This economic message was honed during the campaign. President Obama emphasized this theme in the second debate and spoke regularly about it this fall. "I believe you grow the economy from the middle out," he said in a key October ad.
Polling data showed that this message was compelling to voters. While pollsters often ask which candidate would do better on creating jobs, a Bloomberg poll done in September asked a deeper question: "Whom do you think has laid out a better vision for a successful economic future for the U.S.: Barack Obama or Mitt Romney?" On this question, Obama beat Romney by 10 percentage points.
In October, the Democratic polling firm Penn Schoen Berland tested twelve economic messages from the candidate's convention addresses and stump speeches and found that the top scoring messages were Obama's vision that the economy grows from the middle-out, rather than through trickle-down.
As the President pushes policymakers towards this new vision of the economy, he and the Congress should know that there is a growing chorus of economists who back up the idea of middle-out economics.
Just over a year ago, the Center for American Progress held a meeting with 40 economists, including two Nobel Laureates, asking them what evidence they saw for the idea that inequality may hinder or destabilize economic growth and, conversely, a strong middle class would support sustainable growth.
Like any meeting of top-flight economists, they all had much to say. But, what was surprising was that the general consensus was that there is empirical evidence supporting what the President calls middle out economics.
Economists have found that countries with less inequality are more likely to keep growing. They have found that a stronger middle class supports the kind of investments in education and infrastructure that are vital to creating a highly productive workforce (the key element of any growth theory) and a platform for widespread innovation and entrepreneurship.
Since the financial crisis, economists have also been digging into whether the outsized incomes of those in the financial sector are helping or hurting growth. What they have found is that these higher profits have often been used to lobby for the kinds of deregulation that support more profits for finance, but have both been destabilizing and crowded out investments in more productive sectors.
But, it's not enough to say that the economy grows from the middle out, President Obama must now lay out an economic agenda that is true to these words. His first test is the debate over the fiscal cliff, but the real proof of the durability of a middle-out economics is whether the framing extends beyond the notion that we need a more progressive income tax.
Investing in high-quality public education, that is accessible to all, is obviously the first tenant of a middle-out economics. But, growing from the middle out also means recognizing the challenges that middle class families face, such as how to sort out caring for the young, the aged, and the infirm in an era when every adult has to have a job just to make ends meet. We need to figure out how to support families in ways that foster their labor force participation and make sure that the next generation is well cared for (and ready to learn when they arrive in the classroom).