Published in 2012, way before Donald’s Trump rise to power. Excerpt.
Many Americans no doubt still believe in the American dream. One wonders how long they can maintain that illusion, for America is transforming itself into one of the most unfair, most rigid, and least socially mobile of the industrialized countries. In the United States, parental income now has about a 50 percent weight in determining a child’s lifetime economic prospects. Germany, Sweden, and even class-ridden France are now fairer and more upwardly mobile societies than the United States—on average, parental incomes have only about a 30 percent weight in determining the next generation’s outcomes. The truly equitable, high-mobility societies are Canada, Norway, Denmark, and Finland, where parental income accounts for only about 20 percent of a child’s lifetime earnings. Even many “developing” nations, such as Taiwan and South Korea, now have levels of opportunity and fairness that exceed America’s. For example, someone born into a poor family in South Korea or Taiwan now has a much higher probability of graduating from high school, and exiting poverty, than someone born into a poor family in America. Many of these nations’ citizens also have longer life expectancies than Americans.
And now the day is past when even a college education in America is either financially available to everyone or a sure ticket to a good life. Technology, globalization, and corporate decisions have been compressing wages and outsourcing many white-collar jobs, much as they have been squeezing blue-collar employment. Now to make your way securely into the upper middle class, you need a degree from an elite institution and/or a graduate degree. And the students who can attend those elite schools come overwhelmingly from the wealthiest families in America. In fact, higher education of all kinds—college and graduate school, private and public, elite and average—has been getting sharply more expensive, and access to it sharply more unequal. With the squeeze on state and local government budgets, even state and community colleges are getting very expensive, so children from working-class or poor families must increasingly choose between not attending college or graduating with mountains of debt. As a result, American college graduation rates have stagnated, and now trail those of many other nations.
Now, having squandered trillions on mismanaged wars, tax cuts designed especially for the rich, a gigantic real estate bubble, and massive bailouts for its banks, the United States is confronting major fiscal problems. At the same time, America’s fundamental economic competitiveness has declined severely, as its physical infrastructure, broadband services, educational system, workforce skills, health care, and energy policies have failed to keep pace with the needs of an advanced economy. However, as we shall see later, this is not solely, or even primarily, a matter of money; it is a matter of policy and priorities. In some areas, insufficient government spending is indeed an issue. But in many areas, such as health care, the United States as a society is actually spending far more than other nations, without, however, obtaining the same results.
The principal reason for this is that politically powerful interest groups have been able to block reform: the financial services, energy, defense, telecommunications, pharmaceutical, and processed-food industries; the legal, accounting, and medical professions; and to a lesser extent, several unions—these and other groups, including, of course, lobbyists and politicians, have ferociously resisted efforts to improve America’s future at their expense.
Meanwhile, both political parties are ignoring, lying about, and/or exploiting the country’s very real economic, social, and educational problems. This process is starting to generate an additional danger: demagoguery. As America deteriorates, religious and political extremists are beginning to exploit the growing insecurity and discontent of the population. Thus far, this has principally taken the form of attacks on the federal government, taxes, and social spending. However, sometimes it is also taking more extreme forms: antiscientific fundamentalist Christianity; attacks on education, the teaching of evolution, vaccines, and scientific activity; and demonization of various groups such as immigrants, Muslims, and the poor.
Presiding over all this is an impressive, though utterly cynical, innovation on the part of American politicians: the political duopoly. Over the past quarter century, the leaders of both political parties have perfected a remarkable system for remaining in power while serving America’s new oligarchy. Both parties take in huge amounts of money, in many forms—campaign contributions, lobbying, revolving-door hiring, favors, and special access of various kinds. Politicians in both parties enrich themselves and betray the interests of the nation, including most of the people who vote for them. Yet both parties are still able to mobilize support because they skillfully exploit America’s cultural polarization. Republicans warn social conservatives about the dangers of secularism, taxes, abortion, welfare, gay marriage, gun control, and liberals. Democrats warn social liberals about the dangers of guns, pollution, global warming, making abortion illegal, and conservatives. Both parties make a public show of how bitter their conflicts are, and how dangerous it would be for the other party to achieve power, while both prostitute themselves to the financial sector, powerful industries, and the wealthy. Thus, the very intensity of the two parties’ differences on “values” issues enables them to collaborate when it comes to money.
Since the 2008 financial crisis, federal policy has subsidized banks and bankers enormously, while extending the Bush administration’s tax cuts for the wealthy. With their bonuses and their industry restored, the fake humility of the bankers who begged for federal assistance has now been forgotten. So, unfortunately, has the fact that when the banks were desperate and dependent in 2008 and 2009, the federal government had an unparalleled opportunity to finally bring them under control—an opportunity that both the Bush and Obama administrations completely wasted and ignored. These same bankers are now among the first to warn about federal deficits, to insist on more tax cuts to stay competitive, and to warn darkly that any further regulation will strangle the “innovation” that made them rich, even as it destroyed the world economy.
But they can be expected to behave that way. Over the last thirty years, the economic interests of the top 1 percent, who now control the country’s wealth, businesses, and politics, have diverged sharply from those of other Americans.