A little-noticed report by the non-partisan Congressional Budget Office (CBO) released this month reveals why, for most Americans, the economy is broken.
Reagan ushered in supply-side economics. He didn't author the plan (called voodoo economics by the elder Bush) but was happy to implement it. And, while suggested as an approach to top-down economics, it had its actual desired effect: making the wealthy even more wealthy. And Reagan started cracking down on unions, so rural blue collar workers no longer earned a nice living wage from the auto industry, etc. The wealthy moved their manufacturing factories out of the country. And, with real estate speculation driving up home prices and rent, rural blue collar workers fell further and further behind. The RW blamed this, falsely of course, on Dem policies and immigrants taking the good jobs. This led to the current anger and the rise of Trump. And now the wealthy like Koch, the NRA bosses, Murdock and others use cultural warfare - guns, immigrant anger, LGBTQ+ - to deflect from the work done by the uber-wealthy to destroy the financial life of rural Americans. And they fall for it, hook, line and sinker, though Dem economic policies are much better for workers.
Without progressives, this country would have not a single safety law. We'd be a country of serfs, working for pennies as our "medieval" masters accumulated power, wealth and property. An exaggeration, of course, but not so far-fetched.
32 of 33 civilized countries have universal health care. All except for us, who has the lowest life expectancy by far. Unfettered capitalism is what the wealthy want and scream socialism every time something is done to level the playing field. Socialism. Another word that resonates with angry rural Americans, who somehow believe the pot of gold is around the corner if not for immigrants, non-whites and the like.
Let's not blame the rich for anything. Let's fight over our 10 percent of the pie while the rich keep their 90 percent. The gullible are good with this.
Michael Baker: Thank you for writing this. I have been struggling to understand how people can support Trump. I am reading Land Rich, Cash Poor, but all it says is how hard farming is and how difficult it is for family farmers. It does trace the path of farming in the US from subsistence to middle class to industrialized which is helpful. I haven't understood how anyone can say they were left behind. I have more clarity and understanding now. The truth is we have all become slaves of the oligarchs; it's just not as apparent to some of us. Trump will never get us out of slavery, just put us in deeper, with fewer escape paths.
Hi Adam, had to sleep in but am fascinated by Judd's acuity and ability to give us what we need. I agree that Michael Baker's contribution gives us a superlative addition to Judd's article. I want you to see my recent reply (after 11 am) if it's available because I think you'd appreciate my musical reference.
I often choose to approach the inequality issue to our Euro-centric heritage. That is, the way societies in the 1500's were structured around the rich nobles and the common serfs. The income disparities and social hierarchy we see today reflect the old adage taught in school - loosely; "Those who forget history are condemned to repeat it." Those with power and affluence will do anything to maintain it.
I also now believe we, as a working society, need to focus on the concept of Stakeholders rather than Shareholders, as a better path to income/wealth equality.
Agree with your summary except for making it a solely Republican narrative - the Dems got completely on board with moving the blue collar jobs overseas. Remember, it was the Clinton administration that got NAFTA passed, as well as granting permanent most-favored-nation trade status to China (in addition “ending welfare as we know it”), not to mention the Obama response to the financial crisis of allowing millions of homeowners to lose their homes while the bankers who caused it got bailed out.
So we should indeed be organizing the 90% in solidarity - the problem is that the Democrats have also become a corporate-beholden party, even as their rhetoric is more labor-friendly. It was Obama’s failure to follow through on promises to push for pro-labor legislation (the card-check bill) while he had a Democratic Congress, along with his coddling of the banksters that imploded the economy, that made so many blue collar voters either sit out 2016, or take a chance on Trump for change. Trump is a symptom of a system of corporate corruption of both parties. A truly populist (in the FDR, New Deal mode, authentically taking on the monied interests) Democratic Party would be winning landslides against the fake populism offered by Trump, Vance, et al. Really pathetic that they instead try to out-Republican Republicans by joining them in the “get tough on immigrant” policies, and offering only mostly more means-testing and tax cuts rather than universal concrete benefits such as those in the 32 “civilized” countries. So yes, Republicans suck, but Democrats aren’t exactly a party representing workers’ interests either.
I agree, mostly. It's said more than 50 trillion dollars moved upwards since 1981. People don't have any idea of that number. But you can give every person in the US 100,000 dollars and there still would be close to 20 trillion left. Democrats get money from the same lobbyists. And never rolled back the tax cuts when they could. Also moderated their positions because they were losing elections. It's the wealthy who are the problem, which I tried to make clear. But thanks for the addition.
Perhaps that's because the common narrative is that Democrats need to "moderate" to win voters. One need only look at the truly delusional Trump base to see how effective this message has been.
The overall effect of tax code changes over the period 1957-2023 has been a 60+% reduction for upper income taxpayers, ca 1.5 -2× that of middle class and poor taxpayers. https://substack.com/@importantigravity/p-148311563
Some of the Republicans who voted against expanding the child tax credit on the basis that it would "disincentivize work" probably wish we'd go back to the days of kids laboring in factories and mines. What a bunch of ghouls.
Probably? Look at Arkansas actively changing child labor laws. There is a movement to undermine protections against child labor laws. Why? Because they can be more easily exploited. Immigrant children are particularly vulnerable because relatives expect them to pay their own way in exchange for guardianship. Children are doing dangerous jobs that adults find difficult and many have died from unsafe conditions. Add lack of sleep to the mix because in addition to working full-time doing hard labor they are also expected to attend school.
Getting less attention but having done the same thing to expand child labor is Iowa. The justification was that it encourages and engenders a good work ethic. Safety concerns were soundly dismissed.
Harris has not been strong enough on raising the federal minimum wage or on hitting the Republicans for opposing the raise. Nor has she hit hard enough on taxing the rich -- her proposals are weaker than Biden's. To connect with wavering voters, she should show some anger with the way working people are being treated.
We’ve seen that show before. Obama had a Congressional majority as did Biden, and neither raised the minimum wage. Biden laughably blamed the Parliamentarian. This is the Democratic playbook - push hard to get what the donors want, but always find an excuse why we can’t have nice things that benefit the masses.
Sad but true. And then we get Trump, who stokes their rage all the while implementing policies that make them poorer. But he loves the poorly educated, don'tcha know.
Harris (and all candidates for that matter) should incorporate more rhetorical questions into their comments. Ask the audience or reporters “Why do YOU think prices are higher?” “Did you get too many relief checks?” “Are you purchasing/demanding more goods & services than you did before the pandemic?” “When shopping for meat, eggs, or produce do you think the farmers & ranchers are making so much more?” “If your wages went up, would you want to give them back so your company’s costs would be lower?” Questions like these encourage the listener to think about cause/effect and answer from their own experiences. Otherwise they’re just waiting around to hear something they like, rather than something that fits their experience.
The monumental challenge right now is changing people's beliefs.
For the last 50 years, most Americans have believed that Republicans have been better for the economy. We are seeing overwhelming evidence now that this belief was based on myth. It's just not true.
The problem now is how to convince people that they have been duped for so many years. No one wants to accept the fact that they've been played. People cling hard to their beliefs, in spite of the now obvious facts.
Republicans are definitely horrible, and their tax cuts have hurt the economy and disabled. Any sense of social solidarity. However, Bill Clinton strongly supported the bipartisan" financial reforms" that caused the economy to crash in 2007-8. Then Barack Obama had $750 billion to help the working and middle class people get out of their fraudulent mortgages, and he gave everything to the bankers and virtually nothing to the rest of us. The Democrats have to turn away from their billionaire funders and actually support the workers.
Up until Howard Dean and then Obama, no one knew who you were unless you had corporate/millionaire money backing you. Democrats have already started to buck their corporate donors because they're getting money now from small dollar donations, but it's still not enough.
Also, Democrats have made plenty of mistakes, but they have been the minority power in Washington for 30 years now, except for a few short years where they had majorities. We saw what they could do if people just give them a majority for a change.
Rick, I wonder if trying to educate voters on the long history of exploitation is a fool’s errand? It’s hard enough to grab and hold the attention of those struggling to hold on, people who are suffering from chronic stress overload. That kind of stress reduces their ability to think critically, impairs retention and recall, and increases emotional impulsivity (especially fear and anger). Wouldn’t it be simpler and more effective to just focus on the current situation? Describing how the Republican strategy affects them here and now? Project 2025 offers many examples of Republican goals that would have a negative impact on the non-oligarchs. Going through the most egregious examples, one by one, in plain language, perhaps with the impacts on a hypothetical
That's part of my point. The education is all there, but people are dug in to their beliefs. No one wants to be told that they've been wrong for years.
…hypothetical families, singles, seniors, would make more sense (to me). Use of a few statistics and an accompanying story or two for the economic and social context was always most effective for me when I was explaining/lobbying about the need for social safety net programs.
Effectively reaching the diehard supporters of the Right is the obstacle. With the deliberately designed RW media firmly in place, the message of blaming the Libs is an endless mantra. Not only has it brainwashed a significant chunk of America, it has also moved the Democratic opposition in that same direction in a misguided attempt to attract those voters. It's been an endless push to the right, both-sidesed by the non- Right media. We've seen it on "cultural" issues as well, where Democrats have historically been timid in openly supporting issues popular with the majority of Americans (e.g. abortion rights and gun safety measures). Now the hole is so deep I'm not sure we can climb out.
I wonder if it will take an even more horrific event to bring us to our senses? But alas, it’s equally likely that would just make things worse. Nightmare scenarios abound. :-(
Capitalism works for as long as the checks and balances, keeping the system advantageous for everyone, are effective. Where it goes wrong is when the rich and powerful chip away at the checks and balances, at the expense of everyone else. The Reagan/Thatcher era didn't so much chip away as cut down with an axe, and it seems the 90% are yet to recover.
Seeing that capitalism is an economic system focusing on the accumulation of capital ... a system in which one gets as much as one owns ... I'm tempted to simply answer your question: no.
I was just thinking the same thing. Would capitalism “work” if Democrats had controlled Congress or has capitalism, as we have known it, reached its demise.
I don't understand the premise here, Democrats and Republicans have been in control during capitalism. Capitalism was never gonna last, no political system ever will, short of true direct democracy at small scale being scaled up all the way to each country.
The Scandinavian countries indicate that there are such models. A lot of people claim that these countries are "socialist", but that's not true ... social spending != socialism.
Reagan's "trickle down" economic policy is still functioning as designed - the rich get richer and the poor get poorer. And will continue until the Republican's lose their grip on our government at the local, state and federal level.
Thank you! This is one of the best reports you've done!! You spoke out loud, with the facts to back it up, the ugly truth of the economy. The wealthy are turning us back to 100 years ago. So many people fought and died for better work conditions, hours, and wages. They have all slowly been taken away by the people we entrusted to keep us safe: the people we elected into office in the Senate and House of Representatives. Making backdoor deals with the lobbyists working for the ultra-wealthy. The pandemic opened our eyes to the stark reality and brought out the fighting spirit in many of us. Trump embodies everything dirty, corrupt, and immoral in our society and he encouraged all those of his ilk to wear their greed loud and proud. Unfortunately, he also incited the misinformed and misguided to help him take all their liberties away by preying on their neediness. We need to get Harris/Walz into the White House and clear all mercenary politicians out of the House and Senate to move forward to a fairer, more Democratic society.
"This reflects a severe power imbalance that has become a defining feature of the American economy. Large employers are responsive to shareholders, who demand companies spend billions on stock buybacks and reduce labor costs to increase share prices. But workers are viewed as replaceable — or considered "independent contractors" — and have little to no sway. The fact that the WORKER's' labor is responsible for producing the profits is not a factor."
Judd, I was a machinist for most of my career, my wife was a PA, my brother-in-law was an Electrical Engineer, and my father was the International Sales Director for a medium sized company.
By 'WORKER's' you mean everyone outside of the Board of Director's conference room, correct? I'm just asking because ALL of us worked our butt's off, not just the machinists and PA's.
I don't disagree with any of this. The none to the bottom and all to the top economy that you describe is in no small part due to the continued rise and entrenchment of monopoly power and consolidation with the backing of both parties over decades - and republican tax cuts for the rich of course. Joe Biden, with Kamala Harris and his phenomenal administration have been working to dismantle this neoliberal order (another name for trickle down) and replace it with a bottom up middle out approach to rebuilding our economy and our democracy. But it is a herculean task. They are making real progress but unfortunately it is literally impossible to do it quickly. it takes time to make big changes and overcome the inevitable obstacles and opposition. Hence, we have the conundrum of "the disconnect between broad economic indicators and the subjective view of the economy among Americans.” Harris-Walz are working hard to convince folks that it is possible to create a thriving economy for all with the policies they propose. It has been done before and we have actually made progress toward it under Biden-Harris. But they have to win to make it a reality. The situation is infuriating. But it is our reality.
We also have a simplistic mindset, with expectations of immediate gratification. Couple that with a narcissistic demagogue who promises he'll fix it with his "concepts of plans" - no details required- and the dilemma multiplies.
Democracy, the challenge worth fighting…as we said on many fubar deployments, “let’s embrace the suck together” and make it through to the other side. Harris/Walz…let’s do this!
Robert Reich is always excellent on the disparity in outcomes for rich and poor, and on the reasons behind it. Meanwhile Brad DeLong also covers it, more intermittently because he has a wider scope, but because he seems to follow almost everything with the acute vision of a hawk, the information he highlights really helps you see things in depth. He also has lots of other types of information from historical to artistic, from economics to political. Often really challenging to the reader but always worth the effort. Both on Substack.
I'm pleased you're looking up Brad DeLong, now at Berkeley, and was in the Clinton administration for a time. Today's Robert Reich, though, is what I wanted to draw your attention to - "Why the American economy isn’t working for most Americans in the age of shareholder capitalism - The inevitable logic of CEOs, private equity, and “activist investors”.
It's mainly about Carl Icahn and the damage he's done to the American industrial scene. It seems the biter is finally bit. Reich's tale makes a perfect complement to Judd's article.
The better-way-ahead remains in the fundamental understanding of how the US economy actually works, take a political interest in your every day life, and treat humans with dignity.
To understand the economy, I recommend Dr. Stephanie Kelton’s book, The Deficit Myth. Then follow Dr. Stephanie Kelton, Warren Moseler, Randy Wray, and other macroeconomics Dr. Kelton references. Spoiler alert, fiat currency power controls can easily create a fair, equitable economy for all Americans to prosper. Educate yourself!
Once educated, get involved. You may not like “politics” but politics drive everything and doesn’t care if don’t like it or recognize it’s influence. It’s not easy now and democracy takes work. Good work and “good trouble.”
Finally, once you conquered the above two recommendations, treat all humans with dignity and respect. The education and involvement you experience should open hearts minds to know we’re all in this short life on earth together. Let’s work together to resource good projects to make life exceptional for everyone. Thank you and good luck.
This is what the Harris Walz campaign should focus on: acknowledge that worker bees are still suffering and explain why. It's because of GOP policies that favor the wealthy, and corporate price gouging and stock buybacks. People who are hurting want to feel that they are heard, not just be told the "economy" is great.
And people wonder why Boeing machinists are on strike, while Departing Boeing CEO Dave Calhoun will walk away from the airline manufacturer with a $24 million payday, but he stands to collect about $45.5 million more if the next CEO at Boeing can boost the stock price nearly 37%. And the newly appointed CEO CEO Kelly Ortberg has the chance to reach a $22 million compensation package next year, which could make him one of Washington’s highest-paid CEOs. Seattle Times https://www.seattletimes.com/business/ August 8, 2024. Time for executive pay caps
we're all guilty....the middle class you characterize as just treading water, that may be true in day to day income vs expenses but i think everyone has seen their retirement portfolio balloon......i get so angry that we can't give everyone free healthcare and now "well-meaning" people want to hollow out public education that offers some hope for people to get out of the cycle of poverty. we're all going to .... for our callousness and lack of compassion.
Reagan ushered in supply-side economics. He didn't author the plan (called voodoo economics by the elder Bush) but was happy to implement it. And, while suggested as an approach to top-down economics, it had its actual desired effect: making the wealthy even more wealthy. And Reagan started cracking down on unions, so rural blue collar workers no longer earned a nice living wage from the auto industry, etc. The wealthy moved their manufacturing factories out of the country. And, with real estate speculation driving up home prices and rent, rural blue collar workers fell further and further behind. The RW blamed this, falsely of course, on Dem policies and immigrants taking the good jobs. This led to the current anger and the rise of Trump. And now the wealthy like Koch, the NRA bosses, Murdock and others use cultural warfare - guns, immigrant anger, LGBTQ+ - to deflect from the work done by the uber-wealthy to destroy the financial life of rural Americans. And they fall for it, hook, line and sinker, though Dem economic policies are much better for workers.
Without progressives, this country would have not a single safety law. We'd be a country of serfs, working for pennies as our "medieval" masters accumulated power, wealth and property. An exaggeration, of course, but not so far-fetched.
32 of 33 civilized countries have universal health care. All except for us, who has the lowest life expectancy by far. Unfettered capitalism is what the wealthy want and scream socialism every time something is done to level the playing field. Socialism. Another word that resonates with angry rural Americans, who somehow believe the pot of gold is around the corner if not for immigrants, non-whites and the like.
Let's not blame the rich for anything. Let's fight over our 10 percent of the pie while the rich keep their 90 percent. The gullible are good with this.
Michael Baker: Thank you for writing this. I have been struggling to understand how people can support Trump. I am reading Land Rich, Cash Poor, but all it says is how hard farming is and how difficult it is for family farmers. It does trace the path of farming in the US from subsistence to middle class to industrialized which is helpful. I haven't understood how anyone can say they were left behind. I have more clarity and understanding now. The truth is we have all become slaves of the oligarchs; it's just not as apparent to some of us. Trump will never get us out of slavery, just put us in deeper, with fewer escape paths.
Excellent analysis and summation. We are in your debt.
Hi Adam, had to sleep in but am fascinated by Judd's acuity and ability to give us what we need. I agree that Michael Baker's contribution gives us a superlative addition to Judd's article. I want you to see my recent reply (after 11 am) if it's available because I think you'd appreciate my musical reference.
I often choose to approach the inequality issue to our Euro-centric heritage. That is, the way societies in the 1500's were structured around the rich nobles and the common serfs. The income disparities and social hierarchy we see today reflect the old adage taught in school - loosely; "Those who forget history are condemned to repeat it." Those with power and affluence will do anything to maintain it.
I also now believe we, as a working society, need to focus on the concept of Stakeholders rather than Shareholders, as a better path to income/wealth equality.
Agree with your summary except for making it a solely Republican narrative - the Dems got completely on board with moving the blue collar jobs overseas. Remember, it was the Clinton administration that got NAFTA passed, as well as granting permanent most-favored-nation trade status to China (in addition “ending welfare as we know it”), not to mention the Obama response to the financial crisis of allowing millions of homeowners to lose their homes while the bankers who caused it got bailed out.
So we should indeed be organizing the 90% in solidarity - the problem is that the Democrats have also become a corporate-beholden party, even as their rhetoric is more labor-friendly. It was Obama’s failure to follow through on promises to push for pro-labor legislation (the card-check bill) while he had a Democratic Congress, along with his coddling of the banksters that imploded the economy, that made so many blue collar voters either sit out 2016, or take a chance on Trump for change. Trump is a symptom of a system of corporate corruption of both parties. A truly populist (in the FDR, New Deal mode, authentically taking on the monied interests) Democratic Party would be winning landslides against the fake populism offered by Trump, Vance, et al. Really pathetic that they instead try to out-Republican Republicans by joining them in the “get tough on immigrant” policies, and offering only mostly more means-testing and tax cuts rather than universal concrete benefits such as those in the 32 “civilized” countries. So yes, Republicans suck, but Democrats aren’t exactly a party representing workers’ interests either.
I agree, mostly. It's said more than 50 trillion dollars moved upwards since 1981. People don't have any idea of that number. But you can give every person in the US 100,000 dollars and there still would be close to 20 trillion left. Democrats get money from the same lobbyists. And never rolled back the tax cuts when they could. Also moderated their positions because they were losing elections. It's the wealthy who are the problem, which I tried to make clear. But thanks for the addition.
Perhaps that's because the common narrative is that Democrats need to "moderate" to win voters. One need only look at the truly delusional Trump base to see how effective this message has been.
This
Excellent summary of our so-called Capitalist Democracy.
The overall effect of tax code changes over the period 1957-2023 has been a 60+% reduction for upper income taxpayers, ca 1.5 -2× that of middle class and poor taxpayers. https://substack.com/@importantigravity/p-148311563
Fuck Ronald Fucking Reagan.
Then, now, and forever.
Some of the Republicans who voted against expanding the child tax credit on the basis that it would "disincentivize work" probably wish we'd go back to the days of kids laboring in factories and mines. What a bunch of ghouls.
Probably? Look at Arkansas actively changing child labor laws. There is a movement to undermine protections against child labor laws. Why? Because they can be more easily exploited. Immigrant children are particularly vulnerable because relatives expect them to pay their own way in exchange for guardianship. Children are doing dangerous jobs that adults find difficult and many have died from unsafe conditions. Add lack of sleep to the mix because in addition to working full-time doing hard labor they are also expected to attend school.
Getting less attention but having done the same thing to expand child labor is Iowa. The justification was that it encourages and engenders a good work ethic. Safety concerns were soundly dismissed.
I think you mean roundly, not soundly.
Yes, but autocorrect thought differently.
As we know from reading this substack this is exactly what they are doing, most notably Huckabee Sanders in Arkansas.
They already have loosened child labor laws. Sarah Huckabee is one of the evil so-called Christians who did this.
Thank goodness Big Business isn't involved in our political processes! (eye roll)
I am not an economist. I easily understood this. Thank you PI for explaining this for a layperson.
Harris has not been strong enough on raising the federal minimum wage or on hitting the Republicans for opposing the raise. Nor has she hit hard enough on taxing the rich -- her proposals are weaker than Biden's. To connect with wavering voters, she should show some anger with the way working people are being treated.
Let’s get her and a Democratic majority in Congress and watch!
We’ve seen that show before. Obama had a Congressional majority as did Biden, and neither raised the minimum wage. Biden laughably blamed the Parliamentarian. This is the Democratic playbook - push hard to get what the donors want, but always find an excuse why we can’t have nice things that benefit the masses.
Sad but true. And then we get Trump, who stokes their rage all the while implementing policies that make them poorer. But he loves the poorly educated, don'tcha know.
She needs to win over some low propensity voters to win. She needs to speak forcefully to their situation.
Harris (and all candidates for that matter) should incorporate more rhetorical questions into their comments. Ask the audience or reporters “Why do YOU think prices are higher?” “Did you get too many relief checks?” “Are you purchasing/demanding more goods & services than you did before the pandemic?” “When shopping for meat, eggs, or produce do you think the farmers & ranchers are making so much more?” “If your wages went up, would you want to give them back so your company’s costs would be lower?” Questions like these encourage the listener to think about cause/effect and answer from their own experiences. Otherwise they’re just waiting around to hear something they like, rather than something that fits their experience.
Wavering voters are idiots.
The monumental challenge right now is changing people's beliefs.
For the last 50 years, most Americans have believed that Republicans have been better for the economy. We are seeing overwhelming evidence now that this belief was based on myth. It's just not true.
The problem now is how to convince people that they have been duped for so many years. No one wants to accept the fact that they've been played. People cling hard to their beliefs, in spite of the now obvious facts.
Republicans are definitely horrible, and their tax cuts have hurt the economy and disabled. Any sense of social solidarity. However, Bill Clinton strongly supported the bipartisan" financial reforms" that caused the economy to crash in 2007-8. Then Barack Obama had $750 billion to help the working and middle class people get out of their fraudulent mortgages, and he gave everything to the bankers and virtually nothing to the rest of us. The Democrats have to turn away from their billionaire funders and actually support the workers.
Up until Howard Dean and then Obama, no one knew who you were unless you had corporate/millionaire money backing you. Democrats have already started to buck their corporate donors because they're getting money now from small dollar donations, but it's still not enough.
Also, Democrats have made plenty of mistakes, but they have been the minority power in Washington for 30 years now, except for a few short years where they had majorities. We saw what they could do if people just give them a majority for a change.
Yes. These bothsidesing fools blaming the Dems are so tiresome.
Rick, I wonder if trying to educate voters on the long history of exploitation is a fool’s errand? It’s hard enough to grab and hold the attention of those struggling to hold on, people who are suffering from chronic stress overload. That kind of stress reduces their ability to think critically, impairs retention and recall, and increases emotional impulsivity (especially fear and anger). Wouldn’t it be simpler and more effective to just focus on the current situation? Describing how the Republican strategy affects them here and now? Project 2025 offers many examples of Republican goals that would have a negative impact on the non-oligarchs. Going through the most egregious examples, one by one, in plain language, perhaps with the impacts on a hypothetical
That's part of my point. The education is all there, but people are dug in to their beliefs. No one wants to be told that they've been wrong for years.
…hypothetical families, singles, seniors, would make more sense (to me). Use of a few statistics and an accompanying story or two for the economic and social context was always most effective for me when I was explaining/lobbying about the need for social safety net programs.
Effectively reaching the diehard supporters of the Right is the obstacle. With the deliberately designed RW media firmly in place, the message of blaming the Libs is an endless mantra. Not only has it brainwashed a significant chunk of America, it has also moved the Democratic opposition in that same direction in a misguided attempt to attract those voters. It's been an endless push to the right, both-sidesed by the non- Right media. We've seen it on "cultural" issues as well, where Democrats have historically been timid in openly supporting issues popular with the majority of Americans (e.g. abortion rights and gun safety measures). Now the hole is so deep I'm not sure we can climb out.
I wonder if it will take an even more horrific event to bring us to our senses? But alas, it’s equally likely that would just make things worse. Nightmare scenarios abound. :-(
And that's why there are kajillions of Trumpeters, they can NOT be dissuaded from their cult's beliefs.
It is truly frightening what they believe--especially the religious ones! Talk about hypocrisy. It's unreal.
These outcomes are often blamed on “capitalism“.
This piece leaves me with the question, “are there models of capitalism which do not lead to this outcome?”
Capitalism works for as long as the checks and balances, keeping the system advantageous for everyone, are effective. Where it goes wrong is when the rich and powerful chip away at the checks and balances, at the expense of everyone else. The Reagan/Thatcher era didn't so much chip away as cut down with an axe, and it seems the 90% are yet to recover.
Seeing that capitalism is an economic system focusing on the accumulation of capital ... a system in which one gets as much as one owns ... I'm tempted to simply answer your question: no.
Nein.
Capitalism's gonna capitalism.
Yes. Look at the European Union.
I was just thinking the same thing. Would capitalism “work” if Democrats had controlled Congress or has capitalism, as we have known it, reached its demise.
I don't understand the premise here, Democrats and Republicans have been in control during capitalism. Capitalism was never gonna last, no political system ever will, short of true direct democracy at small scale being scaled up all the way to each country.
The Scandinavian countries indicate that there are such models. A lot of people claim that these countries are "socialist", but that's not true ... social spending != socialism.
Reagan's "trickle down" economic policy is still functioning as designed - the rich get richer and the poor get poorer. And will continue until the Republican's lose their grip on our government at the local, state and federal level.
Judd,
Thank you! This is one of the best reports you've done!! You spoke out loud, with the facts to back it up, the ugly truth of the economy. The wealthy are turning us back to 100 years ago. So many people fought and died for better work conditions, hours, and wages. They have all slowly been taken away by the people we entrusted to keep us safe: the people we elected into office in the Senate and House of Representatives. Making backdoor deals with the lobbyists working for the ultra-wealthy. The pandemic opened our eyes to the stark reality and brought out the fighting spirit in many of us. Trump embodies everything dirty, corrupt, and immoral in our society and he encouraged all those of his ilk to wear their greed loud and proud. Unfortunately, he also incited the misinformed and misguided to help him take all their liberties away by preying on their neediness. We need to get Harris/Walz into the White House and clear all mercenary politicians out of the House and Senate to move forward to a fairer, more Democratic society.
"This reflects a severe power imbalance that has become a defining feature of the American economy. Large employers are responsive to shareholders, who demand companies spend billions on stock buybacks and reduce labor costs to increase share prices. But workers are viewed as replaceable — or considered "independent contractors" — and have little to no sway. The fact that the WORKER's' labor is responsible for producing the profits is not a factor."
Judd, I was a machinist for most of my career, my wife was a PA, my brother-in-law was an Electrical Engineer, and my father was the International Sales Director for a medium sized company.
By 'WORKER's' you mean everyone outside of the Board of Director's conference room, correct? I'm just asking because ALL of us worked our butt's off, not just the machinists and PA's.
He distinguished workers from "large employers" ... that is, corporations, which are artificial entities.
I don't disagree with any of this. The none to the bottom and all to the top economy that you describe is in no small part due to the continued rise and entrenchment of monopoly power and consolidation with the backing of both parties over decades - and republican tax cuts for the rich of course. Joe Biden, with Kamala Harris and his phenomenal administration have been working to dismantle this neoliberal order (another name for trickle down) and replace it with a bottom up middle out approach to rebuilding our economy and our democracy. But it is a herculean task. They are making real progress but unfortunately it is literally impossible to do it quickly. it takes time to make big changes and overcome the inevitable obstacles and opposition. Hence, we have the conundrum of "the disconnect between broad economic indicators and the subjective view of the economy among Americans.” Harris-Walz are working hard to convince folks that it is possible to create a thriving economy for all with the policies they propose. It has been done before and we have actually made progress toward it under Biden-Harris. But they have to win to make it a reality. The situation is infuriating. But it is our reality.
We also have a simplistic mindset, with expectations of immediate gratification. Couple that with a narcissistic demagogue who promises he'll fix it with his "concepts of plans" - no details required- and the dilemma multiplies.
Exactly
Democracy, the challenge worth fighting…as we said on many fubar deployments, “let’s embrace the suck together” and make it through to the other side. Harris/Walz…let’s do this!
Robert Reich is always excellent on the disparity in outcomes for rich and poor, and on the reasons behind it. Meanwhile Brad DeLong also covers it, more intermittently because he has a wider scope, but because he seems to follow almost everything with the acute vision of a hawk, the information he highlights really helps you see things in depth. He also has lots of other types of information from historical to artistic, from economics to political. Often really challenging to the reader but always worth the effort. Both on Substack.
I am going to look up Brad DeLong. Thom Hartmann is another on Substack that I worship.
Thanks, I just signed up for Brad LeLong.
I'm pleased you're looking up Brad DeLong, now at Berkeley, and was in the Clinton administration for a time. Today's Robert Reich, though, is what I wanted to draw your attention to - "Why the American economy isn’t working for most Americans in the age of shareholder capitalism - The inevitable logic of CEOs, private equity, and “activist investors”.
It's mainly about Carl Icahn and the damage he's done to the American industrial scene. It seems the biter is finally bit. Reich's tale makes a perfect complement to Judd's article.
The better-way-ahead remains in the fundamental understanding of how the US economy actually works, take a political interest in your every day life, and treat humans with dignity.
To understand the economy, I recommend Dr. Stephanie Kelton’s book, The Deficit Myth. Then follow Dr. Stephanie Kelton, Warren Moseler, Randy Wray, and other macroeconomics Dr. Kelton references. Spoiler alert, fiat currency power controls can easily create a fair, equitable economy for all Americans to prosper. Educate yourself!
Once educated, get involved. You may not like “politics” but politics drive everything and doesn’t care if don’t like it or recognize it’s influence. It’s not easy now and democracy takes work. Good work and “good trouble.”
Finally, once you conquered the above two recommendations, treat all humans with dignity and respect. The education and involvement you experience should open hearts minds to know we’re all in this short life on earth together. Let’s work together to resource good projects to make life exceptional for everyone. Thank you and good luck.
This is what the Harris Walz campaign should focus on: acknowledge that worker bees are still suffering and explain why. It's because of GOP policies that favor the wealthy, and corporate price gouging and stock buybacks. People who are hurting want to feel that they are heard, not just be told the "economy" is great.
And people wonder why Boeing machinists are on strike, while Departing Boeing CEO Dave Calhoun will walk away from the airline manufacturer with a $24 million payday, but he stands to collect about $45.5 million more if the next CEO at Boeing can boost the stock price nearly 37%. And the newly appointed CEO CEO Kelly Ortberg has the chance to reach a $22 million compensation package next year, which could make him one of Washington’s highest-paid CEOs. Seattle Times https://www.seattletimes.com/business/ August 8, 2024. Time for executive pay caps
we're all guilty....the middle class you characterize as just treading water, that may be true in day to day income vs expenses but i think everyone has seen their retirement portfolio balloon......i get so angry that we can't give everyone free healthcare and now "well-meaning" people want to hollow out public education that offers some hope for people to get out of the cycle of poverty. we're all going to .... for our callousness and lack of compassion.
No we aren't.