From a review of the book, "Who Stole the American Dream" by Robert Steele:
The book opens with reflections of Arnold Toynbee on how civilizations fall, from schisms of the society and schisms of the soul. Being an admirer of George Will's collection entitled "Statecraft as Soulcraft," this resonates with me.
The author chooses to start his account in the 1970's, focusing on Justice Powell and the memorandum that created the US Chamber of Commerce led business lobbying industry--an industry that now has 130 lobbyists for every Member of the Senate and House of Representatives--130 for EACH--and outspends labor 60:1. That is a safe place to start. Starting with the JFK assassination and the LBJ cover-up that neutered the presidency might have been too incendiary. In the author's view, gross inequality made possible by a corrupt Congress destroys the "virtuous circle" Henry Ford pioneered--pay the workers enough and they become consumers.
I have to give the author enormous credit -- this is a masterwork and he provides in one book what I have had to learn across at least 200 books.
Having gone over my notes and the book again, I want to inject here a short quote that accentuates the positive in this book--the sense of hope the author feels.
QUOTE (xxvii): Still, the first shoots of an American political spring have appeared, and our history teaches us that once mobilized, a peaceful but insistent, broad-based grassroots rebellion can regain the power initiative and expand the American dream.
I learn a great deal in reading this book. Indeed, the author's presentation of Richard Nixon blows my mind. I had no idea that "Tricky Dick" had led so many good things into legislation, and that it was a Republican (I used to be one) that inspired the business backlash that turned into a route for democracy. Led by the Business Roundtable of 180 CEOs, this campaign, catalyzed by the Justice Powell memorandum, sought to:
#1 Neutralize Ralph Nader and his idea of a Consumer Protection Agency
#2 Sideline organized labor and advance the class war
#3 Repeal the regulatory regime across the board
#4 Implement a corporate bankruptcy law that allowed facile default on pensions and other debts to the working class
#5 Create the 401(k) as a means of ending corporate pension obligations
#6 Implement tax cuts at any cost
From bibliography to notes to easily-flowing easy-to-read text, this book communicates stuff I did not know.
The author goes on to examine what did work in the way of public power in the 1960's and early 1970's, concluding that it was a mix of non-violent mass led by MLK, citizen boycotts and economic leverage, deliberate combinations of public power and presidential power (MLK and LBJ), the catalyzation of the environmental movement by Rachael Carson's "Silent Spring," and Ralph Nader's media-assisted success against General Motors.
Also important was the business mind-set of the times, established in the 1950's by the auto industry and the auto labor unions in what was called the Treaty of Detroit--in simple terms, the corporations promised pay raises, coverage of half the cost of health insurance, and assured retirement pensions; labor promised a productive trouble-free work force. This WORKED, to include the workers being able to afford to buy cars. [Not in this book is the fact that Rockefeller and Carnegie bought up all the public transport systems to kill them so the workers would HAVE to buy cars.]
NOTEWORTHY: Compression of wages (the smallest possible gap between the least paid and the most paid) is the opposite of Depression. It keeps the money moving.
PART II of the book gets into the "New Economy" or "predatory capitalism," such as discussed in Mark Lewis' "Liar's Poker," John Perkin's "Confessions of an Economic Hit Man," and the most recent 6 star work, Matt Taibbi's "Griftopia." This part cuts to the bone -- Milton Friedman has much to answer for, as do US Government elements that refused to stop stock options and other forms of compensation that separated the interests of the CEOs and financial investors from those of the workers. Combined with the bankruptcy law--and this is a current book very familiar with Mitt Romney and Bain Capital and destructive buy-outs--this allowed CEOs to screw the blue-collar workers and the middle managers over and over again. For a complementary perspective, see "Deer Hunting with Jesus."
This part of the book reminds me of ShadowStats, where you can get the correct unemployment rate (it is 22.4% overall, and closer to 40% for the newly graduated and old dogs like myself). There is a lot of shocking information well presented here, that I have not seen outside the many books I have read -- in other words, the stinking corporate media from Bloomberg and Forbes to the papers that refused to print advertisements against the Iraq war lies (Washington Post, New York Times, Los Angeles Times), are simply not reporting honestly or coherently on these FACTS. The author renders a service with this book.
I am STUNNED to learn that Larry Summers in 2008 questioned the legitimacy of capitalism in light of all that he knew about predatory capitalism. Wow. I learn a great deal about how Microsoft set the pace for lying to Congress about its need for Indian high-tech labor (not in this book, is the fact that what Microsoft really wanted was to pay half price for bodies that could be in the US, and not pay full price for available US citizens with the correct skills). I also learn how Wal-Mart not only was the most efficient supply chain manager, the first, but how Wal-Mart drove its supply chain into migrating to China or losing Wal-Mart's drive to the bottom. I am frightened by the author's discussion of how 97% of the new hiring is for part time workers only. I knew Lowe's and Home Depot were using that strategy, but it is evidently pervasive.
By the by, while the author has many many facts that stand in direct contradiction to everything the federal government says is the truth, he never challenges the government directly--for example, he does not actually come out and say: government says unemployment is 8% but unemployment is really 22.4%. Nor in discussing job creation, does he come out and say that what the government is reporting is starkly at odds with reality--when actually counting the 130,000 people new to the work force each month, the job gains are actually net job losses. See Paul Craig Roberts among others for the details.
I am deeply saddened by this book, but I recommend every American that can afford to buy it, buy it, read it, and then pass it on. This is "ground truth" on who stole the American dream, and I will not spoil the author's surprise ending, but the fact is, to paraphrase Trotsky, "you may not be interested in reality, butreality is assuredly interested in you."
60% of Americans 18-64 are falling behind. Those earning over $75K are feeling pinched but okay, those earning less than $50K a year are hurting big time. The author does not get into other statistics, such as the number of Americans on food stamps (46 million), the number of children going to bed hungry every night (1 in 4), but the facts that he does bring forward are compelling. See "Atlas of Poverty in the USA."
I learn about two indices I did not know existed, the Misery Index and the Economic Insecurity Index.
The 1978 deregulation of interest rates followed by the blockage of individual bankruptcy's (note the irony--corrupt politicians make it harder for individuals to declare bankruptcy while making it easier for corporations to do so).
My blood boils as I read about the shifting of the burdens, the rampant cheating and outrageous salaries "earned" by CEOs, at the same time that Washington gives up all pretense of representing the public interest, and is the absolute servant to the financial mandarins. Joe Lieberman, whom I have always considered sanctimonious and ethically challenged at the same time, is featured in this book, but the author is gifted at avoiding direct challenges to the legitimacy of the all who have made a mockery of our democracy.
QUOTE (135): Political scientists, tracking votes in Congress since the 1980's, have developed broad evidence that this is fairly typical--that senators and House members simply tune out the opinions of average Americans when voting on legislation, especially when powerful financial interests get engaged.
What the author does not say is that a great deal of legislation is passed without its actually being read, the prime example being when Senator Phil Gramm (R-TX) slipped 200 pages of lobbyist written deregulation into the banking bill five minutes before the vote, and not a single Senator objected--and then Bill Clinton took the gold certificates and the handshake from Wall Street, and signed into law a known poison pill law.
The author loses points with me in his treatment of the tax code and solutions to the tax code, but I have the advantage of actually studying the Automated Payment Transaction (APT) Tax, which would allow for the ELIMINATION of ALL incomes taxes (both individuals and corporations) while dramatically increasing the revenue produced, in part because every stock and currency transaction would be taxed. Look it up -- the real reason Congress has a convoluted tax code is because that is how the two-party tyranny shakes down the corporations--and by the by, the corporations never started out to bribe Congress, it is members like Randy Cunningham who set the standard. On the Hill, right now, the standard "kick back" for any delivered earmark is 5%; I am not sure how they calculate kick-backs of "avoided taxation" but am certain it is at least 5%.
QUOTE (142): What has made "the money monopoly" explosively dangerous is that its power and wealth have been built on debt--debt that dwarfed the debt of the US Government.
This book is a reference work in its coverage of how Greenspan and Rubin set the deal, tried to stifle the 1998 warning on derivatives by Brooksley Born, and is very useful in covering a range of other actions by Federal Reserve, Congress, Treasury, and the White House that could today be viewed as grounds for retrospective impeachment (I personally prefer non-punitive Truth and Reconciliation Commissions-- we are long overdue for two, one for what has been done to us, and a second for what has been done to others in our name and at our expense).
The author has put together a coherent narrative on the triple whammy visited upon employees whenever a corporation declared bankruptcy: pensions cut by a third or more; stocks worthless, and 401(k) losses. The author also provides insights into the predatory lending, the 2/28 balloon mortgage scams, the recurring failure of government to have a law much less enforce it -- what Karl Denninger calls "control fraud" in his book, "Leverage: How Cheap Money Will Destroy the World."
The most important part of the book for me comes when the author reviews the legalization of crime by the US Government, starting with President Carter in 1980 deregulating depository institutions, then President Reagan signing two mortgage "enhancement" laws that introduced adjustable rate mortgages, negative amortization, 100% financing, and separation of risk from profit through derivatives. And of course fast forward to Senator Phil Gramm (R-TX) completely deregulating banking, with President Bill Clinton happily signing this bill into law.
Plenty of warnings, pervasive insider fraud -- including details on how John Paulson and Goldman Sachs generally bet on default of the mortgage market (Paulsen make $4 billion) at the same time they were selling those known to be bad derivatives to clients.
The bond rating agencies are a travesty (my word, not his), and the government simply does not prosecute white collar crime (see all the books by Kurt Eichenwald).
QUOTE (307): 'The people's business is not being done,' Bayh declared in February 2010. Congress suffers from multiple pathologies he said, and he ticked them off: 'strident partisanship, unyielding ideology, a corrosive system of campaign financing, gerrymandering of House districts, endless filibusters, holds on executive appointees in the Senate, dwindling social interaction between senators of opposing parties and a caucus system that promotes party unity at the expense of bipartisan consensus.'
The author discusses the role of Newt Gingrich in destroying bi-partisanship, but he does not go far enough--Gingrich not only destroyed Speaker Jim Wright and all hopes of ever doing bi-partisan business again (see my review of John Barry's "The Power and the Ambition: The Fall of Jim Wright - A True Story of Washington") but Gingrich essentially made every Member impeachable for violating Article 1 of the Constitution -- driven by the two-party tyranny, the Members of each party became foot soldiers, either for the President if he was theirs, or as obstructionists if not. Newt Gingrich literally destroyed what was left of the integrity of the US Congress as a whole.
The author surprises me as he relates how 70% of all bills in the Senate die by filibuster. If that is not impeachable disregard for the public interest, what is?
There is a useful discussion of talk radio, Grover Norquist, imperial overstretch coincident with a weak economy, a lack of our own morality in embracing corrupt governments (see Ambassador Mark Palmer's superb "Breaking the Real Axis of Evil"), the empire of bases (to which I would add, no less than 44 totally unjustifiable bases surrounding Iran).
Although the author draws to a close with a reference to President Eisenhower's warning about the military industrial complex, this book does not really address the many complexes that have now enabled a corrupt Congress and the Executive so completely--the agricultural complex, the energy complex, the health complex, the prison complex (very few seem to know that there are three slave trades in the USA: individual slaves (see John Bowe's "Nobodies: Modern American Slave Labor and the Dark Side of the New Global Economy"); prison slaves (many of them locked up by Mike Bloomberg, generally black people using recreational marijuana, at a cost to the NYC taxpayer of $75 million a year); and military slaves employed by Private Military Contractors (PMC) that are totally out of control and not held accountable.
The final three chapters of the book are engrossing, and I will not spoil the surprise by listing the author's ten recommended programs for getting America on track. It is to the author's credit that he has actually studied and presented to all of us ten intelligent moral suggestions. The same cannot be said of anyone else in this country other than myself at BigBatUSA. We are a cheating culture beset with information pathologies from "Lost History" to "Fog Facts" to "Weapons of Mass Deception" and "Weapons of Mass Instruction" (all book titles), and I do despair sometimes.
I am disappointed by the author's complete obliviousness to the two-party tyranny and the FACT that a majority of US voters no longer identify with the two parties that monopolize power. Over 43% of our voters now consider themselves independent, and there are four robust nationally-recognized parties, the Constitution Party, the Green Party, the Libertarian Party, and the Reform Party. While the author touches on open ballot access and particularly open primaries, he does not have a good grip on electoral reform (there are eleven elements in the Electoral Reform Act of 2012, all crowd-sourced after I presented the concept to Occupy NYC), and he is positively naive (or striving desperately to avoid offense) in his discussion of NO LABELS -- a national laughingstock -- and Americans Elect, a phenomenal idea executed so corruptly that it died stillborn.
This is a righteous book. It lays out a damning indictment of all that we do and do not do, and in the end, as I wrote many years ago when evaluating who was to blame for Dick Cheney getting away with murder, it comes down to us. As Pogo said, "we have met the enemy, and he is us."
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