Even as the latest jobs report and rising GDP bring some good news for the U.S., growing income inequality continues to plague the economy. The stock market might be up, but for millions of Americans, the reality of stagnant wages belies the capitalist dream and this trend, if it continues, can demotivate the labor force and hurt business productivity.
Thanks to Washington, and the 2012 presidential elections in particular, the battle lines between the rich and the poor have become so stark that real solutions are hard to find. You are either a populist who believes the playing field for wages needs to be leveled by the government, or an elitist who believes that whatever wages businesses are willing to pay are inherently 'fair.'
Neither is strictly true and we need political leadership that can view inequality in this perspective and address it pragmatically. That ticket, in my opinion, would be a Hillary Clinton presidency, with Elizabeth Warren as her Vice President. The two women can bring complementary perspectives, talents and approaches to the White House that would benefit the nation greatly in 2016.
Hillary Clinton is a pragmatist, and like her husband, a pro-business Democrat. The Clintons are widely regarded as friends of the private sector, and on the biggest issue of all -- taxes -- in favor of lower corporate and capital gains tax rates. During the 2008 election cycle, Hillary raised more money from Wall Street than both John McCain and Barack Obama (in the period leading up to her concession to Obama) and recently helped raise money from Hollywood for Terry McAuliffe in the Virginia gubernatorial race. From a political standpoint, a Clinton candidacy would command strong financial support from the business community, even against a Republican challenger.
Elizabeth Warren, by contrast, is the consummate populist, having made a career out of challenging the excesses of Wall Street and fighting for the rights of average Americans. Though her work with individual bankruptcy produced only mixed success, she was instrumental in creating the seminal Consumer Financial Protection Bureau as part of Dodd-Frank and in fearlessly calling out the business sector on issues like low wages, worker safety and other forms of corporate exploitation. After being elected to the Massachusetts Senate, Warren has pushed steadily for reforms to student loan programs, tighter regulation of payday lending and argued for an expansion of social security, all of which are designed to protect low income and middle class citizens.
The combined forces of these two candidates could garner votes from all segments of the U.S. population and bring two critical facets of public policy into balance -- namely, the need to provide a robust economic environment for the successful conduct of commerce, and the need to protect and advance the rights of consumers and workers. These two factors are often at odds with each other, which is why they require a careful balancing act and complementary perspectives.
The U.S. economy is finally in a strong place, but this momentum depends upon consumer spending -- which accounts for about 70 percent of all economic activity in order to continue, and therefore upon higher wages which puts spending money into consumers' pockets. While economists expect both wages and consumer spending to rise slightly in 2014, the scale of the inequality problem in the U.S. can dampen these forecasts and slow down our progress.
In addition, as the role of women expands and becomes increasingly important in the business world, it is essential for their perspectives and ideas to be reflected in the highest office in the land. In fact, it is not an understatement to say that the contribution of women to the workplace will be a major factor in driving our productivity and success in the foreseeable future.
While Warren has ruled out 2016 aspirations and committed to serving her term in Massachusetts through the beginning of 2019, it is still early days and a lot can change in the next two years. More importantly, she represents a strain of American political thought that is crucial to the interests of average citizens and as such deserves a serious look by the Democratic Party.
It is true that corporate sponsors could be alienated by Warren's fiery brand of economic populism, but it is also true that President Obama won the White House the second time largely on the same platform, and if Warren's enthusiasm can be tempered by Hillary Clinton's realism, the combination could be a winner: politically for the Democrats, for addressing the growing inequality in America and for unleashing the full potential of women in our economy.
SANJAY SANGHOEE is a political and business commentator. He has worked at leading investment banks Lazard Freres and Dresdner, as well as at multi-billion dollar hedge fund Ramius. His opinion pieces appear in Huffington Post, TIME, Bloomberg Businessweek, FORTUNE, and Christian Science Monitor, and he has appeared on CNBC's 'Closing Bell', TheStreet.com, and HuffPost Live on business topics. He is also the author of two thriller novels.
For more information, please visit www.sanghoee.com