WHO STOLE THE AMERICAN DREAM? By Hedrick Smith
Once again Hedrick Smith has produced a winner. Outstanding reporting. Quality writing. It's not hard to see why this man has risen so high in the publishing world and why he has earned a Pulitzer.
Smith chronicles the demise of what he calls the "American Dream" from its glory days immediately post World War II (1950 to 1970) when we enjoyed a thriving economy to the economic stress of today. Wages and benefits were decent and income was distributed fairly among all classes of the American public.
The reversal came in the 1980s and has grown steadily worse, according to Smith.
Biased Federal policies, partisan gridlock and the rampant power of the lobbying industry have consistently eroded the stability and economic strength of the Middle Class, while the rich have grown richer. Using those riches, they have become political power houses playing a major role in the destiny of this country.
Smith has opened his book with two quotations both of which deserve to be repeated here. These both capture the essence of his outstanding book. Former Supreme Court Justice Louis Brandeis warned, "We may have democracy or we may have wealth concentrated in the hands of a few, but we can't have both."
Centuries before, the philosopher Aristotle stated, "It is manifest that the best political community is formed by the citizens of the middle class, and that those states are likely to be well-administered in which the middle class is large and stronger if possible than both other classes."
The process of deterioration began in the mid-1970s. Former President Jimmy Carter campaigned against the loopholes that substantially reduced the tax burdens of the rich. He sent legislation to the Congress that would close the loopholes and reduce taxes for lower income families. Already under the sway of the lobbying industry, Congress quickly reversed Carter's proposals. Instead of increasing taxes on the rich by eliminating the loopholes, the legislators rewrote the law to offer $18.7 billion in tax cuts and in capital gains, a huge boon for the wealthy. More important, it made the business community recognize the power it held and launched it as a major player on the Beltway.
At the same time the power of the once mighty American unions began to diminish. Congress repeatedly refused to act on proposed legislation to empower shareholders. Combined, this meant there was little control on management, and top executives were able to make decisions that benefitted themselves at the expense of workers and investors. That led to a dramatic rise in executive compensation and eventually to the enormous salaries that exist today. The sense of corporate social responsibility soon gave way to the goal of lining the pockets of executives and stockpiling huge corporate profits.
Even as the economy began to falter in 2001, Wall Street, led by the infamous "Gang of Six," fought for larger tax cuts as a stimulus. The new President George Bush was happy to accommodate and passed his controversial tax cuts with little negative reaction from the media, which of course is generally owned by members of the plutocracy who reaped the benefit.
When Smith traces the corrosion of the political world, he cites 1975 as the year major changes in campaign funding began. The Federal Election Commission approved the use of PACs (political action committees) and allowed management to utilize company funds to manage their PACs. Bundling and soft money became key funding techniques for election campaigns. The steady erosion of campaign finance laws accelerated, culminating in the current decisions by what I consider a reckless and biased Supreme Court that have destroyed the essence of our democracy. I, of course, am referring to decision like Citizens United and McCutcheon.
Smith also explains how Walmart changed the face of retailing. In addition to destroying the independently owned, family stores that were the backbone of downtown USA, they launched the massive trend to offshoring that has destroyed America's manufacturing sector. He states that an estimated 3.5 million jobs have been lost to offshoring.
In the same vein, America's dominance in research and development of high tech products and high-end service industries were undermined by offshoring. From 2000 to 2010, offshoring of back office and other support services accounted for a loss of 2.8 million jobs in finance and IT. In just computer manufacturing alone from 2001 to 2008, job losses reached 627,000.
Factor all of this into a national scene in which government has been stalled dramatically by partisan decision-making in which political maneuvering supersedes legislative action and in which rancor and dishonesty have become the hallmark of the ultra-conservative wing of the Republican Party. You can then easily see why Smith believes the American dream has been stolen.
I worry, however, that his prescription for a return to a healthy and thriving USA--although right on target--may be pipe dreaming. Yes, we desperately need a "new direction and a new agenda--a new political and economic response." Think of the percentage of the public that actually votes, the general apathy of the American public and the mediocrity of so many of our news sources that should be informing the public. Faced with that picture, can we rely on Smith's prescription for the cure "a populist surge...a grassroots peaceful political revolution?"
I hope so.
This is a marvelous must-read. Don't skip it.
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Used and torn
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Top reviews from other countries
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- Amazon CustomerReviewed in the United Kingdom on February 16, 2014
Very important reading especially for every American
- jaydeeReviewed in the United Kingdom on July 29, 2018
the swindle of the middle class income earners and workers
