Best Commencement Address

This Is Water

There are these two young fish swimming along, and they happen to meet an older fish swimming the other way, who nods at them and says, “Morning, boys, how's the water?” And the two young fish swim on for a bit, and then eventually one of them looks over at the other and goes, “What the hell is water?”

If at this moment you're worried that I plan to present myself here as the wise old fish explaining what water is to you younger fish, please don't be. I am not the wise old fish. The immediate point of the fish story is that the most obvious, ubiquitous, important realities are often the ones that are the hardest to see and talk about. Stated as an English sentence, of course, this is just a banal platitude-but the fact is that, in the day-to-day trenches of adult existence, banal platitudes can have life-or-death importance. That may sound like hyperbole, or abstract nonsense. So let's get concrete…

A huge percentage of the stuff that I tend to be automatically certain of is, it turns out, totally wrong and deluded. Here's one example of the utter wrongness of something I tend to be automatically sure of: Everything in my own immediate experience supports my deep belief that I am the absolute center of the universe, the realest, most vivid and important person in existence. We rarely talk about this sort of natural, basic self centeredness, because it's so socially repulsive, but it's pretty much the same for all of us, deep down. It is our default-setting, hard-wired into our boards at birth. Think about it: There is no experience you've had that you were not at the absolute center of. The world as you experience it is right there in front of you, or behind you, to the left or right of you, on your TV, or your monitor, or whatever. Other people's thoughts and feelings have to be communicated to you somehow, but your own are so immediate, urgent, real-you get the idea. But please don't worry that I'm getting ready to preach to you about compassion or other-directedness or the so-called “virtues.” This is not a matter of virtue-it's a matter of my choosing to do the work of somehow altering or getting free of my natural, hard-wired default-setting, which is to be deeply and literally self-centered, and to see and interpret everything through this lens of self.

By way of example, let's say it's an average day, and you get up in the morning, go to your challenging job, and you work hard for nine or ten hours, and at the end of the day you're tired, and you're stressed out, and all you want is to go home and have a good supper and maybe unwind for a couple of hours and then hit the rack early because you have to get up the next day and do it all again. But then you remember there's no food at home-you haven't had time to shop this week, because of your challenging job-and so now after work you have to get in your car and drive to the supermarket. It's the end of the workday, and the traffic's very bad, so getting to the store takes way longer than it should, and when you finally get there the supermarket is very crowded, because of course it's the time of day when all the other people with jobs also try to squeeze in some grocery shopping, and the store's hideously, fluorescently lit, and infused with soul-killing Muzak or corporate pop, and it's pretty much the last place you want to be, but you can't just get in and quickly out. You have to wander all over the huge, overlit store's crowded aisles to find the stuff you want, and you have to maneuver your junky cart through all these other tired, hurried people with carts, and of course there are also the glacially slow old people and the spacey people and the ADHD kids who all block the aisle and you have to grit your teeth and try to be polite as you ask them to let you by, and eventually, finally, you get all your supper supplies, except now it turns out there aren't enough checkout lanes open even though it's the end-of-the-day rush, so the checkout line is incredibly long, which is stupid and infuriating, but you can't take your fury out on the frantic lady working the register.

Anyway, you finally get to the checkout line's front, and pay for your food, and wait to get your check or card authenticated by a machine, and then get told to “Have a nice day” in a voice that is the absolute voice of death, and then you have to take your creepy flimsy plastic bags of groceries in your cart through the crowded, bumpy, littery parking lot, and try to load the bags in your car in such a way that everything doesn't fall out of the bags and roll around in the trunk on the way home, and then you have to drive all the way home through slow, heavy, SUV- intensive rush-hour traffic, et cetera, et cetera.

The point is that petty, frustrating crap like this is exactly where the work of choosing comes in. Because the traffic jams and crowded aisles and long checkout lines give me time to think, and if I don't make a conscious decision about how to think and what to pay attention to, I'm going to be pissed and miserable every time I have to foodshop, because my natural default-setting is the certainty that situations like this are really all about me, about my hungriness and my fatigue and my desire to just get home, and it's going to seem, for all the world, like everybody else is just in my way, and who are all these people in my way? And look at how repulsive most of them are and how stupid and cow-like and dead-eyed and nonhuman they seem here in the checkout line, or at how annoying and rude it is that people are talking loudly on cell phones in the middle of the line, and look at how deeply unfair this is: I've worked really hard all day and I'm starved and tired and I can't even get home to eat and unwind because of all these stupid goddamn people.

Or, of course, if I'm in a more socially conscious form of my default-setting, I can spend time in the end-of-theday traffic jam being angry and disgusted at all the huge, stupid, lane-blocking SUVs and Hummers and V-12 pickup trucks burning their wasteful, selfish, forty-gallon tanks of gas, and I can dwell on the fact that the patriotic or religious bumper stickers always seem to be on the biggest, most disgustingly selfish vehicles driven by the ugliest, most inconsiderate and aggressive drivers, who are usually talking on cell phones as they cut people off in order to get just twenty stupid feet ahead in a traffic jam, and I can think about how our children's children will despise us for wasting all the future's fuel and probably screwing up the climate, and how spoiled and stupid and disgusting we all are, and how it all just sucks, and so on and so forth…

Look, if I choose to think this way, fine, lots of us do-except that thinking this way tends to be so easy and automatic it doesn't have to be a choice. Thinking this way is my natural default-setting. It's the automatic, unconscious way that I experience the boring, frustrating, crowded parts of adult life when I'm operating on the automatic, unconscious belief that I am the center of the world and that my immediate needs and feelings are what should determine the world's priorities. The thing is that there are obviously different ways to think about these kinds of situations. In this traffic, all these vehicles stuck and idling in my way: It's not impossible that some of these people in SUVs have been in horrible auto accidents in the past and now find driving so traumatic that their therapist has all but ordered them to get a huge, heavy SUV so they can feel safe enough to drive; or that the Hummer that just cut me off is maybe being driven by a father whose little child is hurt or sick in the seat next to him, and he's trying to rush to the hospital, and he's in a way bigger, more legitimate hurry than I am-it is actually I who am in his way. And so on.

Again, please don't think that I'm giving you moral advice, or that I'm saying you're “supposed to” think this way, or that anyone expects you to just automatically do it, because it's hard, it takes will and mental effort, and if you're like me, some days you won't be able to do it, or you just flat-out won't want to. But most days, if you're aware enough to give yourself a choice, you can choose to look differently at this fat, dead-eyed, over-made-lady who just screamed at her little child in the checkout line-maybe she's not usually like this; maybe she's been up three straight nights holding the hand of her husband who's dying of bone cancer, or maybe this very lady is the low-wage clerk at the Motor Vehicles Department who just yesterday helped your spouse resolve a nightmarish red-tape problem through some small act of bureaucratic kindness. Of course, none of this is likely, but it's also not impossible-it just depends on what you want to consider. If you're automatically sure that you know what reality is and who and what is really important-if you want to operate on your default-setting-then you, like me, will not consider possibilities that aren't pointless and annoying. But if you've really learned how to think, how to pay attention, then you will know you have other options. It will actually be within your power to experience a crowded, loud, slow, consumer hell-type situation as not only meaningful but sacred, on fire with the same force that lit the stars-compassion, love, the sub-surface unity of all things. Not that that mystical stuff's necessarily true: The only thing that's capital-T True is that you get to decide how you're going to try to see it. You get to consciously decide what has meaning and what doesn't. You get to decide what to worship…

Because here's something else that's true. In the day-to-day trenches of adult life, there is actually no such thing as atheism. There is no such thing as not worshipping. Everybody worships. The only choice we get is what to worship. And an outstanding reason for choosing some sort of God or spiritual-type thing to worship-be it J.C. or Allah, be it Yahweh or the Wiccan mother-goddess or the Four Noble Truths or some infrangible set of ethical principles-is that pretty much anything else you worship will eat you alive. If you worship money and things-if they are where you tap real meaning in life-then you will never have enough. Never feel you have enough. It's the truth. Worship your own body and beauty and sexual allure and you will always feel ugly, and when time and age start showing, you will die a million deaths before they finally plant you. On one level, we all know this stuff already-it's been codified as myths, proverbs, clichés, bromides, epigrams, parables: the skeleton of every great story. The trick is keeping the truth up-front in daily consciousness. Worship power-you will feel weak and afraid, and you will need ever more power over others to keep the fear at bay. Worship your intellect, being seen as smart-you will end up feeling stupid, a fraud, always on the verge of being found out. And so on.

Look, the insidious thing about these forms of worship is not that they're evil or sinful; it is that they are unconscious. They are default-settings. They're the kind of worship you just gradually slip into, day after day, getting more and more selective about what you see and how you measure value without ever being fully aware that that's what you're doing. And the world will not discourage you from operating on your default-settings, because the world of men and money and power hums along quite nicely on the fuel of fear and contempt and frustration and craving and the worship of self. Our own present culture has harnessed these forces in ways that have yielded extraordinary wealth and comfort and personal freedom. The freedom to be lords of our own tiny skull-sized kingdoms, alone at the center of all creation. This kind of freedom has much to recommend it. But of course there are all different kinds of freedom, and the kind that is most precious you will not hear much talked about in the great outside world of winning and achieving and displaying. The really important kind of freedom involves attention, and awareness, and discipline, and effort, and being able truly to care about other people and to sacrifice for them, over and over, in myriad petty little unsexy ways, every day. That is real freedom. The alternative is unconsciousness, the default-setting, the “rat race”-the constant gnawing sense of having had and lost some infinite thing.

I know that this stuff probably doesn't sound fun and breezy or grandly inspirational. What it is, so far as I can see, is the truth with a whole lot of rhetorical bullshit pared away. Obviously, you can think of it whatever you wish. But please don't dismiss it as some finger-wagging Dr. Laura sermon. None of this is about morality, or religion, or dogma, or big fancy questions of life after death. The capital-T Truth is about life before death. It is about making it to thirty, or maybe fifty, without wanting to shoot yourself in the head. It is about simple awareness-awareness of what is so real and essential, so hidden in plain sight all around us, that we have to keep reminding ourselves, over and over: “This is water, this is water.”

It is unimaginably hard to do this, to stay conscious and alive in the adult world day in and day out. Which means yet another grand cliché turns out to be true: your education really IS the job of a lifetime. And it commences: now.

I wish you way more than luck.

David Foster Wallace

Kenyon College Commencement Address

2005

FOOTNOTES

The Sham of Corporate Social Responsibility

Corporations Will Not Save Us: The Sham of Corporate Social Responsibility

Last August, the Business Roundtable – an association of CEOs of America’s biggest corporations – announced with great fanfare a “fundamental commitment to all of our stakeholders” and not just their shareholders. 

They said “investing in employees, delivering value to customers, and supporting outside communities“ is now at the forefront of their business goals — not maximizing profits.

Baloney. Corporate social responsibility is a sham.

One Business Roundtable director is Mary Barra, CEO of General Motors. Just weeks after making the Roundtable commitment, and despite GM’s hefty profits and large tax breaks, Barra rejected workers’ demands that GM raise their wages and stop outsourcing their jobs. Earlier in the year GM shut its giant assembly plant in Lordstown, Ohio.

Nearly 50,000 GM workers then staged the longest auto strike in 50 years. They won a few wage gains but didn’t save any jobs. Barra was paid $22 million last year. How’s that for corporate social responsibility?

Another prominent CEO who made the phony Business Roundtable commitment was AT&T’s Randall Stephenson, who promised to use the billions in savings from the Trump tax cut to invest in the company’s broadband network and create at least 7,000 new jobs. 

Instead, even before the coronavirus pandemic, AT&T cut more than 23,000 jobs and demanded that employees train lower-wage foreign workers to replace them.

Let’s not forget Jeff Bezos, CEO of Amazon and its Whole Foods subsidiary. Just weeks after Bezos made the Business Roundtable commitment, Whole Foods announced it would be cutting medical benefits for its entire part-time workforce.

The annual saving to Amazon from this cost-cutting move is roughly what Bezos – whose net worth is $117 billion – makes in a few hours. Bezos’ wealth grows so quickly, this number has gone up since you started watching this video.

GE’s CEO Larry Culp is also a member of the Business Roundtable. Two months after he made the commitment to all his stakeholders, General Electric froze the pensions of 20,000 workers in order to cut costs. So much for investing in employees.

Dennis Muilenburg, the former CEO of Boeing, also committed to the phony Business Roundtable pledge. Shortly after making the commitment to “deliver value to customers,” Muilenburg was fired for failing to act to address the safety problems that caused the 737 Max crashes that killed 346 people.  After the crashes, he didn’t issue a meaningful apology or even express remorse to the victims’ families and downplayed the severity of the fallout to investors, regulators, airlines, and the public. He was rewarded with a $62 million farewell gift from Boeing on his way out.

Oh, and the chairman of the Business Roundtable is Jamie Dimon, CEO of Wall Street’s largest bank, JPMorgan Chase. Dimon lobbied Congress personally and intensively for the biggest corporate tax cut in history, and got the Business Roundtable to join him. JPMorgan raked in $3.7 billion from the tax cut. Dimon alone made $31 million in 2018.

That tax cut increased the federal debt by almost $2 trillion. This was before Congress spent almost $3 trillion fighting the pandemic – and delivering a hefty portion as bailouts to the biggest corporations, many of whom signed the Business Roundtable pledge. 

As usual, almost nothing has trickled down to America’s working class and poor.

The truth is, American corporations are sacrificing workers and communities as never before in order to further boost runaway profits and unprecedented CEO pay. And not even a tragic pandemic is changing that.

Americans know this. A record 76 percent of U.S. adults believe major corporations have too much power.

The only way to make corporations socially responsible is through laws requiring them to be – for example, giving workers a bigger voice in corporate decision making, requiring that corporations pay severance to communities they abandon, raising corporate taxes, busting up monopolies, and preventing dangerous products (including faulty airplanes) from ever reaching the light of day.

If the CEOs of the Business Roundtable and other corporations were truly socially responsible, they’d support such laws, not make phony promises they clearly have no intention of keeping. Don’t hold your breath.

The only way to get such laws enacted is by reducing corporate power and getting big money out of our politics.

The first step is to see corporate social responsibility for the sham it is. The next step is to emerge from this pandemic and economic crisis more resolved than ever to rein in corporate power, and make the economy work for all. 

Robert Reich

May 5, 2020

The False Narrative of Vote-by-Mail Fraud

If we are to have safe, healthy, and fair elections this year in the face one of the worst pandemics in a century, Americans must make widespread use of mail ballots. Election administrators and other leaders from across the political spectrum have urged support to make the necessary adjustments to their election infrastructure. They recognize we have no choice. Most Americans, including a majority of Republicans, agree.

President Trump and his allies, however, are pushing back against this option, raising spurious claims that fraudulent mail ballots will contaminate the election. “I think a lot of people cheat with mail-in voting,” Trump said earlier this week. “Mail in voting is a terrible thing. . . . I think if you vote, you should go,” he later added, not long after he requested a vote-by-mail ballot for the Florida primary. Shortly afterward, Republican National Committee Chairwoman Ronna McDaniel echoed the president in a Fox News op-ed. (This is in sharp contrast to former chairman Michael Steele, who coauthored an op-ed arguing that “the current emergency demands expanded use of vote-by-mail,” and that “democracy depends on it.”)

Trump’s claims are wrong, and if used to prevent states from taking the steps needed to ensure public safety during November’s election, they will be deadly wrong. Mail ballot fraud is incredibly rare, and legitimate security concerns can be easily addressed.

Mail balloting is not a newfangled idea; it was already deeply embedded in the American electoral system before the coronavirus hit. In the last two federal elections, roughly one out of every four Americans cast a mail ballot. In five states — Colorado, Hawaii, Oregon, Utah, and Washington — mail balloting has been the primary method of voting. In 28 additional states, all voters have had the right to vote by mail ballot if they choose, without having to provide any reason or excuse. Over time, a growing number of voters have chosen that option. Since 2000 more than 250 million votes have been cast via mailed-out ballots, in all 50 states, according to the Vote at Home Institute. In 2018, more than 31 million Americans cast their ballots by mail, about 25.8 percent of election participants.

Despite this dramatic increase in mail voting over time, fraud rates remain infinitesimally small. None of the five states that hold their elections primarily by mail has had any voter fraud scandals since making that change. As the New York Times editorial board notes, “states that use vote-by-mail have encountered essentially zero fraud: Oregon, the pioneer in this area, has sent out more than 100 million mail-in ballots since 2000, and has documented only about a dozen cases of proven fraud.” Rounded to the seventh decimal point, that’s 0.0000001 percent of all votes cast. An exhaustive investigative journalism analysis of all known voter fraud cases identified only 491 cases of absentee ballot fraud from 2000 to 2012. As election law professor Richard L. Hasen notes, during that period “literally billions of votes were cast.” While mail ballots are more susceptible to fraud than in-person voting, it is still more likely for an American to be struck by lightning than to commit mail voting fraud.

States have multiple tools to address valid security concerns and protect election integrity when it comes to mail ballots. And recent technologies and strategies have significantly enhanced the security of mail balloting.

Wendy R. Weiser and 

  

Harold Ekeh

                                                                                                           

April 20, 2020

Brennan Center                                 

Coronavirus and the Height of Corporate Welfare

With the coronavirus pandemic wreaking havoc on the global economy, here’s how massive corporations are shafting the rest of us in order to secure billions of dollars of taxpayer-funded bailouts.

The airline industry demanded a massive bailout of nearly $60 billion in taxpayer dollars, and ended up securing $50 billion – half in loans, half in direct grants that don’t need to be paid back. 

Airlines don’t deserve a cent. The five biggest U.S. airlines spent 96 percent of their free cash flow over the last decade buying back shares of their own stock to boost executive bonuses and please wealthy investors.

United was so determined to get its windfall of taxpayer money that it threatened to fire workers if it didn’t get its way. Before the Senate bill passed, CEO Oscar Munoz wrote that “if Congress doesn’t act on sufficient government support by the end of March, our company will begin to…reduce our payroll….”

Airlines could have renegotiated their debts with their lenders outside court, or file for Chapter 11 bankruptcy protection. They’ve reorganized under bankruptcy many times before. Either way, they’d keep flying.

The hotel industry says it needs $150 billion. The industry says as many as 4 million workers could lose their jobs in the coming weeks if they don’t receive a bailout. Everyone from general managers to housekeepers will be affected. But don’t worry – the layoffs won’t reach the corporate level.

Hotel chains don’t need a bailout. For years, they’ve been making record profits while underpaying their workers. Marriott, the largest hotel chain in the world, repurchased $2.3 billion of its own stock last year, while raking in nearly $4 billion in profits. 

Thankfully, Trump’s hotels and businesses, as well as any of his family members’ businesses, are barred from receiving anything from the $500 billion corporate bailout money. But the bill is full of loopholes that Trump can exploit to benefit himself and his hotels.

Cruise ships also want to be bailed out, and Trump called them a “prime candidate” to receive a government handout. But they don’t deserve it either. The three cruise ship corporations controlling 75 percent of the entire global market are incorporated outside of the United States to avoid paying taxes.

They’re floating tax shelters, paying an average U.S. tax rate of just 0.8 percent. Democrats secured key provisions stipulating that companies are only eligible for bailout money if they are incorporated in the United States and have a majority of U.S. employees, so the cruise ship industry likely won’t see a dime of relief funding. However, Trump has made it clear he still wants to help them.

The justification I’ve heard about why all these corporations need to be bailed out is they’ll keep workers on their payrolls. But why should we believe big corporations will protect their workers right now? 

The $500 billion slush fund included in the Senate’s emergency relief package doesn’t require corporations to keep paying their workers and has dismally weak restrictions on stock buybacks and executive pay. 

Even if the bill did provide worker protections, what’s going to happen to these corporations’ subcontractors and gig workers? What about worker benefits, pensions and health care? How much of this bailout is going to end up in the pockets of executives and big investors?

The record of Big Business isn’t comforting. Amazon, one of the richest corporations in the world, which paid almost no taxes last year, is only offering unpaid time off for workers who are sick and just two weeks paid leave for workers who test positive for the virus. Meanwhile, it demands its employees put in mandatory overtime.

Oh, and these corporations made sure they and other companies with more than 500 employees were exempt from the requirement in the first House coronavirus bill that employers provide paid sick leave.

And now, less than a month into statewide shelter-in-place orders and social distancing restrictions, Wall Streeters and corporate America’s chief executives are calling for supposedly “low-risk” groups to be sent back to work to restart the economy. 

They’re so concerned about protecting their bottom line that they’re willing to let people die to preserve their stock portfolios, all while they continue working from the safety and security of their own homes. It’s the most repugnant class warfare you can imagine.

Here’s the bottom line: no mega-corporation deserves a cent of bailout money. For decades these companies and their billionaire executives have been dodging taxes, getting tax cuts, shafting workers, and bending the rules to enrich themselves. There’s no reason to trust them to do the right thing with billions of dollars in taxpayer money. 

Every penny we have needs to go to average Americans who desperately need income support and health care, and to hospitals that need life-saving equipment. It’s outrageous that the Senate bill gave corporations nearly four times as much money as hospitals on the front lines. 

Corporate welfare is bad enough in normal times. Now, in a national emergency, it’s morally repugnant. We must stop bailing out corporations. It’s time we bail out people.

Robert Reich

April 21, 2020

Why the Stock Market Is Healthy as Americans Die

Jon Schwarz for The Intercept

April 12, 2020

This past week the S&P 500 went up 301 points, or 12 percent, its best performance in 46 years.

During the same week, the reported number of Americans killed by Covid-19 went up 11,499, or 161 percent, the coronavirus’s best performance ever.

So this seems like a good time to reevaluate our treasured belief that a rising stock market reflects general human flourishing.

Consider a few more events that happened this week around the same time as this excited tweet from Donald Trump, who somehow is the president of the United States:

Hurrah! Meanwhile, the Covid-19 death toll that day topped 2,000 for the first time. It is now, according to a San Diego gerontologist, the leading cause of death in the U.S., beating out the traditional champions heart disease and cancer. New data showed that Covid-19 is killing African Americans and Latinos in New York City at rates twice that of whites, with a similar disjunction in rates appearing across the country.

Also last week, over 6 million Americans filed for unemployment. The chief economist at RSM, one of the largest accounting firms in the U.S., said this demonstrated that “the carnage in the American labor market continued unabated.” The recent cumulative total of newly-unemployed is 16.8 million people, or about one in ten workers.

As Americans were thrown out of work and into sudden fear of hunger, our economic system encouraged farmers to intentionally destroy their crops. At least 60,000 gallons of milk were dumped into dairy farm manure pits, traditionally the last place you like to see food. Milking cows were sent to slaughter. Fertilized chicken eggs were crushed rather than hatched.

A report sent to the White House on Tuesday from the National Academy of Sciences cast doubt on hopes that the novel coronavirus will naturally diminish in the spring and summer. “A decrease in cases with increases in humidity and temperature elsewhere should not be assumed,” the report explained. “Pandemic influenza strains have not exhibited the typical seasonal pattern of endemic/epidemic strains.”

Amid all of this, Trump demonstrated that he apparently believes Covid-19 is a disease caused by bacteria, rather than a virus. The difference between bacteria and viruses is often taught around 5th grade, when children are ten years old.

What would truly make the stock market skyrocket, you might think by now, would be nuclear war followed immediately by a gigantic asteroid striking Manhattan. A hideously-mutated Jim Cramer, the last man on earth, would shriek “Dow 10,000,000!” just before expiring.

This is not the case, however. Rather, the stock market is simply agnostic about human happiness. It’s just a best-guess measure of future post-tax corporate profitability. If future post-tax corporate profitability is compatible with people being alive and having enough to eat, that’s okay. If not, that’s likewise totally fine. We’re just not part of the equation.

Looked at through this lens, the stock market’s latest behavior is easy to understand. As Dean Baker, senior economist at the Center for Economic and Policy Research in Washington, D.C., puts it: “We should take the recent jump to mean that investors are betting that Congress and Trump just gave them lots of money.”

That’s the true meaning of this week’s odd combination of events. Your grandmother can die of Covid-19 minutes after being discharged from the hospital. Nurses can be forced to protest their employers failing to provide them with basic personal protective equipment. The Centers for Disease Control and Prevention could fail completely at developing a test for the virus. All of that is irrelevant.

What matters is that the Trump administration will pay any price, bear any burden, meet any hardship to keep big corporations alive and profitable. That is, from the GOP’s perspective, the sole legitimate function of the U.S. government. And given their ferocious commitment and the government’s financial firepower, they have a plausible shot at success.

So get ready for further triumphalist tweets from Trump anytime the stock market goes up. You may be reading them while picking up sanitized food containers from a soup kitchen, or auctioning off the wreckage of your bankrupt small business, or attending a funeral via Zoom. Or you may just hazily hear them being celebrated on Fox while intubated and sedated.

None of that will matter, from the perspective of the stock market. What we should all see clearly now is that it can giddily thrive, even as America disintegrates around it.

Dear Bernie

I think Robert Reich speaks for many of us:

Dear Bernie

WEDNESDAY, APRIL 8, 2020

I’m sorry you will not be president, but I understand and appreciate your decision to end your quest at this point.

Four years ago, in the 2016 Democratic primaries, you made it respectable to talk about Medicare for All, free public higher education, and raising taxes on the wealthy. You alerted America to the vast and growing gap in income, wealth, and political power, and its dangers for our economy and democracy.

This time, you’ve not only made it respectable to talk about these and other issues, such as a Green New Deal, but you’ve persuaded a majority of Americans that these problems must be addressed. You’ve given voice to the poor, working class, the undocumented, Native American – all those who have been bullied and abandoned.

You have inspired and galvanized a new generation of young Americans. You have made it possible for America to live up to its ideals. Your courage and determination have made me and countless others proud. Thank you. 

May your voice, your indignation, and your moral clarity ring out for years to come.

Fondly,

Bob

The System: Who Rigged It, How We Fix It

The coronavirus has starkly revealed what most of us already knew: The concentration of wealth in America has created a a health care system in which the wealthy can buy care others can’t. 

It’s also created an education system in which the super-rich can buy admission to college for their children, a political system in which they can buy Congress and the presidency,  and a justice system in which they can buy their way out of jail. 

Almost everyone else has been hurled into a dystopia of bureaucratic arbitrariness, corporate indifference, and the legal and financial sinkholes that have become hallmarks of modern American life.

The system is rigged. But we can fix it.

Today, the great divide in American politics isn’t between right and left. The underlying contest is between a small minority who have gained power over the system, and the vast majority who have little or none. 

Forget politics as you’ve come to see it – as contests between Democrats and Republicans. The real divide is between democracy and oligarchy.

The market has been organized to serve the wealthy. Since 1980, the percentage of the nation’s wealth owned by the richest four hundred Americans has quadrupled (from less than 1 percent to 3.5 percent) while the share owned by the entire bottom half of America has dropped to 1.3 percent.

The three wealthiest Americans own as much as the entire bottom half of the population. Big corporations, CEOs, and a handful of extremely rich people have vastly more influence on public policy than the average American. Wealth and power have become one and the same.

As the oligarchs tighten their hold over our system, they have lambasted efforts to rein in their greed as “socialism”, which, to them, means getting something for doing nothing.

But “getting something for doing nothing” seems to better describe the handouts being given to large corporations and their CEOs. 

General Motors, for example, has received $600 million in federal contracts and $500 million in tax breaks since Donald Trump took office. Much of this “corporate welfare” has gone to executives, including CEO Mary Barra, who raked in almost $22 million in compensation in 2018 alone. GM employees, on the other hand, have faced over 14,000 layoffs and the closing of three assembly plants and two component factories.

And now, in the midst of a pandemic, big corporations are getting $500 billion from taxpayers. 

Our system, it turns out, does practice one form of socialism – socialism for the rich. Everyone else is subject to harsh capitalism.

Socialism for the rich means people at the top are not held accountable. Harsh capitalism for the many, means most Americans are at risk for events over which they have no control, and have no safety nets to catch them if they fall.

Among those who are particularly complicit in rigging the system are the CEOs of America’s corporate behemoths. 

Take Jamie Dimon, the CEO of JPMorgan Chase, whose net worth is $1.4 billion. He comes as close as anyone to embodying the American system as it functions today.

Dimon describes himself as “a patriot before I’m the CEO of JPMorgan.”

He brags about the corporate philanthropy of his bank, but it’s a drop in the bucket compared to his company’s net income, which in 2018 was $30.7 billion – roughly one hundred times the size of his company’s investment program for America’s poor cities. 

Much of JP Morgan’s income gain in 2018 came from savings from the giant Republican tax cut enacted at the end of 2017 – a tax cut that Dimon intensively lobbied Congress for.

Dimon doesn’t acknowledge the inconsistencies between his self-image as “patriot first” and his role as CEO of America’s largest bank. He doesn’t understand how he has hijacked the system.

Perhaps he should read my new book.

To understand how the system has been hijacked, we must understand how it went from being accountable to all stakeholders – not just stockholders but also workers, consumers, and citizens in the communities where companies are headquartered and do business – to intensely shareholder-focused capitalism.

In the post-WWII era, American capitalism assumed that large corporations had responsibilities to all their stakeholders. CEOs of that era saw themselves as “corporate statesmen” responsible for the common good.

But by the 1980s, shareholder capitalism (which focuses on maximizing profits) replaced stakeholder capitalism. That was largely due to the corporate raiders – ultra-rich investors who hollowed-out once-thriving companies and left workers to fend for themselves.

Billionaire investor Carl Icahn, for example, targeted major companies like Texaco and Nabisco by acquiring enough shares of their stock to force major changes that increased their stock value – such as suppressing wages, fighting unions, laying off workers, abandoning communities for cheaper labor elsewhere, and taking on debt – and then selling his shares for a fat profit. In 1985, after winning control of Trans World Airlines, he loaded the airline with more than $500 million in debt, stripped it of its assets, and pocketed nearly $500 million in profits.

As a result of the hostile takeovers mounted by Icahn and other raiders, a wholly different understanding about the purpose of the corporation emerged.

Even the threat of hostile takeovers forced CEOs to fall in line by maximizing shareholder profits over all else. The corporate statesmen of previous decades became the corporate butchers of the 1980s and 1990s, whose nearly exclusive focus was to “cut out the fat” and make their companies “lean and mean.”

As power increased for the wealthy and large corporations at the top, it shifted in exactly the opposite direction for workers. In the mid-1950s, 35 percent of all private-sector workers in the United States were unionized. Today, 6.4 percent of them are.

The wave of hostile takeovers pushed employers to raise profits and share prices by cutting payroll costs and crushing unions, which led to a redistribution of income and wealth from workers to the richest 1 percent. Corporations have fired workers who try to organize and have mounted campaigns against union votes. All the while, corporations have been relocating to states with few labor protections and so-called “right-to-work” laws that weaken workers’ ability to join unions.

Power is a zero-sum game. People gain it only when others lose it. The connection between the economy and power is critical. As power has concentrated in the hands of a few, those few have grabbed nearly all the economic gains for themselves.

The oligarchy has triumphed because no one has paid attention to the system as a whole – to the shifts from stakeholder to shareholder capitalism, from strong unions to giant corporations with few labor protections, and from regulated to unchecked finance.

As power has shifted to large corporations, workers have been left to fend for themselves. Most Americans developed 3 key coping mechanisms to keep afloat.

The first mechanism was women entering the paid workforce. Starting in the late 1970s, women went into paid work in record numbers, in large part to prop up family incomes, as the wages of male workers stagnated or declined. 

Then, by the late 1990s, even two incomes wasn’t enough to keep many families above water, causing them to turn to the next coping mechanism: working longer hours. By the mid-2000s a growing number of people took on two or three jobs, often demanding 50 hours or more per week.

Once the second coping mechanism was exhausted, workers turned to their last option: drawing down savings and borrowing to the hilt. The only way Americans could keep consuming was to go deeper into debt. By 2007, household debt had exploded, with the typical American household owing 138 percent of its after-tax income. Home mortgage debt soared as housing values continued to rise. Consumers refinanced their homes with even larger mortgages and used their homes as collateral for additional loans.

This last coping mechanism came to an abrupt end in 2008 when the debt bubbles burst, causing the financial crisis. Only then did Americans begin to realize what had happened to them, and to the system as a whole. That’s when our politics began to turn ugly.  

So what do we do about it? The answer is found in politics and rooted in power.

The way to overcome oligarchy is for the rest of us to join together and form a multiracial, multiethnic coalition of working-class, poor and middle-class Americans fighting for democracy.

This agenda is neither “right” nor “left.” It is the bedrock for everything America must do.

The oligarchy understands that a “divide-and-conquer” strategy gives them more room to get what they want without opposition. Lucky for them, Trump is a pro at pitting native-born Americans against immigrants, the working class against the poor, white people against people of color. His goal is cynicism, disruption, and division. Trump and the oligarchy behind him have been able to rig the system and then whip around to complain loudly that the system is rigged.

But history shows that oligarchies cannot hold on to power forever. They are inherently unstable. When a vast majority of people come to view an oligarchy as illegitimate and an obstacle to their wellbeing, oligarchies become vulnerable.

As bad as it looks right now, the great strength of this country is our resilience. We bounce back. We have before. We will again.

In order for real change to occur – in order to reverse the vicious cycle in which we now find ourselves – the locus of power in the system will have to change.

The challenge we face is large and complex, but we are well suited for the fight ahead. Together, we will dismantle the oligarchy. Together, we will fix the system.

Robert Reich

3/24/2020