Lawrence R. Jacobs

Page and Jacobs argue that there is, in fact, no "class war" brewing in America--that in fact a philosophically conservative American public, in a natural fidelity to fundamental American values of hard work, independence, basic fairness, and equality of opportunity, broadly favors some pragmatically "liberal" government policies. Those policies include public education, progressive taxation, food stamps, and other economic support programs that make it possible for the poor to maintain themselves and those born into poor families to have a genuine opportunity to achieve better lives. Merely saying, "you can do it if you work hard enough," is not enough. For our egalitarian values to mean anything, they have to be backed up by access to the tools that a talented and determined young person can really use to achieve success.

This won't be a welcome message to everyone. We have some politicians who are deeply invested in the idea that the rich resent taxation, and that the middle class resent any money spent on the poor. Page and Jacobs questioned that, and decided to dig into the question in the most pragmatic possible way: looking at, and analyzing, polls on social and economic issues conducted over the last seventy years, plus a new, large-scale, comprehensive poll, on the same questions, using the same wording. What they found is startling: We are not divided on party lines, or economic lines, or social class lines, or geographic lines. In both major parties, all economic classes, and every region of the country, Americans favor both individualism and self-reliance, as well as public intervention to make the "playing field" fair enough to give everyone a real opportunity for success if they work at it. Across economic, geographic, and ideological lines, most Americans support a higher minimum wage, improved public education, wider access to health insurance coverage, and the use of tax dollars to fund these programs. Why? Because you don't have a realistic, fair shot at success, no matter how hard you're willing to work, if you can't get a decent education, or if you can't get medical care when you're sick, or if working full-time at a minimum wage job doesn't provide you the security and stability to save, get more education or training, and take that next step up the ladder.

Recommended.

I received a free electronic copy of this book from the publisher.… (altro)

Wishing we were Canada

The basic problem is that while government is purposely structured to foster delays, obstruction and compromise, central bankers come to the Fed table “largely in agreement with the bankers’ view of the world.” They take care of their billionaire friends, and ignore the millions who lost their homes. The Fed is populated by bankers rather than career civil servants. Everyone there is looking for the jump to a far more lucrative post in banking. Your financial health and safety are of no concern, according to Fed Power.

Unlike any other body but the Supreme Court, the Fed is an independent government with the government. It bows to no one, makes investments at will, makes profits, and spends it at will. It (now) has the right to print money at will, buy whole banks and businesses when it feels the need, and supports the financial sector to the exclusion of all else. After all, big finance lobbies on the Fed’s behalf, continuously, so it’s only fair. In the context of the constitution of the United States, this is wrong.

There is precious little the Fed reveals about itself. Jacobs and King have collected what there is, and plowed through the minutes the Fed publishes – years after the fact. The book follows the history of the need for a central bank, and the milestones of the years since it came to be in 1913. In addition to everyone’s complaints about the Fed, they expand on these:
-The Fed is simply overtaking fiscal policy in the USA.
-Its scope creep over the decades has become a scope explosion as it takes over tasks and territory (notably from the Treasury Department) at will.
-It made 21,000 transactions on its own account between 2007 and 2009, totaling $7.7 trillion
-It, along with big finance, drains all the best brains away from innovation and industry, with its inequality-building salaries. With those brains, they produce literally nothing.
-The whole problem goes back to Herbert Hoover who amended section 13 (3) to allow the Fed to “act in unusual and exigent circumstances,” apparently without oversight, reporting or restriction.

The authors’ solution, which they mention throughout, is Canada. Canada’s central bank went through little of the crisis and debt and foreclosures that the US did, because it is professionally managed by career civil servants, who work in far more transparent circumstances, overseen by Parliament. The restrictions on banks and mortgages are far more stringent, yet far from crippling the financial sector, Canada’s six major national banks are among the biggest in the world, and big players in the US. Finally, the head of the bank, Mark Carney, was hired across the ocean to run the Bank of England, the first such appointment in history. They must think he knows something they (and clearly Americans) don’t.

David Wineberg… (altro)

This book feels a lot like a missed opportunity: it could have done so much more, and be a rebuttal to Murray's Coming Apart: The State Of White America, 1960-2010 , but sadly, it does not.
In a nutshell, the central argument the authros make is: it is not true that Americans are against taxes: they are happy to pay them if they go to deserving causes, which include education projects as well as helping out those hard working people who have lost their job through no fault of their own. This is based on evindence coming from various surveys plus one commissioned by the authors.
The two main shortcomings for me are first of all, as several people have already noted, the books is quite repetitive. Secondly, they could have done much more in presenting the data - these are almost always presented disaggregated by the categories "All americans, Republicans, High income", with no further "shading", e.g. controlling for the type of occupation, or geographical location, numb er of children and so on. It could be because this would have generated a sparsely populated table (after all, their original survey only includes just over 600 individuals), but still it would have been good to know. For instance, when the authors state that

Only 30 percent of Republicans and 30 percent of the affluent support “decreased” taxes in general

, we do not know how much these two categories overlap, so that it could in principle be that no Republicans are affluent, so that there is a 60% support for decreased taxes.

In addition, if the evidence is so strong, they should have let it speak more, whereas in various places the exposition feels not at all objective (e.g. when a 4% changes from modest to many, as in "the modest 35 percent who said they favored abolishing the estate tax" and "many Americans (39 percent) realize that lower-income people pay more of their earnings in payroll taxes"). Or similarly, not really probing the isues, as for instance when they claim that Republicans do not represent their voters: so why do voters keep voting them?

In short, I am glad I read this book as it was somewhat informative, but I am glad this was one of the monthly freebies from the University of Chicago Press.… (altro)