Back in the heyday of Saturday Night Live, in the late 1970s and early 1980s, comedian Don Novello played a chain-smoking priest, Father Guido Sarducci.
Here’s one of his popular riffs: The Five Minute University.
The premise? Most people forget most of what they memorized in college, just to pass the final, within five years of graduation. So instead, in five minutes, for $20, he would teach you all that most people would remember five years later, saving the students both time and money: “Economics? Supply and demand. That’s it.”
There was a great (subliminal, perhaps inadvertent) irony there. The then-economics profession, misunderstanding Keynes, had become almost obsessed with demand. Supply, despite the wisdom of Fr. Guido, was all but forgotten by Establishment thought leaders and officials.
The loss of appreciation for supply led to a cockamamie policy mix of counterproductively high tax rates and a soggy dollar. This brought about terrible stagflation and a nosebleed “Misery Index,” high inflation plus high unemployment. Which, to the Neo-Keynesians, was an impossibility.
They were wrong.
Keynes, public domain, courtesy of Wikimedia
The pragmatic humanitarian Keynes must have been spinning in his grave. Until, that is, we few, maverick, “supply-siders” reminded Washington of the importance of supply.
The co-author of this essay was the youngest and least consequential of the dozen or so early supply-side mavericks calling for cutting marginal tax rates across-the-board and stabilizing the dollar (optimally through the restoring the gold standard which had been, de facto, abandoned by President Johnson, de jure, “temporarily” suspended by President Nixon).
Supply-siders were roundly mocked by both the right and the left. The right — Establishment Republicans, personified by presidential aspirant George H.W. Bush – mocked us as “Voodoo Economics.” (The most, perhaps only, memorable phrase coined by Bush speechwriter Peter Teeley).
The Democrats dismissed it as “trickle-down economics,” invoking a phrase coined by humorist Will Rogers to ridicule President Herbert Hoover… who we supply-siders ridiculed as well (for driving the Smoot-Hawley tariffs, a proximate cause of, or major contributor to, the Great Depression).
Candidate Reagan (mainly to keep Jack Kemp from entering the 1980 race and splitting the conservative bloc, throwing the nomination to Bush), endorsed Kemp’s proposed 30% across-the-board income tax rate cut. Reagan, upon election, passed and signed a diluted, deferred, version, and delegated the stabilization of the dollar to Fed Chairman Paul Volcker.
Rather than restoring the gold standard (the last remnants of which Volcker himself, as Nixon’s Treasury under secretary, had suspended), Volcker brutally tightened, sending interest rates above 20%, causing a sharp recession, bringing inflation down to low single digits. That blessing persisted for almost 40 years. Until it didn’t.
So, game on!
Image courtesy of Pexels
Despite almost universal ridicule, we supply-siders persisted. In 1979, on the day that Reagan declared his candidacy, the Dow was around 814, US GDP, $2.7T. At the time of our writing this the Dow was above 43,000, US GDP close to $27T.
Not, mind you, inflation-adjusted. But you get the point. And real (inflation-adjusted) per capita GDP? More than doubled from around $30,000 to almost $70,000. Not bad for Voodoo,
The supply-side’s Yoda, Prof. Robert Mundell, went on to win the Nobel Prize in economics. The supply-side’s political quarterback, Rep. Jack Kemp, was posthumously given the Presidential Medal of Freedom by President Obama. Mundell’s younger colleague, Dr. Arthur Laffer, received the Presidential Medal of Freedom from President Trump. Some Voodoo!
One of the co-authors of this essay’s modest contribution to “the supply-side revolution” was to found, around 1986, and sustain a monthly gathering called the Prosperity Caucus (originally called “the Gathering of the Supply-Side Tribes”) in which the supply-siders of those early days got to know one another beyond what they read about in the papers. It still meets monthly under his successors.
The New York Times, Washington Post, the evening news, and, well, practically everybody framed our policies as “Reaganomics.” On Capitol Hill, however, the most aggressive top tax rate cutters were Democrats.
Kemp, Reagan, and the rest of our merry band were delighted. We could not ourselves lead the charge to cut the economy-strangling top rates more radically without being attacked as advocating a policy that was merely, in the words of supply- side judas David Stockman, a “Trojan Horse” to cut taxes for the rich.
As one of us wrote at Newsmax last year:
Democrats, Chairman Dan Rostenkowski, D-Ill., and Speaker Tip O’ Neil, D-Mass., followed by Rep. Dick Gephardt, D-Mo., and Sen. Bill Bradley, D-N.J., led the crusade to topple those nosebleed rates applying exclusively to the wealthy.
Followed by President Bill Clinton, a Democrat, who signed the legislation dramatically cutting the capital gains rate. For which Sen. Joe Biden, D-Del., voted.
America hasn’t seen the kind of sustained and robust economic growth we enjoyed under Reagan and Clinton since, well, Reagan and Clinton. (No, not even under Trump 45. Sorry.)
Does abundance, the 21st century’s policy advocates’ preferred word to prosperity, have political legs? Of course it does!
Sure enough, as the Wall Street Journal’s Molly Ball recently recounted:
Democratic politicians are rushing to embrace the new mantra [of Abundance, by Thompson and Ezra Klein]. New York Gov. Kathy Hochul, Minnesota Gov. Tim Walz, Maryland Gov. Wes Moore and Colorado Gov. Jared Polis have all name-checked it publicly. New Jersey Sen. Cory Booker discussed it at length in his recent 25-hour Senate speech. Former Vice President Kamala Harris and the U.S. Senate’s Democratic caucus are among the many politicians who have recently sought the authors’ counsel. Not one but two congressional caucuses have recently formed to push legislation advancing the ideas laid out in the book.
…
California Gov. Gavin Newsom recently hosted Klein on his podcast for an in-depth 90-minute discussion, where he waxed somewhat defensive about the way the book depicts his state as Exhibit A for Democratic dysfunction; Newsom nonetheless proclaimed the book “essential reading for Democrats” and said he has been handing out copies to the leaders of the state legislature.
…
The Abundance movement cuts across the party’s ideological fissures, attracting support from elements of the moderate establishment and the socialist left alike. “Look, I’m for Medicare for all and taxing billionaires more, but I also want effective government to make sure when we pass those things it actually works,” said Rep. Ro Khanna (D., Calif.), a progressive ally of Sen. Bernie Sanders (I., Vt.).
The new abundance movement within the Democratic Party portends a rising tide that lifts all the boats, in a phrase often used by supply-side precursor President John F. Kennedy (whose proposed tax rate cut of the top rate from 91% to 70% was enacted by Lyndon Johnson and closely emulated by Kemp). It seeks to shift the Democrats’ focus from their aspirations primarily to redistribute American wealth to actively increasing wealth, and all the goods that wealth makes possible. All of us can benefit from baking a bigger pie.
Especially in the wake of the Democrats’ defeats in 2024, the theme of abundance is a big deal. It’s not enough simply to be Not Trump, who after all won the popular and electoral college vote. Despite a near-delirious victory lap, President Trump did not win anything like the kind of mandate that FDR took in the House in 1933 (FDR: 313 Democrats to 117 Republicans; DJT 2024: 220 Republicans, 211 Democrats, 4 vacant).
Trump’s House majority is paper thin, his Senate majority well below the filibuster threshold. And to become competitive again, the Dems simply need to be for something good. Not just “Not Trump.”
A few public intellectuals – led by the center-left Ezra Klein (of the New York Times and podcaster, formerly the Washington Post’s Wonkblog), Noah Smith (the blogger who recently declined the New York Times’s offer to have him replace the retiring Paul Krugman) and Matt Yglesias (now an independent blogger and podcaster) – proposed: abundance.
That’s center left’s term for what the center right calls prosperity. Much of a muchness.
Full disclosure (or perhaps trigger warning).
The authors of this piece believe that energy innovation providing affordable, reliable, and, well, abundant energy is, or should be, the most valuable of the policies to promote. As we wrote at HackerNoon last year:
It may seem paradoxical. But sometimes shortages can be a shortcut to abundance.
Economists call that “a forcing function,” explained by the Interaction Design Foundation as
“an aspect of a design that prevents the user from taking an action without consciously considering information relevant to that action. It forces conscious attention upon something (“bringing to consciousness”) and thus deliberately disrupts the efficient or automatized performance of a task.”
Followers of the work of Washington Power and Light, a relatively new DC-based policy institute, know that we are committed to abundance to promote the general welfare. In particular, we promote the recognition that abundant, affordable, reliable energy is crucial both to equitable prosperity and to addressing other important social and civic goals.
Among such goals is ecological health, including averting or mitigating the impact of climate change. We consider the data compelling that abundant, affordable, reliable energy is necessary to the provision of national security, food security, water security, factories, jobs, poverty reduction, and equitable economic growth.
The, so to speak, high tension between the economy, which depends on reliable, abundant, affordable energy and (in the eyes of the many who consider the emissions from fossil fuels to be driving climate change) the ecology is manifesting in a vivid way just over the border of Washington, DC.
Recently, a plethora of articles have appeared in the national press about the mushrooming demand for electricity to power the data centers known, colloquially, as “the cloud.” These data centers consume massive amounts of electricity.
The advent of artificial intelligence is dramatically accelerating the demand for electricity for computation. The hundreds of data centers, presumably harboring millions of servers, that power the Internet consume massive amounts of electricity. So much so that the internet needs, now and for the foreseeable future, the resuscitation of coal-fired power plants to generate that power.
Rather than finding this alarming, we are welcoming this as providing a “forcing function,” highlighting how essential reliable, abundant, and affordable power is both to our quality of life… and to improving the quality of life in many ways.
The Genesis and Core Tenets of the Emerging Abundance Movement
Many call the nascent abundance movement “supply-side progressivism.” One of us is an original Reagan-era supply-sider, delighted to see such an intelligent reincarnation of this iconic (but much misunderstood) brand.
Supply-side progressivism began seriously to emerge from the Democrats’ 2024 wreckage (see “forcing function,” above), and a questioning of the Democratic Party’s base’s dogmatic obsession with stopping, rather than building: regulating industries, and redistributing wealth.
Klein, Smith and Yglesias advocate policies to enable the creation of more housing, clean energy, efficient infrastructure, and technological innovation.
Ezra Klein, co-author of Abundance with The Atlantic’s Derek Thompson, argued that well-intentioned regulations, particularly in liberal-controlled areas, have inadvertently created bottlenecks that stifle progress and drive up costs. Klein himself was surprised to see this book achieve great public attention, selling hundreds of thousands of copies…
And kickstart a political movement of politicians ambitious to rise… all the way to the presidency.
One of the authors of the piece you are reading is a supply-side original gangster; the other, the co-creator, with Satoshi Nakamoto, of the >$1T market cap Bitcoin (BTC). We applaud the restoration of abundance advocacy to its Democratic Party (and organized labor) roots too. Both Kemp and Reagan, pre-politics, were union presidents, and serious about it.
The abundance agenda is a significant positive advance. The fact that it is coming in from left field is less surprising than those who bitterly cling to the mythos, rather than the ethos, of the ’80s might suppose.
The Republicans have formed something of a cargo cult, celebrating massive tax (NOT tax rate) cuts, while their party leaders play fast and loose with monetary policy. They’re stuck in a 1980s “Groundhog Day” rerun… Not Jack Kemp’s supply-side!
The presenting opportunity? Take it up to the next level by imbibing Paul “A crisis is a terrible thing to waste” Romer’s Exogenous Growth Theory. Or, in better slogan fashion, supplanting “the Industrial Revolution” with “the Innovation Revolution.”
Paul Romer, courtesy of Wikimedia, by Bengt Nyman licensed under the Creative Commons Attribution 2.0 Generic license.
Romer discovered that 50%-80% (or more) of our rising standard of living comes from technological innovation. CHIPS Act, anyone?
In simple terms, more innovation makes everyone better off. Moreover, we contend that energy supply innovation is the, or among the, most important area of innovation.
As summarized at Wikipedia:
… Endogenous growth theory holds that investment in human capital, innovation, and knowledge are significant contributors to economic growth. The theory also focuses on positive externalities and spillover effects of a knowledge-based economy which will lead to economic development. The endogenous growth theory primarily holds that the long run growth rate of an economy depends on policy measures. For example, subsidies for research and development or education increase the growth rate in some endogenous growth models by increasing the incentive for innovation.
Enter “Human Capitalism.”
Time to supersede the “Laffer Curve” with the “Romer Fastball.”
The core Democratic “abundance agenda” is a call for a more dynamic and growth-oriented liberalism. It posits that many of America’s pressing problems, from unaffordable housing to the slow transition to clean energy, are not solely issues of market failure or insufficient redistribution, but also of supply scarcity. The abundance movement champions policies that:
- Invest in infrastructure and technology: Beyond deregulation, abundance advocates push for significant public investment in modernizing infrastructure, accelerating scientific research, and fostering technological innovation. This includes support for technologies like nuclear and geothermal power, desalination, and artificial intelligence, seen as crucial for addressing future challenges and improving living standards.
- Deregulate and streamline permitting: A central tenet is the reform of environmental reviews, zoning laws, and other administrative hurdles that delay and increase the cost of building everything from housing developments to renewable energy projects and public transit. They argue that these regulations, while often well-intentioned, are exploited by organized interest groups to block development, leading to higher prices and unmet needs.
- Prioritize tangible outcomes over process: The movement critiques a perceived liberal tendency to prioritize process and adherence to certain procedures over the actual delivery of results. They argue for a focus on quantifiable outcomes, such as the number of new homes built or the speed of clean energy deployment.
- Embrace economic growth: Unlike some segments of the left that express skepticism towards economic growth, abundance proponents see it as essential for addressing societal needs, alleviating poverty, and fostering a more prosperous and stable society. Scarcity breeds reactionary politics, and a society of plenty is more conducive to progressive goals.
Ezra Klein and Derek Thompson’s Abundance has been instrumental in articulating these ideas, presenting a vision of a future where America is not stuck between a growth-averse progressive movement and a government-allergic conservative movement. They suggest an “Abundance Agenda” as a “Third Way” policy alternative that can outcompete the appeal of both the “socialist left” and the “populist-authoritarian right.”
Klein, Smith and Yglesias, admirably using mostly guerrilla tactics, have created a vibrant intellectual ecosystem advocating for a more “builder” mindset from the left. The abundance agenda is gaining traction, yet not without opposition from the harder left.
Factions Opposing the Abundance Movement
The Atlantic’s Jonathan Chait, at The Atlantic, sums up the state of intramural play very well:
A civil war has broken out among the Democratic wonks. The casus belli is a new set of ideas known as the abundance agenda. Its supporters herald it as the key to prosperity for the American people and to enduring power for the liberal coalition. Its critics decry it as a scheme to infiltrate the Democratic Party by “corporate-aligned interests”; “a gambit by center-right think tank & its libertarian donors”; “an anti-government manifesto for the MAGA Right”; and the historical and moral equivalent of the “Rockefellers and Carnegies grinding workers into dust.”
The factional disputes that tear apart the left tend to involve wrenching, dramatic issues where the human stakes are clear: Gaza, policing, immigration. And so it is more than a little odd that progressive activists, columnists, and academics are now ripping one another to shreds over such seemingly arcane and technical matters as zoning rules, permitting, and the Paperwork Reduction Act.
The intensity of the argument suggests that the participants are debating not merely the mechanical details of policy, but the very nature and purpose of the Democratic Party. And in fact, if you look closely beneath the squabbling, that is exactly what they are fighting over.
The abundance agenda is a collection of policy reforms designed to make it easier to build housing and infrastructure and for government bureaucracy to work. Despite its cheerful name and earnest intention to find win-win solutions, the abundance agenda contains a radical critique of the past half century of American government. On top of that—and this is what has set off clanging alarms on the left—it is a direct attack on the constellation of activist organizations, often called “the groups,” that control progressive politics and have significant influence over the Democratic Party.
The progressive Abundance Agenda faces considerable opposition and skepticism from various factions within the Democratic Party. (As does the prosperity agenda from curmudgeonly Republicans such as Owen Cass, Josh Hawley and J.D. Vance.)
These irredentists have a nostalgic but ill-grounded worldview and imagine risks from the abundance agenda.
- Environmental Advocates and the “Green” Left
- Economic Populists and the Democratic Socialists
- Organized Labor and Social Equity Advocates
- Proceduralists and Good Government Advocates
Attendant Economic and Political Issues
The debate over the abundance movement within the Democratic Party highlights several structural economic and political tensions:
- Growth vs. Redistribution: The most significant tension is the endless debate between prioritizing economic growth (supply-side solutions) and prioritizing equitable distribution of existing resources (demand-side solutions). Abundance advocates believe growth is a prerequisite for broad prosperity, while their critics, blinded to the throughline that equitable and prosperity are complementary, not contradictory, values argue that unchecked growth without robust redistribution exacerbates inequality.
- The Role of Government: The “supply-side progressive” abundance movement implicitly redefines the role of government. Instead of primarily being a regulator, safety net provider, and redistributor, the abundance vision sees government as an enabler of production and innovation, actively removing barriers and making strategic investments. This is a shift from the incumbent progressive view that emphasize government intervention to correct market failures and ensure social justice. Not to generate production and innovation.
- Regulatory Reform vs. Environmental Protection: The core of the abundance agenda often involves regulatory reform, particularly in environmental and land-use law. This immediately pits it against long-standing environmental protection movements that view deregulation as a dangerous retreat from essential safeguards. The challenge is to find a balance where necessary building can occur without undermining ecological integrity.
- Populism vs. Technocratic Solutions: The abundance movement, with its focus on “bottlenecks” and “permitting reform,” can sometimes be perceived as a technocratic solution that fails to resonate with the broader electorate’s concerns about corporate power and economic fairness.
The Demand Progress poll suggests that “populist economic concerns” consistently resonate more broadly and deeply with voters than “abundance” arguments. This poses a political challenge for the movement: how to frame its agenda in a way that connects with everyday economic struggles and offers tangible benefits to working families. Ezra Klein is well aware of this critique, merrily observing that that “’I didn’t write a book that’s substantially about zoning reform and state capacity and think, ‘We’re headed to No. 1, baby,’ he joked.”
While the abundance agenda is continuing to gain traction, its challenges include party unity and strategy. The emergence of the abundance movement highlights internal divisions within the Democratic Party at a crucial time. As the party grapples with its post-2024 message, the debate over abundance versus populism, or a synthesis of the two, will shape its future electoral strategy and policy priorities.
The formation of a “Build America Caucus” in the House, inspired by the abundance movement and seeking bipartisan support for permitting reform, signifies an attempt to bridge these divides and focus on areas of potential consensus. However, the deep ideological disagreements suggest that achieving broad intra-party unity on this agenda will be a significant challenge.
In conclusion…
The abundance movement represents a significant intellectual development within the Democratic Party, advocating for a shift towards a more proactive, supply-oriented approach to solving America’s challenges.
It champions deregulation, public investment, and a focus on tangible outcomes in areas like housing, energy, and infrastructure. However, this agenda faces opposition from environmentalists concerned about regulatory rollbacks, economic populists who prioritize redistribution and fighting corporate power, and social equity advocates who demand guarantees of fairness and inclusion.
The ongoing debate between these factions will undoubtedly shape the future direction of the Democratic Party, and, thereby, that of America. The supply-side progressive forces appear to be gaining momentum.
Image by JillWellington courtesy of PIxabay Content License
Hey Progressives?
Embrace progress!
Welcome,
Abundance.
#
Jeff Garzik, the founder of HEMI.xyz, serves and the founder and chairman of the policy institute Washington Power and Light. Earlier he spent five years as a Bitcoin core developer and ten years at Red Hat. His work with the Linux kernel is now found in every Android phone and data center running Linux today.
Ralph Benko, co-founder and general counsel to F1R3FLY.com, is the co-founder and general counsel to Washington Power and Light. He has worked in or with 3 White Houses, 2 executive branch agencies, and the Congress as well as many political and policy institutes. He is an internationally award-winning, critically acclaimed, author and columnist.
To drill down deeper:
https://www.wsj.com/politics/policy/abundance-ezra-klein-democrats-7d485b4d
Molly Ball, Can the ‘Abundance Agenda’ Save the Democrats? Dispirited liberals are embracing–and feuding over–a new book’s call for cutting red tape.
The Coming Democratic Civil War by Jonathan Chait
A seemingly wonky debate about the “abundance agenda” is really about power.
The ‘abundance’ movement comes home – POLITICO
The moment speaks to how they took inspiration from California and San Francisco as the poster children for how liberal governance has failed to build what …
The Real Path to Abundance – Boston Review
In their new book, Abundance, Ezra Klein and Derek Thompson argue that American liberals have ironically succumbed to a conservative worldview, in the original …
An Abundance of Ambiguity – Washington Monthly
Klein and Thompson argue that a world of plenty awaits us if we reform zoning and environmental laws but that can’t be the whole plan, right … The “abundance …
Abundance: A Primer | Published Work
Abundance: A Primer. The abundance movement is gaining momentum across America’s political landscape. For those new to the idea, abundance is an approach to …
The Abundance Agenda – People’s Policy Project
In the history offered by Abundance, the main economic story of 20th century America is that the country went from having low administrative burdens on …
One Billion Americans – Wikipedia
One Billion Americans argues that America is not over-crowded and that the USA should aim to increase its population to 1 billion in order to counterbalance …
Noah Smith – Pairagraph
Noah Smith is the author of Noahpinion, one of Substack’s most popular blogs. Previously, he was was a columnist a Bloomberg, and before that was an assistant …
Democratic Voters Choose Fighting Corporate Power Over Neoliberal Abundance ‘Scam’: Poll | Common Dreams
That’s according to a new Demand Progress poll of 1,200 registered voters “to test the resonance of the ‘abundance agenda’ being promoted as a potential policy …
Family Seeks Big Oil Accountability in Wrongful Death Lawsuit for Climate Related Death | Common Dreams
Founded in 1971, we now have 500,000 members and supporters throughout the country. (202) 588-1000 · www.Citizen.org · Press PageAction Page. Most Popular. By …
The Meager Agenda of Abundance Liberals – Washington Monthly
… things the country desperately needs, from new housing to clean energy infrastructure. While abundance liberals don’t all agree on everything, they are …
“Abundance” and Its Insights for Policymakers | Article | EESI
Abundance authors Ezra Klein and Derek Thompson believe that U.S. systems of government have become too legalistic, prioritizing process over outcomes and …
New Bipartisan Build America Caucus Launches to Support Pro-Growth Policies
Rep. Josh Harder will serve as Chair. The Build America Caucus will prioritize: Unleashing American energy through permitting and transmission reform.
Abundance That Works for Workers—and American Democracy – The Roosevelt Institute
Ezra Klein argues in his recent op-ed (and at greater length in his compelling new book with Derek Thompson) that a central problem facing Democrats is the …
