How Can We Reclaim the American Dream?
Thoughts from an Independent on Hedrick Smith’s,
Who Stole the American Dream?
Perhaps, if we’re fortunate, in about four decades, someone will write a book about how we reclaimed the American Dream from the brink of extinction, and will point to a book, as significant, written in 2012 by Hedrick Smith, titled, Who Stole the American Dream? Not necessarily because Mr. Smith’s analysis and conclusions are entirely correct, nor even because his book was a vital catalyst in influencing the masses to generate change. But because the grassroots groundswell that he talks about as necessary – demanding various changes – has slowly been brewing and is now playing out intensely in the 2016 election season. Despite the outcome, the grassroots have been fired up, and a movement will likely continue, until, in the future, a real “people’s revolution” reconnects us with our heart and soul, and we have a government – and economy – that’s “of the people, by the people, for the people.”
Mr. Smith cites numerous facts, figures and statistics, and relates various people’s anecdotal stories, that clearly demonstrate that the American Dream prevalent in the 1950s and 1960s has mostly evaporated. The middle class used to be able to count on being able to live a little better than their parents had, and through hard work, provide sufficiently for their families, and then enjoy a secure retirement; but today, most Americans are not on track for retirement, are mired in debt, and are not living better than their parents did. Smith shows positive growth trends between the 1940s to 1970s, and negative growth trends between the 1970s to 2011, and claims that the turning point that led us to where we are started with a rarely discussed memorandum written by Lewis Powell (who later became a Supreme Court Justice) addressed to the U.S. Chamber of Commerce in 1971. The memorandum was a call to arms for businesses and corporations to exert more power in Washington, and they did. Smith offers plenty of correlative evidence that corporate lobbyist influence exploded after that, and many policies in Washington began to favor corporations and their elite over ordinary Americans. While all of that may be true, I believe it’s a little more complicated than that, and other factors not mentioned have also contributed to the inequality we see today.
As a society, we’re just starting to widely acknowledge that we have an ever-widening income gap; Smith shows that middle class workers used to get a solid share of the nation’s gains in productivity; but for awhile now, middle class wages have been flat. “In 2007 [before the collapse], corporate profits garnered the largest share of national income since 1943, while the share of national income going to wages sank to its lowest level since 1929.” CEO pay exploded, and those in the financial industry have cashed in, while middle class worker pay has stagnated at a time when costs of living; namely, housing, health care, and education have gone up exponentially. Bernie Sanders has hounded on this theme so relentlessly that it seems to have now become part of our national consciousness, and even the campaign of Donald Trump has spoken to the angst felt by so many who have been left out and want to “make America great again.” Bernie rails against Wall Street, and talks about increasing the minimum wage, and taxing the wealthy to cover health care and college. And both Bernie and Trump are anti-establishment, have rebuffed super PACs and big donor campaign contributions, and are against free trade deals and offshoring.
Will these kinds of policies bring back the American dream? No doubt that many flaws in our system have brought us to where we are. Smith discusses: the influence of corporate money and lobbyists; unfair changes to the tax code and bankruptcy laws; the formation and collapse of the housing bubble; the movement to send production and jobs overseas; the abused high-tech H-1B visa; how shifting from pensions to 401Ks gave more money to corporate insiders and put more burdens on workers (“You the investor put up 100% of the capital. You take 100% of the risk. And you capture about 37% of the return. The fund or Wall Street puts up none of the capital, takes none of the risk and takes out 63% of the return.”); and related topics. The tangled web of greed, incompetence, and (in many instances) fraud is disturbing. But to successfully rebuild, we need more than reactionary policies; we need structural reform that takes us out of a polarized us versus them mentality, and gives a meaningful voice to everyone.
We seem to have an ongoing argument in our country about economic philosophy and what spurs growth. Do guaranteed high wages for the working class produce consumers who drive economic growth, or only cause inflation? Do protected high profits for the business elite produce investors who create jobs or just an exclusive wealthy class that leaves everyone else behind? Smith points out that it used to be that 50% of profits went back into a business for research and development, new markets, and worker training and pay, but now 91% of profits goes to shareholders. In a less polarized system, where power isn’t concentrated in business, in government, or in parties . . . but in the people, giving everyone a voice, we might have the freedom to grow and work together to find the right balance in these competing philosophies, without pressure to pick one side as an all or nothing alternative to be implemented through sheer force of will.
Smith indeed includes a section about our broken political process, how gerrymandering has created less competitive elections, and a more polarized government with gridlock and an inability to get even the most simple tasks done. In addition to campaign finance reform, Smith talks about the need for reforming the primary system to include open primaries and nonpartisan primaries. As is often the case, this is couched as important in order to revive the political center, the moderates. It may just be a matter of semantics, but I support nonpartisan primaries for a different reason. Unfortunately, “the moderates,” also traditionally known as “the establishment” are part of the problem. A big reason we are where we are is because the moderates have caved to the parties, the special interests, and the power. While it’s true that we need people who can think through our challenges in an open-minded, problem-solving manner, and not a dogmatic, ideological, wedge-driven manner to find cross partisan solutions; we also need people who are not afraid to stand up for unpopular positions when they make more sense than the popular positions. For this reason, I don’t like to talk about electoral reform as a means to the end of “electing moderates.” Any electoral system that’s implemented to get a particular ideological outcome is no electoral system at all. I support open primaries and nonpartisan primaries and other electoral reform because it gives candidates greater access to the ballot, gives people an equal voice in our process, and provides for greater choice and competition in our election system, and thus holds elected officials more accountable. With technology and globalization, our very way of life is changing. We’ll never bring back the economy of the past, which means that we need to work together to innovate our way to a new economy that works for everyone. Smith offers up many needed changes; but we need structural reform to help us build consensus as to how it will happen, and what specific policy proposals will be implemented.
Tiani Xochitl Coleman is a mother of five, a graduate of Cornell Law School, and president of NH Independent Voters.