Robert Reich's writes at robertreich.substack.com. His latest book is "THE SYSTEM: Who Rigged It, How To Fix It." He is Chancellor's Professor of Public Policy at the University of California at Berkeley and Senior Fellow at the Blum Center. He served as Secretary of Labor in the Clinton administration, for which Time Magazine named him one of the 10 most effective cabinet secretaries of the twentieth century. He has written 17 other books, including the best sellers "Aftershock,""The Work of Nations," "Beyond Outrage," and "The Common Good." He is a founding editor of the American Prospect magazine, founder of Inequality Media, a member of the American Academy of Arts and Sciences, and co-creator of the award-winning documentaries "Inequality For All," streaming on YouTube, and "Saving Capitalism," now streaming on Netflix.
Who Rigged It, and How We Fix It
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Why we must restore the idea of the common good to the center of our economics and politics
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A cartoon guide to a political world gone mad and mean

For the Many, Not the Few
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The Next Economy and America's Future
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Beyond Outrage:
What has gone wrong with our economy and our democracy, and how to fix it
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The Transformation of Business, Democracy, and Everyday Life
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Why Liberals Will Win the Battle for America
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A memoir of four years as Secretary of Labor
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This week’s Senate trial is unlikely to convict Donald Trump of inciting sedition against the United States. At least 17 Republican senators are needed for conviction, but only five have signaled they’ll go along.
Why won’t Republican senators convict him? After all, it’s an open and shut case. As summarized in the brief submitted by House impeachment managers, Trump spent months before the election telling his followers that the only way he could lose was through “a dangerous, wide-ranging conspiracy against them that threatened America itself.”
Immediately after the election, he lied that he had won by a “landslide,” and later urged his followers to stop the counting of electoral ballots by making plans to “fight like hell” and “fight to the death” against this “act of war” perpetrated by “Radical Left Democrats” and the “weak and ineffective RINO section of the Republican Party.”
If this isn’t an impeachable offense, it’s hard to imagine what is. But Republican senators won’t convict him because they’re answerable to Republican voters, and Republican voters continue to believe Trump’s big lie.
A shocking three out of four Republican voters don’t think Joe Biden won legitimately. About 45 percent even support the storming of the Capitol.
The crux of the problem is Americans now occupy two separate worlds – a fact-based pro-democracy world and a Trump-based authoritarian one.
Trump spent the last four years seducing voters into his world, turning the GOP from a political party into a grotesque projection of his pathological narcissism.
Regardless of whether he is convicted, America must now deal with the monstrous predicament he left behind: One of the nation’s two major political parties has abandoned reality and democracy.
What to do? Four things.
First, prevent Trump from running for president in 2024. The mere possibility energizes his followers.
An impeachment conviction is not the only way to prevent him. Under Section 3 of the 14th Amendment to the Constitution, anyone who has taken an oath to protect the Constitution is barred from holding public office if they “have engaged in insurrection” against the United States. As constitutional expert and former Yale Law professor Bruce Ackerman has noted, a majority vote that Trump engaged in insurrection against the United States is sufficient to trigger this clause.
Second, give Republicans and independents every incentive to abandon the Trump cult.
White working-class voters without college degrees who now comprise a large portion of it need good jobs and better futures. Many are understandably angry after being left behind in vast enclaves of unemployment and despair. They should not have to depend on Trump’s fact-free fanaticism in order to feel visible and respected.
A jobs program on the scale necessary to bring many of them around will be expensive but worth the cost, especially when democracy hangs in the balance.
Big business, which used to have a home in the GOP, will need a third party. Democrats should not try to court them; the Democratic Party should aim to represent the interests of the bottom 90 percent.
Third, disempower the giant media empires that amplified Trump’s lies for four years – Facebook, Twitter, and Rupert Murdoch’s Fox News and its imitators. The goal is not to “cancel” the political right but to refocus public deliberation on facts, truth, and logic. Democracy cannot thrive where big lies are systematically and repeatedly exploited for commercial gain.
The solution is antitrust enforcement and stricter regulation of social media, accompanied by countervailing financial pressure. Consumers should boycott products advertised on these lie factories and advertisers should shun them. Large tech platforms should lose legal immunity for violence-inciting content. Broadcasters such as Fox News and Newsmax should be liable for knowingly spreading lies (they are now being sued by producers of voting machinery and software which they accused of having been rigged for Biden).
Fourth, safeguard the democratic form of government. This requires barring corporations and the very wealthy from buying off politicians, ending so-called “dark money” political groups that don’t disclose their donors, defending the right to vote, and ensuring more citizens are heard, not fewer.
Let’s be clear about the real challenge ahead. The major goal is not to convict Trump of inciting insurrection. It is to move a vast swath of America back into a fact-based pro-democracy society and away from the Trump-based authoritarian one.
Regardless of whether he is convicted, the end of his presidency has given the nation a reprieve. Unless America uses it to end Trumpism’s hold over tens of millions of Americans, that reprieve may be temporary.
Thankfully, Joe Biden appears to understand this.
I keep hearing that Joe Biden will govern from the “center.” He has no choice, they say, because he’ll have razor-thin majorities in Congress and the Republican party has moved to the right.
Rubbish. I’ve served several Democratic presidents who have needed Republican votes. But the Republicans now in Congress are nothing like those I’ve dealt with. Most of today’s GOP live in a parallel universe. There’s no “center” between the reality-based world and theirs.
Last Wednesday, fully 95% of House Republicans voted against impeaching Trump for inciting insurrection, even after his attempted coup threatened their very lives.
The week before, immediately following the raid on the Capitol, more than 100 House Republicans and several Republican senators objected to the certification of Biden electors in two states on the basis of Trump’s lies about widespread fraud.
Prior to the raid, several Republican members of Congress repeated those lies on television and Twitter and at “Stop the Steal” events.
Trump has remade the Republican party into a white supremacist cult living within a counter-factual wonderland of lies and conspiracies.
According to various surveys, more than half of Republican voters – almost 40 million people – believe Trump won the 2020 race or aren’t sure who won; 45% support the storming of the Capitol; 57% say he should be the Republican candidate in 2024.
In this hermetically sealed cosmos, most Republicans believe Black Lives Matter protesters are violent, immigrants are dangerous and climate change doesn’t pose a threat. A growing fringe openly talks of redressing grievances through violence, including QAnon conspiracy theorists, of whom two are newly elected to Congress, who think Democrats are running a global child sex-trafficking operation.
How can Biden possibly be a “centrist” in this new political world?
There is no middle ground between lies and facts. There is no halfway point between civil discourse and violence. There is no midrange between democracy and fascism.
Biden must boldly and unreservedly speak truth, refuse to compromise with violent Trumpism and ceaselessly fight for democracy and inclusion.
Speaking truth means responding to the world as it is and denouncing the poisonous deceptions engulfing the right. It means repudiating false equivalences and “both sidesism” that gives equal weight to trumpery and truth. It means protecting and advancing science, standing on the side of logic, calling out deceit and impugning baseless conspiracy theories and those who abet them.
Refusing to compromise with violent Trumpism means renouncing the lawlessness of Trump and his enablers and punishing all who looted the public trust. It means convicting Trump of impeachable offenses and ensuring he can never again hold public office – not as a “distraction” from Biden’s agenda but as a central means of reestablishing civility, which must be a cornerstone of that agenda.
Strengthening democracy means getting big money out of politics, strengthening voting rights and fighting voter suppression in all its forms.
It means boldly advancing the needs of average people over the plutocrats and oligarchs, of the white working class as well as Black and Latino people. It means embracing the ongoing struggle for racial justice and the struggle of blue-collar workers whose fortunes have been declining for decades.
The moment calls for public investment on a scale far greater than necessary for Covid relief or “stimulus” – large enough to begin the restructuring of the economy. America needs to create a vast number of new jobs leading to higher wages, reversing racial exclusion as well as the downward trajectory of Americans whose anger and resentment Trump cynically exploited.
This would include universal early childhood education, universal access to the internet, world-class schools and public universities accessible to all. Converting to solar and wind energy and making America’s entire stock of housing and commercial buildings carbon neutral. Investing in basic research – the gateway to the technologies of the future as well as national security – along with public health and universal healthcare.
It is not a question of affordability. Such an agenda won’t burden future generations. It will reduce the burden on future generations.
It is a question of political will. It requires a recognition that there is no longer a “center” but a future based either on lies, violence and authoritarianism or on unyielding truth, unshakeable civility and radical inclusion. And it requires a passionate, uncompromising commitment to the latter.
Donald Trump couldn’t have become president without three sets of enablers. They must he held accountable.
The first enabler was the Republican Party.
For years the GOP has nurtured the xenophobia, racism, fact-free allegations, and wanton disregard for democratic institutions that Trump has fed on.
Republican fear-mongering over immigrants predated Trump. It forced Marco Rubio to abandon his immigration legislation, and, in 2012, pushed Mitt Romney to ludicrously recommend “self-deportation.”
During this year’s Republican primaries, Ben Carson opined that no Muslim should be president of the United States, and Jeb Bush and Ted Cruz suggested Syrian refugees be divided into Christians and Muslims, with only the former allowed entry.
Trump’s racism is nothing new, either. Republicans have long played the race card – charging Democrats with coddling black “welfare queens” and being soft on black crime (remember “Willie Horton”).
Trump’s disdain of facts is also preceded by a long Republican tradition – denying, for example, that carbon emissions cause climate change, and tax cuts increase budget deficits.
And Trump’s threats not to be bound by the outcome of the election are consistent with the GOP’s persistent threats to shut down the government over policy disagreements, and oft-repeated calls for nullification of Supreme Court decisions.
The second Trump enabler was the
media.
“Trump is arguably the first bona fide media-created presidential nominee,” concluded a study by Harvard’s Shorenstein Center on Media, Politics, and Public Policy.
By mid-March, 2016, the New York Times reported that Trump had received almost $1.9 billion of free attention from media of all types – more than twice what Hillary Clinton received and six times that of Ted Cruz, Trump’s nearest Republican rival.
The explanation for this is easy. Trump was already a media personality, and his outrageousness generated an audience – which, in turn, created big profits for the media.
Media columnist Jim Rutenberg reported CNN president Jeff Zucker gushing over the Trump-induced ratings. “These numbers are crazy — crazy.” CBS president and CEO Leslie Moonves said, “It may not be good for America, but it’s damn good for CBS. The money’s rolling in and this is fun.”
Not only did the media fawn over Tump but it also failed to subject his assertions, policy proposals, and biography to the scrutiny normal candidates receive.
Fox News, in particular, became Trump’s amplifier – and Fox host Sean Hannity, Trump’s daily on-air surrogate.
Trump also used his own unceasing tweets as a direct, unfiltered, unchecked route into the minds of millions of voters. The term “media” comes from “mediate” between the news and the public. Trump removed the mediators.
The third Trump enabler was the Democratic Party.
Democrats once represented the working class. But over the last three decades the party has been taken over by Washington-based fundraisers, bundlers, analysts, and pollsters who have focused instead on raising big money from corporate and Wall Street executives, and getting votes from upper middle-class households in “swing” suburbs.
While Republicans played the race card to get the working class to abandon the Democratic Party, the Democrats simultaneously abandoned the working class – clearing the way for Trump.
Democrats have occupied the White House for sixteen of the last twenty-four years, and for four of those years had control of both houses of congress. But in that time they failed to reverse the decline in working-class wages and jobs.
Both Bill Clinton and Barack Obama ardently pushed for free trade agreements without providing millions of blue-collar workers who thereby lost their jobs means of getting new ones that paid at least as well.
They stood by as corporations hammered trade unions, the backbone of the white working class – failing to reform labor laws to impose meaningful penalties on companies that violate them, or help workers form unions with a simple up-or-down votes.
Partly as a result, union membership sank from 22 percent of all workers when Bill Clinton was elected president to fewer than 12 percent today, and the working class lost bargaining leverage to get a share of the economy’s gains.
Both Clinton and Obama also allowed antitrust enforcement to ossify – with the result that large corporations have grown far larger, and major industries more concentrated.
The unsurprising result has been to shift political and economic power to big corporations and the wealthy, and to shaft the working class. That created an opening for demagoguery, in the form of Trump.
Donald Trump has poisoned America, but he didn’t do it alone. He had help from the GOP, the media, and the Democratic Party.
The pertinent question now is: What, if anything, have these enablers learned?
The Clinton campaign is relentlessly focusing on the defects of Donald Trump rather than the defects of the Republican agenda. That’s understandable, and it could be a winning strategy. But it has pitfalls.
The campaign’s goal is to attract a wide swathe of voters who might ordinarily lean Republican on issues, as well as unenthusiastic Democrats who need the specter of a Trump presidency to get to the polls.
As Hillary Clinton told a crowd a few weeks ago at the American Legion convention, “this is not a normal election” and “the debates are not the normal disagreements between Republicans and Democrats.”
One new Clinton ad, for example, shows young women looking at themselves in mirrors while sexist comments by Trump are played in the background.
Another features clips of GOP leaders criticizing Trump in TV interviews, and closes with the words: “Unfit. Dangerous. Even for Republicans.”
Under the umbrella “Together for America,” the Clinton campaign is highlighting other well-known Republicans who have spoken out against Trump’s character and temperament.
The Clinton campaign is also playing up endorsements by traditional Republican newspapers that have found Trump “unfit” to be president, or, in the words of the Cincinnati Enquirer (which hasn’t endorsed a Democrat in a century), “a clear and present danger.”
Vilifying Trump and creating a broad bipartisan coalition against him are entirely justified. Trump is indeed a menace.
It’s also a winning strategy if Hillary Clinton’s only goal is to get elected president.
But a singular focus on Trump poses two big risks for what happens after she wins.
First, it reduces her presidential coattails that might otherwise help Democratic candidates now running for the Senate and House. Portraying Trump as an aberration from normal Republicanism gives their Republican opponents a free pass. All they have to do is distance themselves from him.
Six months ago, when the Clinton campaign and the Democratic National Committee were still linking Trump to the Republican Party, Democrats were well positioned to win back control of the Senate – defending just 10 seats compared with 24 for Republicans.
But the odds of a Democratic Senate takeover have shrunk.
In the key battleground state of New Hampshire, for example, 78 percent of voters now view incumbent Republican Kelly Ayotte, a first-term senator who rarely mentions Trump on the campaign trail, as a “different kind of Republican” than Trump, according to a CBS News-YouGov poll of battleground states last month.
In Ohio, 20 percent of likely Clinton voters said in another recent poll that they will vote for incumbent Republican Senator Rob Portman over the Democratic candidate, Ted Strickland. Strickland was leading several months ago but Portman has pulled ahead. Portman has made it clear he wants nothing to do with Trump. When Ohio hosted the Republican National Convention this summer, Portman stayed away.
In Pennsylvania, Republican Senator Pat Toomey is running neck-and-neck with former environmental official Katie McGinty. Toomey should be vulnerable, but he has refused to endorse Trump and is running as his “own man.”
In North Carolina, Democratic candidate former state lawmaker and ACLU lawyer Deborah Ross has a fighting chance to beat incumbent Republican Senator Richard Burr, but Burr is focusing on state issues and is keeping his distance from Trump.
Hillary Clinton needs a Democratic Senate if she becomes president. Without one, her legislative initiatives will be dead on arrival. She may not even be able to count on enough votes to confirm her cabinet choices.
On the other side of Capitol Hill, the odds of Democrats retaking the House – never high – now seem impossible.
Moreover, in pursing Republican voters who have doubts about Trump, the Clinton campaign has gone to great lengths to avoid tainting House Speaker Paul Ryan with Trump – thereby leaving Ryan more powerful than ever if Clinton wins.
The second risk in focusing on the unique disqualifications of Trump is that it may dilute public support for what Clinton wants to accomplish as president. After all, if the central purpose of her campaign and the major motivation of her supporters is to stop Trump, she’ll already have accomplished that before she’s even sworn in.
It likewise makes it more difficult for her, as president, to push back against Republican orthodoxy with a bold vision of what America must do.
The reality is that Trump’s proposals aren’t far removed from what the Republican Party has been trying to achieve for years – cutting taxes on the rich and on corporations; gutting health, safety, and environmental regulations; repealing Obamacare; spending more on defense; blocking immigration and sending more undocumented workers packing; imposing “law and order” in black communities; and preventing an increase in the minimum wage.
Focusing on Trump’s character flaws instead of the flawed Republican agenda is appropriate – up to a point. Donald Trump is dangerous. And, yes, the first priority must be to stop him.
But that shouldn’t be the only priority.
2.
Third parties have rarely posed much of a threat to the
dominant two parties in America. So how did the People’s Party win the U.S.
presidency and a majority of both houses of Congress in 2020?
It started four years before, with the election of 2016.
As you remember, Donald Trump didn’t have enough delegates to become the Republican candidate, so the GOP convention that summer was “brokered” – which meant the Party establishment took control, and nominated the Speaker of the House, Paul Ryan.
Trump tried to incite riots but his “I deserve to be president because I’m the best person in the world!” speech incited universal scorn instead, and he slunk off the national stage (his last words, shouted as he got into his stretch limousine, were “Fu*ck you, America!”)
On the Democratic side, despite a large surge of votes for Bernie Sanders in the final months of the primaries, Hillary Clinton’s stable of wealthy donors and superdelegates put her over the top.
Both Republican and Democratic political establishments breathed palpable sighs of relief, and congratulated themselves on remaining in control of the nation’s politics.
They attributed Trump’s rise to his fanning of bigotry and xenophobia, and Sanders’s popularity to his fueling of left-wing extremism.
They conveniently ignored the deeper anger in both camps about the arbitrariness and unfairness of the economy, and about a political system rigged in favor of the rich and privileged.
And they shut their eyes to the anti-establishment fury that had welled up among independents, young people, poor and middle-class Democrats, and white working-class Republicans.
So they went back to doing what they had been doing before. Establishment Republicans reverted to their old blather about the virtues of the “free market,” and establishment Democrats returned to their perennial call for “incremental reform.”
And Wall Street, big corporations, and a
handful of billionaires resumed pulling the strings of both parties to make sure regulatory agencies didn’t have enough staff to enforce rules, and to pass the Trans Pacific Partnership.
Establishment politicians also arranged to reduce taxes on big corporations and simultaneously increase federal subsidies to them, expand tax loopholes for the wealthy, and cut Social Security and Medicare to pay for it all. (“Sadly, we have no choice,” said the new President, who had staffed the White House and Treasury with Wall Streeters and corporate lobbyists, and filled boards and commissions with corporate executives).
Meanwhile, most Americans continued to lose ground.
Even before the recession of 2018, most families were earning less than they’d earned in 2000, adjusted for inflation. Businesses continued to shift most employees off their payrolls and into “on demand” contracts so workers had no idea what they’d be earning from week to week. And the ranks of the working poor continued to swell.
At the same time, CEO pay packages grew even larger, Wall Street bonus pools got fatter, and a record number of billionaires were becoming multi-billionaires.
Then, of course, came the recession, along with bank losses requiring another round of bailouts. The Treasury Secretary, a former managing director of Morgan Stanley, expressed shock and outrage, explaining the nation had no choice and vowing to “get tough” on the banks once the crisis was over.
Politics abhors a vacuum. In 2019, the People’s Party filled it.
Its platform called for getting big money out of politics, ending “crony capitalism,” abolishing corporate welfare, stopping the revolving door between government and the private sector, and busting up the big Wall Street banks and corporate monopolies.
The People’s Party also pledged to revoke the Trans Pacific Partnership, hike taxes on the rich to pay for a wage subsidy (a vastly expanded Earned Income Tax Credit) for everyone earning below the median, and raise taxes on corporations that outsource jobs abroad or pay their executives more than 100 times the pay of typical Americans.
Americans rallied to the cause. Millions who called themselves conservatives and Tea Partiers joined with millions who called themselves liberals and progressives against a political establishment that had shown itself incapable of hearing what they had been demanding for years.
The rest, as they say, is history.
You are the captains of American industry, the titans of Wall Street, and the billionaires who for decades have been the backbone of the Republican Party.
You’ve invested your millions in the GOP in order to get lower taxes, wider tax loopholes, bigger subsidies, more generous bailouts, less regulation, lengthier patents and copyrights and stronger market power allowing you to raise prices, weaker unions and bigger trade deals allowing you outsource abroad to reduce wages, easier bankruptcy for you but harder bankruptcy for homeowners and student debtors, and judges who will let you to engage in insider trading and who won’t prosecute you for white-collar crimes.
All of which have made you enormously wealthy. Congratulations.
But I have some disturbing news for you. You’re paying a big price – and about to pay far more.
First, as you may have noticed, most of your companies aren’t growing nearly as fast as they did before the Great Recession. Your sales are sputtering, and your stock prices are fragile.
That’s because you forgot that your workers are also consumers. As you’ve pushed wages downward, you’ve also squeezed your customers so tight they can hardly afford to buy what you have to sell.
Consumer spending comprises 70 percent of the American economy. But the typical family is earning less today than it did in 2000, in terms of real purchasing power.
Most of the economic gains have gone to you and others like you who spend only a small fraction of what they rake in. That spells trouble for the economy – and for you.
You’ve tried to lift your share prices artificially by borrowing money at low interest rates and using it to buy back your shares of stock. But this party trick works only so long. Besides, interest rates are starting to rise.
Second, you’ve instructed your Republican lackeys to reduce your and your corporation’s taxes so much over the last three decades – while expanding subsidies and bailouts going your way – that the government is running out of money.
That means many of the things you and your businesses rely on government to do – build and maintain highways, bridges, tunnels, and other physical infrastructure; produce high-quality basic research; and provide a continuous supply of well-educated young people – are no longer being done as well as they should. If present trends continue, all will worsen in years to come.
Finally, by squeezing wages and rigging the economic game in your favor, you have invited an unprecedented political backlash – against trade, immigration, globalization, and even against the establishment itself.
The pent-up angers and frustrations of millions of Americans who are working harder than ever yet getting nowhere, and who feel more economically insecure than ever, have finally erupted. American politics has become a cesspool of vitriol.
Republican politicians in particular have descended into the muck of bigotry, hatefulness, and lies. They’re splitting America by race, ethnicity, and religion. The moral authority America once had in the world as a beacon of democracy and common sense is in jeopardy. And that’s not good for you, or your businesses.
Nor is the uncertainty all this is generating. A politics based on resentment can lurch in any direction at almost any time. Yet you and your companies rely on political stability and predictability.
You follow me? You’ve hoisted yourself on your own petard. All that money you invested in Republican Party in order to reap short-term gains is now reaping a whirlwind.
You would have done far better with a smaller share of an economy growing more rapidly because it possessed a strong and growing middle class.
You’d have done far better with a political system less poisoned by your money – and therefore less volatile and polarized, more capable of responding to the needs of average people, less palpably rigged in your favor.
But you were selfish and greedy, and you thought only about your short-term gains.
You forgot the values of a former generation of Republican establishment that witnessed the devastations of the Great Depression and World War II, and who helped build the great post-war American middle class.
That generation did not act mainly out of generosity or social responsibility. They understood, correctly, that broad-based prosperity would be good for them and their businesses over the long term.
So what are you going to do now? Will you help clean up this mess – by taking your money out of politics, restoring our democracy, de-rigging the system, and helping overcome widening inequality of income, wealth, and political power?
Or are you still not convinced?
Why did the white working class abandon the Democrats?
The conventional answer is Republicans skillfully played the race card.
In the wake of the Civil Rights Act, segregationists like Alabama Governor George C. Wallace led southern whites out of the Democratic Party.
Later, Republicans charged Democrats with coddling black “welfare queens,“ being soft on black crime (“Willie Horton”), and trying to give jobs to less-qualified blacks over more-qualified whites (the battle over affirmative action).
The bigotry now spewing forth from Donald Trump and several of his Republican rivals is an extension of this old race card, now applied to Mexicans and Muslims – with much the same effect on the white working class voters, who don’t trust Democrats to be as “tough.”
All true, but this isn't the whole story. Democrats also abandoned the white working class.
Democrats have occupied the White House for sixteen of the last twenty-four years, and in that time scored some important victories for working families – the Affordable Care Act, an expanded Earned Income Tax Credit, and the Family and Medical Leave Act, for example.
But they’ve done nothing to change the vicious cycle of wealth and power that has rigged the economy for the benefit of those at the top, and undermined the working class. In some respects, Democrats have been complicit in it.
Both Bill Clinton and Barack Obama ardently pushed for free trade agreements, for example, without providing the millions of blue-collar workers who thereby lost their jobs any means of getting new ones that paid at least as well.
They also stood by as corporations hammered trade unions, the backbone of the white working class. Clinton and Obama failed to reform labor laws to impose meaningful penalties on companies that violated them, or enable workers to form unions with a simple up-or-down votes.
I was there. In 1992, Bill Clinton promised such reform but once elected didn’t want to spend political capital on it. In 2008, Barack Obama made the same promise (remember the Employee Free Choice Act?) but never acted on it.
Partly as a result, union membership sunk from 22 percent of all workers when Bill Clinton was elected president to fewer than 12 percent today, and the working class lost bargaining leverage to get a share of the economy’s gains.
In addition, the Obama administration protected Wall Street from the consequences of the Street’s gambling addiction through a giant taxpayer-funded bailout, but let millions of underwater homeowners drown.
Both Clinton and Obama also allowed antitrust enforcement to ossify – with the result that large corporations have grown far larger, and major industries more concentrated.
Finally, they turned their backs on campaign finance reform. In 2008, Obama was the first presidential nominee since Richard Nixon to reject public financing in his primary and general-election campaigns. And he never followed up on his reelection campaign promise to pursue a constitutional amendment overturning “Citizens United v. FEC,” the 2010 Supreme Court opinion opening the floodgates to big money in politics.
What happens when you combine freer trade, shrinking unions, Wall Street bailouts, growing corporate market power, and the abandonment of campaign finance reform?
You shift political and economic power to the wealthy, and you shaft the working class.
Why haven’t Democrats sought to reverse this power shift? True, they faced increasingly hostile Republican congresses. But they controlled both houses of Congress in the first two years of both Clinton’s and Obama’s administrations.
In part, it’s because Democrats bought the snake oil of the “suburban swing voter” – so-called “soccer moms” in the 1990s and affluent politically-independent professionals in the 2000s – who supposedly determine electoral outcomes.
Meanwhile, as early as the 1980s they began drinking from the same campaign funding trough as the Republicans – big corporations, Wall Street, and the very wealthy.
“Business has to deal with us whether they like it or not, because we’re the majority,” crowed Democratic representative Tony Coelho, head of the Democratic Congressional Campaign Committee in the 1980s when Democrats assumed they’d continue to run the House for years.
Coelho’s Democrats soon achieved a rough parity with Republicans in contributions from corporate and Wall Street campaign coffers, but the deal proved a Faustian bargain as Democrats become financially dependent on big corporations and the Street.
Nothing in politics is ever final. Democrats could still win back the white working class – putting together a huge coalition of the working class and poor, of whites, blacks, and Latinos, of everyone who has been shafted by the shift in wealth and power to the top.
This would give Democrats the political clout to restructure the economy – rather than merely enact palliatives that papered over the increasing concentration of wealth and power in America.
But to do this Democrats would have to stop obsessing over upper-income suburban swing voters, and end their financial dependence on big corporations, Wall Street, and the wealthy.
Will they? That’s one of the biggest political unknowns in 2016 and beyond.
The Republican assault on Planned Parenthood is filled with lies and distortions, and may even lead to a government shutdown.
The only thing we can say for sure about it is it’s already harming women’s health.
For distortions, start with presidential candidate Carly Fiorina’s contention at last week’s Republican debate that a video shows “a fully formed fetus on the table, its heart beating, its legs kicking, while someone says, ‘We have to keep it alive to harvest its brain.’ “
Wrong. In fact, the anti-abortion group that made that shock video added stock footage of a fully-formed fetus in order to make it seem as if that’s what Planned Parenthood intended.
But as Donald Trump has
demonstrated with cunning bravado, presidential candidates can say anything
these days regardless of the truth and get away with it.
At least elected members of Congress should be held to a standard of responsible public service.
Yet last Friday, the House voted 241-187 to block Planned Parenthood’s federal funds for a year.
This may lead to another government shutdown. Funding for the government runs out at the end of the month, and several dozen House Republicans have said they won’t vote for a funding bill that includes money for Planned Parenthood.
This is,
quite frankly, nuts.
A strong moral case can be made that any society that respects women must respect their right to control their own bodies.
There’s also an important economic case for effective family planning.
Public investments in family planning—enabling women to plan, delay, or avoid pregnancy– make economic sense because reproductive rights are also productive rights.
When women have control over their lives they can contribute even more to the economy, better break the glass ceiling, equalize the pay gap, and much more.
Consider Colorado’s highly successful family planning program. Over the past six years, the Colorado health department has offered teenagers and low-income women free long-acting birth control that prevents pregnancy over several years.
As a result, pregnancy and abortion rates plunged—by about 40 percent among teenagers across the state between 2009 to 2013.
In 2009, half of all first births to women in the poorest areas of Colorado occurred before they turned 21.
But by 2014, half of first births did not occur until the women had turned 24. This difference gives young women time to finish their education and obtain better jobs.
Nationally, evidence shows that public investments in family planning result in net public savings of about $13.6 billion a year—over $7 for every public dollar spent.
This sum doesn’t include the billions of additional dollars saved by enabling women – who may not be financially able to raise a child and do not want to have a child or additional children – to stay out of poverty.
Despite what Republicans claim, Planned Parenthood doesn’t focus on providing abortions.
In 2013, the most recent year for which data are available, its services included nearly nearly 500,000 breast examinations, 400,000 Pap tests, nearly 4.5 million tests for sexually transmitted illnesses and treatments.
Planned Parenthood’s contraceptive services are one of the major reasons we don’t have more abortions in the United States.
The prestigious New England Journal of Medicine calls Planned Parenthood’s contraception services one of “the single greatest effort[s] to prevent the unwanted pregnancies that result in abortions.”
Planned Parenthood’s services are particularly important to poor and lower-income women. At least 78 percent of its patients have incomes at or below 150 percent of the federal poverty level.
Planned Parenthood gets around $450 million a year from the federal government. Most of this is Medicaid reimbursements for low-income patients, according to the nonpartisan Congressional Budget Office. The rest is mainly for contraceptive counseling, pregnancy testing and other services.
Federal money can only be used for abortion in rare circumstances.
Even so, over the last five years congressional Republicans have cut 10 percent of the Title X federal budget for family planning, which pays for services such as cancer screenings and HIV tests.
And now they want to do away with it altogether.
This never used to be a partisan issue. After all, Title X was signed into law in 1970 by Richard Nixon.
Obviously, the crass economic
numbers don’t nearly express the full complexity of the national debate around
abortion and family planning.
But they help make the case that we all benefit when society respects women to control their bodies and plan their families.
The attack on Planned Parenthood is not just morally wrong. It’s also economically stupid.
Can it be that America’s small businesses are finally waking up to the fact they’re being screwed by big businesses?
For years, small-business groups such as the National Federation of Independent Businesses have lined up behind big businesses lobbies.
They’ve contributed to the same Republican candidates and committees favored by big business.
And they’ve eagerly connected the Republican Party in Washington to its local business base. Retailers, building contractors, franchisees, wholesalers, and restaurant owners are the bedrock of local Republican politics.
But now small businesses are breaking ranks. They’re telling congressional Republicans not to make the deal at the very top of big businesses’ wish list – a cut in corporate tax rates.
“Given the option, this or nothing, nothing is better for our members,” the director of legislative affairs at Associated Building Contractors told Bloomberg News. (Associated Building Contractors gave $1.6 million to Republicans in the 2014 midterm elections and nothing to Democrats.)
Small businesses won’t benefit from such a tax deal because most are S corporations and partnerships, known as “pass-throughs” since business income flows through to them and appears on their owners’ individual tax returns.
So a corporate tax cut without a corresponding cut in individual tax rates would put small businesses at a competitive disadvantage.
And since a cut in the individual rate isn’t in the cards – even if it could overcome the resistance of Republican deficit hawks, President Obama would veto it – small businesses are saying no to a corporate tax cut.
The fight is significant, and not just because it represents a split in Republican business ranks. It marks a new willingness by small businesses to fight against growing competitive pressures from big corporations.
In case you hadn’t noticed, big corporations have extended their dominance over large swaths of the economy.
They’ve expanded their intellectual property, merged with or acquired other companies in the same industry, and gained control over networks and platforms that have become industry standards.
They’ve deployed fleets of lawyers to litigate against potential rivals that challenge their dominance, many of them small businesses.
And they’ve been using their growing economic power to get legislative deals making them even more dominant, such as the corporate tax cut they’re now seeking.
All this has squeezed small businesses – undermining their sales and profits, eroding market shares, and making it harder for them to enter new markets.
Contrary to the conventional view of an American economy bubbling with innovative small companies, the rate that new businesses have formed has slowed dramatically.
Between 1978 and 2011, as big businesses expanded and solidified control over many industries, the pace of new business formation was halved, according to a Brookings Institution study released last year.
The decline occurred regardless of the business cycle or which party occupied the White House or controlled Congress.
Contributing to the drop was the deregulation of finance – which turned the biggest Wall Street banks into powerhouses that swamped financial markets previously served by regional and community banks. Not even Dodd-Frank has slowed the pace of financial consolidation.
In consequence, many small businesses can’t get the financing they once got from state and local bankers. Over the past two decades, loans to small businesses have dropped from about half to under 30 percent of total bank loans.
That means the Fed’s rock-bottom interest rates haven’t percolated down to many small businesses.
Tensions have also grown between giant franchisors – restaurant chains, fast-food corporations, auto manufacturers, giant retailers – and their franchisees.
Franchisees have found themselves trapped in contracts that siphon off profits to parent companies, give franchisors the right to unilaterally terminate the agreements, and force franchisees into mandatory arbitration of disputes.
Complaints are mounting about parent corporations closing successful franchisees for minor contract violations in order to resell them at high prices to new owners.
Meanwhile, small businesses are feeling the same financial pinch the rest of us endure from big corporations whose growing market power is letting them jack up prices for everything from pharmaceuticals to Internet connections.
So the willingness of small business groups to take on big business on its top legislative priority could mark the start of a political realignment.
If small businesses were willing to ally themselves with consumer, labor, and community groups, they could press for stronger antitrust enforcement against giant corporations.
As well as for breaking up Wall Street’s biggest banks and strengthening community banks.
They could also get legislation banning take-it-or-leave-it contracts requiring mandatory arbitration.
Such an alliance might even become a powerful voice for campaign-finance reform, containing the political clout of giant corporations.
Don’t hold your breath. Small business groups have done the bidding of big business for so long that the current conflict may be temporary.
But the increasing power of big corporations cries out for new centers of countervailing power.
Even if the political realignment doesn’t happen soon, small businesses will eventually wake up – and could play a central role.
According to reports, one of the first acts of the Republican congress will be to fire Doug Elmendorf, current director of the non-partisan Congressional Budget Office, because he won’t use “dynamic scoring” for his economic projections.
Dynamic scoring is the magical-mystery math Republicans have been pushing since they came up with supply-side “trickle-down” economics.
It’s based on the belief that cutting taxes unleashes economic growth and thereby produces additional government revenue. Supposedly the added revenue more than makes up for what’s lost when Congress hands out the tax cuts.
Dynamic scoring would make it easier to enact tax cuts for the wealthy and corporations, because the tax cuts wouldn’t look as if they increased the budget deficit.
Incoming House Ways and Means Chairman Paul Ryan (R-Wis.) calls it “reality-based scoring,” but it’s actually magical scoring – which is why Elmendorf, as well as all previous CBO directors have rejected it.
Few economic theories have been as thoroughly tested in the real world as supply-side economics, and so notoriously failed.
Ronald Reagan cut the top income tax rate from 70 percent to 28 percent and ended up nearly doubling the national debt. His first budget director, David Stockman, later confessed he dealt with embarrassing questions about future deficits with “magic asterisks” in the budgets submitted to Congress. The Congressional Budget Office didn’t buy them.
George W. Bush inherited a budget surplus from Bill Clinton but then slashed taxes, mostly on the rich. The CBO found that the Bush tax cuts reduced revenues by $3 trillion.
Yet Republicans don’t want to admit supply-side economics is hokum. As a result, they’ve never had much love for the truth-tellers at the Congressional Budget Office.
In 2011, when briefly leading the race for the Republican presidential nomination, Newt Gingrich called the CBO “a reactionary socialist institution which does not believe in economic growth, does not believe in innovation and does not believe in data that has not been internally generated.”
The CBO has continued to be a truth-telling thorn in the Republican’s side.
The budget plan Paul Ryan came up with in 2012 – likely to be a harbinger of what’s to come from the Republican congress – slashed Medicaid, cut taxes on the rich and on corporations, and replaced Medicare with a less well-funded voucher plan.
Ryan claimed these measures would reduce the deficit. The Congressional Budget Office disagreed.
Ryan persevered. His 2013 and 2014 budget proposals were similarly filled with magic asterisks. The CBO still wasn’t impressed.
Yet it’s one thing to cling to magical-mystery thinking when you have only one house of Congress. It’s another when you’re running the whole shebang.
Now that Elmendorf is on the way out, presumably to be replaced by someone willing to tell Ryan and other Republicans what they’d like to hear, the way has been cleared for all the magic they can muster.
In this as in other domains of public policy, Republicans have not shown a particular affinity for facts.
Climate change? It’s not happening, they say. And even if it is happening, humans aren’t responsible. (Almost all scientists studying the issue find it’s occurring and humans are the major cause.)
Widening inequality? Not occurring, they say. Even though the data show otherwise, they claim the measurements are wrong.
Voting fraud? Happening all over the country, they say, which is why voter IDs and other limits on voting are necessary. Even though there’s no evidence to back up their claim (the best evidence shows no more than 31 credible incidents of fraud out of a billion ballots cast), they continue to assert it.
Evolution? Just a theory, they say. Even though all reputable scientists support it, many Republicans at the state level say it shouldn’t be taught without also presenting the view found in the Bible.
Weapons of mass destruction in Iraq? America’s use of torture? The George W. Bush administration and its allies in Congress weren’t overly interested in the facts.
The pattern seems to be: if you don’t like the facts, make them up.
Or have your benefactors finance “think tanks” filled with hired guns who will tell the public what you and your patrons want them to say.
If all else fails, fire your own experts who tell the truth, and replace them with people who will pronounce falsehoods.
There’s one big problem with this strategy, though. Legislation based on lies often causes the public to be harmed.
Not even “truthiness,” as Stephen Colbert once called it, is an adequate substitute for the whole truth.