In Bernie Sanders' State of Vermont, "that giant sucking sound" is not jobs moving to Mexico — it is jobs being concocted in Montpelier. Of course, Governor Scott shields illegal immigrants working in Vermont, and Vermont provides driver's licenses to them. The capital city also grants non-citizen residents the right to vote. It is no surprise that Vermont is #1 in the country for illegal northern border crossings.
Speaker of the House Nancy Pelosi and Senate Majority Leader Mitch McConnell have engaged in a standoff throughout the week--Leader McConnell always had the upper hand.
Leader McConnell, along with ten other GOP senators, now support a resolution introduced by Sen. Josh Hawley (R-MO) that would allow the GOP-majority to dismiss articles of impeachment if Speaker Pelosi fails to deliver them within 25 days.
“Whensoever the Senate shall receive notice from the House of Representatives that managers are appointed on their part to conduct an impeachment against any person and are directed to carry articles of impeachment to the Senate, the Secretary of the Senate shall immediately inform the House of Representatives that the Senate is ready to receive the managers for the purpose of exhibiting such articles of impeachment, agreeably to such notice. If, following adoption of such articles, the House of Representatives does not so notify the Senate or otherwise provide for such articles to be exhibited to the Senate within 25 calendar days from the date of adoption of such articles, as recorded in the Journal of the House of Representatives, such articles shall be deemed exhibited before the Senate and it shall be in order for any Senator to offer a motion to dismiss such articles with prejudice for failure by the House of Representatives to prosecute such articles,” the resolution says.
The resolution is a direct rebuke to Speaker Pelosi’s attempt to blackmail the Republican majority in the upper chamber, in hopes of her gaining leverage over her legislative counterpart. Pelosi has drug out this process, hoping that Leader McConnell will blink first, but as anyone on the Hill knows, Pelosi’s strategy was dead-on-arrival.
Sen. Josh Hawley (@HawleyMO@senhawleypress): "I am introducing a resolution to update the Senate's rules to account for this unprecedented attempt by the Speaker of the House to delay, to deny, to obstruct a trial in the United States Senate."
The timeline on a Senate impeachment trial is still unknown, but could begin as early as next week.
entire crony capitalist system, Democrat and Republican alike, has become
a kleptocracy approaching par with third-world hell-holes. This
is the way a great country is raided by its elite.” ---- Karen
McQuillan THEAMERICAN THINKER.com
CRAP ON BORDERS AND HIS PRETEND WALL IS ONLY ONE MORE TRUMP HOAX!
complete fool would believe that Trump is any more for American Legal workers
than the Democrat Party for Billionaires and Banksters!
Administration Betrays Low-Skilled American Workers.”
latest ad from the Federation for American Immigration Reform (FAIR) asks Trump
to reject the mass illegal and legal immigration policies supported by Wall
Street, corporate executives, and most specifically, the GOP mega-donor Koch
Efforts by the big business
lobby, Chamber of Commerce, Koch brothers, and George W. Bush Center include
increasing employment-based legal immigration that would likely crush the historic
wage gains that
Trump has delivered for America’s blue collar and working class citizens.
Mark Zuckerberg’s Silicon Valley investors
are uniting with the Koch network’s consumer and industrial investors to demand
a huge DACA amnesty
A handful of Republican and Democrat
lawmakers are continuing to tout a plan that gives amnesty to nearly a million
illegal aliens in exchange for some amount of funding for President Trump’s
proposed border wall along the U.S.-Mexico border.
MULTI-CULTURALISM and the
creation of a one-party globalist country to serve the rich in America’s open
“Open border advocates, such as Facebook's
Mark Zuckerberg, claim illegal aliens are a net benefit to California with
little evidence to support such an assertion. As the CIS has documented, the
vast majority of illegals are poor, uneducated, and with few skills. How does
accepting millions of illegal aliens and then granting them access to dozens of
welfare programs benefit California’s economy? If illegals were contributing to
the economy in any meaningful way, CA, with its 2.6 million illegals, would be
booming.” STEVE BALDWIN – AMERICAN SPECTATOR
Josh Hawley: GOP Must Defend Middle
Class Americans Against ‘Concentrated Corporate Power,’ Tech Billionaires
Republican Party must defend America’s working and middle class against
“concentrated corporate power” and the monopolization of entire sectors of the
United States’ economy, Sen. Josh Hawley (R-MO) says.
In an interview on The Realignment podcast,
Hawley said that “long gone are the days where” American workers can depend on
big business to look out for their needs and the needs of their communities.
Instead, Hawley explained that increasing “concentrated
corporate power” of whole sectors of the American economy — specifically among
Silicon Valley’s giant tech conglomerates — is at the expense of working and
middle class Americans.
“One of the things Republicans need to recover today is a
defense of an open, free-market, of a fair healthy competing market and the
length between that and Democratic citizenship,” Hawley said, and continued:
At the end of the day, we are trying to support and sustain here
a great democracy. We’re not trying to make a select group of people rich.
They’ve already done that. The tech billionaires are already billionaires, they
don’t need any more help from government. I’m not interested in trying to help
them further. I’m interested in trying to help sustain the great middle of this
country that makes our democracy run and that’s the most important challenge of
“You have these businesses who for years now have said ‘Well,
we’re based in the United States, but we’re not actually an American company,
we’re a global company,'” Hawley said. “And you know, what has driven profits
for some of our biggest multinational corporations? It’s been … moving jobs
overseas where it’s cheaper … moving your profits out of this country so you
don’t have to pay any taxes.”
“I think that we have here at the same time that our economy has
become more concentrated, we have bigger and bigger corporations that control
more and more of our key sectors, those same corporations see themselves as
less and less American and frankly they are less committed to American workers
and American communities,” Hawley continued. “That’s turned out to be a problem
which is one of the reasons we need to restore good, healthy, robust
competition in this country that’s going to push up wages, that’s going to
bring jobs back to the middle parts of this country, and most importantly, to
the middle and working class of this country.”
While multinational corporations monopolize industries, Hawley
said the GOP must defend working and middle class Americans and that big
business interests should not come before the needs of American communities:
A free market is one where you can enter it, where there are new
ideas, and also by the way, where people can start a small family business, you
shouldn’t have to be gigantic in order to succeed in this country. Most people
don’t want to start a tech company. [Americans] maybe want to work in their
family’s business, which may be some corner shop in a small town … they
want to be able to make a living and then give that to their kids or give their
kids an option to do that. [Emphasis added]
The problem with corporate concentration is that it tends to
kill all of that. The worst thing about corporate concentration is that it
inevitably believes to a partnership with big government. Big business and
big government always get together, always. And that is exactly what has
happened now with the tech sector, for instance, and arguably many other
sectors where you have this alliance between big government and big business …
whatever you call it, it’s a problem and it’s something we need to address.
Hawley blasted the free trade-at-all-costs doctrine that has
dominated the Republican and Democrat Party establishments for decades,
crediting the globalist economic model with hollowing “out entire industries,
entire supply chains” and sending them to China, among other countries.
“The thing is in this country is that not only do we not make
very much stuff anymore, we don’t even make the machines that make the stuff,”
Hawley said. “The entire supply chain up and down has gone overseas, and a lot
of it to China, and this is a result of policies over some decades now.”
As Breitbart News reported, Hawley detailed in the interview how Republicans like
former President George H.W. Bush’s ‘New World Order’ agenda and Democrats have
helped to create a corporatist economy that disproportionately benefits the
nation’s richest executives and donor class.
The billionaire class, the top 0.01 percent of earners, has
enjoyed more than 15 times as much wage growth as the
bottom 90 percent since 1979. That economy has been reinforced with federal
rules that largely benefits the wealthiest of wealthiest earners. A study released last month revealed that the richest
Americans are, in fact, paying a lower tax rate than all other Americans.
John Binder is a reporter for Breitbart News. Follow him on
Twitter at @JxhnBinder.
Carlson Exposes D.C. ‘Conservatives’ for Doing Big Tech’s Bidding
Fox News host Tucker Carlson slammed establishment conservatives
for taking money from big tech companies to do their bidding, on Tucker
Carlson Tonight, Friday night.
The popular host, known for his no-holds-barred denunciations of
establishment conservatives as well as Democrats, revealed massive spending by
the establishment conservative Koch Foundation to protect big tech in Washington.
Tucker revealed that Americans for Prosperity, a “purportedly
conservative group” controlled by the Kochs, launched an ad campaign trying to
stave off the closing net of antitrust enforcement against Google and Facebook.
The ads targeted Republican and Democrat state attorneys general that were
investigating alleged antitrust violations by big tech companies.
The Koch-funded group also targeted members of the Senate
Judiciary Committee with digital ads urging them to “oppose any effort to use
antitrust laws to break up America’s innovative tech companies,” reported
The Fox host ran through a laundry list of allegedly
“conservative” D.C. think tanks that take money from big tech, and often
advocate against regulating them over political bias or any other matter.
“In all, the Koch network quietly spent at least $10 million
defending Silicon Valley companies that work to silence conservatives.”
“Google has given money to at least 22 right-leaning
institutions that are also funded by the Koch network,” reported Carlson.
“Those institutions include the American Conservative Union, the
American Enterprise Institute, the National Review Institute, the Competitive
Enterprise Institute, the Heritage Foundation, and the Mercatus Center.”
Carlson explained that this spending gets results.
“In September of 2018, the Competitive Enterprise Institute and
three other groups funded by Google and the Kochs sent a joint letter to
the Attorney General at the time, Jeff Sessions, expressing grave concerns over
the DoJ’s plans to look into whether search engines and social media were
hurting competition and stifling speech.”
Carlson also called out The Heritage Foundation, arguing that
its shilling for big tech meant that it “no longer represents the interest of
conservatives, at least on the question of tech.”
“A recent paper by Heritage,
entitled ‘Free Enterprise Is
the Best Remedy For Online Bias Concerns,’ defends the special
privileges that Congress has given to left-wing Silicon Valley monopolies. And
if conservatives don’t like it, Heritage says, well they can just start their
This is despite the fact that Google
publicly snubbed the foundation last year, canceling the formation of a planned
“A.I ethics” council after far-left employees of the tech company threw a hissy fit over the fact that Heritage president Kay Coles James was
set to be one of its members.
Are you an insider at Google,
Facebook, Twitter or any other tech company who wants to confidentially reveal
wrongdoing or political bias at your company? Reach out to Allum Bokhari at his
secure email address firstname.lastname@example.org.
Allum Bokhari is the senior
technology correspondent at Breitbart News.
In truth, the Golden State is becoming a semi-feudal kingdom,
with the nation’s widest gap between
middle and upper incomes—72 percent, compared with the U.S. average of 57
percent—and its highest poverty rate. Roughly half of America’s homeless live
in Los Angeles or San Francisco, which
now has the highest property crime rate among major cities.
The Golden State is on a path to high-tech feudalism, but there’s
still time to change course.
the modern equivalent of the ancient city-states of Athens and Sparta.
California has the ideas of Athens and the power of Sparta,” declared then-governor Arnold Schwarzenegger in 2007. “Not
only can we lead California into the future . . . we can show the nation and
the world how to get there.” When a movie star who once played Hercules says so
who’s to disagree? The idea of California as a model, of course, precedes the
former governor’s tenure. Now the state’s anti-Trump resistance—in its zeal on
matters concerning climate, technology, gender, or race—believes that it knows how to
create a just, affluent, and enlightened society. “The future depends on us,”
Governor Gavin Newsom said at his inauguration.
“And we will seize this moment.”
truth, the Golden State is becoming a semi-feudal kingdom, with the nation’s widest gap between middle and upper incomes—72 percent, compared
with the U.S. average of 57 percent—and its highest poverty rate. Roughly half
of America’s homeless live in Los Angeles or San Francisco, which now has the highest property crime rate among major
cities. California hasn’t yet become a
full-scale dystopia, of course, but it’s heading in a troubling direction.
didn’t have to happen. No place on earth has more going for it than the Golden
State. Unlike the East Coast and Midwest, California benefited from
comparatively late industrialization, with an economy based less on auto
manufacturing and steel than on science-based fields like aerospace, software,
and semiconductors. In the mid-twentieth century, the state also gained from
the best aspects of progressive rule, culminating in an elite public university
system, a massive water system reminiscent of the Roman Empire, and a vast
infrastructure network of highways, ports, and bridges. The state was
fortunate, too, in drawing people from around the U.S. and the world. The
eighteenth-century French traveler J. Hector St. John de
Crèvecœur described the American as
“this new man,” and California—innovative, independent, and less bound by tradition
or old prejudice—reflected that insight. Though remnants of this California
still exist, its population is aging, less mobile, and more pessimistic, and
its roads, schools, and universities are in decline.
In the second half of the
twentieth century, California’s remarkably diverse economy spread prosperity
from the coast into the state’s inland regions. Though pockets of severe
poverty existed—urban barrios, south Los Angeles, the rural Central Valley—they
were limited in scope. In fact, growth often favored suburban and exurban communities, where
middle-class families, including minorities, settled after World War II.
last two decades, the state has adopted policies that undermine the basis for
middle-class growth. State energy policies, for example, have made California’s
gas and electricity prices among the steepest in the country. Since 2011,
electricity prices have risen five times faster than the national average. Meantime, strict land-use
controls have raised housing costs to the nation’s highest, while taxes—once
average, considering California’s urban scale—now exceed those of virtually every
state. At the same time, California’s
economy has shed industrial diversity in favor of dependence on one industry:
Big Tech. Just a decade before, the state’s largest firms included those in the
aerospace, finance, energy, and service industries. Today’s 11 largest
companies hail from the tech sector, while energy firms—excluding Chevron,
which has moved much of its operations to Houston—have disappeared. Not a single top aerospace firm—the
iconic industry of twentieth-century California—retains its headquarters here.
lionized in the press, this tech-oriented economy hasn’t resulted in that many
middle- and high-paying job opportunities for Californians, particularly
outside the Bay Area. Since 2008, notes Chapman University’s Marshall
Toplansky, the state has created five times the number of low-paying, as
opposed to high-wage, jobs. A remarkable 86 percent of new jobs paid below the
median income, while almost half paid under $40,000. Moreover, California,
including Silicon Valley, created fewer high-paying positions than the national
average, and far less than prime competitors like Salt Lake City, Seattle, or
Austin. Los Angeles County features the lowest pay of any of the nation’s 50
No state advertises its
multicultural bona fides more than California, now a majority-minority state.
This is evident at the University of California, where professors are required to prove their service to
“people of color,” to the state’s high school curricula, with its new ethnic studies component. Much of
California’s anti-Trump resistance has a racial context. State Attorney General
Xavier Becerra has sued the administration numerous times over immigration
policy while he helps ensure California’s distinction as a sanctuary for
illegal immigrants. So far, more than 1 million illegal residents have received driver’s licenses, and they qualify
for free health care, too. San Francisco now permits illegal immigrants
to vote in local elections.
radical policies may make progressives feel better about themselves, though
they seem less concerned about how these actions affect everyday people.
California’s Latinos and African-Americans have seen good blue-collar jobs in
manufacturing and energy vanish. According to one United Way study, over half of Latino households can barely pay their
bills. “For Latinos,” notes long-time political consultant Mike Madrid, “the California Dream is becoming an unattainable fantasy.”
past, poorer Californians could count on education to help them move up. But
today’s educators appear more interested in political indoctrination than
results. Among the 50 states, California ranked 49th in the performance of low-income students. In wealthy San
Francisco, test scores for black students are the worst of any California
county. Many minority residents, especially African-Americans, are fleeing the
state. In a recent UC Berkeley poll, 58 percent of black expressed interest in
leaving California, a higher percentage than for any racial group, though
approximately 45 percent of Asians and Latinos also considered moving out.
the biggest demographic disaster is generational. For decades, California
incubated youth culture, creating trends like beatniks, hippies, surfers, and
Latino and Asian art, music, and cuisine. The state is a fountainhead of youthful wokeness and rebellion, but that may prove short-lived as millennials leave. From
2014 to 2018, notes demographer Wendell Cox, net domestic out-migration grew
from 46,000 to 156,000. The exiles are increasingly in their family-formation
years. In the 2010s, California suffered higher net declines in virtually every
age category under 54, with the biggest rate of loss coming among the 35-to-44
families with children leave, and international migration slows to one-third of
Texas’s level, the remaining population is rapidly aging. Since 2010,
California’s fertility rate has dropped 60 percent, more than the national
average; the state is now aging 50 percent more rapidly than the rest of the
country. A growing number of tech firms and millennials have headed to
the Intermountain West. Low rates of homeownership among younger people play a
big role in this trend, with California millennials forced to rent, with little chance of buying their
own home, while many of the state’s biggest metros lead the nation in long-term
owners. California is increasingly a
greying refuge for those who bought property when housing was affordable.
Schwarzenegger morphed into a progressive environmentalist, climate concerns
began driving state policy. His successors have embraced California
“leadership” on climate issues. Jerry Brown recently told a crowd in China that the rest of the world should
follow California’s example. The state’s top Democrats, like state senate
president pro tem Kevin DeLeon, Los Angeles mayor Eric Garcetti, and
billionaire Democratic presidential candidate Tom Steyer, now compete for the green mantle.
policies have worsened conditions for many middle- and working-class Californians.
Oblivious to these concerns, Greens ignore practical ideas—nuclear power,
natural gas cars, job creation in affordable areas, home-based work—that could
help reduce emissions without disrupting people’s lives. Ultra-green policies
also work against the state’s proclaimed goal of
building more than 3.5 million new housing units by 2025. In accordance with
its efforts to reduce car use, the state mandates that most growth occurs in
already-crowded coastal areas, where land prices are highest. But in cities
like San Francisco, the cost of building one unit for a homeless person surpasses $700,000.
California’s inland regions, though experiencing population gains, keep
losing state funding for decrepit highways in favor of urban-centric, mass transit projects—yet
transit use has stagnated, especially in greater Los Angeles.
state, nevertheless, continues its pursuit of policies that would eliminate all
fossil fuels and nuclear power—outpacing national or even Paris Accord levels
and guaranteeing ever-rising energy prices. Mandating everything from electric cars to electric homes will only drive more working-class
Californians into “energy poverty.” High energy prices also directly affect the
manufacturing and logistics firms that employ blue-collar workers at decent
wages. Business relocation expert Joe Vranich notes that industrial firms account for many of the
2,000 employers that left the state this decade. California’s industrial growth
has fallen to the bottom tier of states; last year, it ranked 44th, with a rate of growth
one-third to one-quarter that of prime competitors like Texas, Virginia,
Arizona, Nevada, and Florida.
the high energy prices tend to hit the interior counties that, besides being
poorer, have far less temperate climates. Cities like Bakersfield, capital of the state’s once-vibrant oil industry, are
particularly hard-hit. High energy prices will cost the region, northeast of
the Los Angeles Basin, 14,000 generally high-paid jobs, even as the state
continues to import oil from Saudi Arabia.
leaders apply climate change to excuse virtually every failure of state policy.
During the California drought, Brown and his minions blamed the “climate” for the dry
period, refusing to take responsibility for insufficient water storage that would have helped farmers. When the rains
returned and reservoirs filled, this argument was forgotten, and little effort
has been made to conserve water for next time. Likewise, Newsom and his supporters in the media have blamed recent fires on changes in the global
climate, but the disaster had as much to do with green mandates against controlled burns and brush clearance than anything occurring on a planetary scale. Brown joined greens and others in blocking such sensible policies.
advocates ever seem to ask if their policies actually help the planet. Indeed,
California’s green policy, as one paper demonstrates, may be increasing total greenhouse-gas
emissions by pushing people and industries to states with less mild climates.
In the past decade, the state ranked 40th in per-capita reductions, and its
global carbon footprint is minimal. Renewable energy may be expensive and unreliable,
but state policy nevertheless enriches the green-energy investments of tech leaders, even when their efforts—like the Google-backed Ivanpah solar farm—fail to deliver affordable, reliable energy.
It’s not so surprising,
given these enthusiasms, that progressive politicians like Garcetti—who leads a city with paralyzing traffic congestion,
rampant inequality, a huge rat infestation, and proliferating homeless camps—would rather talk about
becoming chair of the C40 Cities Climate Leadership Group.
is asserting itself, though. Tech firms already show signs of restlessness with
the current regulatory regime and appear to be shifting employment to other states, notably Texas, Tennessee, Nevada, Colorado, and Arizona. Economic-modeling firm Emsi estimates
that several states—Idaho, Tennessee, Washington, and Utah—are growing their
tech employment faster than California. The state is losing momentum in
professional and technical services—the largest high-wage sector—and now stands
roughly in the middle of the pack behind other western states such as Texas,
Tennessee, and Florida. And Assembly Bill 5, the state law regulating certain
forms of contract labor, reclassifies part-time workers. Aimed initially at
ride-sharing giants Uber and Lyft, the
legislation also extends to independent contractors in industries from media to
point, as even Brown noted, the ultra-high capital gains returns will fall
and, combined with the costs of an expanding welfare state, could leave the
state in fiscal chaos. Big Tech could stumble, a possibility made more real by
the recent $100 billion drop in the value of privately held “unicorn” companies,
including WeWork. If the tech economy slows, a rift could develop between two
of the state’s biggest forces—unions and the green establishment—over future
levels of taxation. More than two-thirds of California cities don’t have any funds set aside for retiree health
care and other retirement expenses. The state also confronts $1 trillion in
pension debt, according to former Democratic state senator Joe Nation. U.S. News & Report ranks California, despite the tech boom,
42nd in fiscal health among the states.
rebellion against the state’s energy policies is already under way.
Recently, 110 cities, with total population exceeding 8 million, have demanded
changes in California’s drive to prevent new natural gas hookups. The state’s
Chamber of Commerce and the three most prominent ethnic
chambers—African-American, Latino, and
Asian-Pacific—have joined this effort.
need less bombast and progressive pretense from their leaders and more
attention to policies that could counteract the economic and demographic tides
threatening the state. On its current course, California increasingly resembles
a model of what the late Taichi Sakaiya called “high-tech feudalism,” with a
small population of wealthy residents and a growing mass of modern-day serfs.
Delusion and preening ultimately have limits, as more Californians are
beginning to recognize. As the 2020s beckon, the time for the state to change
course is now.
And it all got much, much worse after 2008,
when the schemes collapsed and, as Lemann points out, Barack Obama did not
aggressively rein in Wall Street as Roosevelt had done, instead restoring the
status quo ante even when it meant ignoring a staggering white-collar crime
spree. RYAN COOPER
The Rise of Wall Street Thievery
How corporations and
their apologists blew up the New Deal order and pillaged the middle class.
America has long had a
suspicious streak toward business, from the Populists and trustbusters to
Bernie Sanders and Elizabeth Warren. It’s a tendency that has increased over
the last few decades. In 1973, 36 percent of respondents told Gallup they had
only “some” confidence in big business, while 20 percent had “very little.” But
in 2019, those numbers were 41 and 32 percent—near the highs registered during
the financial crisis.
Clearly, something has
happened to make us sour on the American corporation. What was once a stable
source of long-term employment and at least a modicum of paternalistic benefits
has become an unstable, predatory engine of inequality. Exactly what went
wrong is well documented in Nicholas Lemann’s excellent new book, Transaction
Man. The title is a reference to The Organization Man, an
influential 1956 book on the corporate culture and management of that era.
Lemann, a New Yorker staff writer and Columbia journalism
professor (as well as a Washington Monthly contributing
editor), details the development of the “Organization” style through the career
of Adolf Berle, a member of Franklin D. Roosevelt’s brain trust. Berle argued
convincingly that despite most of the nation’s capital being represented by the
biggest 200 or so corporations, the ostensible owners of these firms—that is,
their shareholders—had little to no influence on their daily operations.
Control resided instead with corporate managers and executives.
Transaction Man: The Rise of the Deal and the
Decline of the American Dream
by Nicholas Lemann
Farrar, Straus and Giroux, 320 pp.
was alarmed by the wealth of these mega-corporations and the political power it
generated, but also believed that bigness was a necessary concomitant of
economic progress. He thus argued that corporations should be tamed, not broken
up. The key was to harness the corporate monstrosities, putting them to work on
behalf of the citizenry.
exerted major influence on the New Deal political economy, but he did not get
his way every time. He was a fervent supporter of the National Industrial
Recovery Act, an effort to directly control corporate prices and production,
which mostly flopped before it was declared unconstitutional. Felix
Frankfurter, an FDR adviser and a disciple of the great anti-monopolist Louis
Brandeis, used that opportunity to build significant Brandeisian elements into
New Deal structures. The New Deal social contract thus ended up being a
somewhat incoherent mash-up of Brandeis’s and Berle’s ideas. On the one hand,
antitrust did get a major focus; on the other, corporations were expected to
play a major role delivering basic public goods like health insurance and
then turns to his major subject, the rise and fall of the Transaction Man. The
New Deal order inspired furious resistance from the start. Conservative
businessmen and ideologues argued for a return to 1920s policies and provided
major funding for a new ideological project spearheaded by economists like
Milton Friedman, who famously wrote an article titled “The Social
Responsibility of Business Is to Increase Its Profits.” Lemann focuses on a
lesser-known economist named Michael Jensen, whose 1976 article “Theory of the
Firm,” he writes, “prepared the ground for blowing up that [New Deal] social
and his colleagues embodied that particular brand of jaw-droppingly stupid that
only intelligent people can achieve. Only a few decades removed from a crisis
of unregulated capitalism that had sparked the worst war in history and nearly
destroyed the United States, they argued that all the careful New Deal regulations
that had prevented financial crises for decades and underpinned the greatest
economic boom in U.S. history should be burned to the ground. They were
outraged by the lack of control shareholders had over the firms they supposedly
owned, and argued for greater market discipline to remove this “principal-agent
problem”—econ-speak for businesses spending too much on irrelevant luxuries
like worker pay and investment instead of dividends and share buybacks. When
that argument unleashed hell, they doubled down: “To Jensen the answer was
clear: make the market for corporate control even more active, powerful, and
all-encompassing,” Lemann writes.
best part of the book is the connection Lemann draws between Washington
policymaking and the on-the-ground effects of those decisions. There was much
to criticize about the New Deal social contract—especially its relative
blindness to racism—but it underpinned a functioning society that delivered a
tolerable level of inequality and a decent standard of living to a critical
mass of citizens. Lemann tells this story through the lens of a thriving
close-knit neighborhood called Chicago Lawn. Despite how much of its culture
“was intensely provincial and based on personal, family, and ethnic ties,” he
writes, Chicago Lawn “worked because it was connected to the big organizations
that dominated American culture.” In other words, it was a functioning
democratic political economy.
came the 1980s. Lemann paints a visceral picture of what it was like at street
level as Wall Street buccaneers were freed from the chains of regulation and
proceeded to tear up the New Deal social contract. Cities hemorrhaged
population and tax revenue as their factories were shipped overseas. Whole
businesses were eviscerated or even destroyed by huge debt loads from hostile
takeovers. Jobs vanished by the hundreds of thousands.
it all got much, much worse after 2008, when the schemes collapsed and, as
Lemann points out, Barack Obama did not aggressively rein in Wall Street as
Roosevelt had done, instead restoring the status quo ante even when it meant
ignoring a staggering white-collar crime spree. Neighborhoods drowned
under waves of foreclosures and crime as far-off financial derivatives
imploded. Car dealerships that had sheltered under the General Motors umbrella
for decades were abruptly cut loose. Bewildered Chicago Lawn residents
desperately mobilized to defend themselves, but with little success. “What they
were struggling against was a set of conditions that had been made by faraway
government officials—not one that had sprung up naturally,” Lemann writes.
Toward the end of the
book, however, Lemann starts to run out of steam. He investigates a possible
rising “Network Man” in the form of top Silicon Valley executives, who have largely
maintained control over their companies instead of serving as a sort of
esophagus for disgorging their companies’ bank accounts into the Wall Street
maw. But they turn out to be, at bottom, the same combination of blinkered
and predatory as the Transaction Men. Google and Facebook, for instance, have
grown over the last few years by devouring virtually the entire online ad
market, strangling the journalism industry as a result. And they directly
employ far too few people to serve as the kind of broad social anchor that the
car industry once did.
his final chapter, Lemann argues for a return to “pluralism,” a “messy,
contentious system that can’t be subordinated to one conception of the common
good. It refuses to designate good guys and bad guys. It distributes, rather
than concentrates, economic and political power.”
is a peculiar conclusion for someone who has just finished Lemann’s book, which
is full to bursting with profoundly bad people—men and women
who knowingly harmed their fellow citizens by the millions for their own
private profit. In his day, Roosevelt was not shy about lambasting rich people
who “had begun to consider the government of the United States as a mere
appendage to their own affairs,” as he put it in a 1936 speech in which he also
declared, “We know now that government by organized money is just as dangerous
as government by organized mob.”
concentrated economic power is a bad thing, then the corporate form is simply a
poor basis for a truly strong and equal society. Placing it as one of the
social foundation stones makes its workers dependent on the unreliable goodwill
and business acumen of management on the one hand and the broader marketplace
on the other. All it takes is a few ruthless Transaction Men to undermine the
entire corporate social model by outcompeting the more generous businesses. And
even at the high tide of the New Deal, far too many people were left out,
especially African Americans.
writes that in the 1940s the United States “chose not to become a full-dress
welfare state on the European model.” But there is actually great variation
among the European welfare states. States like Germany and Switzerland went
much farther on the corporatist road than the U.S. ever did, but they do
considerably worse on metrics like inequality, poverty, and political
polarization than the Nordic social democracies, the real welfare kings.
for how threadbare it is, the U.S. welfare state still delivers a great deal of
vital income to the American people. The analyst Matt Bruenig recently
calculated that American welfare eliminates two-thirds of the “poverty gap,”
which is how far families are below the poverty line before government
transfers are factored in. (This happens mainly through Social Security.) Imagine
how much worse this country would be without those programs! And though it
proved rather easy for Wall Street pirates to torch the New Deal corporatist
social model without many people noticing, attempts to cut welfare are
typically very obvious, and hence unpopular.
Lemann’s book is more than worth the price of admission for the perceptive
history and excellent writing. It’s a splendid and beautifully written
illustration of the tremendous importance public policy has for the daily lives
of ordinary people.
According to a recent report, the
Masters of the Universe in Silicon Valley have plans to further expand into the
world of finance in the new year — falling just short of opening their own
A recent report from CNBC claims that Silicon Valley tech giants are
likely to expand their business into the world of finance even further in 2020,
but many want to avoid the hassle of becoming a fully-fledged bank. With
Facebook announcing its own cryptocurrency, Googles plans to introduce consumer
bank account sin collaboration with Citibank, and Apple’s new credit card in
partnership with Goldman Sachs, finance seems to be a major focus for tech
Though their products are different,
both firms share something in common: they have no plans to become regulated
financial institutions like Citi or Goldman. While Big Tech — a group of
companies that includes Google, Amazon, Facebook and Apple —
will undoubtedly push deeper into finance this year, their progress in banking
will be “more of a slow creep than big strides,” said Sarah Kocianski, head of
research at fintech consultancy 11:FS.
“The big tech firms will continue to
add services that are peripheral to banking to their existing offerings,
without going full-stack banking,” she said. “The headache of getting, and
maintaining, a banking license would likely be considered too big a risk for
these companies. Instead, they will continue to operate with licensed
But, Accenture’s global
payments lead, Sulabh Agarwal stated when asked that it makes little sense for
tech firms to become banks. “Do I expect them to become banks? I don’t think so
do. I expect them to create new services to enhance their propositions,”
Facebook is making moves on two
fronts in the world of finance, with its digital currency Libra and with its
payment processing platform Facebook Pay. CNBC writes:
“The theory goes that if 2 billion
people were to withdraw their deposits from the banking system and move them
into Libra tokens, you’d effectively have a run on the banks,” said Simon
Taylor, co-founder and blockchain lead at 11:FS. “Facebook is absolutely big
enough for that to be plausible, but whether or not it happens depends much
more on what consumer problem is being solved.”
Aside from libra, Facebook is also
consolidating its payment products under a new brand called Facebook Pay. Uber, like its Southeast Asian
competitor Grab, is moving further into finance with a division called Uber Money that houses a digital
wallet and upgraded payment cards. They’ll face competition from the likes of
Google Pay and Apple Pay in the U.S. and Chinese payment apps like Alipay and WeChat Pay.
E-commerce giant Amazon is already
in the process of lending out money but has yet to break into consumer banking.
It should be noted that Amazon at one point set up a student loan scheme in
2016 with Wells Fargo which shut down shortly afterward. Sarah Kocianski,
head of research at fintech consultancy 11:FS, stated that there
was “every reason to suspect they’ve learned from that.”