There are lots of reviews of this little book, which I read today. I think that its main point that the lopsided wealth distribution with the top 10% holding 30% of the net worth of the population and the Middle Class income remaining unchanged since 1975 while productivity has increased another 20%, is at the core of the political-economic problems facing this nation.
This paints a picture of stupidity by most Americans in thinking that politicians are either the cause or the cure of long-term problems, and so the anger at incumbents is largely misplaced and ineffective. It may be the result of a misinformation campaign waged by that powerful minority of wealthy with international connections and concerns which if revealed would call into doubt their patriotism, whatever party they are in. Reich takes pains to explain how politicians and Wall Street are not at the root of the problem, that the lopsided wealth distribution is.
The most critical remarks about the book's proposals have to do with its Progressive style of fixes, creating more taxes on the rich and spreading the windfall to the poor and disadvantaged. These are very unpopular ideas right now because most people don't understand what creating a permanent under-class would do and because they admire the greed and focus of people that have made it, regardless of how.
We DO need to tax the rich more, but not make it a direct redistribution of income, but make taxes a tool to control how the wealthy use their money in this society.
I have observed in my writings some of the same economic principles that Reich describes in his book having more wealth than you can use makes your use of it inefficient unless it is invested properly, which the Crisis of 2008 showed was not sound investment by people who had control of huge quantities of wealth, and that appreciation of the top-end of a price distribution drags up the price in the entire distribution, This drove the housing bubble as the asking prices were a dangerous percentage of the net income of many borrowers who are now in foreclosure.
Reich's dire scenario for the 2020 election, in which a Libertarian-style Independent Party takes the election from the Democrats and Republicans, Abolishes the Fed, and pushes the nation in isolation behind import tarrifs and withdraw from world bodies, is just the Reactionary fantasy that plunges the world into another Depression. It would play out a cycle in US History between a prospering Middle Class and a prospering Plutocracy each at the expense of the other, the key chart in the book is the percentage of wealth held by the top 10% which peaked in the 1890's, 1828, and 2007, each before major market crashes and recessions. It is a lesson we seem to need to learn about over and over, forgetting about it when the last generation to suffer has died off.
Reich goes on the describe the pretty-standard Left of Center proposals that have been around for a long time and makes them targets for dismissal by many people who think that the government should not be helping the disadvantaged, except of course that a much larger percentage of the population is being disadvantaged by the economic shift and that the only thing that prevents the anger from spilling out onto the streets is that many Americans blame politicians, which is largely a misplaced anger, and that they admire wealthy and successful people, wanting to become like them, not having realized that these people have gotten more wealthy and have more power at their own expense. When that realization reaches a tipping-point there will be a sea change in American politics that has never occurred before, because America has always had a way to grow out of its inequalities. That may not be true anymore, and with no Frontier, recalling that even during the Great Depression of the 1930's that migration was a way out. I think that Reich's Reactionary political swing will either not happen or it will quickly be overtaken by outside events, such as a world war.
It would be easy for Congress to roll back the perks given the rich especially since 1980 without earmarking the money for a dole, but if history is any guide, the cycle of inequality may already be forming its response which will have exactly the same effect as a tax on the wealthy. The critics of the New Deal claimed that it was WW II that ended the Great Depression and regardless of whether this was true or not, the world wide economic collapse of the 1930's made it easier for dictators of all sorts to come to power and wage war. So, if bad economics sowed dragon's teeth, the rich
wound up paying a tax. It is just too bad that more than 25 Million people had to pay with their lives as a result.
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