There are many reasons why America’s system of economic security is not working. Chief among them is a common factor in almost all of our social policies: they are designed with the assumption that people are constantly employed. For example, most social insurance programs, from Social Security to Unemployment Insurance to Medicare, require people to build up years of contributions before they can access benefits.¹

Over the past century, the United States has experienced two large-scale financial crises: the Great Depression of 1929 and the recent Great Recession, which began in 2007. These periods also represented peaks in the share of U.S. income collected by the top 1 percent of earners. In 1929, the top 1 percent accrued over 22 percent of total national income, including capital gains – a share several percentage points above its historical average, and one that would not be seen again until 2006. Notably, the number of bank failures in the U.S.

Notwithstanding repeated attempts at monetary and fiscal stimulus since 2009, the United States remains mired in what is by far its worst economic slump since that of the 1930s.¹  More than 25 million working-age Americans remain unemployed or underemployed, the employment-to-population ratio lingers at an historic low of 58.3 percent,² business investment continues at historically weak levels, and consumption expenditure remains weighed down by massive private sector debt overhang left by the bursting of the housing and credit bubble a bit over three years ago.

In putting forth his jobs program, President Obama faced a difficult dilemma: propose a program that could gain Republican support or a more ambitious program that would actually get the economy back on a path of recovery and job creation.