Table of Contents

A thriving middle class at home enables the United States to lead abroad from a position of strength. Yet too many Americans are struggling to attain or sustain a middle-class standard of living, and they worry that it will be even harder for their children to do so. That was the case before the coronavirus pandemic began and is even more so now. Although changes to domestic fiscal and monetary policies would affect Americans’ economic well-being more directly than foreign policy, it is worth exploring whether and how U.S. foreign policy could work better for the middle class.

Long-Term Forces Reshaping Middle-Class Attitudes and Interests

Over the past two decades, the convergence of three factors has forced a broad reevaluation of U.S. foreign policy. First, the long-term decline of manufacturing, coupled with advances in technology, have exacerbated middle-class economic anxieties. Second, a combination of increasing inequality, deteriorating public finances, and rising economic competition with China has led some Americans to question why the benefits of globalization seem to favor the nation’s top earners, why other countries are not paying their fair share for international security, and why they are not always playing by the same rules. Third, with the threat of terrorism receding in Americans’ minds, many middle-class households have begun to view the economic struggles at home as a higher priority than the major geopolitical or security threats abroad. Separately, these three factors might not have spurred a reckoning in the overall direction and purpose of U.S. foreign policy. But their convergence made such a reckoning unavoidable, and the pandemic has magnified the urgency around addressing them.

Mounting Economic Anxieties in the Age of Globalization and Technological Change

Middle-class anxieties in the United States have escalated over the last two decades as middle-income wages have stagnated and household costs have risen. In a poll conducted by the Pew Research Center in spring 2019, 69 percent of Americans surveyed said they expected their children to be worse off or no better financially than their parents.1 And that poll was taken when the U.S. economy was performing well and unemployment rates were low.2 Domestic policies and structural trends largely account for this growing economic stress. However, U.S. foreign policy has also played a role through the embrace and promotion of globalization, particularly in the post–Cold War era.

Those interviewed and surveyed in Colorado, Nebraska, and Ohio—in conservative and progressive strongholds alike—sounded a common refrain when asked how the middle class is faring: they struggle to keep pace with the rising costs of healthcare, housing, education, and childcare, among other household costs. A few data points bear out the challenge facing households. The pace of consumer inflation in medical care services has been nearly twice the pace of overall inflation since 2000, and healthcare spending has grown from 5.4 percent of total household expenditures in 2000 to 8.1 percent in 2018.3 The median sales price (nominal) for an existing single-family home has risen 92 percent since 2000, while the median family income (nominal) has grown more slowly.4 Student debt more than quadrupled between 2004 and 2017.5 An estimated 10 to 29 percent of median family income now goes toward infant care, depending on the state.6

Of course, not all expenses have gone up. The cost of some household goods has dropped, in no small part because international trade has lowered the price of imports. Goods purchases now make up a smaller share of total household expenditures than they did two decades ago, freeing up income for other items. For example, for consumers in the middle-income quintile, expenditures on apparel have fallen from 5.9 percent of total expenditures in 1985 to 2.9 percent in 2019, spending on all food items (including food away from home) has fallen from 15.5 to 14.1 percent, and spending on all transportation has fallen from 21.0 to 18.6 percent.7 However, one side effect of this trend, among others, is that the benefits of international trade are no longer as visible or significant for middle-class Americans, since goods purchases now account for a smaller percentage of their household expenditures.

Perhaps the biggest contributor to the struggle of the middle class, and many other Americans, is slow income growth. Between 1970 and 2000, the median household income for middle-income households grew about 40 percent; but over the past two decades, it has grown by less than 10 percent.8 Furthermore, in 1970, middle-income households held 62 percent of all household income, and by 2018, they held only 43 percent. The 2008 global financial crisis dealt a particularly harsh setback. According to the Pew Research Center, middle-income households experienced an 8 percent drop in median income between 2007 and 2011.9 It took until 2015 for median incomes to recover to pre-crisis levels. Overall, U.S. income inequality (as measured by the Gini ratio for all American households) hit a new peak in 2017—only to retreat slightly in 2018.10

The reasons behind sluggish income growth within the middle quintiles are complex, but they involve a mix of structural changes in the U.S. economy, such as the continued growth of the service sector; technological change that favors skilled workers; globalization; decreasing business dynamism; and domestic policy shifts, such as changes to the tax code, regulatory stances, and social insurance programs. Today, middle-class households rely predominantly on employment in the service sector, where wages for those without a college degree (67 percent of the U.S. workforce) are lower than in the goods-producing industries where they once worked in larger numbers.11 For example, Walmart is currently the top private sector employer in Ohio and twenty-one other U.S. states, with average salaries hovering around $29,500 per year.12

At the same time, technological changes have reduced the demand for labor for many rote tasks in the manufacturing sector. Looking ahead, one study estimates that ongoing technological advances in areas like artificial intelligence could cause twice as much workforce displacement in the services sector between 2020 and 2040 as the industrial revolution caused for agricultural workers between 1900 and 1940. And the amount of displacement could be nearly three times what automation, foreign trade, and other factors caused for the manufacturing workforce in the 1970s and 1980s.13 Even as technological change has proceeded, the rate of productivity growth has decelerated, creating a modest drag on economic growth. From 1980 to 2010, the average annual rate of labor productivity was 2.1 percent, slipping to 0.9 percent in the post-2010 period.14

With income growth slowing for the middle class, some saw trade liberalization as just adding insult to injury, especially in hard-hit communities.

With income growth slowing for the middle class, some saw trade liberalization as just adding insult to injury, especially in hard-hit communities. Since trade policy is more visible politically than slow-moving and diffuse technological change—Congress votes on trade agreements, not on technology change—it was cast as the primary culprit for the loss of well-paying manufacturing jobs, the move toward outsourcing, the declining bargaining power of labor, and the downward pressure on wages in some sectors. That is not to say that trade policy had nothing to do with the decline in manufacturing. In particular, rapid trade liberalization with China in the 2000s almost certainly contributed to the drop in manufacturing payrolls from 17.2 million in October 2000 (when then president Bill Clinton signed legislation granting permanent normal trade relations with China under the Trade Act of 1974) to 11.6 million jobs just one decade later.15 But the consequent economic pain was concentrated in certain communities—some of which are hugely important political constituencies in battleground states in presidential elections. This has obscured the broad but diffuse gains of globalization enjoyed by many middle-class households elsewhere across the country, including those working in advanced manufacturing, agricultural, and service export industries.

It is also worth noting that the technological advances transforming the workforce have links to globalization and foreign policy. For example, U.S. manufacturers accelerated investments in labor-saving technologies in the 1970s and 1980s, partly to reduce costs and compete more effectively with Japanese auto and electronics producers.16 The ongoing debates about whether “robots or trade” caused manufacturing job losses are therefore misleading, because these are not mutually exclusive factors. In a more competitive global economy, businesses will turn to technology or more diffuse supply chains to lower labor costs—a dynamic that is not favorable for the U.S. middle class. Meanwhile, the highly skilled employees, the content and intellectual property creators, and the investors behind the technological advances are in the upper-income bracket. Moreover, China and other major powers seek to build technological advantages in certain sectors, which further complicate the policy response to technological change.

Finally, globalization has not only contributed to the movement of goods, services, capital, and data but also to the movement of people. U.S. businesses and previous Democratic and Republican administrations frequently emphasized that a welcoming stance toward immigration gave the United States a significant edge in the global economy. Many constituents on both sides of the political aisle still see immigration as delivering significant economic benefits for the middle class. It is largely the cultural dimensions to immigration that heighten anxieties, particularly on the right of the political spectrum.

The foreign-born population in the United States has climbed steadily since the passage of the immigration and naturalization act in 1965. Today, it stands at 13.7 percent.17 The last two periods when the foreign-born share of the population reached current levels—the 1880s and the 1920s—saw a populist backlash not dissimilar to that in 2016.18 The Pew Research Center predicts that the foreign-born share of the U.S. population could reach nearly 18 percent in 2065, surpassing the highest percentage recorded in two centuries (14.8 percent).19

In a 2018 poll, 61 percent of Republicans and 19 percent of Democrats said that the impact of the United States becoming majority nonwhite by 2045 will be mostly negative.20 So while Americans are chiefly concerned about the economic viability of the middle class, many also are deeply conflicted about its evolving makeup. And they lay at least some of the blame for these anxieties on globalization and U.S. foreign policy.

Heightened Sensitivity to the Costs and Uneven Benefits of U.S. Global Leadership

The combination of rising income inequality, slowing economic growth, deteriorating public finances, and intensifying foreign economic competition, particularly from China, has created a more challenging environment for U.S. foreign policy leadership than several decades ago when Americans could more readily see the benefits of that role. Today, growing economic burdens at home have encroached on that shared sense of national purpose.

Today, growing economic burdens at home have encroached on that shared sense of national purpose.

When the United States forged a bipartisan consensus on its foreign policy in the 1950s and 1960s—largely around building up and leading “the West” as a bulwark against Soviet aggression and the spread of communism during the Cold War—income inequality in the United States was at a historic low point.21 And average annual economic growth during this period hummed along at over 4 percent.22 The combination of the earlier war effort and massive levels of public investment in the New Deal era contributed to both phenomena. World War II had also destroyed the production capacities of America’s foreign economic competitors in Europe and Japan. Therefore, as the barriers to trade in goods came down and the United States helped these nations recover through the Marshall Plan, the markets for U.S. exports opened up with minimal risk of import competition. The conditions were perfect for the United States to underwrite the security and economic recovery of Western allies and partners. The middle class believed not only that the United States could afford to assume a significant global leadership role but also that they would benefit from it.

When the Cold War ended and the United States set a new, ambitious foreign policy agenda to transform the U.S.-led Western order into a U.S.-led global order, the economic conditions were once again chiefly favorable. Having tamed the inflation of the 1970s, the Federal Reserve Bank was able to keep interest rates low. With the Soviet Union no longer a threat, the United States could spend less on defense and reduce fiscal deficits. The Japanese economy cooled after the 1970s and 1980s and no longer presented a challenge to U.S. economic primacy. The Chinese economy had yet to fully take off, and its leaders were not yet prepared to test the rules of economic engagement. By the second half of the 1990s, the U.S. economy was on a roll—growing more than 4 percent a year on average. However, it is important to note that this strong economic performance, in aggregate, masked growing income inequality, which accelerated in the late 1980s and throughout the 1990s. Only U.S. labor unions consistently raised concerns about the unbalanced nature of U.S. growth, as the issue had not yet gained salience in the public discourse.

In comparison, since 2001, the U.S. annual growth rate has generally remained below 3 percent;23 income inequality has continued to worsen;24 and China has burst onto the scene as a global economic powerhouse and become more willing to use its growing leverage to capture market share. As awareness of the problems grew, many economists started to call for significant increases in public investment in infrastructure, research and development (R&D), education, and workforce development to boost the productivity and competitiveness of U.S. labor. But such investment did not come readily. Meanwhile, the United States has spent trillions of dollars on decades-long wars and military interventions in Afghanistan, Iraq, and elsewhere. This naturally raised questions about whether the international economic system built by the United States is still benefiting the middle class and whether the United States can afford to be underwriting international security.

Absence of a Unifying Geopolitical and Security Threat

While acknowledging the need to manage threats from overseas, those interviewed in Colorado, Nebraska, and Ohio (prior to the pandemic) stressed that the daily economic struggles facing Americans are of greater concern to them than foreign policy. National polling data suggest that until quite recently many Americans share this view.25 This is probably because none of the current threats, on their own or collectively, unite and preoccupy Americans like the harrowing prospect of nuclear Armageddon did during the Cold War or the terrorist threat in the aftermath of the September 11, 2001, attacks. With no unifying geopolitical threat to rally around, the one thing that seems to unify Americans across the political spectrum is that the United States must be far more judicious about whether and when it starts another major war. In a late 2019 poll, three-quarters of Americans viewed diplomacy rather than military strength to be the best way to ensure peace, which included over half of Republicans for the first time since the 1990s.26 Two decades of military interventions in Afghanistan and Iraq cost the United States thousands of American lives and trillions of taxpayer dollars—without clear-cut victories. Therefore, it is not surprising that the interviewees were paying less attention to U.S. foreign policy aims abroad and instead were worrying about their needs and economic well-being at home.

Some national security professionals on both sides of the aisle have been trying to rally public support around the geostrategic competition with China, which is likely to be a defining feature of U.S. foreign policy for decades. But, at the time of the interviews, such a competition with China was not at the forefront of the minds of most Coloradans, Nebraskans, Ohioans, or Americans in general. Their concerns were more narrowly focused on pushing back harder against China’s unfair trading practices and increasing domestic investments to better compete with China’s economy.

Meanwhile, others in the national security community have been warning that an escalation of geopolitical tensions with China would undermine core national economic interests. They stress how the fates of the Chinese, U.S., and global economies are intertwined. They also believe that the United States could find it difficult to mobilize other nations to its side in an all-encompassing geopolitical struggle with China, whose economic leverage on U.S. allies and partners far exceeds anything the Soviet Union could bring to bear during the Cold War.

Some interviewees, particularly younger Americans and Democrats, viewed climate change as an existential threat to the planet and believed that it should be the top priority for U.S. foreign and domestic policy. But for many others, especially in rural counties, it was actually the economic consequences of the policy responses to climate change that concerned them most.27 Stringent regulatory measures to reduce fossil fuel emissions threaten their livelihoods, particularly in Colorado’s oil- and gas-producing regions and in Nebraska’s counties dependent on agriculture and the coal transportation industries.

How the COVID-19 Crisis Will Exacerbate Preexisting Challenges

The continuing economic fallout from the pandemic and the perceived lack of global cooperation to mitigate its impacts significantly complicates the challenges already facing U.S. policymakers. To the list of policy priorities, they must now add containing a global pandemic; spurring an economic recovery, particularly for those Americans most impacted by it; and managing the growing risks of political instability abroad.

More than any other income group in the country, the middle class depends on employment earnings to make ends meet—partly because it has less access to social transfers than lower-income populations and partly because it has less capital income than higher-income (and wealthier) populations.28 Hence, the shock to the U.S. labor market has been profound for many middle-class households. The country saw a tenfold increase in new unemployment insurance claims from February to mid-summer—a surge that is unprecedented in the history of the unemployment insurance program.29 Millions more workers still face layoffs if economic conditions do not stabilize soon, especially in “high-contact intensive jobs” and in industries hardest hit by the crisis, including oil and gas (concurrently beset by a price war among foreign producers), transportation, travel and hospitality, and brick and mortar retail.30 Millions of others have temporarily left the labor force and are waiting on the sidelines for the economy to improve or for their jobs to return. A large percentage of these jobs support middle-income households that do not have substantial savings and live paycheck to paycheck.31 These economic stresses have fallen disproportionately on Black and Hispanic communities, exposing the deeper vulnerabilities of people of color due to systemic injustices.

It is unclear how long extraordinary measures will be needed to control the virus’s spread or how long it will take U.S. economic activities to return to pre-crisis levels.

The U.S. economy is currently expected to decline by 6.5 percent this year, according to the June projections from the Federal Reserve.32 The unemployment rate, which surged to 14.3 percent in April, is forecasted to settle at a little under 10 percent by the end of this year—almost three times higher than the projection from December 2019. Many of those laid off are counting on government assistance to pay their mortgages, rent, and utilities; buy groceries; and meet other regular expenses. As of the writing of this report, it is unclear how long extraordinary measures will be needed to control the virus’s spread or how long it will take U.S. economic activities to return to pre-crisis levels. Congress has authorized more than $2 trillion in aid for U.S. workers and businesses through the Coronavirus Aid, Relief and Economic Security (CARES) Act.33 Additional federal measures have included about $500 billion more for small business, plus modest extensions to unemployment and debt relief programs. The Federal Reserve slashed interest rates and adopted a highly accommodative stance with respect to inflation. Yet it is too soon to know just how much these policies and the phased reopening of local economies will offset the long-term economic hardships imposed on middle-class households.

Even if the United States bounces back faster than expected, a projected downturn in global economic growth is likely to impede a full national recovery. Prior to the pandemic, the International Monetary Fund (IMF) was expecting positive per capita income growth in over 160 countries in 2020. But in its revised outlooks in April 2020 and again in June 2020, it forecasted that over 170 countries will experience negative per capita income growth and that the global economy will contract by 4.9 percent.34 The IMF assesses that emerging markets and low-income nations—across Africa, Latin America, and much of Asia—are at especially high risk of economic distress. These countries have far fewer resources than China, the United States, and European countries to contend with the economic fallout. They are “dangerously exposed” to ongoing demand and supply shocks, severe tightening in financial conditions, and, in some cases, an unsustainable debt burden.35 Previous research has shown that it takes an average of eight years for per capita GDP to return to pre-crisis levels following a major financial crisis.36

At the same time, COVID-19 is expected to increase geopolitical and security risks around the world. UN Secretary General António Guterres has warned that the pandemic threatens to further erode trust in many public institutions and governments across the globe, where citizens believe their authorities have mishandled the response or tried to downplay the severity of the crisis.37 The virus also threatens to exacerbate ethnic, religious, tribal, and other tensions to the extent that it disproportionately harms already marginalized populations.

Improved cooperation among the G20’s leading economies and the UN Security Council’s permanent members would bolster business confidence and public trust and hence speed up the recovery. But the United States has retreated from the leadership role it once played in mobilizing collective action, and many of these countries themselves have been hit hard by the virus, severely hampering coordination. Tensions between the United States and China have also ratcheted up, as each country blames the other for the current predicament. For example, Chinese media sources have promoted anti-American conspiracy theories about the origins of the virus and heavily criticized U.S. handling of the disease. Meanwhile, the Trump administration has tagged the coronavirus as the “Chinese virus” and has defunded, and is withdrawing from, the World Health Organization (WHO), arguing that the organization appeased China’s desire to minimize the initial outbreak in Wuhan.

Under these circumstances, the effects of the national and global crises are likely to linger for years and further strain the U.S. middle class. At a minimum, even after the United States has overcome the public health crisis and normal economic activity has resumed, it is very likely that:

  • More Americans will struggle to attain or sustain a middle-class lifestyle. High unemployment will reduce middle-class incomes and weigh on wage growth. Meanwhile, some household costs, especially for healthcare, are liable to be higher than before the crisis.
  • Americans will be even more sensitive to inequality. The crisis has further exposed the wide disparities between the nation’s top earners and everyone else in terms of job security, income, savings, and access to healthcare and reliable broadband connectivity—among the many other facets of U.S. economic and social life. It has revealed just how much more vulnerable marginalized populations, especially communities of color that must also contend with long-standing race-based injustices, are to shocks.
  • Many American households will have even less room to absorb another economic shock. They will have depleted their savings to carry them through layoffs and pay cuts and, in some cases, defaulted on mortgage payments and car or student loans.
  • American middle-class households will feel even more anxious about the risks associated with globalization. Many have experienced the worst economic shock of their lifetimes as a result of a virus that started in China and spread rapidly around the world. And they will not forget that U.S. manufacturers struggled to produce desperately needed medical equipment and supplies.
  • Americans will be even more conflicted about spending taxpayer dollars on U.S. foreign policy. On the one hand, they may support investing more in global health security—particularly to prevent another crisis that could devastate the U.S. economy and upend their way of life. On the other hand, they will be more sensitive to the opportunity costs of spending money abroad. A massive amount of investment at home will be needed to keep struggling industries and businesses afloat and to assist U.S. states and cities in offsetting the hundreds of billions of dollars in lost revenue.
  • In time, middle-class households will end up footing at least part of the bill for the recovery—whether it is through higher taxes, less generous safety nets, or both. When this crisis is over, the United States may have doubled or tripled the $2.2 trillion dollars it has already spent on the CARES Act, further exploding the national debt.

In sum, the COVID-19 crisis will have far-reaching, long-term socioeconomic and political ramifications in the United States and across the globe, thereby altering the trajectory of international affairs. Even if the worst fears do not materialize and the recovery proceeds far quicker than projected, the pressure to ensure that U.S. foreign policy advances the economic well-being of the middle class will undoubtedly increase.

How Much the Direction of U.S. Foreign Policy Needs to Change

Hundreds of middle-class Americans and community leaders interviewed across Colorado, Nebraska, and Ohio voiced deep concern about the costs of U.S. foreign policy and serious skepticism about its benefits. Whether in an urban or rural area—or in a Republican or Democratic stronghold—they all stressed how prior administrations had not done enough to make foreign policy work better for America’s middle class.

Hundreds of middle-class Americans and community leaders interviewed across Colorado, Nebraska, and Ohio voiced deep concern about the costs of U.S. foreign policy and serious skepticism about its benefits.

It is clear that the direction of U.S. foreign policy must change. However, Trump does not deserve the blame for creating this moment. Americans’ concerns were growing well before he became president and well before the pandemic hit. In fact, Obama captured the nation’s attention in 2008 as an anti-establishment candidate promising a less adventurous and more strategically disciplined vision of U.S. global leadership, partly in response to these evolving dynamics. For some of the same reasons, Hillary Clinton, the Democratic candidate in the 2016 presidential campaign, came out against the Trans-Pacific Partnership (TPP), the twelve-nation trade deal negotiated by the Obama administration.38 But the rebalancing that Obama and Clinton pursued pale in comparison to Trump’s America First strategy—a vision that has broken sharply with all Democratic and Republican predecessors.

When policy fails to adapt to growing economic and societal stresses at home—whether because of domestic political divides, inadequate policy tools, hard-to-absorb strategic challenges, or other factors—an abrupt change in approach becomes more likely. But often that correction goes too far, as evidenced by the government’s recent headlong dive into U.S. withdrawal and unilateralism. Today, a change of course is urgently needed. The country must advance U.S. national security interests and middle-class economic interests concurrently and, with its allies and partners, strategically navigate the major challenges that lie ahead. Despite the urban-rural divides, partisan differences, and varied industrial interests of the middle class, this is what many of the middle-class Americans interviewed want.

And they are pragmatic: they are not optimistic enough about the current system to believe it will deliver on all its promises without stronger government leadership and investment, and they are not pessimistic enough to demand a wholesale rewrite of the global order. A Gallup poll from February 2019 showed that 69 percent of Americans thought the United States should take a major or leading role in world affairs, a figure that has been relatively stable for a decade.39 The American middle class wants its government to better promote its interests—by fostering greater stability and lowering the risks of living in a more open and integrated world, by leading a global economic system that promotes growth but also fair play, and by investing more in economic resilience efforts at home. They want a more secure economic future in the twenty-first century. Foreign policy needs to help make that happen.

But a better foreign policy alone is obviously insufficient. A foreign policy that is judicious and adapts U.S. leadership to the evolving global order will not advance middle-class interests if domestic institutions and policies do not ensure that the gains reach the middle class. U.S. foreign policy changes must be accompanied by internal reforms that enable the middle class and those working to join it to both shape national policymaking and equally profit from the increased national wealth.

The exact policy and institutional reforms needed will naturally be contested at the national and state levels—as they must be. The ideas and recommendations proposed in this report are a foray into this debate and provide important perspectives on some of the key questions facing the middle class. They underscore that a revamped U.S. foreign policy will succeed only to the degree that domestic politics and national economic management address American middle-class concerns and preferences. Support of the middle class, and in particular the many Americans demanding change, will be indispensable in sustaining responsible U.S. leadership in an uncertain world.

Notes

1 Richard Wike, Jacob Poushter, Laura Silver, Kat Devlin, Janell Fetterolf, Alexandra Castillo, and Christine Huang, “European Public Opinion Three Decades After the Fall of Communism,” Pew Research Center, October 15, 2019, https://www.pewresearch.org/global/2019/10/15/european-public-opinion-three-decades-after-the-fall-of-communism/.

2 U.S. Bureau of Labor Statistics, “Seasonal Unemployment Rate,” latest monthly data release from August 2020, current and historical data accessed on September 10, 2020, https://data.bls.gov/timeseries/LNS14000000?years_ option=all_years.

3 U.S. Bureau of Labor Statistics, “Consumer Price Index for All Urban Consumers (CPI-U), Medical Care Services, Series CUSR0000SAM2,” latest monthly data release from August 2020, current and historical data accessed on September 15, 2020; U.S. Bureau of Labor Statistics, “2019 Consumer Expenditure Survey (CES),” Table 1502: Composition of consumer unit: Annual expenditure means, shares, standard errors and coefficients of variation, https://www.bls.gov/cex/2019/combined/cucomp.pdf; and U.S. Bureau of Labor Statistics, “2000 Consumer Expenditure Survey (CES) Annual Report,” Table 1: Healthcare as a share of average annual expenditures for all consumer units, https://www.bls.gov/cex/csxann00.pdf.

4 National Association of Realtors, “Home Sales: Median Sales Price of Existing Homes,” latest release on August 21, 2020, current and historical data accessed via Haver Analytics on September 15, 2020. The calculation compares the median home price in January 2020 with that recorded in January 2000. Current data are available at https://www.nar.realtor/sites/default/files/documents/ehs-07-2020-single-family-only-2020-08-21.pdf.

5 Peter G. Peterson Foundation, “Student Debt Continues to Rise,” July 18, 2018, https://www.pgpf.org/blog/2018/07/the-facts-about-student-debt.

6 Elise Gould and Hunter Blair, “Who’s Paying Now? The Explicit and Implicit Costs of Current Early Care and Education System,” Economic Policy Institute, January 15, 2020, https://www.epi.org/files/pdf/181729.pdf.

7 U.S. Bureau of Labor Statistics, “Consumer Expenditure Surveys (CE),” Table 1101, latest annual data released on September 10, 2020, and current and historical data accessed via Haver Analytics on September 15, 2020. Current data are available at https://www.bls.gov/cex/2019/aggregate/quintile.pdf.

8 Rakesh Kochhar, Pew Research Center, “Middle Class Data Update: State Ranges,” presented to the Carnegie task force, March 13, 2020, and August 6, 2020.

9 Ibid.

10 Data accessed via Haver Analytics on August 8, 2020, based on census data on income inequality (Table H-4); see https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-inequality.html.

11 U.S. Census, “Educational Attainment: 2018 American Community Survey 1-Year Estimates,” accessed January 22, 2020, at data.census.gov. As a share of all total nonfarm payrolls, jobs in goods-producing industries have declined from 27 percent in 1980 to 14 percent in 2020. By comparison, today, the remaining 15 percent is public sector employment, which is down from 18 percent in 1980. U.S. Bureau of Labor Statistics, “Current Employment Statistics: Establishment Survey,” Table B-1, latest release from April 3, 2020, current and historical data accessed via Haver Analytics on April 13, 2020.

12 Rachel Gillett, “The Largest Employers in Each US State,” Business Insider, June 11, 2017, https://www.businessinsider.com/largest-employers-each-us-state-2017-6; and Ohio Department of Development, “Ohio Major Employers: Historic Data,” 2017, https://development.ohio.gov/files/research/B2021.pdf. According to Walmart’s website, about 75 percent of its store management employees, who once started as hourly associates, earn between $50,000 and $170,000 a year. It also indicates that Walmart is investing $2.7 billion over two years in higher wages, education, and training; see “Company Facts,” accessed September 10, 2018, https://corporate.walmart.com/ newsroom/company-facts. However, the majority of its employees are not store managers. According to Walmart, the average hourly full-time wage was $14.16 in Ohio as of September 2019; see “Location Facts,” accessed October 16, 2018, https://corporate.walmart.com/our-story/locations/united-states/ohio?multi=false. The annual wage is calculated using 2,080 hours (as is done by the U.S. Bureau of Labor Statistics); see U.S. Bureau of Labor Statistics, “May 2017 State Occupational Employment and Wage Estimates: Ohio,” accessed September 10, 2018, https://www.bls.gov/oes/ current/oes_oh.htm#00-0000.

13 Karen Harris, Austin Kimson, and Andrew Schwedel, “Labor 2030: The Collision of Demographics, Automation, and Inequality,” Bain & Company, February 7, 2018, https://www.bain.com/insights/labor-2030-the-collision-of-demographics-automation-and-inequality/.

14 U.S. Department of Labor, Bureau of Labor Statistics, “Productivity and Costs,” latest release on September 3, 2020; series used is the annual growth in real output per hour of all persons within the nonfarm business sector. Current and historical data accessed via Haver Analytics on September 15, 2020. Current data are available at https://www.bls.gov/lpc/#tables.

15 David H. Autor, David Dorn, and Gordon H. Hanson, “The China Syndrome: Local Labor Market Effects of Import Competition in the United States,” American Economic Review 103, no. 6 (2013): 2121–68; and U.S. Bureau of Labor Statistics, “Current Employment Statistics—CES (National),” Table B-1a, Employment and Earnings, latest release from April 3, 2020. Current and historical data series accessed via Haver Analytics on April 13, 2020.

16 Bruce Stokes, “Foreign Policy for the Middle Class: The National Context,” presented to the Carnegie task force, January 21, 2020.

17 Pew Research Center, “Key Findings About U.S. Immigrants,” August 20, 2020, accessed online on September 15, 2020, https://www.pewresearch.org/fact-tank/2020/08/20/key-findings-about-u-s-immigrants/.

18 Bruce Stokes, “Foreign Policy for the Middle Class: The National Context.”

19 Pew Research Center, “Modern Immigration Wave Brings 59 Million to U.S., Driving Population Growth and Change Through 2065,” September 28, 2015, https://www.pewresearch.org/hispanic/2015/09/28/modern-immigration-wave-brings-59-million-to-u-s-driving-population-growth-and-change-through-2065/.

20 Public Religion Research Institute, “Partisan Polarization Dominates Trump Era: Findings From the 2018 American Values Survey,” October 2018, https://www.prri.org/wp-content/uploads/2018/10/Partisan-Polarization-2018_AVS-C.pdf, 8.

21 Gini ratio for all families hit a minimum of 0.348 in 1968, as did the shorter time series for all households. U.S. Census, “Historical Income Tables: Income Inequality,” Table F-4, latest release on August 27, 2019, data series accessed on August 3, 2020.

22 Data for annual growth of real GDP accessed via Haver Analytics on August 9, 2020. They are also available from the Bureau of Economic Analysis historical tables.

23 Ibid.

24 U.S. Census, “Historical Income Tables: Income Inequality,” Table H-2, latest release on August 27, 2019, data series accessed on August 3, 2020, https://www.census.gov/data/tables/time-series/demo/income-poverty/historical-income-inequality.html.

25 Pew Research Center, “In a Politically Polarized Era, Sharp Divides in Both Partisan Coalitions,” December 17, 2019, https://www.pewresearch.org/politics/2019/12/17/6-views-of-foreign-policy/.

26 Pew Research Center, “Views of Foreign Policy: Democrats Overwhelmingly Say Diplomacy, Rather Than Military Strength, Is the Best Way to Ensure Peace; Republicans Are More Divided,” December 13, 2019, https://www.pewresearch.org/politics/2019/12/17/6-views-of-foreign-policy/pp_2019-12-16_political-values_6-06/.

27 While many young and democratic interviewees voiced higher concerns regarding the consequences of climate change, those in the tourist sector also hold a financial stake in Colorado’s environmental condition. Meanwhile, interviewees representing the energy and gas industry, particularly in the Denver-Julesburg Basin in northeast Colorado, were more concerned with the economic costs of adopting environmental regulations. See Salman Ahmed, Allison Gelman, Wendy Cutler, Rozlyn Engel, David Gordon, Jennifer Harris, Brian Lewandowski, Douglas Lute, Daniel M. Price, Christopher Smart, Jake Sullivan, Ashley J. Tellis, Richard Wobbekind, and Tom Wyler, “U.S. Foreign Policy for the Middle Class: Perspectives From Colorado,” Carnegie Endowment for International Peace, November 5, 2019, https://carnegieendowment.org/2019/11/05/u.s.-foreign-policy-for-middle-class-perspectives-from-colorado-pub-80112.

28 Federal Reserve Board of Governors, “2016 Survey of Consumer Finance, Excel Based on Public Data (2016 dollars),” Table 2: Amount of before-tax family income, distributed by income sources, by percentile of net worth, 1989–2016 surveys, October 31, 2017, https://www.federalreserve.gov/econres/scfindex.htm.

29 Dylan Matthews, “9 Charts Showing What Coronavirus Is Doing to the Economy,” Vox, April 3, 2020, https://www.vox.com/future-perfect/2020/3/30/21184401/coronavirus-covid-19-economy-charts.

30 Charles Gascon, “COVID-19: Which Workers Face the Highest Unemployment Risk?,” Federal Reserve Bank of St. Louis, March 24, 2020, https://www.stlouisfed.org/on-the-economy/2020/march/covid-19-workers-highest-unemployment-risk.

31 Board of Governors of the Federal Reserve System (U.S.), “Report on the Economic Well-Being of U.S. Households in 2018,” Board of Governors, 2019, https://www.federalreserve.gov/consumerscommunities/files/2018-report-economic-well-being-us-households-201905.pdf.

32 Federal Reserve System (U.S.) Federal Open Market Committee, “FOMC Projections Materials: June 10, 2020, Median,” accessed August 4, 2020, https://www.federalreserve.gov/monetarypolicy/fomcprojtabl20200610.htm.

33 “The CARES Act Works for All Americans,” U.S. Department of the Treasury, https://home.treasury.gov/policy-issues/cares. Also see the International Monetary Fund’s global economic policy tracker, “Policy Responses to COVID-19,” https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19#U.

34 Kristalina Georgieva, “Confronting the Crisis: Priorities for the Global Economy,” International Monetary Fund, April 9, 2020, https://www.imf.org/en/News/Articles/2020/04/07/sp040920-SMs2020-Curtain-Raiser. The World Bank estimate is slightly worse (a 5.2 percent decline); and International Monetary Fund (IMF), “World Economic Outlook Update: A Crisis Like No Other, and Uncertain Recovery,” June 2020, https://www.imf.org/en/Publications/WEO/Issues/2020/06/24/WEOUpdateJune2020.

35 Georgieva, “Confronting the Crisis: Priorities for the Global Economy.”

36 Carmen M. Reinhart and Kenneth S. Rogoff, “Recovery From Financial Crises: Evidence From 100 Episodes,” American Economic Review 104, no. 5 (2014): 50–55.

37 United Nations, “Secretary-General’s Remarks to the Security Council on the COVID-19 Pandemic [as delivered],” April 9, 2020, https://www.un.org/sg/en/content/sg/statement/2020-04-09/secretary-generals-remarks-the-security-council-the-covid-19-pandemic-delivered.

38 Jessica Taylor, “Clinton Breaks With Obama to Oppose Asia Trade Deal,” NPR, October 7, 2015, https://www.npr.org/sections/itsallpolitics/2015/10/07/446672839/clinton-breaks-with-obama-to-oppose-trans-pacific-partnership.

39 Gallup, “U.S. Position in the World,” https://news.gallup.com/poll/116350/position-world.aspx. Also see Gallup, “Foreign Trade: Opportunity or Threat to the U.S. Economy,” https://news.gallup.com/reports/267386/trade-under-trump-gallup-briefing.aspx. Note that support for trade is negatively correlated with the domestic unemployment rate, and February 2020 could end up representing a cyclical high-water mark for trade support.