Today’s AI Prompt: List Policies that Have Hurt the Middle Class

Wali-G Prompt: “Peace and stability of nations is what’s going on today. Make a list of all the policies that both the Right and Left have created that have hurt the average middle class person in the last 25 years. Include solutions.”

ChatGPT said:
(Thought for 1m 27s)

Major policies (last ~25 years) that have hurt the middle class — from the Right, the Left, and bipartisan choices — plus practical solutions

Quick note up front: “All” is impossible — hundreds of laws, regulations and local rules matter — but below I list the major, recurring policy themes over roughly the past 25 years that economists and policy analysts most often identify as having eroded middle-class security (jobs, wages, benefits, housing, health and debt). Where a claim relies on internet sources I cite the most load-bearing references. I also flag whether the policy was primarily advanced by the Right, the Left, or was bipartisan, and give concrete, actionable solutions for each item.

1) Regressive/uneven federal tax changes that shifted income upward

What happened: Large federal tax cuts in the 2000s and again in 2017 reduced rates on capital gains/dividends and top incomes and shifted more tax benefit toward high-income households. Those changes produced smaller relative gains for middle-income households while reducing revenue available for public investments that support middle-class living standards.
Center on Budget and Policy Priorities
+1

Who pushed it: Primarily Right / conservative lawmakers, though tax policy is often bipartisan in implementation.
How it hurt the middle class: Smaller after-tax gains for the middle versus the wealthy; tighter federal budgets for education, infrastructure, and social programs; greater inequality and price pressure on housing/health/education.
Center for American Progress

Solutions (practical):

Shift to more progressive revenue (raise top rates, tighten capital-income preferences) and close loopholes while protecting middle-income families (expand EITC/child tax credit).

Pair revenue changes with targeted middle-class supports (childcare, community college funding, housing vouchers).

Make corporate tax incentives conditional on job creation and wage growth in the U.S.

2) Financial deregulation / excessive risk-taking in finance (contributed to the 2008 crisis)

What happened: A string of deregulatory moves and lax supervision allowed banks and shadow-bank entities to grow risky positions (securitization, leverage), contributing to the 2008 crisis and the deep recession that followed — which wiped out home equity, retirement savings and jobs for many middle-class households. Analysts debate exact causal chains, but deregulation and weak oversight were important factors.
Investopedia
+1

Who pushed it: Mostly Right + bipartisan coalitions in the 1990s–2000s; regulators on both sides sometimes failed to act.
How it hurt the middle class: Job losses, foreclosures, lost retirement savings; long recovery with wage stagnation for many.
Solutions:

Restore strong prudential regulation (higher capital/liquidity, limits on risky proprietary activities) and robust consumer protections (clearer disclosure, arbitration limits).

Enforce anti-fraud and market-conduct rules; require resolvability of big banks (no taxpayer bailouts).

Strengthen community banking and public options for credit to ensure fair lending.

3) Trade and globalization policies that accelerated offshoring of middle-class jobs

What happened: Trade policy changes (e.g., granting China PNTR/WTO entry in 2001 and subsequent global trade liberalization) exposed U.S. manufacturing to intense foreign competition; many manufacturing jobs were lost or shifted offshore. Research ties trade shocks to long-term local job losses and wage pressure in affected regions.
World Trade Organization
+1

Who pushed it: Bipartisan (both Democratic and Republican administrations supported trade liberalization at different times).
How it hurt the middle class: Loss of well-paid manufacturing jobs; hollowing-out of regional labor markets; downward pressure on wages and benefits in affected communities.
Solutions:

Aggressively fund worker adjustment: retraining, portable benefits, stronger unemployment insurance and relocation assistance.

Negotiate trade deals with enforceable labor and environmental standards and fast remedies for unfair practices.

Invest in regional manufacturing hubs (tax credits tied to domestic production, public R&D, infrastructure) to rebuild middle-skill employment.

4) Rising student-loan debt driven by higher college costs and federal loan policies

What happened: Over decades tuition rose substantially; borrowing expanded (federal loan programs grew and private lending filled gaps). Policy choices (loan availability without stronger accountability or cost-control) helped expand debt burdens. That debt constrains household formation, savings, and mobility for many middle-income households.
Brookings
+1

Who pushed it: Mixed — higher education institutions, state budget choices, and federal loan policy (both parties).
How it hurt the middle class: Large, persistent debt loads for recent graduates; delayed home purchases, family formation and retirement saving.
Solutions:

Make public higher education affordable again (state reinvestment, tuition caps, debt-free pathways).

Reform federal student aid: more income-driven repayment, quicker loan forgiveness for predatory/low-value programs, stricter oversight of for-profit colleges.

Expand high-quality alternatives (apprenticeships, community college partnerships, stackable credentials).

5) Health-care policy design problems that left many middle-class families exposed to premium and cost shocks

What happened: The Affordable Care Act expanded coverage but left some middle-income families exposed to high premiums in some markets; subsidy design and periodic expirations or political fights over subsidies can produce major premium swings for middle earners. Recent debates over ACA subsidy extensions demonstrate how policy cliff effects can sharply raise middle-class health costs.
KFF
+1

Who pushed it: Primarily Left (ACA) for expansion of coverage; but policy design and later budget moves are partisan.
How it hurt the middle class: Premium spikes when subsidies lapse or markets are thin; high out-of-pocket costs; job tie-ins for coverage that reduce labor mobility.
Solutions:

Stabilize marketplace subsidies and extend them in the medium term; expand Medicaid in holdout states.

Introduce a public option or reinsurance to reduce premiums, and cap out-of-pocket spending for middle earners.

Decouple basic coverage from employment (portable benefits), encourage price transparency and lower drug prices via negotiation.

6) Weak labor protections and policies that reduced union power and bargaining leverage

What happened: Right-leaning “right-to-work” laws, prosecutorial choices, and broader political shifts made union organizing harder and reduced union density; that has lowered wage growth and benefits for many middle-skill workers.
aflcio.org
+1

Who pushed it: Primarily Right at state level, with some national bipartisan trends that favored flexibilization.
How it hurt the middle class: Lower wages, fewer employer-provided benefits (pensions/health), and less workplace bargaining power.
Solutions:

Restore easier union certification and collective bargaining rights at federal level (e.g., card check, stronger NLRB enforcement).

Promote sectoral bargaining, higher minimum wage indexed to cost of living, and portable benefit models.

Incentivize worker ownership and co-ops in distressed communities.

7) Local land-use and zoning rules that restrict housing supply and hike prices

What happened: Strict single-family zoning, height limits, and other local restrictions in fast-growing metro areas have reduced housing supply and pushed prices up faster than incomes. That squeezes middle-class families trying to buy starter homes in high-opportunity areas. (This is a local policy problem but cumulatively national in effect.)
Who pushed it: Local governments and local political coalitions (mix of NIMBY interests across the political spectrum).
How it hurt the middle class: Higher rents and house prices, longer commutes, reduced upward mobility.
Solutions:

Encourage zoning reform: allow duplexes, triplexes, and mid-rise near transit; density bonuses for affordable units.

Federal incentives/grants tied to local reform; expand housing vouchers and support for missing-middle housing construction.

Streamline permitting and fund infrastructure so building is less costly.

8) Privatization / outsourcing of public services without strong oversight

What happened: Shifts toward privatizing services (prisons, some transit operations, IT, student loans servicing, charter management) sometimes prioritized cost-cutting over quality and accountability, producing worse outcomes for citizens who rely on those services.
Who pushed it: Often Right-leaning policy makers and some bipartisan pragmatic moves.
How it hurt the middle class: Worse service quality, higher long-term costs, and fewer public sector middle-class jobs.
Solutions:

Require public-interest performance contracts, transparency, and easier remedies when private contractors underperform.

Preserve and invest in high-quality public provision where appropriate (transit, education, correctional reform).

Reassess privatization projects with cost-benefit and equity lenses.

9) Criminal-justice and sentencing policies that eroded financial/household stability in affected communities

What happened: Tough sentencing, aggressive enforcement, and criminal penalties for nonviolent drug offenses (though reforms have accelerated recently) increased incarceration and long-term labor market scarring, disproportionately harming working-class and middle-class families in certain communities.
Who pushed it: Historically bipartisan, but political choices over the last decades enforced harsher penalties.
How it hurt the middle class: Lost income, broken families, and reduced lifetime earnings and credit access.
Solutions:

Continue sentencing reform, expand diversion and treatment programs, and remove employment licensing barriers for those with records.

Invest in community reentry, job training and mental-health/substance-use treatment.

10) Bipartisan neglect of public investment (infrastructure, childcare, broadband, elder care)

What happened: Long periods of underinvestment in care infrastructure, affordable childcare, elder care, broadband and physical infrastructure increased the private costs households must bear (time, money), reducing middle-class financial resilience.
Who pushed it: Bipartisan failure to prioritize sustained public investment.
How it hurt the middle class: Higher out-of-pocket care costs, constrained labor force participation (especially for women), lower productivity.
Solutions:

Make long-term public investments (childcare, elder care, broadband, transit) financed with progressive revenue and targeted public-private partnerships.

Expand subsidized early childhood education and tax credits for caregiving; treat care infrastructure as core economic infrastructure.

Final caveats and a short framework for reform

Many harms are bipartisan or systemic. Trade liberalization, financialization, and routinized austerity often had support across parties — blame isn’t purely “Left” or “Right.”

Fixes require a mix of revenue, regulation, and public investment. The recurring pattern: policy choices that concentrate income and reduce public services weaken middle-class resilience. Rebalancing means restoring progressive revenues, stronger market rules, labor power, and direct public investment in human and physical infrastructure.

Targeted bridge policies reduce transition pain. For trade and automation shocks: robust wage insurance, retraining, portable benefits, and place-based investments help. For education debt: income-driven repayment and cost control; for health care: subsidy stability plus public options.

If you want, I can:

Turn this into a two-page policy brief with citations and budget ballpark numbers for each solution.

Draft a political-neutral “action plan” for a city or state to protect and rebuild its middle class.

Which would you like next?