AEI Launches New Center on Opportunity and Social Mobility

The American Enterprise Institute announced last month the launch of an ambitious new effort — the American Dream Initiative — to produce research “focused on poverty alleviation, workforce development, vocational education, housing and urban policy, and the revitalization of key institutions.” As part of that project, AEI also will stand up a new Center on Opportunity and Social Mobility led by Senior Fellow Scott Winship. Serving as deputy director will be Kevin Corinth, former staff director of the Joint Economic Committee in Congress and chief economist of the President’s Council of Economic Advisers at the White House under former President Donald Trump. Corinth spoke recently with Spotlight about the plans for the Center; the transcript of that conversation has been lightly edited for length and clarity.

So, tell us about the center and this new AEI initiative

The new AEI Center on Opportunity and Social Mobility is part of the broader American Dream Initiative, and it’s motivated to address a couple major challenges. One is increasing opportunity, especially for disadvantaged children from groups that have been traditionally left behind. The second challenge is increasing social mobility, both in terms of helping people climb the economic ladder, but also making sure that people are connected to work, that they have strong families and communities, and that they are not succumbing to other problems of social isolation such as the growing drug abuse problem. And I think what distinguishes this effort from a lot of the current policy conversation is that it’s really taking on these problems head on. There’s a tendency from some to politicize these issues, to kind of fuel the populist fire, whether it’s on the drug overdose issue or keeping people connected to work. We really want to take a serious look at these problems and provide evidence-based solutions to tackle them.

And is the idea, particularly now that there is a Republican House, to be producing legislation-ready ideas?

We have two goals. One is to do rigorous research that identifies the problems and their causes, but the second part is to design solutions. That means focusing both on big ideas and providing specific policy solutions that one could work together with legislative staff to turn into real legislation.

How will this work in terms of staff? Will you be drawing from existing AEI scholars?

The great thing is that AEI has a large, existing staff that focuses on issues that really get at the center of these problems. That includes Poverty Studies, of which Scott Winship was the director, and which is now being expanded into the Center an Opportunity and Social Mobility, but it also includes scholars in education, workforce development, the AEI housing center, and scholars who focus on urban issues. The idea is to bring in the ideas of these existing AEI scholars and ensure that we’re getting at the core problems, both in terms of research diagnosing the major issues and then identifying new solutions. While we certainly may bring in additional folks in the future, we’re starting with a strong team already in place.

Do you have initial targets of opportunity?

We have a lot of projects we would like to start on. One particular area that both Scott Winship and I are really interested in is social capital, the extent to which that’s declined over time, and the extent to which that’s playing a major role in weakening opportunity and social mobility. Scott is also very interested in early childhood development. There’s just a lot of research out there on how what happens when kids are young matters a lot for their future outcomes. Now, the problem is that we don’t know what policies we can enact that will actually improve early childhood outcomes. Head Start does not have a strong record of success, but that doesn’t mean that there aren’t other policies out there that could lead to improvements. And so, we don’t want to give up on that area. We just want to push ahead on more effective policies, making this a great opportunity for the Center to contribute to the policy conversation.

And are there particular areas where you think it’s more likely that some progress might be made on the Hill, such as a compromise on extending the expanded Child Tax Credit?

Two examples come to mind. One area is the drug overdose problem — I think everybody recognizes how bad that is. Over a hundred thousand people are dying each year and I think there’s genuine concern from both sides of the political aisle to address it. What we need is a better idea of what’s causing it, whether it’s supply side factors in terms of more potent drugs being produced more cheaply and then coming across our borders, and then on the demand side, whether it’s people who are becoming more disconnected from society and turning to drugs in lieu of more productive activities. Better identifying the causes the drug problem will lead to more effective solutions.

The second area is the Child Tax Credit discussion as you mentioned. Many in the previous Congress were fighting for a Child Tax Credit that was not connected to work. I think that’s off the table in the new Congress. That said, I wouldn’t be surprised if there’s continued focus on modifications to the Child Tax Credit that would preserve its full earnings and work requirement but could potentially be somewhat more generous, perhaps to young children. I think there could be real conversations along those lines in coming months which could bear fruit in terms of some bipartisan agreement.

What about Senator (Mitt) Romney’s (R-Utah) proposal? Is that something that you find interesting?

Senator Romney has had two child tax credit proposals. The first one did not have a work requirement, and the second one did have a work requirement. I thought the second proposal was more likely to be implemented and is also a better proposal. It essentially kept the earnings requirement, but increased benefit levels and streamlined some programs. Some might argue that his plan phases in benefits too quickly or sets maximum benefit levels too high, but these are the right debates to have. People can land in different spots on these questions, but I think his overall framework makes sense.

And on paid leave, an issue that AEI has done a lot of work on, there at least seem to be glimmers of hope there as a bipartisan caucus has just started meeting. Do you have any expectations of movement there?

We’ll have to see. My personal view is that paid leave arrangements should be made between employers and employees without interference from the government. From a public policy perspective, perhaps there could be some compromise in terms of having a child tax credit that was a little bit higher when a child is born that could provide extra assistance to young parents. But something broader is probably less likely to happen.

Finally, Kevin, going back to where you started and how the Center will be different in terms of not focusing on the more populist elements of some potential solutions to these problems. Could you elaborate on that a bit?

Sure. So, I think the populist movement gets its premises wrong. They start with the observation that living standards have worsened over time, both for those at the bottom and in the middle. And that’s simply not true. Living standards have grown over time. Poverty has fallen. Wages were increasing the fastest for those at the bottom pre-pandemic. So, it’s just not true that living standards are getting worse.

And because the populist movement oftentimes misdiagnose the problem, they propose solutions that are not going to get at the root causes of what’s causing problems in the first place. They instead point to solutions that try to prop up certain industries and have a more centralized role for government in terms of strengthening the economy. That’s completely wrongheaded. We need a government that gets out of the way in terms of less regulation and less burdensome taxes, so that private entrepreneurs can drive the economic growth that we’ve seen in the past. So, the Center will not be focused on using the government to stand in the way of economic progress, but rather to ensure that all segments of the population can benefit from that progress by ensuring that disadvantaged children have equal opportunity and by tackling some of these larger social problems that are interfering with people’s participation in their communities and the economy.