Closing the Ever-Growing Gap

Administrative Actions to Close the Ever-Growing Gap

CFED

First published January 2017

President Obama inherited the worst economic conditions of any president since the Great Depression. Through a series of legislative and administrative accomplishments, he put the economy back on the right course, established consumer protections, expanded economic opportunity and ensured that the wealthiest Americans contribute more of their fair share.

Despite the enormity of these successes, our work is not done. Nearly half of Americans cannot come up with $400 to cover a surprise expense or loss of income—surprises that are becoming all too common. At the same time, wealth inequality has soared to historic heights, and Black and Latino households now own pennies for every dollar owned by white households. In short, America faces widespread financial insecurity, an enormous wealth divide between those at the top and everybody else, and an ever-growing wealth gap between white households and households of color. 

In response to these conditions, President-Elect Donald Trump and House Speaker Paul Ryan (R-WI) have proposed a troubling policy agenda. The problems facing financially fragile households are not problems that will be solved by giving tax cuts to the wealthiest Americans, gutting consumer protections or eliminating the first rungs on the ladder of opportunity. In contrast to these proposals, Prosperity Now released A Federal Policy Blueprint to Close the Ever-Growing Wealth Gap in September 2016, which proposed wealth-building, inequality-reducing, opportunity-expanding legislation and ambitious budget requests.

This document maintains a similarly ambitious scope but with a narrower focus: on administrative actions that President-Elect Trump can take as early as January 20. For a president truly interested in building an opportunity economy, this document describes seven administrative policy proposals that would help solve the problems of financial insecurity, wealth inequality, and the growing racial wealth divide: 

1. Rainy Day Savings
2. College Savings
3. Affordable Homeownership
4. Retirement Savings
5. Financial Capability Services & Tax Preparation
6. The Racial Wealth Divide
7. Persistent Poverty and Community Development