Imagine: A U.S. Economy that Worked for All People. A conversation with Natalie Foster on the Guarantee Economy

Natalie Foster has a bold vision for a new kind of economy in America, one that would guarantee a floor through which no one could fall. Imagine – an economy where everyone has access to good health care, education, stable housing, and time and support for caregiving. Where Baby Bonds invested in every child at birth would grow and provide economic opportunity, help close racial and gender wealth gaps and unleash ingenuity. And where jobs would be big enough to support human life, rather than so many jobs that now don’t pay enough or provide enough hours to survive, so people cobble together two or three, and life becomes a chaotic slog of precarious work and no time for anything else. She sees an economy that “allows each of us to build lives of dignity, agency and freedom regardless of race, gender, or zip code.”

You don’t have to look far for statistics or surveys that show that, right now, there is no floor and only a meager safety net, and far too many people in America are suffering – nearly four in ten say they couldn’t cover an unexpected $400 expense with cash. Nearly 40 million people live in poverty, about half live in deep poverty, and rates are much higher for people of color. After cutting child poverty in half with pandemic-era expanded child tax credits, the U.S. once again has one of the highest child poverty rates of any advanced economy. The U.S. has one of the highest eviction rates of advanced countries. Housing is unaffordable, as are medical costs: two-thirds of all bankruptcies and nearly a half of all foreclosures are related to high medical costs. Families struggle to pay the high cost of care while caregivers earn poverty wages, and, unlike every other advanced economy, no one is guaranteed any paid time off for any reason. Student loan debt is so high in the U.S. that three out of four U.S. borrowers say they’ve had to postpone a major life event, like buying a house or starting a family. And since the 1980s, most of the new jobs that have been created that politicians like to tout have been in lower-wage service sectors that no longer can support an individual, much less a family.

We’re a long way from Foster’s vision. Yet creating a guarantee economy is not pie in the sky, she insists. The pandemic unleashed new waves of investment, creative public policy responses, and a better understanding that the way the economy has been set up hasn’t been working for far too many people for far too long. And that, unlike the weather, the economy is a choice.

Starting in 2020, as the then-uncontrolled and deadly COVID-19 virus swept the globe, shut down schools and businesses and put an astounding 20 million people out of work, the federal government – with bipartisan support – sent stimulus checks, expanded the child tax credit, put a moratorium on evictions, and helped with mortgage and rental assistance so people could survive. Having learned the difficult lesson of the Great Recession – when an anemic policy response cost too many people their livelihoods and homes - policymakers in 2020 expanded Medicaid and the Affordable Care Act, bringing the number of uninsured Americans to an all-time low. Investing in a functioning unemployment system also unleashed a wave of entrepreneurial dynamism, as more people with a little more breathing room and a little more security opened small businesses at an unprecedented rate in 2020 and 2021.

Even as many of the federal investments have ended or been rolled back, Foster shows in her new book how many states and communities are forging ahead: Montgomery County, Maryland is investing in affordable “social housing” for middle-class working families that will be kept off the speculative market. Lawmakers in Connecticut passed a “baby bonds” initiative, providing the state’s poorest children with $3,200 at birth, which will be safely invested, tax free, and available for them to use for their education, to start a business or buy a home in Connecticut by the time they turn 18. More than 150 local communities in 35 different states, some with the help of federal funds, experimented with guaranteed basic income pilots. Close to 20 states are poised to create or expand the child tax credit, and debate to do the same on a national level in Congress continues.

She writes, “For those who say guarantees are impossible in America, we say: We’re already doing it.”

We wanted to know more – and more specifically, how we get from here to there. The Better Life Lab co-hosted a book event for Foster, along with our colleagues at New America who also work to advance Family Economic Security and Wellbeing. Following the event, BLL Director Brigid Schulte continued the conversation with Natalie Foster, president and co-founder of the Economic Security Project, Aspen Institute fellow and former New America fellow. Their conversation has been lightly edited for length and clarity.

Brigid Schulte: Natalie, you open your book with a series of provocative imaginings: Imagine a veteran with PTSD who’s ended up on the streets, given a key to her own place because the government took over the lease of an empty motel. Imagine a 30-something weighed down with student loan debt locked in a dead-end job who, once the government erases that debt, has the energy and bandwidth to open their own business. Or a sandwich generation caregiver, with no time to rest between caring for kids and aging parents, who starts receiving a child tax credit check every month. “Finally, it’s as if her unpaid caregiving is being counted as work.”

Let’s start with the story of what led you to this point in your life, where you’re asking that we imagine this fairer future and you’ve become an evangelist for what you call the Guarantee Economy?

Natalie Foster: I was brought up in Kansas, the daughter of a preacher. And in college, I found organizing. Preacher's kids take to organizing pretty well, because we're trained to bring people together around shared purpose. We’re optimistic by nature. And we believe deeply in community and how community is what advances things forward.

I went to a Christian school called Pepperdine. In my senior year, I invited Dr. Cornel West to campus. He said something that has always stuck with me: “Justice is what love looks like in public.”

Schulte: I got chills when I read that in your book. It’s just beautiful.

Foster: I'd spent a lot of time thinking about love, but to connect it to justice was really helpful. So, I never looked back. I got to use technology to bring people together. During the first part of my career, I got to run some of the biggest digital teams in the country. Then I realized I was just tired of protesting the outcome of the debate. I wanted to set the terms of the debate.

So, I have been in pursuit of that on behalf of economic power for everyday Americans ever since. I spent time thinking about the future of work and read your work and others during that period. One of the things that many of us talked about was flexibility -- the ability to make decisions -- and agency. And I came to realize that flexibility was secondary. Before we could discuss flexibility, we had to have stability to allow for that agency and freedom that people deserve. So, I went in pursuit of what stability would look like. And that really challenges the trickle-down economics story that we've been told for the last 50 years that the market will solve our problems, that government needs to get out of the way, and that it's your job to sort yourself out and pull yourself up by your bootstraps.

None of that allows for or creates stability. In fact, it's the opposite. So that's really some of the awakenings I've had that led me to this work.

Schulte: You talk about trickle-down economics. I remember a time when even George H.W. Bush called it “voodoo economics” – no one could quite believe the argument that cutting taxes and regulations and giving more money to rich people and corporations would eventually trickle down and be good for everyone. And yet it has become orthodoxy. You write in your book that people have come to believe that this is just the way things are. Did you have that sense, too? And what made you change your mind?

Foster: Trickle down was definitely the orthodoxy I was raised in: Total faith in the market. Zero faith in government, and people should pull themselves up by their bootstraps. It really tracks to my lifetime. I was born in 1979, right as Ronald Reagan would be elected and that orthodoxy burst onto the scene in public policy. But it actually had been simmering for a long time. It was a long, slow, deliberate effort to lay those ideas out and to build them inside of the courts and the academic institutions and journalism to where it would become “common sense.” And when we elected Ronald Reagan and Margaret Thatcher across the pond in the UK, that idea would become the way things were.

In some ways, I feel like the last decade of my life has been an unpeeling of that story.

Schulte: Tell us more about the new story you’re seeding, the Guarantee Economy. A few years ago, you were on the Better Life Lab podcast talking about guaranteed basic income and the pilots you and the Economic Security Project helped get off the ground in Stockton, California, with then-mayor Michael Tubbs. In the book, you talk about seven guarantees: income, housing, health care, college education, dignified work, care infrastructure and inheritance.

Foster: The book is really laying out a framework for the guarantee economy, based on the idea that the government should invest in a floor through which no one can fall. I trace seven guarantees where I see a ton of progress.

I come at it from guaranteed income. I was lucky to meet Michael Tubbs and Dr. Aisha Nyandaro out of Jackson, Mississippi early on in this journey. Dorian Warren, Chris Hughes, and I launched Economic Security Project in late 2016 to spur on this conversation around a cash floor in America. I had read Dr. Martin Luther King's last book (Where Do We Go From Here?) where he talks about a guaranteed minimum income as one of the key ways that we could abolish poverty. He was being pushed by Jonnie Tillmon and other black women who were organizing around welfare rights. They were arguing for dignity, saying that economic justice is racial justice and racial justice is economic justice.

So in our work, we found it to be very important to root ourselves in the history of the civil rights movement. So Michael Tubbs would launch a pilot in Stockton, giving 125 families $500 a month with no strings attached. And, Dr. Aisha Nyandaro would launch the Magnolia Mothers Trust, where she would give black women in Jackson $1,000 a month with no strings attached.

It was a radical idea at the time. People would protest, ‘You can't just give people money! What do they do with the money?’ But other people took notice and were very inspired, and the movement would grow and grow until there'd be 140 pilots, some led by nonprofits, some led by mayors around the country demonstrating what a guaranteed income could look like. And then the pandemic would hit, and there would be a political opening at the federal level and lawmakers would look for ideas that were tested and had good policy and good politics and they would move them forward and we would see stimulus checks sent by both Democratic and Republican presidents.

We would see the expanded child tax credit passed, which was a guaranteed income for families with children. Every parent of young children in America, over the course of six months, received checks with no strings attached. That was political warp speed - to see the idea go from white papers to demonstrations in the cities to actual policy at the federal level.

And as I looked around, I saw that was happening across a number of guarantees. All of this bucking the story that we had been told about how the government should have no role in our lives. That the markets will solve our problems. It is all adding up to a new economic paradigm.

Schulte: In the interview you did with NPR’s Marketplace, the host brought up ballooning public debt and the notion the federal government spends too much money. Politicians on the stump like to promise they’ll cut taxes, and everyone cheers, and no one seems to make the connection between that and bridges that are falling apart or how we can’t pay our teachers enough. How do you counter the narrative that ‘We can’t afford a Guarantee Economy?

Foster: One is the narrative that these things should be personal investments. Not public goods. Once, high school was not considered a public good in this country. It was available only to those who could afford it. And we decided as a society, ‘No, we want high school for everyone.’ And now that is just the norm of how society functions. So, it is possible to expand our sense of public good, even in this moment.

It’s all related to the belief that it's possible. In the book, I root all my examples of guarantees in the United States. For so long, on things like guaranteed housing, we would point to the low cost ‘social housing’ in Vienna, [where 80 percent of the population qualifies for low-cost public housing] we would point to Singapore, [where 80 percent of the population lives in government-built housing.] Now we can point to Montgomery County, Maryland that is building housing for middle income Marylanders that will kept permanently off the speculative market. It’s right on the Metro line, where rents will stay stable for families, and they can raise their children and invest in lives where housing is affordable. That's possible in the United States of America today.

Schulte: As you’ve reported on these guarantees here in the U.S., what has most struck you?

Foster: One thing I hear from people over and over again who are part of the guaranteed income demonstrations is – I have room to breathe. That is the vision – that everybody has just a little room to breathe. That in the richest nation on earth, in the richest moment in history, that people can live lives of dignity, of freedom and agency. To be able to invest in and support and provide for their families and the people that they love. All of that should be available to us, and can be if we create a floor that allows for those things to thrive.

[Nobel economist] Joseph Stiglitz just came out with the book, The Road to Freedom, talking about the connection between freedom and economic security. It's building on Mia Birdsong's work, who has launched a beautiful exploration of a hundred year vision of freedom that is interconnected -- freedom that allows us to be together in community. When you are working hand to mouth, when you are working three jobs, when time is something you don’t have, none of it is possible. That is not a freedom you get. That’s an important part of the story.

Not only is it important to the individual, but it's important to communities. Communities work when people have time to invest in them. And that is important to democracy. Democracy works when institutions are invested in and people believe in them and get something from them. And that can only happen if the institutions are working for people. One of the things we know about the child tax credit is that for every dollar that was spent, there was $8 in social and economic return. [Other research has found a 10 to 1 return on investment.] Looking at returns – both financial and social – is an important part of this work.

Schulte: You write how the unprecedented federal investments in people and families made during the pandemic have shown us that government can work to make people’s lives better. What are the lessons we have, or should have learned from the pandemic?

Foster: One of the lessons is that the guarantee economy is possible in the United States of America. In fact, we did a very early version of it.

And that is important because, as you and I just discussed, for my whole lifetime, that was not something I believed or anyone around me believed could happen in the United States of America. But in fact, it did. We would give people money to keep them in their homes, with mortgage and rental assistance. We would pass a national eviction moratorium that kept people safe in their homes. We would literally do things like buy hotels and move the unhoused in, giving them a room of their own with a key. It would be fast. It would be creative. It's the American spirit, right? It's like the man on the moon spirit applied to the housing crisis that happened here.

We mobilize the National Guard and we put free vaccines in people's arms that the government made sure moved at the most rapid rate in history. All these things were possible when government believed it was important, and when we believed government had a role to stabilize the country.

I take a lot of hope from that period. Now, it's, it's very disheartening to see it unwind. But the fact it happened is the thing that I think should give us inspiration, and that there is continued momentum. So even though we don't have the federal child tax credit, for example -- the guaranteed income for families with kids -- state after state after state is passing their own child tax credit. They are picking up that momentum. They are seeing what it meant in people's lives and they are moving it forward. Just yesterday, Illinois became the 13th state to pass a child tax credit. So we've doubled the number of states that have them on the books. And I think we'll triple that number by 2025. And these are red states, blue states, and purple states. So even though D. C. is unable to move things forward right now, that is not true in the state houses in the laboratories of democracy. There are places like New Mexico that have made child care a constitutional right, and have announced free child care for everyone in the state.

So, it is moving forward. It's just not the stories that we hear often.

Schulte: That’s one things we’re working on at the Better Life Lab – telling more of those stories. Helping to change the narrative. What’s your call to action for people?

Foster: The call to action is to join something. Join an organization that is fighting for one of these guarantees, or all of these guarantees. That's one of the arcs of the book that I found really important. If you look at eliminating student debt, it went from an idea to then buying debt on the secondary market, proving it was possible to cancel debt, then realizing it's actually got to be policy and policy requires organizations, advocates who are fighting day in and day out to move things forward. Caring Across Generations supports caregivers – people who need affordable caregiving, but also caregivers who need to have a living wage. The organization Hand in Hand, which organizes people who employ people in their home, or the Debt Collective organizing people around their debt. Join something that is fighting for the guarantees, because none of us can do this alone.

Schulte: I’m struck by both the enormity of the problems, and your enormous energy and optimism. What gives you hope for change?

Foster: [Activist, writer and educator] Mariame Kaba said, ‘Hope is a discipline.’ That has always stuck with me, because it is not something that always comes naturally. Some days, you're looking through the news and it feels very demoralizing. But hope is a discipline that we owe our future generations -- to believe that a different country is possible. This democracy, this truly multiracial democracy that we are trying to build, is so young. As [social justice activist] Deepak Bhargava said,we became a true democracy in 1965 [with the Civil Rights Act in 1964 and Voting Rights Act in 1965] We are just getting started. We're going to have setbacks. But there's so many bright spots when you actually can look past the headlines, that it's worth believing in and investing in.