First Letter from Tim Ferguson to Kamala Harris, November 2024

November 13, 2024

Madam Vice President:

Over the past 50 years, America’s middle class has been pummeled at the hands of both Republicans and Democrats.[i] In the 2024 presidential election, you campaigned on the correct issue inasmuch as you campaigned on its behalf. Indeed, you made middle-class hope the centerpiece of your campaign, just as your opponent made middle-class anger the centerpiece of his. Unfortunately for your campaign, it seems that the American people today harbor more anger than hope.

The essence of America is that it is to be a republic. In order to have a commonwealth, the commons must have the wealth. On this point, the intuition of ordinary Americans agrees with the reason of political philosophers and the principles of our Founding Fathers: the middle class should own at least half the wealth.[ii] This belief has held steady for 24 centuries. It is not communism. It is not socialism. It is Classical republicanism. That the middle class should come first is American patriotism 101. 

Whereas middle-class primacy leads to stability and prosperity, middling insecurity causes pessimism, polarization, demagoguery, patronage, authoritarianism, and cultism.[iii] The fate of our middle class over the next few decades will decide the fate of our American experiment in the democratic-republican model of government. Next to the gravity of these considerations, the other issues influencing this election’s outcome are insignificant. Yet, fed by the underlying anger of the American people, their prominence far outgrew their significance, crowding out any genuine, sober discourse on how we might restore middle-class primacy. 

We write you now to introduce a plan – entitled Operation Abigail – that would do just that. We ask that you take a few moments to review the enclosed summary of Operation Abigail, and if you agree with it, to endorse it.

That summary broadly outlines a plan to rebuild America’s middle class appealing to all good-natured Americans, whatever their heritage or political affiliation. Its vision is to restore the middle-class primacy of the 1950s, without the segregation, the racism, and the sexism. And if it still remains true to its egalitarian origins, the Republican Party – the party of Abraham Lincoln, Thaddeus Stevens, Theodore Roosevelt, and Dwight Eisenhower – will rush to the front lines to support Operation Abigail.[iv] For no plan has ever enunciated a more authentically conservative and republican vision than of the triumphant middle-class commonwealth, inherited from the Founding Fathers, improved for our posterity.

But that summary does not fully elaborate one feature of Operation Abigail: Its power to mitigate pre-Revolution Black wealth disparities. To aid in considering your willingness to support our efforts, I devote the rest of this letter to that aspect of our plan.

Any plan that would restore what was best about America’s founding is incomplete unless it also undertakes to repair what was worst. For all our veneration of the Founding Fathers, whose opposition to monarchy and devotion to the republican cause can never be tarnished, we must also remember that at the birth of this republic, about one person in five was enslaved. These slaves can account themselves among the founding generation as any minutemen who picked up the rifle to win our freedom from the foreign power which then ruled our affairs. In fact, many of them did.

Yet hard economic reality demonstrates in mathematical terms that, while their descendants have a first-class claim to America’s founding heritage, too many of them have only enjoyed a second-class share of its blessings. 160 years after Abolition, the Black median household net worth is barely one-tenth the White median.[v] Modern research shows that, at current rates, White-Black income convergence won’t be achieved for another 180 years, sometime around the year 2,200.[vi] The more we learn, the less surprised we should be. 160 years may seem like a long time ago to Americans, but ultra-long term datasets of intergenerational wealth and income elasticity in Italy demonstrate the persistence of economic advantages existing as far back as the Renaissance, passed from wealthy families to their descendants across the span of 600 years![vii] The United States isn’t even 250 years old yet.

If economic disparities which existed before Leonardo and Michelangelo were even born can still be detected in homogeneous Florence, Italy after 600 years, of course slavery’s economic consequences will still persist in multiracial Florence, South Carolina after 160. The freedmen started with almost nothing but the enmity of the majority and from there endured over a century of segregation and discrimination. Despite the often-quoted and moronic refrain that enough time has by now passed to erase those inequalities – which seeks to hold Black Americans responsible for Black wealth disparities – the truth is that the project of economic convergence moves much slower than nominal political or legal equality. And this is especially so against the historic headwinds of segregation and discrimination.

Operation Abigail would create an immediate and powerful market incentive to ameliorate these historic racial economic disparities, thereby hastening the convergence. And it would do so in a manner that would take nothing away from White Americans.  

As the enclosed outline describes, Operation Abigial would prospectively tether the top households to the national median household net worth at an efficient mathematical ratio such that the outcomes of America’s top households thereafter rise and fall lockstep in proportion to the national median. The top households must thereafter cause the median to increase in order to themselves enjoy any future gains. If this sounds like an incentive plan, that’s precisely what it is: Operation Abigail simply scales up capitalism’s own invention of the long-term incentive plan from the level of enterprise to nation.

The initial ratio would be 10,000:1. This would set a $1.5 billion cap, a limit surpassed by about 675 American households. The multiple could be periodically adjusted as necessary to cover the requisite number of households having adequate market power to endow the incentive plan with incentive force. But even under the initial 10,000x threshold, the potential is clear: at 10,000:1, every $1 increase to the median rewards the top by $10,000; every $10,000, by $100 million; and every $100,000, by $1 billion.

Applying this general framework to America’s current racial disparities, the incentive to eliminate or at least substantially mitigate them also becomes clear, particularly since Black wealth disparities are so severe. By our math, Black wealth disparities alone drag down the national median by perhaps $40,000, which by operation of the 10,000:1 ratio would create a $400 million per-covered household incentive to reduce them.[viii] One beauty of median benchmarking is that this could not be effectively achieved simply by shifting wealth or income from White to Black households because that wouldn’t raise the median. Operation Abigail ensures that elites are rewarded only for increasing America’s total wealth.

Put simply: Operation Abigail makes tolerating extreme racial disparities very, very expensive for succeeding generations of elites.

And, just like a true incentive plan, Operation Abigail leaves the manner and method that are actually used to raise the median to market actors.[ix] Though we could make a few suggestions, it’s beyond our remit to dictate any specific policy other than to create the incentive itself, for doing so would change the ratio’s character from that of an incentive plan to a mandate. That said, and without any consultation with or suggestion by them, we would recommend serious consideration of Darrick Hamilton’s and Sandy Darrity’s Baby Bonds program as one positive-sum technique that could be used to accelerate racial wealth convergence.

In any event, put any median-top social aspect ratio in place, and witness the project of reducing Black wealth disparities rise from the status of “maybe someday” to urgent market imperative. Discover the optimal ratio, and watch as all other ordinary workers are lifted too, side-by-side, in a great racial economic convergence into the strongest middle class foundation of the greatest republic in history.

Sincerely,

Tim Ferguson