Peter Gosselin's HIGH WIRE Mentioned in Time

The New President's Economy Problem
Thursday, May. 15, 2008, TIME
By JUSTIN FOX

FINANCIAL SECURITY
47 million uninsured
HEALTH CARE AND RETIREMENT SCARE YOU? YOU'RE NOT ALONE

Ronald Reagan uttered another line in that 1980 debate with Jimmy Carter that has entered the history books: "There you go again," he chastised his opponent. What's less well remembered is what that was in response to. Carter had been making the case for national health insurance and said Reagan had once opposed Medicare. Reagan objected that Carter was misrepresenting his position — he had simply opposed a particular Medicare bill. But Carter was absolutely right that Reagan wasn't for universal health care — or for any other government effort to socialize risk.

In the seminal PBS series Free to Choose, which aired in 1980 and may have helped set the mood for Reagan's victory, economist Milton Friedman argued that economic freedom was just as important as all those freedoms written into the Bill of Rights. This went on to become perhaps the most consistent theme of the Reagan economic era: giving Americans the freedom to succeed or fail on their own economically was a good thing. And it is probably a good thing. But not an unmitigated good. Economic security matters to Americans too. And finding ways to offer more of it may be the basis of the next big economic-policy revolution.

Economic changes over the past three decades — many the result of government decisions — have "left working families up and down much of the income spectrum living with fewer economic protections, bearing more economic risk, chancing steeper financial falls," writes Los Angeles Times reporter Peter Gosselin in his new book High Wire: The Precarious Financial Lives of American Families. This Great Risk Shift from governments and corporations to individuals, as Yale political scientist Jacob Hacker labeled it in the title of another book on the subject, has become one of the defining economic realities of our age. Some aspects of it are still in dispute: economists can't seem to agree on whether jobs really have become less secure than they were. But others are undeniable. "No one argues that Americans aren't shouldering more of the risk on health care and retirement than they used to be," says Hacker.

That you're-on-your-own ethos is already beginning to change — a little. In 2006 Congress passed a law that has brought positive changes to the 401(k) savings plans that for many Americans have replaced pensions. But the majority of private-sector workers in the country aren't offered a 401(k) or a pension, according to the Employee Benefit Research Institute. All three candidates have talked of creating a new system of portable retirement accounts for those who don't get one through employers, with Obama's plan the most ambitious.

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