If you want a gauge of the state of America, the country that put billionaire Donald Trump in the White House, consider this: the three richest Americans -- Bill Gates, Jeff Bezos, and Warren Buffett -- now have the wealth of the bottom half of the U.S. population, or 160 million Americans. Or consider this: the 2016 Wall Street bonus pool, as former Labor Secretary Robert Reich pointed out recently, was larger than the yearly earnings of "all 3.3 million Americans working full time at or below the federal minimum wage of $7.25 an hour." And keep in mind that the Trump-Republican tax "reform" bill, if passed, will only make such figures more mind-boggling. It will assumedly send so much more money cascading upward that the copious funding of future 1% elections will be guaranteed for our "democratic" lifetimes.
And if anyone was in doubt about the nature of Donald Trump's "populism," he answered that question within weeks of his election when he began appointing the wealthiest cabinet in American history. It was already clear by then who he really thought the "forgotten men and women of this country" were: former Goldman Sachs partners with at least a few hundred million dollars in their pockets. In this new Gilded Age (in which, I suspect, disparities in wealth may actually become worse than in the nineteenth century version of the same), isn't it time to stop talking about "trickle down economics" and come up with some new phrase? Gusher economics? We certainly need something that comes closer to capturing the realities of a moment in which, for instance, that tax bill will offer a staggering one-half of its cuts to the top 1% while, as Robert Borosage writes in the Nation, "raising taxes on families earning $10,000-$75,000 over the next decade" and even eliminating a tax credit that incentivizes employers to hire disabled veterans.
With that in mind, TomDispatch regular Rajan Menon takes a clear-eyed look at the populism of the Trumpian moment, the growing inequality that is increasingly the heart and soul of this society, and what is(n't) being done about it. Tom
Twenty-First-Century American Populism
Or Putting Your Mouth Where Your Money Isn't
By Rajan Menon
Among the stranger features of the 2016 election campaign was the success of Donald Trump, a creature of globalization, as an America First savior of the white working class. A candidate who amassed billions of dollars by playing globalization for all it was worth -- he manufactured clothes and accessories bearing his name in low-wage economies and invested in corporations eager to outsource -- won over millions of voters by promising to keep jobs here in the U.S.
Admittedly, only a third of his voters earned less than $50,000 a year and cultural and racial resentment, not just economic grievances, drove many of them to Trump. Still, in an ever more economically unequal America, his populist economic message resonated. It helped him win the presidency by peeling off white working class votes in key regions, particularly the industrial Midwest. Now, he's stuck with his populist narrative, and here's the problem for him: it's not likely to work -- not given the economic realities of this planet, not for long anyway.
Fading Economic Hegemony
In the Oval Office, as on the campaign trail, Trump's refrain remains that the economic woes of American workers, including stagnant wages and job insecurity, are the fault of predatory Asian and Mexican exporters, aided and abetted by inept past presidents who inked lousy trade deals. During campaign 2016, he promised to kick down doors abroad and force countries running surpluses, notably China, to buy more from the United States or face huge tariff hikes. He railed against companies that relocate production abroad, depriving Americans of jobs.
Trump's economic nationalism is, of course, a con job. He did, however, effectively employ the demagogue's artifice, which invariably lies in crafting simplistic answers to complicated questions and creating plausible scapegoats for complicated problems. In fact, workers in industries the United States dominated for decades are in distress because of irreversible historic changes and the absence, thanks to a staggeringly lopsided distribution of wealth and political power in America, of progressive policies that would better prepare them to cope with the changes that have occurred in the international economy.
But first, a little history.
For nearly three decades after World War II, the United States dominated the global marketplace in big-ticket industries like steel, automobiles, passenger aircraft, shipbuilding, and heavy machinery. That hegemony was bound to fade. As a start, America's postwar economic primacy owed much to the ravages of that global conflict. After all, the industrial bases of Japan and Germany lay in ruins. Wartime allies Britain and France faced long, arduous recoveries. But the economies of those industrialized, technologically advanced countries were bound to recover -- and by the mid-1970s they had. By then, America's near-monopoly was ending.
Between 1965 and 2010, the share of the national market held by America's steelmakers and carmakers plunged from nearly 90% to 45%. By the 1970s, they were already complaining about an influx of "cheap imports" and lobbying Washington to enact countermeasures. Now regarded as the ultimate free trader, President Ronald Reagan would indeed oblige them. In 1981, for instance, he limited Japanese automobile sales in the U.S., while hiking tariffs tenfold on motorcycle imports to save Harley-Davidson. European and Japanese steel companies would soon face similar restrictions.
Seen in historical perspective, Washington's reaction to trade competition was hardly unique. Britain, too, had preached free trade during its economic heyday -- until, that is, its imperial predominance began to wane. In the nineteenth century, the zenith of British free trade cheerleading, the United States relied heavily on protectionism to ensure the growth of its nascent industrial base. As its economic power expanded, however, its own version of such cheerleading began. Now, China is fast becoming an economic superpower. Unsurprisingly, at conclaves like the Davos World Economic Forum at the Asia-Pacific Economic Cooperation summit, President Xi Jinping is predictably starting to sound more like Adam Smith than Karl Marx, just as Donald Trump's speeches during his November whirlwind trip through Asia are coming to resemble nineteenth-century American rationales for protectionism.
Since the 1970s, workers in places like Detroit, Bethlehem, and Peoria have faced another challenge: a range of new sources of competition, especially the "Asian tigers" like South Korea and Taiwan. Once considered inferior, their products have by now become a hallmark of quality, making South Korean or Japanese cars, cellphones, computers, and television sets ubiquitous in this country.
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