‘THE SYSTEM’ A SOBER ACCOUNT OF AMERICAN OLIGARCHY
“Liberty produces wealth and wealthdestroys liberty,” Henry Demarest Lloyd wrote in 1894. “The flames of the new economic evolution run around us, and we turn to find that competition has killed competition, that corporations have grown greater than the State … and that the naked issue of our time is with property becoming masterinstead of servant.”
One hundred and twenty-five years later, according to Robert Reich, little has changed in the United States. Corporate elites have acquired unimagined wealth and power, established an oligarchy and subverted our democracy. Since 1980, the share of total wealth heldby the richest 0.1% Americans — about 160,000 households — increased from 10% to 20%; they now own almost as much as the bottom 90%of households combined.
The typical CEO, who once earned 20 times the pay of a typical worker, now earns 300 times as much. With lobbyists (many of them former legislators and congressional staff) as thick as thieves in Washington, D.C., 80% of Americans have good reason to conclude, as they did in a 2013 survey, that the government is “run by a few big interestslooking out for themselves.”
In “The System: Who Rigged It, How We Fix It,” Mr. Reich uses scorching indictments of Jamie Dimon, the CEO of JPMorgan Chase, takeover specialist Carl Icahn, and other malefactors of wealth to demystify corporate capitalism (which he calls “socialism for the rich”). He identifies three systemic changes that have allowed corporations to privatize gain and nationalize risk: the replacement of stakeholder with shareholder governance, the shift in power from large unions to international corporations, and the domination of Main Streetby Wall Street.
Mr. Reich has held these views throughout his long career. A professor of public policy at the University of California, Berkeley, he has served as secretary of labor in the Clinton administration; written 17 books; co-created two documentary films, “Inequality for All” and “Saving Capitalism”; contributes a weekly column to The Guardian and Newsweek; and appears frequently on CNN and MSNBC. Like Sen. Bernie Sanders, whose presidential campaign he endorsed in 2016, Mr. Reich has been remarkably consistent. Therefore, the themes and the evidence in “The System” will be familiar to his readers. That said, his jeremiad remains compelling. Although he acknowledges that Democrats have won some victories for working people — the Affordable Care Act, Earned Income Tax Credit, Family and Medical Leave Act — Mr. Reich claims they have done “nothing to change the vicious cycle of wealth and power that has rigged the economy for the benefit of those at the top.”He believes a coalition of working-class, middle-class and poor people, white people, Black people and Latino people can enact fundamental reform instead of the “palliative measures that paper over” the stark realitiesof power and politics.
Not surprisingly, Robert Reich believes that Donald Trump “is the best thing to have happened to the new American oligarchy.” In addition to tax cuts and regulatory rollbacks, he writes, Mr. Trump “stokes divisiveness and tribalism” that keeps the bottom 90% from seeing how the oligarchs control government policies and a “boardroom culture that tolerates financial conflicts of interest, insider trading and the outright bribery of public officials through unlimited campaign donations.”
Stagnating wages, staggering inequality, mass murders with assault weapons, children locked in cages at the southern border, climate change that threatens the planet and, he would surely add, a pandemic, Mr. Reich acknowledges, provide more than sufficient reasonsfor Americans to despair.
But he concludes, as is his wont, by claiming, “It’s not as bleak as it sometimes seems.” Putting his faith in “the startling diversity of younger Americans” determined to make things better and the record numbers of them who voted in 2018 and are committed to public service, Mr. Reich calls for outrage to be transformed into organization. Now that almost half of Americans identify as Independents, Mr. Reich suggests the formation of a new party that unites disaffected voters (including those on the right ofthe old political spectrum) “is not far-fetched.”
With Justice Louis Brandeis, Mr. Reich insists, “We can have democracy in this country or we can have great wealth concentrated in the hands of a few, but we can’t have both.”
They may well be right, but, alas, we’ve heard that song before; it’s from an old familiar score.