President Lyndon B. Johnson was known for the War on Poverty. President Donald J. Trump, if his first six months is any indication, will be known for waging the War on Poor People.
We’ve seen not just a deluge of random bad policies, but a fundamental reorganization of the agreements we keep as tax-paying Americans with each other and our government.
We can count down the days until the November 2026 mid-term elections in hopes Congress can clean up these messy laws before the ink fully dries. We can also embrace our agency as impact investors in this moment by stepping up as the third party in our social contract: the private sector.
Dismantling the welfare state
In a strategy resembling death by a thousand (budget) cuts, the Trump administration has already delayed over $1 billion for the universal preschool program Headstart, sought to leave over 60,000 veterans jobless, and thoroughly gutted the Consumer Financial Protection Board, or CFPB, which regulates bad actors within the finance industry taking advantage of the economically vulnerable.
The administration has also threatened to substantially end Section 8, the housing program that is a subsidy for over 9 million American renters – and relied upon by thousands of landlords, both individuals and corporations, as part of their financing solutions.
This administration has a knife at the neck of the nation’s most critical social net systems. The politically neutral Congressional Budget Office said early and often that there is simply no way to reduce government spending to levels expected without cutting two main entitlements: Medicaid for one in five Americans, and Social Security for all of us.
The final version of the Big Ugly Bill threatens health insurance for at least 12 million Americans, and does nothing to address the impending cliff in the Social Security system, which is due to run short on funds as soon as 2033. It also may reduce or eliminate SNAP food benefits for as many as 22 million Americans.
The social welfare state was built on the concept that collectivizing some of the fruits of our economic activity (through taxes) would more efficiently provide collective resources like healthcare, retirement, and more – the Costco of public goods. It reflects an understanding that each individual member of society is better off when all of us are healthy, housed and fed, and know that our children have safe learning environments.
In the wake of America’s neo-liberal shift, society has often looked to the government to even out some of the capital accumulation that’s seen as a necessary evil of capitalist economic efficiency. At a bare minimum, we ask the government to step in and correct instances where private markets clearly fail and greed prevails over human interest, such as product safety.
And yet, the outcome over the past 30 years has been massive inequality. Private markets are increasingly expected to regulate themselves, with investors voting with their dollars towards the world they want to see. Sometimes this can be leveraged as a defensive mechanism, like investors taking their frustrations out on unelected official Elon Musk through the Tesla share price.
At this moment in history, equally important is our offensive ability to build a different economy, that doesn’t require as much clean-up from, at best, an unresponsive and, at worst, an antagonistic government.
Blossoming of community care
The funding gaps being left by the Trump administration’s budget cuts make even more visible the spaces where private markets could do a much better job at creating systemic equity and asset distribution across society. At Candide Group, we’ve spent the last decade supporting over 150 funds and companies that address climate justice, employee ownership and worker wealth, home and place, and equity and inclusion. And we are thinking more granularly about how our investments can help fill gaps that the Trump administration is leaving.
Here are some key strategies we’re considering, and examples of organizations we’ve supported that are out doing the work every day. We see these as examples of how investors can help fill in current funding gaps, and then beyond, build towards a more equitable American future.
Make Healthy Food Affordable
Everytable is a California-based fast-casual restaurant chain that focuses on getting healthy, affordable food in low-income communities. For instance, they provide meals at community colleges in East LA and Compton, and will soon start serving meals at 31 public schools within the Compton Unified School District. They also see franchise ownership as a great opportunity for wealth-building in communities of color.
Everytable worked with the Reinvestment Fund and Mission Driven Finance to build the Social Equity Franchise Fund, providing non-extractive finance to new franchisees who can build long-term value for their families and communities.
“As SNAP and Medicaid benefits get cut, private organizations like social enterprises and nonprofits that work to provide communities healthy food access are increasingly important.” said Sam Polk, co-founder and CEO of Everytable. “In many neighborhoods, social enterprises like Everytable are really the only option for people who want healthy, affordable food.”
Build Equity for Low-Income Workers
Apis & Heritage works to move business ownership into the hands of low-income workers, as a powerful mechanism for closing the racial wealth gap. They use an Employee-Led Buyout, or ELBO, model to provide selling owners with a fair, upfront price for their business, and give frontline workers—particularly in low- to moderate-income communities—the opportunity to become owners of the businesses they help build.
This creates a path towards higher wages and improved working conditions in the short term, and a long-term path to retirement security in the long term, often exceeding traditional 401(k)s.
Keep clean energy flowing to low-income communities
Impact investors have been deeply concerned about capital gaps for climate justice in the wake of challenges to the $20 billion Greenhouse Gas Reduction Fund, as Amy Cortese and David Bank wrote in Impact Alpha, and I on Forbes.com. The launch of GGRF helped educate impact investors about the many fantastic projects bringing the asset-building power of renewable energy to low-income communities. It’s jeopardy hopefully inspires impact investors to step up and fill upcoming capital gaps.
Solar Holler is a West Virginia-based solar developer and installer serving Appalachia, including Virginia, Kentucky and Ohio. Working with households, churches, schools and other non-profit organizations, Solar Holler has sought to build on the region’s history as an energy producer, without the staggering long-term threats to public health generated by coal. This month, it completed five of seventeen intended solar projects installed on the roofs of West Virginia public schools.
“It’s these sorts of projects that get me out of bed in the morning—the kind that cram as much good into one place as possible,” CEO Dan Conant said. “The kind that provide educational opportunities for West Virginian kids to stay home. The kind that support American manufacturing and union labor. The kind that lower bills for organizations doing God’s work.”
“Every panel we put up means more money for teachers and supplies, and…actual education,” he added. “The electricity generated by the solar is 20% cheaper than what the out-of-state monopoly utility is charging.”
Politics and the economy
So why should we care about government services, if private investors working in free markets can provide everything that citizens need? Not so fast…
We need a mixture of public and private services to make a country run well. Ever since the World Happiness Report was established at the UN in 2012, the top four slots have been consistently occupied by Finland, Denmark, Iceland and Sweden, all democratic socialist. (Born and raised in California to Greek ancestors, I would’ve put these countries right at the bottom based on weather alone. Can free healthcare, childcare, college education, and the hipster concept of “hygge” make up for winter?).
The US, on the other hand, has had an over-reliance on private markets to do the core work of our social contract. This is a challenge we still need to fix to both ensure the welfare of our people and our long-term global competitiveness. As a small business owner, I’m proud to provide quality health benefits to all our employees. I also wonder, how did healthcare become an employee benefit and not a human right in the first place?
So I don’t mean to imply that being active investors means we should abandon the work of building effective governments. Over the next year in politics, we will fund movement organizing with an eye on the midterms, and on harm-reduction amid the onslaught of terrible policy.
And we can also use this time to really get our private assets working more proactively towards the future we want to see.
Our horse named “Politics” is badly wounded and recovering for the next race; our good old mare “Economy” should be ready to run at full speed.
Full disclosures related to my work available here. This post does not constitute investment, tax, or legal advice, and the author is not responsible for any actions taken based on the information provided herein. Certain information referenced in this article is provided via third-party sources and while such information is believed to be reliable, the author and Candide Group assume no responsibility for such information. Follow me on LinkedIn. Check out Candide’s website or my book here.
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Morgan Simon is Founding Partner of Candide Group and the author of Real Impact: The New Economics of Social Change.
