As the squeeze on living standards has intensified, the way we talk about inequality and growth has changed in subtle ways. In particular, more majoritarian ways of thinking about prosperity have come to the fore, most notably in the slogans of the ‘99 per cent’ and ‘squeezed middle’. Such terms may lack focus but they don't lack substance; they reflect a genuine faltering of real income growth for a large swath of households in Britain and America, and one that began before the 2008 crisis.

This book brings detail and definition to this important debate by comparing the experience of the ordinary working households in America and Britain in recent decades. It contains eleven essays by an impressive array of US academics, from Jacob Hacker to Eileen Appelbaum, ranging across a broad terrain. It begins with a wide-angle view of America's declining middle class and then zooms in to explore how this decline manifests itself in a range of policy areas. It then concludes by drawing out some general lessons for policy and politics.

The book will be most useful for UK policy makers who are keen to learn from the US experience, in both positive and negative ways. For such readers, it makes three main contributions. First, it acts as a warning of what happens when politics and policy fails. The book opens with Mishel and Shierholz's arresting description of the economic decline of the US middle class over the past thirty years showing that, across a broad swath of America, real incomes have barely grown for a generation. For much of the American workforce, the main motor of rising living standards – the link from rising productivity to rising pay – has all but broken down.

The book also carries some more specific cautionary tales. A powerful chapter from Appelbaum and Leana describes the pervasive insecurity facing America's care workers in a largely un-unionised, unregulated labour market, in which legislation like the federal minimum wage provides a grossly inadequate floor. Carré and Heintz describe similar vulnerability among temporary, low-paid and part-time workers more generally. These are timely warnings in light of recent UK debates about ‘zero hour’ contracts and minimum wage avoidance in the care sector.

The book's second contribution, however, is to combat fatalism. As with many good comparative studies, it reminds us that policy really matters. Kenworthy's excellent chapter, comparing the contribution that taxes and transfers make across mature economies, shows that inequality can be reduced decisively if political support can be built for redistributive mechanisms. Kenworthy's discussion of tax policy is particularly useful in the UK, where taxes are too often judged in isolation, solely on the basis of their direct distributive impact. In fact, taxes like VAT, although regressive in themselves, can play an essential role in funding progressive social spending.

Another substantive chapter from Gitterman shows that tools like the minimum wage and in-work cash transfers can support living standards if smartly designed. It gives a detailed account of the US and UK approaches to Tax Credits and the Earned Income Tax Credit (EITC).The chapter also reminds us that smart policy can help to shape politics. In the US, the Earned Income Tax Credit (cleverly framed as a tax rebate) enjoys relatively broad support while the minimum wage is highly divisive. In the UK, the opposite holds, and the minimum wage (supported by the respected Low Pay Commission) enjoys broad support while tax credits (seen by many as state handouts) are being eroded. Institutions and the way in which policies are framed can reshape the debate.

Third, by sharing success stories from the US the book stimulates new ideas. A chapter from Riccio describes how new organisations in American civil society are working with employers to encourage career progression for low wage workers. Likewise a chapter from Wardrip describes the way new policy mechanisms are being used in the US to encourage institutional investment in private rental sector accommodation. Meanwhile, Smith-Ramani and Mehta summarise what works in encouraging low- and middle-income households to save. Their discussion of the merits of matched-savings accounts makes painful reading following the UK's recent abolition of the successful Child Trust Fund. This is precisely the kind of policy decision, running hard into a gale of evidence, that comparative public policy should help politicians to avoid.

The book concludes with reflections on the politics of the squeezed middle as Hacker draws out lessons for how best to protect the US middle class. His three take-aways – focus more on pre-distribution and less on redistribution, worry more about ‘gradual drift’ and not just big one-off changes, and make sure the middle is well-organised politically – may be broad but they give food for thought. Alakeson concludes the volume with a concise summary drawing together the key points.

Overall, this book brings much-needed precision and substance to an often formless debate. And it does so while motivating the reader with a mix of dire prophecies and new policy ideas. Although the concept of the ‘squeezed middle’ may already feel passé, this book confirms that it has substance. Large swaths of the populations of Britain and America were missing out on economic growth before the crisis struck. This book helps us to understand why and what can be done about it.