In United States public policy, supply-side progressivism is a political ideology that emphasizes increasing the supply of essential goods and services, such as housing, healthcare, and higher education, in order to make them more abundant and affordable. Supply-side progressives believe that some regulations artificially restrict the supply and drive up costs of essential goods and services, while other regulations, such as antitrust law, need to be implemented or enforced to encourage market competition and innovation. They also advocate for more investment in research and development for technologies such as sustainable energy sources in order to increase abundance and reduce costs over time.
History
In the United States, supply-side economics has historically been coded as right-wing, and used to justify cutting taxes for the wealthy and reducing government regulations. Supply-side progressives aim to ensure that people across social classes have access to essential goods, by reducing regulations that restrict supply, and increasing regulations that improve supply and decrease cost. In the early 2010s, Miles Kimball termed "supply-side liberalism" with the launch of his blog, "Confessions of a Supply-Side Liberal". Over the next decade, he covered applications of supply-side liberalism on topics such as immigration and housing. In 2017, Neil Irwin of the New York Times wrote about increasing the US labor pool in his article "Supply-Side Economics, but for Liberals", including via the earned income tax credit and child-care subsidies.
During the COVID-19 pandemic, media attention for supply-side progressivism increased due to pandemic-related shortages. Matthew Yglesias wrote about supply-side interventions in decreasing cost and increasing access to healthcare. The Niskanen Center published a report about "cost-disease socialism", expanding on Baumol's cost disease, citing examples in healthcare, higher education, housing affordability, and childcare where supply-side solutions can be impactful. This was followed by a New York Times opinion piece by Ezra Klein advocating to Democrats to incorporate supply-side progressivism into their strategy, and a piece in The Atlantic by Derek Thompson about what he called "the abundance agenda", his "simple plan to solve all of America's problems". In 2021 Thompson started writing a column for The Atlantic about supply-side progressivism, called Work in Progress. In January 2022, a think tank that supports supply-side progressivism, the Institute for Progress, was launched, funded by Open Philanthropy and Tyler Cowen's Emergent Ventures.
Approach
Conventional progressivism focuses on policies that redistribute wealth or subsidize access to basic goods, such as universal healthcare and housing vouchers. By contrast, supply-side progressivism aims to create more of these goods and services and make them more widely available. Another school of supply-side progressivism, anchored in the Rehn-Meidner model, emphasizes that innovation, productivity and structural change is enhanced by high minimum wages, solidaristic wage policies and low profit margins.
Reducing regulatory restriction of supply
Supply-side progressives criticize regulations that constrain the supply of essential goods and services. Examples include zoning laws and building permit requirements that impede the building of new housing and infrastructure, as well as limits on doctor residency training positions and immigration.
Encouraging innovation
Supply-side progressives emphasize innovation as a way to increase manufacturing capacity and throughput of existing goods, and to create new goods to help meet demand. This can come in the form of research, development, or implementation sponsored directly by the government, and prizes provided to people or companies who solve specific problems. Some supply-side progressives argue that increasing the supply of high-skilled immigrants will encourage innovation. In the Rehn-Meidner model, innovations are enforced by wage pressure on firms. In the affiliated Schumpeterian theory of transformation pressure, innovations are enhanced by a recession, a stronger currency and by environmental regulations.