"Reaganomics killed America's middle class," and "the old deal that held US society together started to unwind."

Photo credit.

Following are two topics raised during the Tuesday "Chew On This" discussion about what divides Americans.

Tuesday night, we chewed on THAT.

Starting the conversation here.

A return to Piketty: "Reaganomics killed America's middle class."

There’s nothing “normal” about having a middle class. Having a middle class is a choice that a society has to make, and it’s a choice we need to make again in this generation, if we want to stop the destruction of the remnants of the last generation’s middle class ...

... Capitalism is not an economic system that produces a middle class. In fact, if left to its own devices, capitalism tends towards vast levels of inequality and monopoly. The natural and most stable state of capitalism actually looks a lot like the Victorian England depicted in Charles Dickens’ novels.

Continuing it here.

Decline and fall: how American society unravelled, by George Packer (The Guardian)

Thirty Forty years ago, the old deal that held US society together started to unwind, with social cohesion sacrificed to greed. Was it an inevitable process – or was it engineered by self-interested elites?

 ... The large currents of the past generation – deindustrialisation, the flattening of average wages, the financialisation of the economy, income inequality, the growth of information technology, the flood of money into Washington, the rise of the political right – all had their origins in the late 70s. The US became more entrepreneurial and less bureaucratic, more individualistic and less communitarian, more free and less equal, more tolerant and less fair. Banking and technology, concentrated on the coasts, turned into engines of wealth, replacing the world of stuff with the world of bits, but without creating broad prosperity, while the heartland hollowed out. The institutions that had been the foundation of middle-class democracy, from public schools and secure jobs to flourishing newspapers and functioning legislatures, were set on the course of a long decline. It as a period that I call the Unwinding.

In one view, the Unwinding is just a return to the normal state of American life. By this deterministic analysis, the US has always been a wide-open, free-wheeling country, with a high tolerance for big winners and big losers as the price of equal opportunity in a dynamic society. If the US brand of capitalism has rougher edges than that of other democracies, it is worth the trade-off for growth and mobility. There is nothing unusual about the six surviving heirs to the Walmart fortune possessing between them the same wealth as the bottom 42% of Americans – that's the country's default setting. Mark Zuckerberg and Bill Gates are the reincarnation of Henry Ford and Andrew Carnegie, Steven Cohen is another JP Morgan, Jay-Z is Jay Gatsby.

The rules and regulations of the Roosevelt Republic were aberrations brought on by accidents of history – depression, world war, the cold war – that induced Americans to surrender a degree of freedom in exchange for security. There would have been no Glass-Steagall Act, separating commercial from investment banking, without the bank failures of 1933; no great middle-class boom if the US economy had not been the only one left standing after the second world war; no bargain between business, labour and government without a shared sense of national interest in the face of foreign enemies; no social solidarity without the door to immigrants remaining closed through the middle of the century.

Once American pre-eminence was challenged by international competitors, and the economy hit rough seas in the 70s, and the sense of existential threat from abroad subsided, the deal was off. Globalisation, technology and immigration hurried the Unwinding along, as inexorable as winds and tides. It is sentimental at best, if not ahistorical, to imagine that the social contract could ever have survived – like wanting to hang on to a world of nuclear families and manual typewriters ...

A long multiple-bourbon Sunday read: "The End of Our World Order Is Imminent."

That's a tad bouncy, so maybe Ministry is better.

At any rate, the following strikes me as essentially correct. I've never bought into Manifest Destiny, or thought that America's post-WWII hegemony was about much of anything beyond expanding markets at the point of a bayonet. There are numerous wonderful aspects of life as an American, and most of them exist side by side with unpleasant, uncomfortable and inconvenient truths.

This doesn't mean one stops trying to make the world a better place, only that they pause on occasion to acknowledge reality.

The End of Our World Order Is Imminent, by Alfred McCoy (The Nation)

At least 200 empires have risen and fallen over the course of history, and the United States will be no exception.

Once upon a time in America, we could all argue about whether or not US global power was declining. Now, most observers have little doubt that the end is just a matter of timing and circumstance. Ten years ago, I predicted that, by 2025, it would be all over for American power, a then-controversial comment that’s commonplace today. Under President Donald Trump, the once “indispensable nation” that won World War II and built a new world order has become dispensable indeed.

The decline and fall of American global power is, of course, nothing special in the great sweep of history. After all, in the 4,000 years since humanity’s first empire formed in the Fertile Crescent, at least 200 empires have risen, collided with other imperial powers, and in time collapsed. In the past century alone, two dozen modern imperial states have fallen and the world has managed just fine in the wake of their demise.

The global order didn’t blink when the sprawling Soviet empire imploded in 1991, freeing its 15 “republics” and seven “satellites” to become 22 newly capitalist nations. Washington took that epochal event largely in stride. There were no triumphal demonstrations, in the tradition of ancient Rome, with manacled Russian captives and their plundered treasures paraded down Pennsylvania Avenue. Instead, a Manhattan real-estate developer bought a 20-foot chunk of the Berlin Wall for display near Madison Avenue, a sight barely noticed by busy shoppers.

For those trying to track global trends for the next decade or two, the real question is not the fate of American global hegemony, but the future of the world order it began building at the peak of its power, not in 1991, but right after World War II. For the past 75 years, Washington’s global dominion has rested on a “delicate duality.” The raw realpolitik of US military bases, multinational corporations, CIA coups, and foreign military interventions has been balanced, even softened, by a surprisingly liberal world order—with sovereign states meeting as equals at the United Nations, an international rule of law that muted armed conflict, a World Health Organization that actually eradicated epidemic diseases which had plagued humanity for generations, and a developmental effort led by the World Bank that lifted 40% of humanity out of poverty.

Some observers remain supremely confident that Washington’s world order can survive the inexorable erosion of its global power. Princeton political scientist G. John Ikenberry, for example, has essentially staked his reputation on that debatable proposition. As US decline first became apparent in 2011, he argued that Washington’s ability to shape world politics would diminish, but “the liberal international order will survive and thrive,” preserving its core elements of multilateral governance, free trade, and human rights. Seven years later, amid a rise of anti-global nationalists across significant parts of the planet, he remains optimistic that the American-made world order will endure because international issues such as climate change make its “protean vision of interdependence and cooperation… more important as the century unfolds.”

This sense of guarded optimism is widely shared among foreign-policy elites in the New York-Washington corridor of power. The president of the influential Council on Foreign Relations, Richard Haass, has typically argued that the “post-Cold War order cannot be restored, but the world is not yet on the edge of a systemic crisis.” Through deft diplomacy, Washington could still save the planet from “deeper disarray” or even “trends that spell catastrophe.”

But is it true that the decline of the planet’s “sole superpower” (as it was once known) will no more shake the present world order than the Soviet collapse once did? To explore what it takes to produce just such an implosion of a world order, it’s necessary to turn to history—to the history, in fact, of collapsing imperial orders and a changing planet ...

"Human nature does not change, but social structures can, and they did."

The book is called "The Unwinding: An Inner History of the New American Era," written by George Packer, and released in May 2013. It's food for thought as one prepares for a 35th high school reunion ... class of 1978, square in the middle of the time of which Packer speaks.

Decline and fall: how American society unravelled, by George Packer (The Guardian)

Thirty years ago, the old deal that held US society together started to unwind, with social cohesion sacrificed to greed. Was it an inevitable process – or was it engineered by self-interested elites?

... Americans were no less greedy, ignorant, selfish and violent then than they are today, and no more generous, fair-minded and idealistic. But the institutions of American democracy, stronger than the excesses of individuals, were usually able to contain and channel them to more useful ends. Human nature does not change, but social structures can, and they did.

At the time, the late 1970s felt like shapeless, dreary, forgettable years. Jimmy Carter was in the White House, preaching austerity and public-spiritedness, and hardly anyone was listening. The hideous term "stagflation", which combined the normally opposed economic phenomena of stagnation and inflation, perfectly captured the doldrums of that moment. It is only with the hindsight of a full generation that we can see how many things were beginning to shift across the American landscape, sending the country spinning into a new era.