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Sunday, September 1, 2013

Hedrick Smith. Who Stole the American Dream?

Hedrick Smith.  Who Stole the American Dream?  ©2012  For the last several years I have been addicted to national and business news.  As a result I found almost nothing new in this book.  Instead I found the most comprehensive and well thought out statement of how shifts in the attitudes of corporate leadership beginning in the early 1970s did just what the title of the book suggests.  Corporate America, aided and abetted by Congress stole the American dream and handed it over to the top 1%, who now account for 23% of all income in the US.  We went from a society with a strong manufacturing sector that provided jobs, decent incomes and pensions for its workers to a society that provides none of that.  In the virtuous circle that prevailed from the end of WW II through the 1960s, workers were well paid and felt their futures were secure.  As a result their spending provided the demand that allowed the economy to continue to grow.  Corporate decisions beginning in the 1970s and perhaps a thousand fold increase in lobbying expenditures resulted in legislation that ended the virtuous circle and benefitted only the very wealthy, the so called “1%.”  This gift to the rich was provided by a Congress that now spends its time raising campaign money instead of looking after the people’s business.  About 50% of baby boomers can look forward to living in poverty until the end of their lives.  Read this book or if you can’t take it all in, read the appendix, which is a chronology of how our economy became so warped that we have an extreme maldistribution of income and millions of formerly so called middle class people living in poverty with little or no hope of ever attaining financial security.  So what do we do about it?  Smith’s answer is political activism.  He lays out a series of recommendations that would basically take us back to the successful traditions of the past where administrations from George Washington through maybe Bill Clinton took leadership to develop infrastructure and promote technological development.   When government performs its leadership role, everyone benefits, both business and the people at large.

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