Slate Money — “The Riches of This Land”

Date: August 8, 2020
Host: Felix Salmon (Axios)
Panelists: Anna Szymanski (Breakingviews), Jim Tankersley (New York Times, Guest)
Theme: The rise and fall of the American middle class, systemic discrimination, the future of the labor market, U.S.-China economic tensions, virtual economies, and structural shifts amid the pandemic.

Episode Overview

This episode features a conversation with Jim Tankersley, New York Times reporter and author of “The Riches of This Land,” a book about the history and struggles of the American middle class. The hosts and Tankersley discuss the evolution of the middle class, the role of diversity in driving economic prosperity, contemporary challenges like labor market stagnation and offshoring, the implications of government and corporate policy, the accelerating shift to a virtual economy, and the impact of geopolitical tensions with China. The discussion highlights underlying optimism about growth through inclusion and recognizes sobering realities about persistent racial and class disparities.

Key Discussion Points & Insights

1. Defining the American Middle Class and Its Evolution

• Origin of the Modern Middle Class

  • The idea that America always had a vibrant middle class is a myth; real growth started post-WWII (01:55).
  • The postwar period featured increasing economic security, widespread home ownership, education, and retirement security (01:55–02:52).
  • The period of strong growth ended in the late 70s/early 80s, with subsequent decades, especially the 21st century, seeing stagnation and decline.

• Middle Class Stagnation

  • Growing debate about whether the middle class is shrinking or just stagnating (02:52).
  • Since the Clinton-era 1990s, middle class income and job growth have been deeply disappointing (03:55).

2. Diversity, Inclusion, and the Real History of Middle Class Prosperity

• Expanding Opportunity Was Key to Growth

  • Myth-Busting: The iconic "Leave it to Beaver" white, male-centric narrative is historically inaccurate.

  • The real postwar middle-class boom was powered by opening up skilled jobs to women and people of color due to civil rights advances and the necessities of war (04:15–05:22).

    “The reason the middle class grew and thrived...was that we opened up the American labor market...to nonwhite guys, to women of all races, to men of color who had been held back by overt discrimination.”
    — Jim Tankersley (04:15)

• Echoes in Global Development

  • Felix draws a parallel to microfinance: bringing women into the workforce in poorer nations has transformative effects, just like the U.S. postwar inclusion boom (05:22–06:06).

• Current Barriers and Latent Potential

  • Policies and structural barriers still limit women and minorities (06:06).
  • Further inclusion represents economic “low-hanging fruit” for productivity gains.

3. Economic Ideologies: Right, Left, and the Size of the Pie

• Debates Across the Spectrum

  • Both populist right ("immigrants take jobs") and populist left ("redistribute wealth from billionaires") get the story partly wrong (07:00–08:35).

  • Real economic growth comes from both better allocation and growth of the economic pie via maximizing diverse talent.

    “If we better allocate the resources in the pie, the pie will grow faster.”
    — Jim Tankersley (07:34)

4. Productivity, Offshoring, Labor Markets, and New Opportunities

• The Global Labor Challenge

  • The offshoring of jobs is a structural shift, not easily reversed—political promises to restore them haven't panned out (10:10–11:44).

  • Future good jobs will likely emerge in new industries (healthcare, carbon mitigation) but precisely where and how is unclear.

    “I don't think there's a very good chance that most of the jobs that have been outsourced are coming back....what hasn't happened now is those better jobs...haven't appeared.”
    — Jim Tankersley (10:10)

• Role of Government Investment

  • Postwar prosperity was aided by substantial public investment in science, which seeded private sector dynamism (11:44–12:34).
  • Today, lack of public investment is a bottleneck for productivity and job creation.

• Profit-Sharing and Worker Bargaining

  • Exploding corporate profits haven’t translated into wage gains; companies reward shareholders over labor (12:34–14:37).

  • Strong labor markets and worker bargaining power are crucial for this to change.

    “When the labor market has been so loose for so much of the last 20 years, companies could view workers as eminently replaceable and disposable.”
    — Jim Tankersley (14:37)

  • True wage growth and investment in workers may require both tight labor markets and government intervention to spur broader distribution of gains (14:37–15:42).

5. The Pandemic, Virtualization, and the Changing Economy

• Acceleration of Digital Transformation

  • The pandemic drastically sped up the shift to digital business models—669,000 new digital NYT subscribers in a single quarter shows the wider pattern (24:42–25:57).
  • Brick-and-mortar businesses, especially those lacking scale or agility, are struggling, while “kitchen-only” restaurants and e-commerce explodes.

• Will It Last?

  • Panelists debate whether shopping and business habits will snap back post-pandemic (25:57–28:07).

  • Extended crisis may make behavioral shifts permanent, especially for new delivery and remote retail models.

    “I think the longer this goes on...the more it’s going to result in some type of permanent behavioral changes.”
    — Anna Szymanski (28:07)

• Winners and Losers

  • Commercial real estate & small businesses are major losers; big box and digital-first retailers dominate (29:00–30:18).
  • Equity markets reflect a “winner-takes-all” effect, raising worries about more concentrated corporate power (30:18–31:56).

6. US-China Tensions and Global Business Risks

• Escalating Conflict

  • Trump administration’s “China villain” strategy (e.g., TikTok ban) is largely political posturing, intended to shift COVID-19 blame (18:34–19:55).

    “They think making a villain out of China is helpful for them in this election...it is a way to try to...deflect coronavirus blame.”
    — Jim Tankersley (18:34)

  • Real consequences for American and global businesses, as the uncertainty threatens market plans (21:55–23:53).

  • Even a Biden administration is unlikely to fully reverse the chilling of US-China relations.

7. Notable Quotes & Exchanges

• On Structural Racism & Economic Mobility (37:49–40:22)
  • Tankersley references a study highlighting the persistent penalty for Black Americans since 1870:

    “Since 1870, the penalty for being Black in America in terms of economic mobility has not changed. It is just as hard today for Black men to get ahead as it was during Reconstruction.”
    — Jim Tankersley (37:54)

  • Felix Salmon notes that, in sectors like Wall Street, things may even be getting worse for Black professionals (39:39).

    “There are definitely significant parts of the economy where things are getting worse.”
    — Felix Salmon (39:39)

Segment Timestamps

• [00:10] Introduction and episode overview
• [01:55] The rise and fall of the middle class
• [04:15] The role of inclusion in prosperity
• [07:00] Ideological divides over economic solutions
• [10:10] The reality of offshoring and future employment
• [11:44] Government investment and postwar productivity
• [12:34] Corporate profits, labor, and wage stagnation
• [17:40] U.S.-China tensions: TikTok, WeChat, and business fallout
• [24:18] NYT’s digital milestone and the virtual economy
• [27:04] Will post-pandemic behaviors last?
• [29:00] Commercial real estate and small business under threat
• [30:18] The “winner-takes-all” economy
• [37:49] Enduring barriers to Black economic mobility

Memorable Moments

• On Tiktok and Geopolitics:

  “I can't imagine a scarier, more horrifying thing than a LinkedIn TikTok scenario.”
  — Jim Tankersley (33:24)

• On pandemic consumer shifts:

  “I never want to go back into an electronics store again...It's just easier to order a new...whatever online and have it show up at my door two days later.”
  — Jim Tankersley (27:04)

• On myth versus reality:

  “It is this great myth that Americans, so many white Americans have sold to the rest of the country is this idea that we have this Leave it to Beaver middle class...”
  — Jim Tankersley (04:15)

• On executive compensation:

  “The market seems to have no problem with increased compensation for executives...it's not necessarily paying people that the market doesn't like. It's paying your typical worker.”
  — Jim Tankersley (16:26)

Conclusion

The episode delivers a nuanced, historically informed, and at times sobering look at the American middle class, reminding listeners that its true strength came from inclusion and opportunity. But deep structural barriers—especially around race—remain as strong as ever, and recent crises threaten to entrench economic power at the top. Yet, amid the pessimism, there’s optimism: unleashing untapped talent and making strategic investments could still foster a new era of broadly shared prosperity.

For listeners seeking a sharp, candid conversation on the roots of economic opportunity and the forces shaping our post-pandemic economy, this episode offers expert insight, grounded analysis, and a balanced dose of realism and hope.