Saving Capitalism: For the Many, Not the Few
America was once celebrated for and defined by its large and prosperous middle class. Now, this middle class is shrinking, a new oligarchy is rising, and the country faces its greatest wealth disparity in eighty years. Why is the economic system that made America strong suddenly failing us, and how can it be fixed?
Leading political economist and bestselling author Robert B. Reich presents a paradigm-shifting, clear-eyed examination of a political and economic status quo that no longer serves the people, exposing one of the most pernicious obstructions to progress today: the enduring myth of the “free market” when, behind the curtain, it is the powerful alliances between Washington and Wall Street that control the invisible hand. Laying to rest the specious dichotomy between a free market and “big government,” Reich shows that the truly critical choice ahead is between a market organized for broad-based prosperity and one designed to deliver ever more gains to the top. Visionary and acute, Saving Capitalism illuminates the path toward restoring America’s fundamental promise of opportunity and advancement.
nation’s productivity has risen 65 percent: Josh Bivens, Elise Gould, Lawrence Mishel, and Heidi Shierholz, Raising America’s Pay: Why It’s Our Central Economic Policy Challenge, Briefing Paper #378, Economic Policy Institute website, June 4, 2014 (http://www.epi.org/publication/raising-americas-pay/). During the Clinton administration: Lawrence Mishel, The Wedges Between Productivity and Median Compensation Growth, Issue Brief #330, Economic Policy Institute website, April 26, 2012
Consumption,” Wall Street Journal, July 16, 2013. Also see Yu Xie and Xiang Zhou, “Income Inequality in Today’s China,” Proceedings of the National Academy of Sciences, May 13, 2014 (http://online.wsj.com/articles/SB10001424127887323664204578607340845518674) (http://www.pnas.org/content/111/19/6928.full). 18 THE DECLINE OF COUNTERVAILING POWER A study published in the fall of 2014: See Martin Gilens and Benjamin Page, “Testing Theories of American Politics: Elites, Interest
9.1, 16.1 common misunderstandings of, 1.1, 13.1 corporate welfare subsidies enforcement of rules, 2.1, 8.1, 13.1, 13.2 protectionism, 3.1, 4.1, 13.1 redistributions of wealth, itr.1, 10.1, 13.1, 15.1, 16.1, 20.1 regulation of property rights, 4.1, 13.1 revolving doors with lobbyists, 5.1, 5.2, 9.1, 16.1, 18.1, 19.1 revolving doors with Wall Street, 5.1, 18.1, 18.2, 19.1 Wall Street bailout, 1.1, 7.1, 8.1, 12.1 Grassley, Charles Great Crash of 1929, 5.1, 5.2, 11.1, 17.1 Great
per classroom, for example. Presumably, if teaching jobs paid better they would attract many more such teachers. On the other hand, the worth to society of many CEOs, hedge-fund managers, investment bankers, “high-frequency” traders, lobbyists, and high-end corporate lawyers may be less than they command in the market. Much of what they do entails taking money out of one set of pockets and putting it into another, in escalating zero-sum activity. High-frequency traders, for example, profit by
First, how will this trend threaten capitalism if countervailing power is not re-established? Second, how can the middle class and the poor regain sufficient countervailing power to reorganize the market in ways that generate broader-based prosperity? And third, what might that reorganization look like? 17 The Threat to Capitalism America has faced similar questions before. During eras of significant technological change, workers are typically displaced, social systems become destabilized, and