Robert Reich – “Saving Capitalism: For the Many, Not the Few”

Information on the Book
Title: Saving Capitalism: For the Many, Not the Few (also a Netflix documentary)
Author: Robert Reich
Bio:

• Chancellor’s Professor of Public Policy at the University of California at Berkeley
• Senior Fellow at the Blum Center; Served as Secretary of Labor in the Clinton admin
• Major Works: “Aftershock,” “The Work of Nations,” “Beyond Outrage,” and “The Common Good.”

Summary
America was once celebrated for and defined by its large and prosperous middle class. Now, this middle class is shrinking, a new oligarchy is rising, and the country faces its greatest wealth disparity in eighty years. Why is the economic system that made America strong suddenly failing us, and how can it be fixed? 

Leading political economist and bestselling author Robert B. Reich presents a paradigm-shifting, clear-eyed examination of a political and economic status quo that no longer serves the people, exposing one of the most pernicious obstructions to progress today: the enduring myth of the “free market” when, behind the curtain, it is the powerful alliances between Washington and Wall Street that control the invisible hand. Laying to rest the specious dichotomy between a free market and “big government,” Reich shows that the truly critical choice ahead is between a market organized for broad-based prosperity and one designed to deliver ever more gains to the top. Visionary and acute, Saving Capitalism illuminates the path toward restoring America’s fundamental promise of opportunity and advancement.

Review
Robert Reich provides insight into how America’s economic system is flawed. The problem is not how to frame the ‘free market’ vs government debate, but how to structure the government and the rules set by it. 

I had always wondered why there was an inequality problem in America. This book explains why. Nothing is actually “free” about the American economic system. In fact, it boxes in people and unknowingly (or knowingly) takes away wealth from the middle class and funnels it to the top. 

The rules are made in favor of those with economic power; the more economic power, the more political influence, vice versa. The lack of opportunities for the working middle class to climb up the ladder has little to do with their ability to work, but their inability to influence the rules that are disproportionately in favor of the rich. The fact that wages have stagnated while labor productivity has increased is proof of this. 

Just like elections, richer people have more opportunities to influence the economy. Actually, elections are another way the rich gain access to politicians who will create/kill legislation aiding/against their interests. 

This book is relevant today because President Trump seems to think that lowering taxes on the wealthy and their corporations will help the middle-class. This trickle-down theory is wrong, especially considering the enlarging gap between the wealthy and the poor. 

Once you learn that the system favors corporations, the fact that Amazon has not paid corporate taxes (paid $162 million in 2019 – amounting to 1.2% of the company’s pre-tax income; not even close to the 21% corporate tax rate) will not surprise you.

There are shocking statistics everywhere in the book, including the fact that the Walmart heirs own more wealth than the bottom 40 percent of Americans. Another interesting point was that heirs can receive inheritances without being taxed for the wealth accumulated by their ancestors. This was news to me, since I’m neither American nor an heir to a corporate conglomerate.

The message at the end of the book is this: it’s time for people to stand up and make politicians listen to them, not the rich. A good first step would be to vote in elections and push members of Congress to vote against legislation that helps consolidate this system. 

Image: The White House