bipartisan failure. The Democrats have their fingerprints on this as well,” he said. They also pointed out that, by percentage, the poorest Americans are more willing to donate in hopes of fixing issues that affect them because they have firsthand experience.

“We’ve lost empathy because we live in bubbles,” said WuDunn. She advocated for the breaking of these bubbles as a potential solution: “When people in poor neighborhoods confront the need, they give, they respond. I think that we’d also see that in the top 20 percent if they saw the need.”

Kristof and WuDunn ended the conference on a hopeful note. Kristof cited Kansas’s recent move to increase taxes. “Ultimately, Kansas voters rebelled because their schools were doing too poorly,” he said. “Likewise, you have red states like Idaho, like Utah, that are expanding Medicaid.”

He added that the idea that Americans once got by without government benefits is historically inaccurate; even the pioneers who settled in Oregon, Kristof pointed out, had the Homestead Act. “My area was transformed by these big ideas,” he said.“That is what, I think, can again transform the opportunities for the kids on the number six bus.”

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