Ronald Reagan

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The America That Reagan Built by J. David Woodard

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affirmative action, anti-communist, Ayatollah Khomeini, Berlin Wall, Bonfire of the Vanities, colonial rule, Columbine, corporate raider, cuban missile crisis, Deng Xiaoping, friendly fire, glass ceiling, global village, Gordon Gekko, gun show loophole, income inequality, invisible hand, Jeff Bezos, laissez-faire capitalism, late capitalism, Live Aid, Marc Andreessen, Mikhail Gorbachev, mutually assured destruction, Neil Kinnock, new economy, postindustrial economy, Ralph Nader, Robert Bork, Ronald Reagan, Ronald Reagan: Tear down this wall, Rubik’s Cube, Silicon Valley, South China Sea, stem cell, Ted Kaczynski, The Predators' Ball, trickle-down economics, women in the workforce, Y2K, young professional

The epoch began with World War II’s ‘‘Greatest Generation’’ in charge, and ended with their children running things. George Herbert Walker Bush and his son George W. Bush were a metaphor for leadership change in the whole country. But it was Ronald Reagan who set the tone for politics in the twentyfive years since his election in 1980. At his funeral in June of 2004, President George W. Bush said in the eulogy, ‘‘Ronald Reagan belongs to the ages now, but we preferred it when he belonged to us.’’ The Reagan legacy remained. His 248 Epilogue President George W. Bush bows at the casket of former President Ronald Reagan after giving a eulogy at the funeral service for President Ronald Reagan at the National Cathedral in Washington, DC, June 11, 2004. (White House photo by Tina Hager) foreign and domestic policies were the template for all his successors. The words on Reagan’s Georgian gray granite headstone could sum up the twentyfive years of American political history discussed here.

Presidents matter, but so do governors, Supreme Court justices, and legislators. The election of Ronald Reagan and Bill Clinton, the governorship of George W. Bush in Texas, the nomination of Clarence Thomas to the U.S. Supreme Court, and the ‘‘Contract with America’’ all changed the course of politics for the nation as a whole. Their outcome, ratified or rejected in elections, also influenced the cultural agenda for a time. Prologue xi Almost without exception, election outcomes are the chapter divisions in this book. The most important one was 1980, when Ronald Reagan forged a conservative governing coalition that changed the course of American politics. While every personality discussed in this book had an influence, Ronald Reagan towered over them all. His election and re-election, both by landslide margins, ended a string of five failed presidencies.

Vanderbilt Television News Archive, July 20, 1982. 59. New York Times, January 21, 1981. 60. New York Times, January 21, 1983. 61. Dinesh D’Souza, Ronald Reagan (New York: Touchstone Books, 1997), p. 109. 62. Vanderbilt Television News Archive, June 11, 1984. 63. Peter Schweizer, Reagan’s War (New York: Doubleday, 2002), p. xi. 64. Peter Schweizer, Reagan’s War (New York: Doubleday, 2002), p. 15. 65. Ronald Reagan Presidential Library, ‘‘Speeches,’’ March 8, 1983. 66. Peter Schweizer, Reagan’s War (New York: Doubleday, 2002), p. 144. 67. New York Times, June 21, 1984. 68. New York Times, October 26, 1982. 69. Lawrence I. Barrett, Gambling with History (New York: Penguin Books, 1983), pp. 73–74. 70. Ronald Reagan Presidential Library, ‘‘Speeches,’’ May 9, 1982. 71. Seymour M. Hersch, The Target Is Destroyed (New York: Random House, 1986). 72.


pages: 372 words: 115,094

Reagan at Reykjavik: Forty-Eight Hours That Ended the Cold War by Ken Adelman

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anti-communist, Berlin Wall, British Empire, cuban missile crisis, Deng Xiaoping, Dissolution of the Soviet Union, Donald Trump, F. W. de Klerk, Fall of the Berlin Wall, Haight Ashbury, Kitchen Debate, kremlinology, Mikhail Gorbachev, mutually assured destruction, old-boy network, Ronald Reagan, Ronald Reagan: Tear down this wall, Saturday Night Live, Sinatra Doctrine, War on Poverty, Yogi Berra

The five-star general made a surprise appearance in Reykjavik and led the Soviet arms team in making unprecedented concessions during an all-night Saturday session. (Ronald Reagan Library) The official U.S. residence in Reykjavik, which the ambassador had to vacate for the president’s stay, was filled with the antlers of assorted animals the ambassador had shot. Amid all the antlers, the president frequently called Nancy back home, calls that always cheered him up. (Ronald Reagan Library) Downtime for the U.S. team in Reykjavik came only at the outset of meals. Here Reagan was joking while, to his right, Shultz and Poindexter prepared a paper to present over lunch. To the president’s left is Don Regan. Nearest the camera are Max Kampelman on the left and the author on the right. (Ronald Reagan Library) Late Sunday afternoon on the second floor of Hofdi House, Reagan read over the U.S. final offer.

Bush wished him well, and then issued a statement from the White House praising Gorbachev for working with Reagan “boldly and decisively to end the Cold War and liberate the Soviet people from Communist dictatorship.” From his home in California, Ronald Reagan issued a statement saying that Gorbachev “will live forever in history” and that freedom-loving people should forever be grateful to him. Late that afternoon, with the Moscow winter sky already dark, the red hammer and sickle flag was lowered from the pole at the top of the Kremlin. A white, blue, and red flag of the Russian Federation was raised in its place. The Cold War thus ended just as Ronald Reagan had said it would. We won. They lost. Chapter 10 Reflections and Conclusions on Reykjavik If, as stated in the introduction, the Reykjavik summit resembles a classic mystery thriller à la Agatha Christie, then the question naturally arises, “Who done it?” In this case, we know who—Ronald Reagan and Mikhail Gorbachev. But we are less sure of the “it.”

This assessment was shared by the U.S. and Soviet ambassadors—Arthur Hartman in Moscow and Yuri Dubinin in Washington—during separate meetings in Shultz’s inner office. Secure in our assessment, we had no problem with the grip-and-grin session we came to expect, if that would indeed help Gorbachev. After all, nobody was better at gripping and grinning than Ronald Reagan. THE AIR FORCE ONE carrying Reagan to Iceland—Sam 27000—had joined the presidential fleet in 1972. Although it was small compared with the 747 that would replace it, it had a history and a scale that Reagan loved. It was good that he did, since he would log more miles on it (630,000) than any of his predecessors. Fittingly, that plane now resides in the Ronald Reagan Presidential Library, seeming almost airborne on display in its own pavilion. Behind the presidential quarters were the staff conference area and a handful of seats for top presidential aides and secretaries.


pages: 286 words: 79,601

Great American Hypocrites: Toppling the Big Myths of Republican Politics by Glenn Greenwald

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affirmative action, anti-communist, cuban missile crisis, David Brooks, national security letter, Ronald Reagan, Saturday Night Live, The Wealth of Nations by Adam Smith

Unfortunately for then vice president George Herbert Walker Bush, political pundits and other opinion makers of the 1980s, like those of the 1880s, did not take kindly to aristocratic manners, generally seeing them as feminine…. This was a perception held as much—if not more—by Republicans as by Democrats. Alexander Haig, Ronald Reagan’s close friend Senator Paul Laxalt, and even Reagan himself regarded Bush as effete and unmanly. Newspaper articles appeared describing his life as one devoted to pleasing others. Conservative columnist George Will dismissed Bush as “lap dog” with a “thin tinny arf.” There are multiple levels of irony here, beginning with the fact that Ronald Reagan, depicted as the epitome of salt-of-the-earth, manly courage, avoided combat during World War II, remaining instead in Hollywood as a coddled actor, while George H. W. Bush, by all accounts, heroically served his country during that war as a fighter pilot.

This functions exactly the same as the images of moral purity that they work so hard to manufacture, whereby the leaders they embrace—such as Gingrich, Limbaugh, Bill Bennett, even the divorced and estranged-from-his-children Ronald Reagan and Coulter herself (with her revolving door of boyfriends and broken engagements)—are plagued by the most morally depraved and reckless personal lives, yet still parade around as the heroes of the “Values Voters.” Just as what matters is that their leaders present themselves as moral (even while deviating as far as they want from those standards), what matters to them also is that their leaders playact as strong and masculine figures, even when there is no basis, no reality, to the playacting. Like John Wayne, Ronald Reagan never got anywhere near war (claiming eyesight difficulties to avoid deployment in World War II), and he spent his life as a Hollywood actor, yet to this day, conservatives swoon over his masculine role-playing as though he was some sort of super-brave military hero.

As McGovern put it in a 2007 Los Angeles Times editorial, responding to accusations from Dick Cheney equating “McGovernism” with cowardice and surrender: In the war of my youth, World War II, I volunteered for military service at the age of 19 and flew 35 combat missions, winning the Distinguished Flying Cross as the pilot of a B-24 bomber. By contrast, in the war of his youth, the Vietnam War, Cheney got five deferments and has never seen a day of combat—a record matched by President Bush. While Republicans have ensured that virtually every asset of America bears the name of Ronald Reagan—including a glorious battleship, the USS Ronald Reagan—right-wing tough guys who never spent a day in the military protested and mocked endlessly when it was announced, in 2005, that a submarine would be named after the Navy veteran Jimmy Carter. Carter is a graduate of the Naval Academy, having attended during World War II. In the Navy he became a submariner, serving in both the Atlantic and Pacific fleets, and he rose to the rank of lieutenant.


pages: 323 words: 95,188

The Year That Changed the World: The Untold Story Behind the Fall of the Berlin Wall by Michael Meyer

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Ayatollah Khomeini, bank run, Berlin Wall, Bonfire of the Vanities, Bretton Woods, BRICs, call centre, Fall of the Berlin Wall, falling living standards, Francis Fukuyama: the end of history, haute couture, mass immigration, Mikhail Gorbachev, mutually assured destruction, Ronald Reagan, Ronald Reagan: Tear down this wall, union organizing

Peter Robinson’s fascinating book, How Ronald Reagan Changed My Life, 2003, was a key source for the background on Reagan’s immortal speech. Additional references: Hoover Digest, “Tearing Down That Wall,” by Peter M. Robinson, reprinted from the Weekly Standard, June 23, 1997. Also by Robinson, “Why Reagan Matters,” Speech to the Commonwealth Club, January 7, 2004. Ronald Reagan: Remarks at the Brandenburg Gate, West Berlin, June 12, 1987; Address to the Students of Moscow University, May 31, 1988. I cite James Mann’s masterly history of the George W. Bush administration’s foreign policy and its ideological antecedents, Rise of the Vulcans: The History of Bush’s War Cabinet, 2004, further elaborated in “Tear Down That Myth,” a New York Times op-ed, June 10, 2007. An excellent analysis of Ronald Reagan’s transition from intransigent Cold War warrior to flexible partner in peace can be found in Bradley Lightbody’s The Cold War, 1999.

For them, the revolutions of 1989 became the foundation of a new post–Cold War weltanschauung: the idea that all totalitarian regimes are similarly hollow at the core and will crumble with a shove from the outside. If its symbol is the Berlin Wall, coming down as Ronald Reagan famously bid it to do in a speech in Berlin in 1987, the operational model was Nicolae Ceausescu’s Romania. “Once the wicked witch was dead,” as Francis Fukuyama, the eminent political economist, has put it, “the munchkins would rise up and start singing joyously about their liberation.” It is true that instead of seeking to contain the former Soviet Union, as previous administrations had done, the United States under Ronald Reagan chose to confront it. He challenged Mikhail Gorbachev not only to reform the Soviet system from within but to “tear down this wall.” Yet other factors figured in this equation, not least a drop in oil prices from roughly $40 a barrel in 1980 to less than $10 a decade later, not to mention the Soviet leader’s own actions.

Among those who swung their hammers to bring it down, said Bush, there was no doubt: “The hardest blow had been struck by President Ronald Reagan.” As Bush saw it, Reagan’s world was one of moral absolutes—right and wrong, black and white. As Reagan stood up to confront communist tyranny, so would he stand up to a more modern challenge. The “evil empire” became the new president’s “war on terror,” the “axis of evil.” Yet the essential narrative of a grand struggle against an implacable enemy of freedom remained unchanged. Standing aboard the USS Lincoln on May 1, 2003, Bush declared “mission accomplished” in Iraq, a triumph for liberty in the tradition of Roosevelt’s Four Freedoms, the Truman Doctrine and “Ronald Reagan’s challenge to an evil empire.” In a 2005 speech to the National Endowment for Democracy (delivered in the Reagan Amphitheater), he spoke of how the fight against Islamic radicalism “resembles the struggle against communism in the last century.”


pages: 1,351 words: 404,177

Nixonland: The Rise of a President and the Fracturing of America by Rick Perlstein

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affirmative action, Alistair Cooke, Bay Area Rapid Transit, Berlin Wall, Bretton Woods, cognitive dissonance, cuban missile crisis, delayed gratification, desegregation, East Village, European colonialism, full employment, Golden Gate Park, Haight Ashbury, immigration reform, In Cold Blood by Truman Capote, index card, indoor plumbing, Kitchen Debate, liberal capitalism, Mahatma Gandhi, Marshall McLuhan, Monroe Doctrine, moral panic, New Urbanism, Norman Mailer, Own Your Own Home, Paul Samuelson, Plutocrats, plutocrats, price mechanism, Ralph Nader, RAND corporation, rolodex, Ronald Reagan, sexual politics, the medium is the message, traveling salesman, upwardly mobile, urban planning, urban renewal, walking around money, War on Poverty, white picket fence, Whole Earth Catalog

De Groot, “Ronald Reagan and Student Unrest in California, 1966–1970,” Pacific Historical Review 65, no. 1 (1996). More or less, Brown was doing: “Reagan Called Brown Choice for Nomination,” LAT, January 4, 1966. “‘Bring him on’”: Bill Boyarsky, The Rise of Ronald Reagan (New York: Random House, 1968), 113. A young assistant was sent: Ibid., 112. Pat was not the most inspiring: Lou Cannon, Governor Reagan: His Rise to Power; Jack Langguth, “Political Fun and Games in California,” NYTM, October 16, 1966. Reagan punditry fixated: David Broder and Stephen Hess, The Republican Establishment: The Present and Future of the GOP (New York: Harper & Row, 1967), 246. An editorial cartoon depicted Goldwater: Ibid., 276. Elizabeth Taylor, Borax Boy: Ibid., 246. Lassie, Liberace: “Ronald Reagan to the Rescue!”

The Los Angeles Times columnist Paul Coates described the panicked calls he was getting from readers: “My wife just called. Said she heard five was dead. And they’re spreading out all over town. This time I’m gonna get me a gun.” At his announcement in January of his candidacy for California governor, Ronald Reagan had blamed the original Watts riot on the “philosophy that in any situation the public should turn to government for the answer.” Now he denounced Governor Brown. And the New York Times—which had last taken note of the California governor’s race in mid-February, commenting on how little attention the actor Ronald Reagan had been able to garner since “his dramatic and carefully rehearsed television entry into the race” (the paper had sent its Hollywood correspondent to cover it, and he had dwelled on the living-room set with the crackling fire, and props such as the bottle Reagan waved while warning how “social tinkering had caused the layoff of 200 workers in ketchup factories”)—now reported, “A withering crossfire of political accusations emerged today after Tuesday’s violent outbreak.”

The Chicago Trib responded, “When American soldiers are dying daily in Vietnam, demonstrations that block traffic on busy streets are very likely to lead to violence”—and that this would be the demonstrators’ fault. Ronald Reagan maneuvered to force Berkeley president Clark Kerr’s resignation. Evidence suggests it may have been quid pro quo to J. Edgar Hoover. Reagan’s security clearance form as governor required him to answer the question “Are you now, or have you ever been, a member of any organization which has been designated by the United States Attorney General under the provisions of Executive Order 10450?” and warned that “any false statement herein may be punished as a felony.” Reagan answered no, untruthfully, but the FBI looked the other way. Hoover was like most conservatives: they tended to cut Ronald Reagan slack. Though he had just proposed the largest tax increase in California history, they were promoting him for president.


pages: 391 words: 102,301

Zero-Sum Future: American Power in an Age of Anxiety by Gideon Rachman

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Asian financial crisis, bank run, battle of ideas, Berlin Wall, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Bretton Woods, BRICs, capital controls, centre right, clean water, collapse of Lehman Brothers, colonial rule, currency manipulation / currency intervention, deindustrialization, Deng Xiaoping, Doha Development Round, energy security, failed state, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, full employment, global reserve currency, greed is good, Hernando de Soto, illegal immigration, income inequality, invisible hand, Jeff Bezos, laissez-faire capitalism, Live Aid, market fundamentalism, Martin Wolf, mass immigration, Mexican peso crisis / tequila crisis, Mikhail Gorbachev, moral hazard, mutually assured destruction, Naomi Klein, offshore financial centre, open borders, open economy, Peace of Westphalia, peak oil, pension reform, Plutocrats, plutocrats, popular capitalism, price stability, RAND corporation, reserve currency, rising living standards, road to serfdom, Ronald Reagan, shareholder value, Sinatra Doctrine, sovereign wealth fund, special economic zone, Steve Jobs, Stewart Brand, The Chicago School, The Great Moderation, The Myth of the Rational Market, Thomas Malthus, trickle-down economics, Washington Consensus, Winter of Discontent, zero-sum game

Campbell, Iron Lady, 243. 16. Ibid., 253. 17. Thatcher, Downing Street, 804. 18. Ibid., 687. 19. Campbell, Iron Lady, 260. 20. Ibid. 21. Thatcher, Downing Street, 485. 3. THE UNITED STATES, 1980: THE REAGAN REVOLUTION 1. Ronald Reagan, An American Life (New York: Simon & Schuster, 1990), 227. 2. Roger Rosenblatt, “Man of the Year 1980: Ronald Reagan,” Time, January 2, 1981, 3. 3. Reagan wrote in his diary in 1982 that the press was wrong to argue that he was taking aim at the New Deal, and that his real target was the Great Society. See Dinesh D’Souza, Ronald Reagan: How an Ordinary Man Became an Extraordinary Leader (New York: Simon & Schuster, 1997), 61. 4. Reagan, American Life, 230. 5. D’Souza, Reagan, 89. 6. Sean Wilentz, The Age of Reagan: A History, 1974–2008 (New York: HarperCollins, 2008), 144.

They are queuing up to obtain the new British cure.”15 In even more grandiloquent mode, she claimed as early as 1982 that Britain was “teaching the nations of the world how to live.”16 On a visit as prime minister to Mikhail Gorbachev’s Russia in 1990, she noted wryly that the new mayor of Moscow appeared to be a disciple of her own economic guru, Milton Friedman.17 In her memoirs she boasted proudly, “Britain under my premiership was the first country to reverse the onward march of socialism.”18 By the end of her period in office, Thatcher was increasingly worried that the European Union posed a threat to her free-market policies in Britain. She was, by contrast, an unabashed admirer of the United States in general and of Ronald Reagan in particular. Her speechwriter Ronnie Miller remarked, “She loved America … and America loved her back.”19 John Campbell, her biographer, believes that “a part of her would really rather have been American.”20 As the Soviet bloc began to crumble, the partnership of Thatcher and Reagan took on a global significance. Thatcher was not exaggerating hugely when she wrote in her memoirs, “The West’s system of liberty, which Ronald Reagan and I personified in the eastern bloc, was increasingly in the ascendant; the Soviet system was showing its cracks.”21 While Thatcher and Reagan’s support of democracy in Eastern Europe fits a narrative in which the advances of economic and political freedom throughout the 1980s were essentially inseparable, elsewhere things were more complicated.

Thatcher notoriously referred to Nelson Mandela’s African National Congress as a “terrorist” organization—and there are warm references in her memoirs to dictators such as Suharto of Indonesia and General Augusto Pinochet in Chile. But while Thatcher may have exaggerated the extent to which she and Ronald Reagan always represented “freedom,” there is no doubt about the potency and importance of their transatlantic partnership and their promotion of free markets. Together with Mikhail Gorbachev and Deng Xiaoping, Thatcher and Reagan were the dominant figures of the Age of Transformation. 3 THE UNITED STATES, 1980 THE REAGAN REVOLUTION All new American presidents seek to capture the spirit of the age in their inaugural addresses. Ronald Reagan did it more completely than most when he stood facing west behind the Capitol building in January 1981 and proclaimed, “In the present crisis, government is not the solution to our problems, government is the problem.”


pages: 772 words: 203,182

What Went Wrong: How the 1% Hijacked the American Middle Class . . . And What Other Countries Got Right by George R. Tyler

8-hour work day, active measures, activist fund / activist shareholder / activist investor, affirmative action, Affordable Care Act / Obamacare, bank run, banking crisis, Basel III, Black Swan, blood diamonds, blue-collar work, Bolshevik threat, bonus culture, British Empire, business process, capital controls, Carmen Reinhart, carried interest, cognitive dissonance, collateralized debt obligation, collective bargaining, commoditize, corporate governance, corporate personhood, corporate raider, corporate social responsibility, creative destruction, credit crunch, crony capitalism, crowdsourcing, currency manipulation / currency intervention, David Brooks, David Graeber, David Ricardo: comparative advantage, declining real wages, deindustrialization, Diane Coyle, Double Irish / Dutch Sandwich, eurozone crisis, financial deregulation, financial innovation, fixed income, Francis Fukuyama: the end of history, full employment, George Akerlof, George Gilder, Gini coefficient, Gordon Gekko, hiring and firing, income inequality, invisible hand, job satisfaction, John Markoff, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, labor-force participation, labour market flexibility, laissez-faire capitalism, lake wobegon effect, light touch regulation, Long Term Capital Management, manufacturing employment, market clearing, market fundamentalism, Martin Wolf, minimum wage unemployment, mittelstand, moral hazard, Myron Scholes, Naomi Klein, Northern Rock, obamacare, offshore financial centre, Paul Samuelson, pension reform, performance metric, pirate software, Plutocrats, plutocrats, Ponzi scheme, precariat, price stability, profit maximization, profit motive, purchasing power parity, race to the bottom, Ralph Nader, rent-seeking, reshoring, Richard Thaler, rising living standards, road to serfdom, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, Sand Hill Road, shareholder value, Silicon Valley, South Sea Bubble, sovereign wealth fund, Steve Ballmer, Steve Jobs, The Chicago School, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, transcontinental railway, transfer pricing, trickle-down economics, tulip mania, Tyler Cowen: Great Stagnation, union organizing, Upton Sinclair, upwardly mobile, women in the workforce, working poor, zero-sum game

Until the Tea Party election of 2010, almost all Congressional Republicans went along, as Rothbard noted: “conservative Republicans … found themselves adjusting rather easily to the new era of huge permanent deficits.”27 Republican Party Budget Deficits Ronald Reagan’s attributes, especially his joviality, his ability to inspire, and his fear of nuclear weapons, demand admiration. But balancing a checkbook was obviously not one of his talents. Ronald Reagan proved no more resistant to the siren call of deficit spending and easy credit than the most spendthrift Pharaoh, Roman emperor, or Oriental potentate shaving silver coins to debase their monetary base. In the Dark Ages, as trade dwindled and copper mines closed, coins became so shaven that some claimed they could float, like Jackson dollars 600 years later.28 In aping that behavior, Ronald Reagan was just another in a long line of irresponsible spendthrifts. His deliberate decision to pursue deficits of choice repudiated the foundation of the golden age, replacing it with the notion that America could somehow routinely prosper beyond its means by borrowing from its children.

Nothing that this nation, or any other nation, has done in modern economic history compares in difficulty with the selling job that must now be done to make people accept the new reality.”44 A showman of extraordinary ability, ideally unschooled in economic history, was required if families were to be convinced to vote against their own economic interest. That leadership was provided by the charismatic and trusted Ronald Reagan. Much of the subsequent success in stripping economic sovereignty from families that we discuss shortly lies with the advocacy role of Friedman and his powerful ability to appeal to wealthy executive suites and, through them, to Ronald Reagan. Similar to prominent twentieth-century scientists such as Francis Crick or Linus Pauling, Friedman’s professional accomplishments lent undue weight to his personal philosophical musings. With the test of time, however, his Reaganomics has proven no more credible than Crick’s flirtation with eugenics or Pauling’s belief in megadoses of vitamin C.

BUSH, President, November 2008 “The economics literature, based on correlation or regression coefficients, suggests that the United States may, indeed, be exceptional, but not in having more mobility, but in having less, a finding our results support.”2 MRAKUS JÄNTTI, et al, University of Oslo, 2005 [College in America] “Rich, stupid children are more likely to graduate than poor, clever ones.”3 Economist, April 17, 2010 [The dominant role of parental wealth] “… very manifestly displays the anti-meritocracy in America—the reproduction of social class without the inheritance of any innate ability.”4 DALTON CONLEY, Director, Center for Advanced Social Science Research, New York University, December 2007 America is the only rich democracy in the twenty-first century where birth remains destiny—and I think it’s because Ronald Reagan never understood John Ford. I can understand him not appreciating Jean-Jacques Rosseau, maybe John Locke, or even Frank Capra. But John Ford? It’s all there in the greatest Western of all, My Darling Clementine. President Reagan loved his cowboys, especially stories about individual heroes like Wyatt Earp. He watched Clementine but didn’t see it, and proved clueless when it came to Ford’s evocative message. After all, it was the community that hired Earp and sparked the gunfight at the OK Corral, banding together in joint action to improve their lives by creating new opportunity, their eyes set on the future. In contrast, the politician Ronald Reagan chose to demonize the communitarian spirit and the notion that the business community has broad responsibilities to society.


pages: 1,242 words: 317,903

The Man Who Knew: The Life and Times of Alan Greenspan by Sebastian Mallaby

airline deregulation, airport security, Andrei Shleifer, anti-communist, Asian financial crisis, balance sheet recession, bank run, barriers to entry, Benoit Mandelbrot, Bretton Woods, central bank independence, centralized clearinghouse, collateralized debt obligation, conceptual framework, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, currency peg, energy security, equity premium, fiat currency, financial deregulation, financial innovation, fixed income, Flash crash, forward guidance, full employment, Hyman Minsky, inflation targeting, information asymmetry, interest rate swap, inventory management, invisible hand, Kenneth Rogoff, Kitchen Debate, laissez-faire capitalism, Long Term Capital Management, low skilled workers, market bubble, market clearing, Martin Wolf, money market fund, moral hazard, mortgage debt, Myron Scholes, new economy, Nixon shock, Northern Rock, paper trading, paradox of thrift, Paul Samuelson, Plutocrats, plutocrats, popular capitalism, price stability, RAND corporation, rent-seeking, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, Saturday Night Live, savings glut, secular stagnation, short selling, The Great Moderation, the payments system, The Wealth of Nations by Adam Smith, too big to fail, trade liberalization, unorthodox policies, upwardly mobile, WikiLeaks, women in the workforce, Y2K, yield curve, zero-sum game

“Right Move at the Eleventh Hour: Time Board of Economists Generally Backs Fed’s Decision,” Time, October 22, 1979, 24. 20. “Will the Last Remain First? A Cooler Ronald Reagan Enters the Race,” Time, November 26, 1979. 21. “‘President Reagan,’” New Republic, December 1, 1979. For further doubts about Reagan’s seriousness, see “Where Did He Get Those Figures? G.O.P. Front Runner Seems to Pluck Facts from Thin Air,” Time, April 14, 1980. 22. Notes from a meeting with Milton Friedman, January 21, 1980, folder “Meese, Ed—Campaign Planning—Meetings, January 1980,” Box 103, Ronald Reagan Campaign Papers, Ronald Reagan Governor’s Papers, 1965–1980, Ronald Reagan Presidential Library. 23. Arthur Laffer, “The Laffer Economic Report,” January 11, 1980, Research Policy (Hopkins/Bandow)—[Correspondence], box 453, Ronald Reagan 1980 Campaign Papers, Ronald Reagan Library. Emphasis original. 24. David A.

Skinner, Annelise Graebner Anderson, and Martin Anderson, eds., Reagan: A Life in Letters (New York: Free Press, 2003), 298–99. Quoted in Silber, Volcker: The Triumph, 195. 28. Ronald Reagan to Murray L. Weidenbaum, “Handwritten Note on Gordon Luce Correspondence,” 1981, box FG 143033198, Ronald Reagan Library. The author is grateful to Jerry L. Jordan for bringing this evidence to his attention. 29. Murray L. Weidenbaum to Ronald Reagan, memorandum, August 11, 1981, box FG 143033198, Ronald Reagan Library. The author is grateful to Jerry L. Jordan for providing a copy of this document. 30. Ronald Reagan to Gordon Luce, letter, August 14, 1981, Ronald Reagan Library. Copy obtained from Jerry L. Jordan. 31. Hobart Rowen, “Reagan Might Just Join the New Gold Rush,” Washington Post, August 20, 1981. 32.

For Anderson’s discussion of how he persuaded advisers to help Reagan, see Martin Anderson, Revolution: The Reagan Legacy (Stanford, CA: Hoover Press, 1990), 168. 40. See Edwin Meese, “Campaign Planning Meeting Notes,” n.d., all April and May 1979 Notes, Meese, Ed—Campaign Planning—Meetings, April 1979/May 1979, Box 103, 1980 Campaign Papers, Ronald Reagan Governor’s Papers, Ronald Reagan Library. 41. Martin, Greenspan: The Man Behind Money, 141. 42. Edwin Meese, “Notes and Agendas from Meeting on Public Policy Issues,” September 8, 1979, Meese, Ed—Campaign Planning—Meetings, September 1979, box 103, 1980 Campaign Papers, Ronald Reagan Governor’s Papers, Ronald Reagan Library. The following account derives from these sources. 43. Greenspan, interview by the author, April 11, 2011. CHAPTER ELEVEN 1. In January 1978, Burns had lamented, “We need an anti-inflation policy on the part of the Administration,” as though it were not the Fed’s responsibility to deliver one.


pages: 840 words: 202,245

Age of Greed: The Triumph of Finance and the Decline of America, 1970 to the Present by Jeff Madrick

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accounting loophole / creative accounting, Asian financial crisis, bank run, Bretton Woods, capital controls, collapse of Lehman Brothers, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, desegregation, disintermediation, diversified portfolio, Donald Trump, financial deregulation, fixed income, floating exchange rates, Frederick Winslow Taylor, full employment, George Akerlof, Hyman Minsky, income inequality, index fund, inflation targeting, inventory management, invisible hand, John Meriwether, Kitchen Debate, laissez-faire capitalism, locking in a profit, Long Term Capital Management, market bubble, minimum wage unemployment, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, Myron Scholes, new economy, North Sea oil, Northern Rock, oil shock, Paul Samuelson, Philip Mirowski, price stability, quantitative easing, Ralph Nader, rent control, road to serfdom, Robert Bork, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, Ronald Reagan: Tear down this wall, shareholder value, short selling, Silicon Valley, Simon Kuznets, technology bubble, Telecommunications Act of 1996, The Chicago School, The Great Moderation, too big to fail, union organizing, V2 rocket, value at risk, Vanguard fund, War on Poverty, Washington Consensus, Y2K, Yom Kippur War

In contrast, Wriston favored marking stocks to market because there was a true market for them. 25 HE TURNED AGAINST VOLCKER: Ibid., pp. 737, 760. 26 LEAST NOTICED WAS THE PLIGHT: Paul Krugman, “LDC Debt Policy,” in Feldstein, ed., American Economic Policy in the 1980s, p. 719. CHAPTER 7: RONALD REAGAN 1 HIS PROTESTANT MOTHER, THE DO-GOODER: Ronald Reagan with Richard G. Hubler, Where’s the Rest of Me?: The Ronald Reagan Story (New York: Duell, Sloan & Pearce, 1965), pp. 7–8. 2 ACCORDING TO RONALD REAGAN: Ibid., pp. 8–9. Also on Jack’s anger, see Robert Dallek, Ronald Reagan, The Politics of Symbolism (Cambridge: Harvard University Press, 1984), Chapter 1 in general. Dallek also makes much of Reagan’s fear of a loss of self-control, a more spurious claim, at least to the degree Dallek stresses it. 3 “HE SUCCEEDED IN EVERYTHING HE TRIED”: Lou Cannon, President Reagan: The Role of a Lifetime (New York: Simon & Schuster, 1991), p. 33. 4 HE SHOWED LITTLE OF THE DEEPER EMOTION: Garry Wills, Reagan’s America: Innocents at Home (New York: Doubleday, 1987), pp. 305–6. 5 REAGAN RETAINED: Edmund Morris, Dutch: A Memoir of Ronald Reagan (New York: Random House, 1999), pp. 157–60. 6 “THE PROFITS OF CORPORATIONS HAVE DOUBLED”: Dallek, Ronald Reagan, p. 27. 7 GARRY WILLS ARGUES PERSUASIVELY: Wills, Reagan’s America, pp. 288–97. 8 “THE COMMUNIST PLAN”: Reagan and Hubler, Where’s the Rest of Me?

High, highdzn v3.1 For Kim Contents Cover Title Page Copyright Dedication Introduction One REVOLUTION Prologue: Lewis Uhler Believer 1. Walter Wriston Regulatory Revolt 2. Milton Friedman Proselytizer 3. Richard Nixon and Arthur Burns Political Expediency 4. Joe Flom The Hostile Takeover and Its Consequences 5. Ivan Boesky Wanting It All 6. Walter Wriston II Bailing Out Citibank 7. Ronald Reagan The Making of an Ideology 8. Ted Turner, Sam Walton, and Steve Ross Size Becomes Strategy 9. Jimmy Carter Capitulation 10. Howard Jarvis and Jack Kemp Tapping the Anger 11. Paul Volcker, Jimmy Carter, and Ronald Reagan Revolution Completed Two THE NEW GUARD 12. Tom Peters and Jack Welch Promises Broken 13. Michael Milken “The Magnificent” 14. Alan Greenspan Ideologue 15. George Soros and John Meriwether Fabulous Wealth and Controversial Power 16. Sandy Weill King of the World 17. Jack Grubman, Frank Quattrone, Ken Lay, and Sandy Weill Decade of Deceit 18.

During the recession, Reed had slashed expenses, fired tens of thousands of employees, and made Citibank a more cautious and conservative lender, but Alan Greenspan cut interest rates sharply beginning in 1991, producing an economic recovery. Citibank returned to profitability. Now profits returned with economic recovery. By the mid-1990s, Reed had remade his reputation and saved the bank’s independence, but he was still not certain the giant bank could survive without a major partner. 7 Ronald Reagan THE MAKING OF AN IDEOLOGY In the 1960s, Ronald Reagan, well into his fifties, became the political leader of the conservative movement. To almost everyone’s surprise, the former actor won election as governor of California in 1966, even as political conservatives were defeated around him. One of his main strengths had been his understanding of the needs and fears of working people, of which he never lost sight. Sympathizing with them, he could convince them of his views, even if his policies ultimately conspired against them.

Who Rules the World? by Noam Chomsky

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Albert Einstein, anti-communist, Ayatollah Khomeini, Berlin Wall, Bretton Woods, British Empire, capital controls, corporate governance, corporate personhood, cuban missile crisis, deindustrialization, Donald Trump, Doomsday Clock, Edward Snowden, en.wikipedia.org, facts on the ground, failed state, Fall of the Berlin Wall, Howard Zinn, illegal immigration, Intergovernmental Panel on Climate Change (IPCC), invisible hand, liberation theology, Malacca Straits, Martin Wolf, Mikhail Gorbachev, Monroe Doctrine, nuclear winter, Occupy movement, oil shale / tar sands, one-state solution, Plutonomy: Buying Luxury, Explaining Global Imbalances, precariat, Ralph Waldo Emerson, Ronald Reagan, South China Sea, Stanislav Petrov, structural adjustment programs, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, trade route, union organizing, uranium enrichment, wage slave, WikiLeaks, working-age population

Significantly, he adds: “The astonishing feature of the federal fiscal position is that revenues are forecast to be a mere 14.4 per cent of GDP in 2011, far below their postwar average of close to 18 per cent. Individual income tax is forecast to be a mere 6.3 per cent of GDP in 2011. This non-American cannot understand what the fuss is about: in 1988, at the end of Ronald Reagan’s term, receipts were 18.2 per cent of GDP. Tax revenue has to rise substantially if the deficit is to close.” Astonishing indeed, but deficit reduction is the demand of the financial institutions and the superrich, and in a rapidly declining democracy, that’s what counts.21 Though the deficit crisis has been manufactured for reasons of savage class war, the long-term debt crisis is serious, and has been ever since Ronald Reagan’s fiscal irresponsibility turned the United States from the world’s leading creditor to the world’s leading debtor, tripling the national debt and raising threats to the economy that were rapidly escalated by George W.

., who led U.S. counterinsurgency and internal defense planning from 1961 to 1966, describes the unsurprising consequences of the 1962 decision as a shift from toleration of “the rapacity and cruelty of the Latin American military” to “direct complicity” in their crimes, to U.S. support for “the methods of Heinrich Himmler’s extermination squads.”19 One major initiative was a military coup in Brazil, backed by Washington and implemented shortly after Kennedy’s assassination, that instituted a murderous and brutal national security state there. The plague of repression then spread through the hemisphere, encompassing the 1973 coup that installed the Pinochet dictatorship in Chile and later the most vicious of all, the Argentine dictatorship—Ronald Reagan’s favorite Latin American regime. Central America’s turn—not for the first time—came in the 1980s under the leadership of the “warm and friendly ghost” of the Hoover Institution scholars, who is now revered for his achievements. The murder of the Jesuit intellectuals as the Berlin Wall fell was a final blow in defeating the heresy of liberation theology, the culmination of a decade of horror in El Salvador that opened with the assassination, by much the same hands, of Archbishop Óscar Romero, the “voice for the voiceless.”

Secretary of State George Shultz informed Israeli Foreign Minister Yitzhak Shamir that Washington “had considerable sympathy for the Israeli action,” which, to general approbation, he termed “a legitimate response” to “terrorist attacks.”9 A few days later, the UN Security Council unanimously denounced the bombing as an “act of armed aggression” (with the United States abstaining).10 “Aggression” is, of course, a far more serious crime than international terrorism. But giving the United States and Israel the benefit of the doubt, let us keep to the lesser charge against their leadership. A few days after, Peres went to Washington to consult with the leading international terrorist of the day, Ronald Reagan, who denounced “the evil scourge of terrorism,” again to general acclaim from “the world.”11 The “terrorist attacks” that Shultz and Peres offered as the pretext for the bombing of Tunis were the killings of three Israelis in Larnaca, Cyprus. The killers, as Israel conceded, had nothing to do with Tunis, though they might have had Syrian connections.12 Tunis was a preferable target, however; it was defenseless, unlike Damascus.


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Pivotal Decade: How the United States Traded Factories for Finance in the Seventies by Judith Stein

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1960s counterculture, affirmative action, airline deregulation, anti-communist, Ayatollah Khomeini, barriers to entry, Berlin Wall, blue-collar work, Bretton Woods, capital controls, centre right, collective bargaining, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, desegregation, energy security, Fall of the Berlin Wall, falling living standards, feminist movement, financial deregulation, floating exchange rates, full employment, Gunnar Myrdal, income inequality, income per capita, intermodal, invisible hand, knowledge worker, laissez-faire capitalism, liberal capitalism, Long Term Capital Management, manufacturing employment, market bubble, Martin Wolf, new economy, oil shale / tar sands, oil shock, open economy, Paul Samuelson, payday loans, post-industrial society, post-oil, price mechanism, price stability, Ralph Nader, RAND corporation, reserve currency, Robert Gordon, Ronald Reagan, Simon Kuznets, strikebreaker, trade liberalization, union organizing, urban planning, urban renewal, War on Poverty, Washington Consensus, working poor, Yom Kippur War

Other scholars trace rightward trends, culminating in the election of conservative Ronald Reagan as president in 1980. Since 1992, when Michael Kazin enjoined historians to write more about conservatism, the profession has answered the call.5 Because most historians today are closer to the left than to the right, many treat their subjects the way anthropologists do theirs. A few argue that post-World War II political culture was never as liberal as assumed. They write about conservative communities or conservatives in general, a new Right, leading up to the 1964 presidential campaign of Barry Goldwater.6 But the key fact about Goldwater was not that he presaged a future but that he lost massively in 1964. If Goldwaterites were the only people who voted for Ronald Reagan in 1980, he would have lost. There is a thread that links conservative ideas.

It followed only half of the German model. Yes, the government of Helmut Schmidt pursued tight money. But it was active in the microeconomy, ensuring that its industries were able to thrive in the new conditions. Just as the Fed did, Carter initially focused simply on inflation. But Republican Ronald Reagan and primary challenger Edward Kennedy argued that Carter had no real plan to improve the economy, and they were right. The upcoming election forced him to face the nation’s problems that the Fed could ignore. CHOOSING CANDIDATES IN HARD TIMES Ronald Reagan emerged from a large field of Republican contenders who sensed the president’s vulnerability in 1980. Perennial candidate Harold Stassen thought that his time was now. Congressman John Anderson of Illinois ran for president in 1980 because he had become too liberal for his Rockport district.

Germond and Jules Witcover, Blue Smoke and Mirrors: How Reagan Won and Why Carter Lost the Election of 1980 (New York: Viking, 1981), 320. 5. Andrew E. Busch, Reagan’s Victory: The Presidential Election of 1980 and the Rise of the Right (Lawrence: University Press of Kansas, 2005), 130. 6. Washington Post, Nov. 6, 1980, Bi. 7. During his first term, defense outlays increased by one third. 8. Ronald Reagan, “Address to the Nation on the Economy,” Feb. 5, 1981, in Public Papers of the Presidents of the United States (Washington, D.C.: Government Printing Office, 1982), 78–83. 9. Ronald Reagan, “Address Before a Joint Session of the Congress on the Program for Economic Recovery,” Feb. 18, 1981, in Public Papers (1981), http://www.presidency.ucsb.edu/ws/?pid=43425. 10. Don Fullerton, “Inputs to Tax Policy-Making: The Supply Side, the Deficit, and the Level Playing Field,” in American Economic Policy in the 1980s, ed.


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The Dead Hand: The Untold Story of the Cold War Arms Race and Its Dangerous Legacy by David Hoffman

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active measures, anti-communist, banking crisis, Berlin Wall, Chuck Templeton: OpenTable, crony capitalism, cuban missile crisis, failed state, joint-stock company, Mikhail Gorbachev, mutually assured destruction, nuclear winter, Robert Hanssen: Double agent, rolodex, Ronald Reagan, Ronald Reagan: Tear down this wall, Silicon Valley, Stanislav Petrov, Thomas L Friedman, uranium enrichment, Vladimir Vetrov: Farewell Dossier, zero-sum game

It was the craziest thing I had ever heard of: Simply put, it called for each side to keep enough nuclear weapons at the ready to obliterate each other, so that if one attacked, the second had enough bombs left to annihilate its adversary in a matter of minutes. We were a button push away from oblivion." Ronald Reagan, An American Life (New York: Simon & Schuster, 1990), p. 13. 7 Ronald Reagan, The Reagan Diaries (New York: HarperCollins, 2007), June 7, 1981. 8 Martin Anderson, presentation, Oct. 11, 2006, Hoover Institution, Stanford University, "Implications of the Reykjavik Summit on Its Twentieth Anniversary." Also, communication with author, Sept. 10, 2008. 9 Tony Thomas, The Films of Ronald Reagan (Secaucus, N.J.: Citadel Press, 1980), pp. 98-99. 10 Laurence W. Beilenson, The Treaty Trap: A History of the Performance of Political Treaties by the United States and European Nations (Washington, D.C.: Public Affairs Press, 1969), pp. 212, 219-221. 11 The author covered the Reagan campaign as a reporter for Knight-Ridder newspapers, and never picked up on Reagan's nuclear abolitionist views.

In the years leading up to the Soviet collapse, he kept detailed notebooks, filled with technical information about weapons systems and key decisions. Here, he attends a May Day celebration, date unknown. [Ksenia Kostrova] Katayev in the 1990s. [Ksenia Kostrova] A Katayev drawing on modular missiles. [Hoover Institution Archives] President Ronald Reagan and the Joint Chiefs of Staff discussed the concept of missile defense on February 11, 1983. The president wrote in his diary that night, "What if we tell the world, we want to protect our people, not avenge them...?" [Ronald Reagan Library] Reagan unveiled his vision for the Strategic Defense Initiative in a televised speech on March 23, 1983. [Ray Lustig/Washington Post] The nuclear accident at Chernobyl in April 1986 was a turning point for Soviet leader Mikhail Gorbachev. [Reuters] Marshal Sergei Akhromeyev, chief of the Soviet General Staff, played a key role in Gorbachev's drive to slow the arms race.

[RIA Novosti] A poster outlining Gorbachev's proposal in 1986 to eliminate all nuclear weapons by the year 2000. Akhromeyev is identified on the reverse as the main author. [Hoover Institution Archives] At the Reykjavik summit, October 11-12, 1986, Gorbachev and Reagan came closer than any other leaders of the Cold War Period to agreements that would slash nuclear arsenals. [Ronald Reagan Library] They parted without a deal after Reagan insisted that his cherished dream of missile defense could not be limited to research in the laboratory. [Ronald Reagan Library] Yevgeny Velikhov (right), an open-minded physicist, helped break through the walls of Soviet military secrecy. With Thomas B. Cochran of the Natural Resources Defense Council, near the Semipalatinsk nuclear test site, July 1986. [RIA Novosti] Velikhov and Cochran arranged an unprecedented joint experiment to verify the presence of a nuclear warhead on a missile aboard the Slava, a Soviet cruiser off the coast of Yalta, July 1989.


pages: 392 words: 106,532

The Cold War: A New History by John Lewis Gaddis

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anti-communist, Ayatollah Khomeini, Berlin Wall, British Empire, colonial rule, cuban missile crisis, Deng Xiaoping, European colonialism, full employment, land reform, long peace, means of production, Mikhail Gorbachev, mutually assured destruction, Potemkin village, Ronald Reagan, Ronald Reagan: Tear down this wall, Sinatra Doctrine

., #11 (Winter, 1998), 5–14. 62 Interview, CNN Cold War, Episode 19, “Freeze.” 63 I have drawn, in the following two sections, upon arguments developed in further detail in Gaddis, Strategies of Containment, pp. 353–79. 64 Speech at Notre Dame University, May 17, 1981, Public Papers of the Presidents of the United States: Ronald Reagan, 1981 (Washington: Government Printing Office, 1982), p. 434. 65 Speech to members of the British Parliament, London, June 8, 1982, Reagan Public Papers, 1982, pp. 744—47. For the drafting of this speech, see Richard Pipes, Vixi: Memoirs of a Non-Belonger (New Haven: Yale University Press, 2003), pp. 197–200. 66 Speech to the National Association of Evangelicals, Orlando, Florida, March 8, 1983, Reagan Public Papers, 1983, p. 364; Ronald Reagan, An American Life (New York: Simon and Schuster, 1990), pp. 569–70. 67 The figures are in Gaddis, Strategies of Containment, pp. 393–94. 68 Lettow, Ronald Reagan, p. 23; Reagan, An American Life, p. 13. 69 Radio-television address, March 23, 1983, Reagan Public Papers, 1983, pp. 442—43. 70 Ibid., p. 364.

English and Elizabeth Tucker (University Park, Pennsylvania: Pennsylvania State University Press, 2000), p. 46; Mikhail Gorbachev, Perestroika: New Thinking for Our Country and the World (New York: Harper & Row, 1987), pp. 69–70. 81 For more on the movie, see http://www.imdb.com/title/tt0086637/. 82 Lettow, Ronald Reagan, pp. 179–86. 83 Chernyaev diary, January 16, 1986, in Chernyaev, My Six Years with Gorbachev, pp. 45—46. 84 See Gaddis, Strategies of Containment, p. 359. 85 Gorbachev, Memoirs, pp. 191, 193. 86 Lettow, Ronald Reagan, pp. 217–26; Gaddis, Strategies of Containment, p. 366n. 87 Gorbachev, Memoirs, p. 419. 88 Remarks on Signing the Intermediate-Range Nuclear Forces Treaty, December 8, 1987, Reagan Public Papers, 1987, p. 1208. 89 See the Chernyaev transcript of the Bush-Gorbachev meeting at Malta, December 3, 1989, CWIHP Bulletin, #12/13 (Fall/Winter, 2001), p. 236.

The danger of war between the United States and the Soviet Union—two superpowers instead of the three Orwell had anticipated—seemed greater than it had for many years. And the apparently permanent conflict known as the “Cold War,” which began while Orwell was still alive, showed not the slightest signs of ending. But then, on the evening of January 16, 1984, an actor Orwell would have recognized from his years as a film reviewer appeared on television in his more recent role as president of the United States. Ronald Reagan’s reputation until this moment had been that of an ardent Cold Warrior. Now, though, he envisaged a different future:Just suppose with me for a moment that an Ivan and an Anya could find themselves, say, in a waiting room, or sharing a shelter from the rain or a storm with a Jim and Sally, and that there was no language barrier to keep them from getting acquainted. Would they then deliberate the differences between their respective governments?


pages: 273 words: 34,920

Free Market Missionaries: The Corporate Manipulation of Community Values by Sharon Beder

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anti-communist, battle of ideas, business climate, corporate governance, en.wikipedia.org, full employment, income inequality, invisible hand, liquidationism / Banker’s doctrine / the Treasury view, minimum wage unemployment, Mont Pelerin Society, new economy, old-boy network, popular capitalism, Powell Memorandum, price mechanism, profit motive, Ralph Nader, rent control, risk/return, road to serfdom, Ronald Reagan, school vouchers, shareholder value, spread of share-ownership, structural adjustment programs, The Chicago School, the market place, The Wealth of Nations by Adam Smith, Thomas L Friedman, Torches of Freedom, trade liberalization, traveling salesman, trickle-down economics, Upton Sinclair, Washington Consensus, wealth creators, young professional

In an era when the ‘limits to growth’ were proclaimed, the gnostic supply-siders made claims to knowing the secret of endless wealth: the magic of the market place . . . a theory for the multitude of go-getters, promising that the cornucopia was bottomless.35 This optimism helped Ronald Reagan to get elected, despite George Bush labelling supply-side theories as ‘voodoo economics’ when he was a rival candidate for presidential nomination in the 1980 primaries. Reagan’s campaign advertisements promised tax cuts that would make everyone better off: Ronald Reagan believes that when you tax something, you get less of it. We’re taxing work, savings, and investment like never before. As a result, we have less work, less savings, and less invested.36 Like monetarism, supply-side economics failed to deliver on its promises in practice.

Coors spent a further $300,000 on a building to house it, and committed millions of dollars to its ongoing operations.3 This commitment enabled it to collect further funds from other corporate donors, such as petroleum tycoon Edward Noble. Coors was on the board of directors of the National Association of Manufacturers (NAM), managed plants where unions were banned, and was a staunch Reagan supporter. UK newspaper The Guardian referred to Coors as an ‘ultraconservative businessman who, for all practical purposes, bought the White House for Ronald Reagan in 1980’. Coors supported Ronald Reagan from the 1960s and Reagan often visited the Coors’ family home. The Coors Corporation sponsored Reagan’s radio shows, while the Heritage Foundation supplied him with many of his policy ideas. After Reagan was elected president, ‘Joe became a member of his Kitchen Cabinet, offering staffing and policy suggestions . . .’.4 The initial leadership of the Heritage Foundation was drawn from the youthful staff of conservative politicians in Washington, including Paul Weyrich, who served as the foundation’s first president, and Edward Feulner, who has been the foundation’s long-term president since 1977.

Early on it brought in Friedman, then a little known economist, as adviser. One White House official told The Atlantic that the AEI played a large part in getting Ronald Reagan elected by making ‘conservatism intellectually respectable’. Its promotion of deregulated markets found expression in Reagan policies. By 1985, it employed 176 people, boasted 90 adjunct scholars and a budget of $12.6 million, 45 per cent from some 600 major corporations.45 The Heritage Foundation was also extremely influential during the Reagan years. It provided information to members of Congress, and most of its policy recommendations, outlined in a document entitled Mandate for Change, were adopted by the Reagan administration. Feulner received a Presidential Citizen’s Medal from Ronald Reagan for being ‘a leader of the conservative movement . . . who has helped shape the policy of our Government’.


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America at the Crossroads: Democracy, Power, and the Neoconservative Legacy by Francis Fukuyama

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affirmative action, Ayatollah Khomeini, Berlin Wall, Bretton Woods, cuban missile crisis, David Brooks, European colonialism, failed state, Francis Fukuyama: the end of history, Internet Archive, Mikhail Gorbachev, Monroe Doctrine, mutually assured destruction, New Journalism, race to the bottom, RAND corporation, rent-seeking, road to serfdom, Ronald Reagan, Ronald Reagan: Tear down this wall, transaction costs, uranium enrichment, War on Poverty, Washington Consensus

It is thus not surprising that most neo-conservatives were broadly supportive of Ronald Reagan's effort to remoralize the struggle between Soviet communism and liberal democracy and did not wince in embarrassment when he spoke of the Soviet Union as an "evil empire." On the other hand, from the late 1970s on it became increasingly hard to disentangle neoconservatism from other, more traditional varieties of American conservatism, whether based on small-government libertarianism, religious or social conservatism, or American nationalism. Even identifying who qualified as a neoconservative became difficult. This was true for two reasons. First, many neoconservative ideas were wholeheartedly adopted by mainstream conservatives and, indeed, by a broader American public. Ronald Reagan may have offered anecdotes of "welfare queens," but the debate about welfare turned much more serious when the link between social programs like AFDC and welfare dependency was supported by empirical social scientists in the pages of The Public Interest.

Neoconservatives were in their origin (mostly) Jewish intellectuals who loved to read, write, argue, and debate; in a sense, it was their intellectual brilliance, their ability to reflect, and the nuance and flexibility associated with intellectual debate that was most notable about them, and what set them apart from the paleoconservatives. Of the two presidents in question, Ronald Reagan in my view more clearly qualifies as a neoconservative. Much as his enemies are loath to admit it, Ronald Reagan was an intellectual of sorts: in the first decade or so of his career, all he had to offer were ideas and arguments about communism and the free market, American values, and the defects of the reigning liberal orthodoxy. He also bore a similarity to the City College crowd insofar as he came to anticommunism from the left: he started out as a Democrat and an admirer of Franklin Roosevelt and was a labor leader as president of the Screen Actors Guild.

During the late 1970s and 1980s, Wohlstetter turned his attention to the Persian Gulf, Iraq, the Iran-Iraq war, and the burgeoning problem of nuclear proliferation in the Middle East. He and his students thus played a critical role in translating a broad, general set of neoconservative ideas into specific foreign policy preferences. Through Wohlstetter's influence on people like Robert Bartley, the long-time Wall Street Journal opinion page editor, these preferences came to define the hard-line alternative to Kissinger and detente and were incorporated into policy when Ronald Reagan was elected president. The Neoconservative Legacy A constant thread running throughout Wohlstetter's work was the impact on warfare of increasing targeting precision. At the nuclear level, multiple independently targetable reentry vehicles (MIRVs) made possible a counterforce strike at hardened missile silos, while in conventional warfare precision targeting made obsolete the need to flatten entire cities and their civilian populations as occurred during the Allied bombing campaigns against Germany and Japan.


pages: 284 words: 85,643

What's the Matter with White People by Joan Walsh

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affirmative action, Affordable Care Act / Obamacare, banking crisis, clean water, collective bargaining, David Brooks, desegregation, Donald Trump, Edward Glaeser, full employment, global village, Golden Gate Park, hiring and firing, impulse control, income inequality, invisible hand, knowledge worker, labor-force participation, mass immigration, new economy, obamacare, Occupy movement, Plutocrats, plutocrats, Ralph Nader, Ronald Reagan, upwardly mobile, urban decay, War on Poverty, We are the 99%, white flight, women in the workforce, zero-sum game

After Carter, Ronald Reagan sounded themes of American unity and optimism. Just as Nixon had learned some of his law-and-order, culture-war tactics from Reagan’s divisive 1966 campaign, Reagan learned from Nixon’s fall. He mostly shed his nasty culture-warrior persona of the sixties to become the man who would awaken us to “Morning in America.” Reagan could afford to move to higher ground; Nixon had done the job of dividing us. And Democrats, running away from their own history, had no message to unite us. Part III The Loneliness of the Reagan-Era Do-Gooder Chapter 13 Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it. —Ronald Reagan, August 1986 Ronald Reagan wiped the political slate clean, erasing the history of American class conflict and the Democratic Party’s legacy of standing with the common man.

Suddenly, cable news shows that had been obsessing over the deficit “crisis” and President Obama’s latest poll numbers were explaining how decades of tax cuts and deregulation unraveled the social contract established in the New Deal. It had been accepted by every American president for thirty years afterward, until Richard Nixon brilliantly divided the New Deal coalition, largely around race. In the early days, polls showed that the Occupy movement’s grievances were broadly shared, even by the white working class, which Nixon and then Ronald Reagan had lured to the GOP. Yet how long before the 99 percent would cleave back into the 51 and the 48 percent? I couldn’t know. For the moment, though, it was amazing to see such broadly shared political discontent surfacing at all. As I headed down the dark canyon of Wall Street itself, I decided to climb the steps of Federal Hall to get a better view of blue-helmeted cops behind barricades, waiting for trouble that never came that day.

When Romney released 2010 tax returns showing that while he made $21 million off investments, he only paid a 13.9 percent tax rate—a lower rate than middle-class workers—he offered the nation a crash course in our plutocratic tax policy. Unfortunately, some of the politicians who’d worked hardest to protect Romney’s low investment tax rate were Democrats, a complication that hinders the party’s attempt to channel the interests of the 99 percent. Even some of the white working class, the group Ronald Reagan had turned into Reagan Democrats by railing against “welfare queens” everyone knew were black, seemed to be waking up. Right-wing author Charles Murray, who in the 1980s blamed government for encouraging sloth and single parenthood in the black community, published a best seller that said the same thing about the white “lower class”: they were suffering from declining wages and higher unemployment not because of a changed economy, but because they had come to prefer slacking and shacking up to hard work and marriage.


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Inflated: How Money and Debt Built the American Dream by R. Christopher Whalen

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Albert Einstein, bank run, banking crisis, Black Swan, Bretton Woods, British Empire, California gold rush, Carmen Reinhart, central bank independence, commoditize, conceptual framework, corporate governance, corporate raider, creative destruction, cuban missile crisis, currency peg, debt deflation, falling living standards, fiat currency, financial deregulation, financial innovation, financial intermediation, floating exchange rates, Fractional reserve banking, full employment, global reserve currency, housing crisis, interchangeable parts, invention of radio, Kenneth Rogoff, laissez-faire capitalism, liquidity trap, means of production, money: store of value / unit of account / medium of exchange, moral hazard, mutually assured destruction, non-tariff barriers, oil shock, Paul Samuelson, payday loans, Plutocrats, plutocrats, price stability, pushing on a string, quantitative easing, rent-seeking, reserve currency, Ronald Reagan, special drawing rights, The Chicago School, The Great Moderation, too big to fail, trade liberalization, transcontinental railway, Upton Sinclair, women in the workforce

And by inviting his adversary to share the platform with him that night, Jerry Ford fulfilled his stewardship as the unelected president and gave the future of the Republican Party to Ronald Reagan, whatever happened in the election that year.11 Even as the Ford–Dole ticket went down to a close defeat in 1976, with 297 electoral votes for Carter to 241 for Ford, the seeds of the Reagan revolution were already starting to grow. By the mid-term election in 1978, the insurgent conservatives in the Republican Party were beginning to effectively target liberal Democrats in Southern states with the basic Reagan message of tax cuts and smaller government. Only weeks before the election in 1978, a New York Congressman named Jack Kemp and Senator William Roth of Delaware won initial approval of a 25 percent across the board cut in tax rates, but the measure was dropped from the legislation. It would take four more years and the election of Ronald Reagan for the Kemp–Roth tax cut to be adopted by Congress.

These crises were made inevitable because Reagan and the presidents who came before and after his eight years in office found it impossible to rein in spending. No amount of tax cuts will save American consumers from the ravages of inflation if Congress refuses to eliminate fiscal deficits. Even Ronald Reagan, with all of his rhetoric about scaling back the size of government, was reluctant to pay the political price of confronting Congress over spending. The bubble economy was simply passed to the next generation. The Crisis Managers Volcker, a self-described “Brooklyn Democrat” who was born in Cape May, N.J., was inherited by Ronald Reagan, a converted Democrat and former labor leader and California governor. Reagan understood the connection between money and inflation. During a talk to the Prosperity Caucus in Washington in the early 1990s, syndicated columnist Robert Novak revealed that Reagan’s favorite economist was Fredric Bastiat, a nineteenth-century French economic philosopher and author of The Law.

But it was also a passive recognition of the political tide in America and of the fact that the federal regulators have been captured by the banking industry. While Big Government was rhetorically demonized by Ronald Reagan, government in fact continued to grow nonetheless. Greenspan made Americans believe that they could have a normal, stable economy despite the growing debt load and continuing red ink. Just as past Fed chairmen have given past Presidents their way with respect to monetary policy, Greenspan did so and more. He gave Americans what they wanted to see, namely the appearance of economic prosperity, without forcing Congress and successive presidents to address fiscal problems. There was no need for Presidents Reagan, Bush, Clinton, or Bush to encourage Greenspan to provide easy money as Ronald Reagan and James Baker had done so bluntly with Paul Volcker in 1984. Greenspan was leading the easy-money parade from the outset.


pages: 485 words: 148,662

Farewell by Sergei Kostin, Eric Raynaud

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active measures, car-free, cuban missile crisis, index card, invisible hand, kremlinology, Lao Tzu, Mikhail Gorbachev, Ronald Reagan, Vladimir Vetrov: Farewell Dossier

That France was capable of providing the United States with information that would play a critical role in the orientation of the alliance activities and the consolidation of its means of defense was an entirely new situation, and I was especially aware of it.”13 Marcel Chalet was not mistaken about the impact of the file he had transmitted. When Ronald Reagan was eventually informed by his friend William Casey about the importance of the dossier, he was totally astounded. “This is the biggest fish of that kind caught since the war!” he acknowledged, even though this admission was obviously not to the advantage of American secret services.14 This dossier, indeed, made it necessary to revise many of the certitudes held by the free world. The American president, who was no fan of communist regimes, was thus encouraged to be yet more forceful with the Eastern Bloc. Ronald Reagan’s opinion of François Mitterrand changed radically. By sharing the information he had, the socialist president clearly demonstrated his attachment to the Western camp and its values.

The Cold War, Reagan, and the Strange Dr. Weiss CHAPTER 29. The Gulag Prisoner CHAPTER 30. Portrait of the Hero as a Criminal CHAPTER 31. Unveiled CHAPTER 32. The Game Is Up CHAPTER 33. “The Network” CHAPTER 34. The Farewell Affair Under the Magnifying Glass of the KGB and DST CHAPTER 35. Hero or Traitor? FOREWORD BY RICHARD V. ALLEN In 1976, five years before the Farewell case, Ronald Reagan nearly unseated President Gerald Ford for the Republican presidential nomination. The major salient of his attack on Ford was on foreign and national security policy. Reagan rejected “détente,” not because he opposed a relaxation of tensions with the Soviet Union, but because under Nixon, Ford, and Kissinger “détente” had taken on a special, nearly theological meaning—a supposedly ineluctable process of gradually making the Soviets completely dependent on trade and technology from the West, hence causing them to moderate their behavior in terms of global expansion and military procurement.

He knew perfectly well that this was not militant communism making a spectacular breakthrough within the Western Bloc. To the contrary, the West was now enjoying a major advance into Soviet front lines. For the past few months, France had had a mole, code name “Farewell,” operating at the heart of one of the most sensitive divisions of the KGB. During a face-to-face meeting, Mitterrand shared this secret with Ronald Reagan and revealed to him the scope of global Soviet industrial pillage. At the time, the American president did not fully understand the impact of the dossier, but he was a fast learner. Soon after, he would refer to it as “the greatest spy story of the twentieth century.” Mitterrand-Reagan private conversation in Ottawa on July 19, 1981. The two presidents are relaxed and already in connivance: the disclosure of the Farewell dossier changed entirely the attitude of the leader of the Western Bloc toward the Socialist president.


pages: 233 words: 73,772

The Secret World of Oil by Ken Silverstein

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business intelligence, clean water, corporate governance, corporate raider, Donald Trump, energy security, Exxon Valdez, failed state, Google Earth, offshore financial centre, oil shock, paper trading, rolodex, Ronald Reagan, WikiLeaks, Yom Kippur War

A WikiLeaked cable offered a less flattering description of Aliyev, comparing him to Sonny Corleone, the fictional mobster from The Godfather. • Neil Bush, the son of one American president and the brother of another, who one newspaper observed ran numerous business ventures that had “a history of crashing and burning in spectacular fashion.” Nonetheless, Bush’s family name has led various natural resource companies to hire him to broker deals in Asia and Africa. • Bretton Sciaroni, a portly American and former ideologue of Ronald Reagan’s White House who played a little-known but vital role in the Iran–Contra scandal but now resides in Phnom Penh, where he is an official adviser to Prime Minister Hun Sen, a one-time Khmer Rouge cadre, and opens doors for Western natural resource firms. In large part because they inhabit the shadows of the energy world, the oil literature has largely consigned such middlemen and other characters to the margins of attention, or omitted them entirely.

From early on, Rich cultivated ties to monarchs and presidents, diplomats and intelligence agencies, especially Iran’s SAVAK under the shah. During the Arab oil embargo of the early 1970s Rich brokered a deal by which Iran secretly supplied Israel, which proved to be a vital economic lifeline.6 Rich also periodically lent a hand to the Mossad’s clandestine operations, among them the evacuation of Ethiopian Jews to Israel in the 1980s. Rich made a fortune by buying oil from Iran during the hostage crisis and from Libya when Ronald Reagan’s administration imposed a trade embargo on Muammar Gaddafi’s regime, as well as from supplying oil to apartheid South Africa. An inveterate sanctions-buster, Rich used offshore front companies and corporate cutouts to try to stay below the radar. He also pioneered the practice of commodity swaps, like the uranium-for-oil deals he brokered in the 1980s between apartheid South Africa and Iran.

One Western investor I talked to described the situation as “a nightmare,” saying, “Anything having to do with licenses, natural resources, or concessions—that’s where you have problems and where you always have military and government officials looking for money.” For major Western companies trying to navigate this complicated and perilous investment climate, this is where Bretton Sciaroni comes in. The portly Sciaroni makes a most unusual power broker in contemporary Cambodia. A former ideologue of Ronald Reagan’s White House, he played a little-known but vital role in enabling Oliver North’s weapons shipments and assistance to the Nicaraguan Contras during the 1980s. Yet now he is an official adviser to the government of Prime Minister Hun Sen, a one-time Khmer Rouge cadre. The Cambodian government has bestowed upon Sciaroni the titles of minister without portfolio and his excellency. He is the chairman of the International Business Chamber (IBC), an association that includes most of the multinational corporations in Cambodia and which is the most important business group in the country.


pages: 364 words: 99,613

Servant Economy: Where America's Elite Is Sending the Middle Class by Jeff Faux

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back-to-the-land, Bernie Sanders, Black Swan, Bretton Woods, BRICs, British Empire, call centre, centre right, cognitive dissonance, collateralized debt obligation, collective bargaining, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, currency manipulation / currency intervention, David Brooks, David Ricardo: comparative advantage, falling living standards, financial deregulation, financial innovation, full employment, hiring and firing, Howard Zinn, Hyman Minsky, illegal immigration, indoor plumbing, informal economy, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, lake wobegon effect, Long Term Capital Management, market fundamentalism, Martin Wolf, McMansion, medical malpractice, mortgage debt, Myron Scholes, Naomi Klein, new economy, oil shock, old-boy network, Paul Samuelson, Plutocrats, plutocrats, price mechanism, price stability, private military company, Ralph Nader, reserve currency, rising living standards, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, school vouchers, Silicon Valley, single-payer health, South China Sea, statistical model, Steve Jobs, Thomas L Friedman, Thorstein Veblen, too big to fail, trade route, Triangle Shirtwaist Factory, union organizing, upwardly mobile, urban renewal, War on Poverty, We are the 99%, working poor, Yogi Berra, Yom Kippur War

If the market is no longer delivering the prosperity promised the citizen in the American dream, then the political system bears more responsibility than our leaders want to admit for the relentless redistribution of income and wealth from the bottom and the middle of the pyramid to the top. Most dangerous of all, such an acknowledgment encourages discussion about who our political representatives actually represent. The Democrats are no more eager to have this conversation than the Republicans are. Ronald Reagan’s election, like Franklin Roosevelt’s half a century earlier, profoundly changed the way that Americans think collectively about the future. The stock market crash of 1929 and the Great Depression that followed thoroughly discredited the system of unregulated financial speculation that had driven the country and the world to its economic knees. In response, the New Deal not only expanded the role of government in managing the market and protecting the public from the hard edges of laissez-faire, it also established a presumption of collective responsibility for the future.

In effect, while the Republicans were consolidating the alliance between big business and right-wing populism, the Democrats were breaking up their old alliance between Southern politicians (social conservatives and economic populists) and Northern liberals. Increasingly sophisticated attacks from the Republican Right and the growing indifference from within the Democratic Party itself put the New Deal on the defensive. Its intellectual energy sputtered just as the country needed to address the market signals of the erosion of U.S. economic power. Jimmy Carter was the transitional figure. He prepared the ideological ground for Ronald Reagan just as Herbert Hoover had prepared it for Franklin Roosevelt. Contrary to popular impression, Hoover was not a laissez-faire conservative. As secretary of commerce in the 1920s, he increased the regulation of business, advocated more progressive taxation of the rich, and supported a pension for every American. Faced with the Great Depression in his first year in office, he increased public works and initiated a number of programs that Roosevelt would later build on.

He hired Paul Volcker to be the chairman of the Federal Reserve, who immediately raised interest rates and plunged the economy into stagflation: a politically deadly combination of rising unemployment and rising prices. Carter cut domestic spending. But to impress conservatives, he also cut taxes for business and increased military spending. On election day of 1980, despite the daily headlines about the crisis of the Americans being held hostage in Iran (including Carter’s botched rescue attempt), the voter exit polls showed that the economic woes were the chief reasons voters gave for voting for Ronald Reagan. Two months before the election, 62 percent of voters had cited the “high cost of living” as the most important problem facing the nation. Fully 52 percent of American voters supported the imposition of wage-price controls. In his history of Carter’s economic policies, Georgia Institute of Technology economist W. Carl Biven concluded, “The Iranian crisis and the split in the Democratic Party were contributing factors in the electoral outcome, but the inflation that dogged the Administration from its first days in office, and which crested in 1980, was probably the decisive reason for his defeat.”12 In January 1981, Stuart Eizenstat, Carter’s chief domestic policy adviser, was asked by a historian from the National Archives what he thought the administration should have done differently.


pages: 357 words: 94,852

No Is Not Enough: Resisting Trump’s Shock Politics and Winning the World We Need by Naomi Klein

Airbnb, basic income, battle of ideas, Berlin Wall, Bernie Sanders, Brewster Kahle, Celebration, Florida, clean water, collective bargaining, Corrections Corporation of America, desegregation, Donald Trump, drone strike, Edward Snowden, Elon Musk, energy transition, financial deregulation, greed is good, high net worth, Howard Zinn, illegal immigration, income inequality, Internet Archive, late capitalism, Mark Zuckerberg, market bubble, market fundamentalism, mass incarceration, Mikhail Gorbachev, moral panic, Naomi Klein, Nate Silver, new economy, Occupy movement, offshore financial centre, oil shale / tar sands, open borders, Peter Thiel, Plutocrats, plutocrats, private military company, profit motive, race to the bottom, Ralph Nader, Ronald Reagan, Saturday Night Live, sexual politics, sharing economy, Silicon Valley, too big to fail, trade liberalization, transatlantic slave trade, transatlantic slave trade, Triangle Shirtwaist Factory, trickle-down economics, Upton Sinclair, urban decay, women in the workforce, working poor

Trump Organization: no new deals for foreign properties “Full Transcript of Trump Press Conference,” BBC.com, January 11, 2017, http://www.bbc.com/​news/​world-us-canada-38536671. Reagan’s Prophecy Fulfilled New Yorker: Trump golf cover Françoise Mouly, “Cover Story: ‘Broken Windows,’ By Harry Blitt,” New Yorker, March 31, 2017, http://www.newyorker.com/​culture/​cover-story/​cover-story-2017-04-10. Ronald Reagan: “government is not the solution, it is the problem” Ronald Reagan Presidential Library and Museum, “The Reagan Presidency,” accessed April 10, 2017, https://reaganlibrary.gov/​sreference/​facts-admin. Rob Ford and smoking crack “Raw Video Released of Rob Ford Smoking Crack,” Globe and Mail (Toronto), August 11, 2016, http://www.theglobeandmail.com/​news/​news-video/​video-raw-video-released-of-rob-ford-smoking-crack/​article31375481/.

Indeed, a lawsuit making this allegation has already been launched. But the Trumps seem unconcerned. A near-impenetrable sense of impunity—of being above the usual rules and laws—is a defining feature of this administration. Anyone who presents a threat to that impunity is summarily fired—just ask former FBI director James Comey. Up to now in US politics there’s been a mask on the corporate state’s White House proxies: the smiling actor’s face of Ronald Reagan or the faux cowboy persona of George W. Bush (with Dick Cheney/Halliburton scowling in the background). Now the mask is gone. And no one is even bothering to pretend otherwise. This situation is made all the more squalid by the fact that Trump was never the head of a traditional company but has, rather, long been the figurehead of an empire built around his personal brand—a brand that has, along with his daughter Ivanka’s brand, already benefited from its merger with the US presidency in countless ways.

That private is better than public. And if that’s all true, why not wreck the place before you leave—figuratively if not literally. It’s a reminder that Trump’s political career would have been impossible without the degradation of the whole idea of the public sphere, which has been unfolding over decades. It could never have happened without the idea that “government is not the solution, it is the problem,” as Ronald Reagan famously put it. And it could never have happened had that message not been followed up with decades of deregulation that essentially legalized bribery, with outrageous sums of corporate money flowing into politics. It’s absolutely true that the system is corrupt. It is a swamp. And people know it. They know that the rewriting of the rules in favor of a small group of corporate interests and the one percent has been a bipartisan process—that it was Bill Clinton who deregulated the banks, setting the stage for the 2008 collapse, and it was Obama who chose not to prosecute the bankers, and that the Democratic candidate running against Trump would almost surely have done no different.


pages: 162 words: 51,473

The Accidental Theorist: And Other Dispatches From the Dismal Science by Paul Krugman

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Bonfire of the Vanities, Bretton Woods, clean water, collective bargaining, computerized trading, corporate raider, declining real wages, floating exchange rates, full employment, George Akerlof, George Gilder, Home mortgage interest deduction, income inequality, indoor plumbing, informal economy, invisible hand, Kenneth Arrow, knowledge economy, life extension, lump of labour, new economy, Nick Leeson, paradox of thrift, Paul Samuelson, Plutocrats, plutocrats, price stability, rent control, Ronald Reagan, Silicon Valley, trade route, very high income, working poor, zero-sum game

To say that America was a far more unequal society in 1989 than it was in 1973 is a simple statement of fact, not an attack on Ronald Reagan. Think about the parable of the fishermen and the prospectors: The greater inequality of the latter society did not come about because it has worse leadership but because it lives in a different environment. And changes in the environment—in world markets, or in technology—might change a society of middle-class fishermen into a society with dismaying extremes of wealth and poverty, without it necessarily being the result of deliberate policies. In fact, it’s pretty certain that this is what has happened in the United States. Ronald Reagan did not single-handedly cause the incomes of the rich to soar and those of the poor to decline. He did cut taxes at the top and social programs at the bottom, but most of the growth in inequality took place in the marketplace, in the pretax incomes of families.

I’m not saying that Clinton’s policies led to that result—they accounted for only part of the good news about the deficit, and hardly any of the rest. But the point is that the supply-siders were absolutely sure that his policies would produce disaster—and indeed, if their doctrine had any truth to it, they would have. Nor, I would argue, do supply-side views spread because they are good politics. True, Ronald Reagan won on a supply-side platform—but one suspects he would have won on almost any platform, and that the taunts of “voodoo economics” actually cost him some votes. Today, the supply-side label is a clear liability. Even promoters of the concept shy away from the label. In 1994, Republican leaders like Gingrich and Dick Armey chose to conceal the extent of their tax-cutting fervor from the voters, who they judged would not trust an economic program based on supply-side assumptions.

I can’t help admiring the fortitude of veteran supply-sider Paul Craig Roberts—who recently declared in his BusinessWeek column that the prosperity of the American economy under Bill Clinton proves the validity of, yes, supply-side economics. After all, back in 1993 Roberts, in lockstep with other supply-siders, predicted nothing but disaster from Clintonomics: “a bigger deficit, higher unemployment, rising inflation, and a currency crisis to boot.” Faced with the reality of a Dow near 8,000, the lowest unemployment rate in a generation, and the smallest deficit since, well, Ronald Reagan’s first budget, some people would have tried to change the subject. Roberts, however, is made of sterner stuff. But then, what choice did he have? The standard (and true) riposte to Clintonian triumphalism is that Clinton presides over a prosperity he did not create, that the credit for the good news belongs partly to Alan Greenspan but mainly to the resilience and flexibility of America’s private sector.


pages: 851 words: 247,711

The Atlantic and Its Enemies: A History of the Cold War by Norman Stone

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affirmative action, anti-communist, Ayatollah Khomeini, bank run, banking crisis, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Bonfire of the Vanities, Bretton Woods, British Empire, central bank independence, Deng Xiaoping, desegregation, Dissolution of the Soviet Union, European colonialism, facts on the ground, Fall of the Berlin Wall, financial deregulation, Francis Fukuyama: the end of history, Frederick Winslow Taylor, full employment, Gunnar Myrdal, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, illegal immigration, income per capita, interchangeable parts, Jane Jacobs, Joseph Schumpeter, labour mobility, land reform, long peace, mass immigration, means of production, Mikhail Gorbachev, new economy, Norman Mailer, North Sea oil, oil shock, Paul Samuelson, Ponzi scheme, popular capitalism, price mechanism, price stability, RAND corporation, rent-seeking, Ronald Reagan, Silicon Valley, special drawing rights, Steve Jobs, strikebreaker, The Death and Life of Great American Cities, trade liberalization, trickle-down economics, V2 rocket, War on Poverty, Washington Consensus, Yom Kippur War, éminence grise

It was not necessary: the debt was simply not paid, or, rather, the American taxpayer paid it. The West, in the summer of 1979, was in poor condition, and Europe was not producing the answers. Creativity would have to come from the Atlantic again, and it did. Margaret Thatcher emerged in May, and Ronald Reagan was elected President in 1980. 21 Atlantic Recovery: ‘Reagan and Thatcher’ Ronald Reagan and Margaret Thatcher each brought to bear some of the core beliefs of their civilization, which included (among others) Hollywood and a belief in facts. Ronald Reagan had been an actor, a Rooseveltian Democrat, and he had escaped from a past in a way that commanded respect - his father a drunken failure, his mother a shrew. He had pushed his way forward, via a degree in simple-minded verities at an obscure college, through sports-commentating, to Hollywood.

General Galtieri (centre) with Admiral Lambruschini (left) and Brigadier General Graffigna, Buenos Aires cathedral, May 1980; Arthur Scargill, Orgreave colliery, May 1984 44. and 45. Couples. Ronald Reagan and Margaret Thatcher, June 1984; Nicolae and Elena Ceauşescu with folkloric Romanian children, c. 1985 46. and 47. More couples. Elizabeth II and Rupert Murdoch, Wapping, February 1985; General Wojciech Jaruzelski and Pope John Paul II, Warsaw, June 1987 48. and 49. Cold War spin-offs. President Mohammed Najibullah meeting Soviet troops, Kabul, October 1986; Prime Minister Turgut Özal meeting Ronald Reagan, April 1985 50. and 51. The end. The East German leader Egon Krenz about to lose his job, with Mikhail Gorbachev, Moscow, November 1989; Boris Yeltsin earlier in the same year It was of course a racial matter.

Still, he had only managed to win the nomination because the other candidate, Nelson Rockefeller, scored black marks for divorcing his wife of thirty-one years, and Goldwater manoeuvred himself into what appeared to be grotesquely reactionary positions - the abolition of graduated income tax, the bombing of North Vietnam, a denunciation of Eisenhower’s administration as a ‘dime store New Deal’. His electoral ship sank with all hands, though Ronald Reagan found a lifebelt. The mood was now for political change, though, looking back, it is difficult to see quite where the urgency for this lay. The racial problem in the USA was indeed a great blot, and had been seen as such even in the days when the Constitution proclaimed equality. But there was much to be said for taking things carefully, even just applying the existing laws that protected individuals in the Anglo-Saxon manner.


pages: 56 words: 17,340

Media Control: The Spectacular Achievements of Propaganda by Noam Chomsky

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British Empire, declining real wages, feminist movement, Howard Zinn, Ralph Nader, RAND corporation, Ronald Reagan, strikebreaker

His atrocities were revealed in this book so conclusively that "only the most light-headed and cold-blooded Western intellectual will come to the tyrant's defense," said the Washington Post. Remember, this is the account of what happened to one man. Let's say it's all true. Let's raise no questions about what happened to the one man who says he was tortured. At a White House ceremony marking Human Rights Day, he was singled out by Ronald Reagan for his courage in enduring the horrors and sadism of this bloody Cuban tyrant. He was then appointed the U.S. representative at the U.N. Human Rights Commission, where he has been able to perform signal services defending the Salvadoran and Guatemalan governments against charges that they conduct atrocities so massive that they make anything he suffered look pretty minor. That's the way things stand.

It was distributed by the Marin County Interfaith Task Force. The national press refused to cover it. The TV stations refused to run it. There was an article in the local Marin County newspaper, the San Francisco Examiner, and I think that's all. No one else would touch it. This was a time when there was more than a few "lightheaded and cold-blooded Western intellectuals" who were singing the praises of Jose Napoleon Duarte and of Ronald Reagan. Anaya was not the subject of any tributes. He didn't get on Human Rights Day. He wasn't appointed to anything. He was released in a prisoner exchange and then assassinated, apparently by the U.S.-backed security forces. Very little information about that ever appeared. The media never asked whether exposure of the atrocities-instead of sitting on them and silencing them-might have saved his life.

In August we suddenly turned against Saddam Hussein after having favored him for many years. Here was an Iraqi democratic opposition who ought to have some thoughts about the matter. They would be happy to see Saddam Hussein drawn and quartered. He killed their brothers, tortured their sisters, and drove them out of the country. They have been fighting against his tyranny throughout the whole time that Ronald Reagan and George Bush were cherishing him. What about their voices? Take a look at the national media and see how much you can find about the Iraqi democratic opposition from August through March (1991). You can't find a word. It's not that they're inarticulate. They have statements, proposals, calls and demands. If you look at them, you find that they're indistinguishable from those of the American peace movement.


pages: 309 words: 91,581

The Great Divergence: America's Growing Inequality Crisis and What We Can Do About It by Timothy Noah

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assortative mating, autonomous vehicles, blue-collar work, Bonfire of the Vanities, Branko Milanovic, call centre, collective bargaining, computer age, corporate governance, Credit Default Swap, David Ricardo: comparative advantage, Deng Xiaoping, Erik Brynjolfsson, feminist movement, Frank Levy and Richard Murnane: The New Division of Labor, Gini coefficient, Gunnar Myrdal, income inequality, industrial robot, invisible hand, job automation, Joseph Schumpeter, low skilled workers, lump of labour, manufacturing employment, moral hazard, oil shock, pattern recognition, Paul Samuelson, performance metric, positional goods, post-industrial society, postindustrial economy, Powell Memorandum, purchasing power parity, refrigerator car, rent control, Richard Feynman, Richard Feynman, Ronald Reagan, shareholder value, Silicon Valley, Simon Kuznets, Stephen Hawking, Steve Jobs, The Spirit Level, too big to fail, trickle-down economics, Tyler Cowen: Great Stagnation, union organizing, upwardly mobile, very high income, Vilfredo Pareto, War on Poverty, We are the 99%, women in the workforce, Works Progress Administration, Yom Kippur War

Foreign policy intellectuals furrowed their brows over Eurocommunism, and feminists still believed they had a decent shot at adding an Equal Rights Amendment to the Constitution. It was a different reality. But incomes were growing more unequal in America then, and they continue to grow more unequal in America today. That story hasn’t changed at all. What did change over the years were the speculative explanations as to why incomes were becoming more unequal. It was Ronald Reagan’s fault. No, it was the inevitable result of a maturing global economy. No, it was caused by computers. No, it was caused by the twin epidemics of teenage pregnancy and divorce. Some people denied the Great Divergence was happening at all. Others said it was a fleeting phenomenon. Still others said all would be well once the economy became more productive (i.e., once there was a significant increase in output per hour worked).

Corporate profits had been in decline since the mid-1960s, and per capita GDP growth had dropped from about 3 percent in the late 1960s and early 1970s to below 1 percent during the late 1970s.26 The share of national income going to the richest 1 percent had slipped from about 11 percent in 1965 to about 9 percent in 1975, and it stayed there for three more years. Even if you could get a raise, it had to be pretty big to keep up with inflation, which averaged more than 9 percent during the second half of the 1970s. This was largely due to oil prices, which continued to rise briskly even after the oil embargo was halted early in 1974.27 In short, the economy was lousy for everyone. All Ronald Reagan really had to do to win the 1980 general election was say the following (in his debate with President Jimmy Carter): When he was a candidate in 1976, President Carter invented a thing he called the misery index. He added the rate of unemployment and the rate of inflation, and it came, at that time, to 12.5% under President Ford. He said that no man with that size misery index has a right to seek reelection to the Presidency.

—Former Procter & Gamble lobbyist Bryce Harlow, in a 1984 essay describing the business of corporate representation LEFT-OF-CENTER POLITICIANS AND ACTIVISTS have long argued that the federal government caused the Great Divergence. And by “federal government,” they generally mean Republicans, who have controlled the White House for most of the past thirty years. According to this narrative, the policy changes initiated by President Ronald Reagan and carried forward by the Bush presidencies, père et fils, effected a long-term shift in American demographics. The leftist intellectual Michael Harrington, author of The Other America, once summarized these policies as “a bizarre anti-welfare-state Keynesianism for the rich.” There can be no question that Reagan and his Republican White House successors, in attempting to reduce government’s size, made it less beneficial to people at lower income levels and more accommodating to people at higher income levels.


pages: 332 words: 89,668

Two Nations, Indivisible: A History of Inequality in America: A History of Inequality in America by Jamie Bronstein

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Affordable Care Act / Obamacare, back-to-the-land, barriers to entry, basic income, Bernie Sanders, big-box store, blue-collar work, Branko Milanovic, British Empire, Capital in the Twenty-First Century by Thomas Piketty, clean water, cognitive dissonance, collateralized debt obligation, collective bargaining, Community Supported Agriculture, corporate personhood, crony capitalism, deindustrialization, desegregation, Donald Trump, ending welfare as we know it, Frederick Winslow Taylor, full employment, Gini coefficient, income inequality, interchangeable parts, invisible hand, job automation, John Maynard Keynes: technological unemployment, labor-force participation, land reform, land tenure, low skilled workers, low-wage service sector, mandatory minimum, mass incarceration, minimum wage unemployment, moral hazard, moral panic, mortgage debt, New Urbanism, non-tariff barriers, obamacare, occupational segregation, Occupy movement, oil shock, Plutocrats, plutocrats, price discrimination, race to the bottom, rent control, road to serfdom, Ronald Reagan, Scientific racism, Simon Kuznets, single-payer health, strikebreaker, too big to fail, trade route, transcontinental railway, Triangle Shirtwaist Factory, trickle-down economics, universal basic income, Upton Sinclair, upwardly mobile, urban renewal, wage slave, War on Poverty, women in the workforce, working poor, Works Progress Administration

They also argued that welfare destroyed initiative and family—that redistributive programs made people dependent or caused family instability by enabling poor people to divorce or to remain unmarried. In the worst formulation, they described the poor as devious “welfare queens.”100 As the next chapter will show, Ronald Reagan, long an opponent of welfare programs, made those associations and claims central tenets of his administration. Under the pressure of neoliberalism, the Great Compression quickly began to unravel. CHAPTER 7 The Triumph of Neoliberalism: 1979–1999 Stagflation and the oil shocks of the 1970s had brought economic malaise to the United States, setting the stage for widespread acceptance of a new, “neoliberal” theory of prosperity, divorced from both equality of condition and equality of opportunity. Over the course of the next decade, Ronald Reagan’s severe tax cuts and George H. W. Bush’s “trickle-down” economics promoted the idea that Americans should nurture and cultivate “job creators,” the wealthiest Americans, who, it was assumed, would reinvest in the economy and cause growth that would benefit all.

When the Family Assistance Plan stalled and died, the political will to broaden the social safety net evaporated under economic pressure. Stagflation, the oil shocks of the 1970s, and deindustrialization brought malaise to the United States. These conditions enabled widespread acceptance of an alternative theory of prosperity, discussed in Chapter 7. Divorced from both equality of condition and equality of opportunity, Ronald Reagan’s tax cuts, military spending, safety-net slashing, and “trickle-down” economics promoted the idea that the freest markets were most efficient, and the most efficient markets produced the most prosperity. Although direct subsidies to income only represented a very small percentage of the annual U.S. budget, welfare programs and the people who used them came under attack. The formerly deserving poor, mothers with children, had now become “welfare queens,” and Bill Clinton, a Democratic president, collaborated with the Republican Congress to create time limits and work requirements for those on income support.

The discourse around the proposal demonstrated that conservatives feared the government was overreaching and that federalized child care threatened the sanctity of the family.78 By the mid-1970s, the residual poverty that remained was largely concentrated in states that had set lower standards for themselves for helping the poor, and the programs were funded by more generous states. Unsurprisingly, residents of wealthier states resented the differential. WELFARE REFORM IN THE CARTER ADMINISTRATION As economic conditions in the United States worsened throughout the 1970s, resentment of welfare expenditure grew. Former California governor Ronald Reagan, running in the 1976 Republican presidential primary, hit on a winning formula by transforming one particular welfare recipient, 47-year-old Linda Taylor, into the embodiment of everything that was wrong with government aid. Reagan never mentioned Taylor’s name on the campaign trail but always invoked a litany of her crimes: “She has 80 names, 30 addresses, 12 social security cards and is collecting veterans’ benefits on four nonexistent deceased husbands.”


pages: 298 words: 95,668

Milton Friedman: A Biography by Lanny Ebenstein

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affirmative action, banking crisis, Berlin Wall, Bretton Woods, Deng Xiaoping, Fall of the Berlin Wall, fiat currency, floating exchange rates, Francis Fukuyama: the end of history, full employment, Hernando de Soto, hiring and firing, inflation targeting, invisible hand, Joseph Schumpeter, Kenneth Arrow, labour market flexibility, Lao Tzu, liquidity trap, means of production, Mont Pelerin Society, Myron Scholes, Pareto efficiency, Paul Samuelson, Ponzi scheme, price stability, rent control, road to serfdom, Robert Bork, Ronald Coase, Ronald Reagan, school choice, school vouchers, secular stagnation, Simon Kuznets, stem cell, The Chicago School, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, Thorstein Veblen, zero-sum game

Adam Smith, An Inquiry Into the Nature and Causes of the Wealth of Nations, vol. 1 (Indianapolis: Liberty Classics, 1976), 456, 426. 8. Memoirs, 480. 9. FTC, i. 10. Ibid. 11. Ibid. 12. Memoirs, 605. 13. Ibid., 503. 14. Ibid., 504. CHAPTER 21 1. Memoirs, 209–210. 2. Martin Anderson, Revolution (New York: Harcourt Brace Jovanovich, 1988), 164. 3. Ronald Reagan, Reagan: In His Own Hand (New York: Free Press, 2001), 267. 4. Ronald Reagan, Speaking My Mind: Selected Speeches (New York: Simon and Schuster, 1989), 96. 5. Milton Friedman, “The Path We Dare Not Take,” Reader’s Digest (March 1977), 110. 6. Milton Friedman, “What Is America?” Saturday Evening Post (October 1978), 16. 7. Milton Friedman, “Will Freedom Prevail?” Newsweek (November 19, 1979), 142. 8. Milton and Rose Friedman, The Tyranny of the Status Quo (New York: Harcourt Brace Jovanovich, 1984), 1. 9.

He was never really comfortable with the indexation idea, in large part because it merely treats the symptoms of inflation rather than addressing inflation itself, a much preferred course. A significant outcome stemming in part from the indexation idea, though, was the indexation of tax brackets to account for inflation. Previously, as a result of inflation, individuals’ tax rates effectively rose with higher average prices (taxpayers were pushed into higher brackets of income taxation). When, during Ronald Reagan’s presidency, indexation of tax brackets was implemented as part of the Tax Reduction Act of 1981, a major systemic demand for inflation by politicians was removed. Since then inflation has markedly declined and stayed low, though there is no direct cause-and-effect relationship between indexed tax rates and inflation. Friedman’s views on taxes, spending, balanced government budgets, and government deficit spending have evolved over the decades.

According to Friedman, an advantage of a flat tax is that it would “release all of us from the unpaid bookkeeping we are forced to engage in... and make available for productive use the highly skilled accountants and lawyers who now devote their... talents to advising their clients how to avoid taxes.”20 As a second best alternative to a flat-rate tax, which he believes would be politically difficult to achieve, he supports a reduction in top tax rates. He remarked during Jimmy Carter’s presidency that “reducing oppressively high marginal rates would do far more to promote effective use of resources” than Carter’s economic plans. He also said at that time, in response to a question about what to do to increase productivity: “Reduce the top rate of the personal income tax (from 70 percent) to 25 percent.”21 During Ronald Reagan’s presidency, the top income tax rate was reduced to 28 percent. Friedman writes of the “disastrous effects on incentives”22 of high tax rates. He has always been a “supply-sider”—a term that came in vogue in the late 1970s to contrast with the Keynesian emphasis on demand—as he favors reduction in tax rates to increase productivity and advocates a stable monetary environment. He has never adopted the idea of the Laffer curve, however, whereby tax cuts pay for themselves.


pages: 900 words: 241,741

Total Recall: My Unbelievably True Life Story by Arnold Schwarzenegger, Peter Petre

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Berlin Wall, California gold rush, call centre, clean water, cleantech, Donald Trump, financial independence, Golden Gate Park, illegal immigration, index card, Maui Hawaii, Mikhail Gorbachev, oil shale / tar sands, pension reform, risk tolerance, rolodex, Ronald Reagan, Saturday Night Live, Silicon Valley, stem cell, Y2K

It cost just $5, so I bought it. When I got home, I put it up on the wall with Scotch tape. It looked beautiful hanging there. Then Artie came over. As soon as he saw it, he started snorting and acting pissed off. “Ugh,” he said, “what a fool.” I said, “What’s the matter?” “Oh, Reagan, I mean, Jesus.” “That’s a great picture. I found it in Tijuana.” He said, “Do you know who this is?” “Well, it says below, ‘Ronald Reagan.’ ” “He’s the governor of the state of California.” I said, “Really! That’s amazing. That’s twice as good. I have the governor of the state of California hanging here.” “Yeah, he used to be in Westerns,” Artie said. — With Franco as my training partner, I could concentrate on my competition goals. I was determined to win the IFBB Mr. Universe title that I’d failed to get in Miami. That loss to Frank Zane still stung so much that I didn’t want to just win the contest; I wanted to win it so decisively that people would forget I’d ever lost.

In Southern California, the value of property was rising at almost twice the rate of inflation. You could put down $100,000 to buy something for $1 million, and the next year it would be worth $1.2 million, so you’d made 200 percent on your investment. It was crazy. Al Ehringer and I flipped our building on Main Street and bought a city block for redevelopment in Santa Monica and another in Denver. I traded up my twelve-unit apartment building for a thirty-unit one. By the time Ronald Reagan came into office in 1981 and the economy slowed, I’d achieved another piece of the immigrant dream. I’d made my first million. — Conan the Barbarian might still be stuck in the comic books today if John Milius hadn’t reentered the picture in 1979. He took Oliver Stone’s script, chopped it in half, and rewrote it to cost much less, but still $17 million. Even better for Ed Pressman, Milius had a path to money.

I’d had my Jeep outfitted with a loudspeaker and siren for showing off or scaring other drivers out of my way. But now when we drove around town, I’d sink a little lower in the seat, hoping that no one would see me. It was weird pulling up at the gym every day: like most of the people there, I was known as a Republican, and now here I was with the Teddy stickers. Personally, I was hoping that Ronald Reagan would be elected president, but no one was asking my opinion; it was Maria they wanted to see. Hollywood, of course, is a big liberal town, and her family connections went deep. Her grandfather Joe Kennedy had been heavily involved in movies, running no fewer than three studios in the 1920s, and the Kennedys were famous for involving entertainers in political campaigns. So everyone in the family was very much aware of Hollywood, and they turned to actors, directors, and executives for help in fund-raising.


pages: 494 words: 132,975

Keynes Hayek: The Clash That Defined Modern Economics by Nicholas Wapshott

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airport security, banking crisis, Bretton Woods, British Empire, collective bargaining, complexity theory, creative destruction, cuban missile crisis, Francis Fukuyama: the end of history, full employment, Gordon Gekko, greed is good, Gunnar Myrdal, if you build it, they will come, Isaac Newton, Joseph Schumpeter, liquidationism / Banker’s doctrine / the Treasury view, means of production, Mont Pelerin Society, mortgage debt, New Journalism, Northern Rock, Paul Samuelson, Philip Mirowski, price mechanism, pushing on a string, road to serfdom, Robert Bork, Ronald Reagan, Simon Kuznets, The Chicago School, The Great Moderation, The Wealth of Nations by Adam Smith, Thomas Malthus, trickle-down economics, War on Poverty, Yom Kippur War

Goldwater with Jack Casserley, Goldwater (St. Martin’s Press, New York, 1988), p. 140. 15 Goldwater, Conscience of a Conservative, p. 44. 16 Milton Friedman, “The Goldwater View of Economics,” The New York Times, October 11, 1964. 17 Paul Samuelson, The New York Times, October 25, 1964. 18 Ronald Reagan (1911–2004), Hollywood actor, California governor, and 40th president of the United States. 19 Rowland Evans and Robert Novak, The Reagan Revolution (E. P. Dutton, New York, 1981), p. 237. 20 Ibid. 21 Ronald Reagan, “Time for Choosing,” address broadcast on television, October 27, 1964. 22 Newton Leroy “Newt” Gingrich (1943– ), born Newton Leroy McPherson. After completing a doctoral dissertation on Belgian education policy in the Congo from 1945 to 1960, he taught at West Georgia College before being elected to the House of Representatives in 1978.

ALSO BY NICHOLAS WAPSHOTT Ronald Reagan and Margaret Thatcher: A Political Marriage (2007) Older: The Biography of George Michael with Timothy Wapshott (1998) Carol Reed: A Biography (1994) Rex Harrison (1991) The Man Between: A Biography of Carol Reed (1990, in United Kingdom) Thatcher with George Brock (1983) Peter O’Toole: A Biography (1981; in United Kingdom, 1983) KEYNES HAYEK Nicholas Wapshott W. W. NORTON & COMPANY NEW YORK ■ LONDON TO ANTHONY HOWARD CONTENTS PREFACE ONE The Glamorous Hero How Keynes Became Hayek’s Idol, 1919–27 TWO End of Empire Hayek Experiences Hyperinflation Firsthand, 1919–24 THREE The Battle Lines Are Drawn Keynes Denies the “Natural” Order of Economics, 1923–29 FOUR Stanley and Livingston Keynes and Hayek Meet for the First Time, 1928–30 FIVE The Man Who Shot Liberty Valance Hayek Arrives from Vienna, 1931 SIX Pistols at Dawn Hayek Harshly Reviews Keynes’s Treatise, 1931 SEVEN Return Fire Keynes and Hayek Lock Horns, 1931 EIGHT The Italian Job Keynes Asks Piero Sraffa to Continue the Debate, 1932 NINE Toward The General Theory The Cost-Free Cure for Unemployment, 1932–33 TEN Hayek Blinks The General Theory Invites a Response, 1932–36 ELEVEN Keynes Takes America Roosevelt and the Young New Deal Economists, 1936 TWELVE Hopelessly Stuck in Chapter 6 Hayek Writes His Own “General Theory,” 1936–41 THIRTEEN The Road to Nowhere Hayek Links Keynes’s Remedies to Tyranny, 1937–46 FOURTEEN The Wilderness Years Mont-Pèlerin and Hayek’s Move to Chicago, 1944–69 FIFTEEN The Age of Keynes Three Decades of Unrivalled American Prosperity, 1946–80 SIXTEEN Hayek’s Counterrevolution Friedman, Goldwater, Thatcher, and Reagan, 1963–88 SEVENTEEN The Battle Resumed Freshwater and Saltwater Economists, 1989–2008 EIGHTEEN And the Winner Is . . .

He imposed price controls on fuel, leading to long lines at filling stations. He appointed as chairman of the Federal Reserve a lifelong Democrat, Paul Volcker,96 with a mission to raise interest rates to choke off the demand that was thought to be the root of inflation. Carter’s failure to bring prices under control in time for the November 1980 election was a gift to his Republican rival, the handsome, affable, twinkle-eyed Ronald Reagan, who asked voters, “Are you better off than you were four years ago?” The answer was a resounding no. It was not only Carter who was on trial, but also John Maynard Keynes. Thirty-four years after the great man’s death and more than forty after publication of his General Theory, Keynesianism appeared to have run its course. Like the overuse of a wonder drug, dispensers of his remedy appeared to have applied too much of the elixir too often.


pages: 482 words: 122,497

The Wrecking Crew: How Conservatives Rule by Thomas Frank

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affirmative action, anti-communist, barriers to entry, Berlin Wall, Bernie Madoff, British Empire, collective bargaining, corporate governance, Credit Default Swap, David Brooks, edge city, financial deregulation, full employment, George Gilder, guest worker program, income inequality, invisible hand, job satisfaction, Mikhail Gorbachev, Mont Pelerin Society, mortgage debt, Naomi Klein, new economy, P = NP, Plutocrats, plutocrats, Ponzi scheme, Ralph Nader, rent control, Richard Florida, road to serfdom, rolodex, Ronald Reagan, school vouchers, shareholder value, Silicon Valley, stem cell, Telecommunications Act of 1996, the scientific method, too big to fail, union organizing, War on Poverty

This vast stream of dollars flooding into Washington, the story goes, is then diverted by the know-it-all government to people it deems worthier than you. And when Washington’s bureaucrats aren’t wasting your tax dollars on idiotic projects that they always bungle, they are telling you how to run your business, compiling regulation upon regulation into a bookshelf of legalese that no one can ever hope to understand or obey. “Every businessman has his own tale of harassment,” thundered Ronald Reagan in 1964. “Our natural, inalienable rights are now considered to be a dispensation of government, and freedom has never been so fragile, so close to slipping from our grasp as it is at this moment.” It has been forty-five years now since Reagan’s electrifying vision of homegrown tyranny fueled Barry Goldwater’s run for the nation’s highest office; it has been four decades since a diluted version of it propelled Richard Nixon to the presidency.

Admittedly, cynicism seems like an unlikely quality to find in a movement whose rank and file get misty-eyed contemplating the flag, the family, the founding fathers, and the Boy Scouts, and who can be moved to hold candlelight vigils to protect Ten Commandments monuments. Change the subject to government, though, and you will have opened the floodgates of sarcasm, disbelief, contempt, and ridicule. It was sunny Ronald Reagan who claimed to find terror in the phrase “I’m from the government and I’m here to help.” And it was Reagan’s economic adviser David Stockman who, in 1981, penned this bitter verdict on the Carter administration that he was preparing to terminate. “Much of the vast enterprise of American government was invalid, suspect, malodorous,” he wrote with disgust. The “projects and ministrations” of liberalism “were not spawned from higher principles . . . ; they were simply the flotsam and jetsam of a flagrantly promiscuous politics, the booty and spoils of the organized thievery conducted within the desecrated halls of government.”8 Conservative antigovernment cynicism can be found in many forms.

To fill the main supporting role in this great freedom-fest, meanwhile, the organizers turned to apartheid South Africa, a place where only a small, correctly complexioned percentage of the population possessed the most basic democratic rights. But there was also a certain cynical brilliance to it. Jamba was officially sponsored by a long-forgotten Washington group called Citizens for America whose leading members were typical conservative plutocrats: oil barons, Wall Street kings, and agribusiness lords. The group’s founder, Jack Hume, was one of the California millionaires who had funded Ronald Reagan’s political career from the beginning. (“He made a substantial investment and has backed Reagan ever since” is one apt description.)46 To represent its conservatism to the world, though, this 24-karat group did not choose a contented white yachtsman snoozing in an easy chair, but a black African fond of camouflage and handguns; a ferocious warrior who single-handedly kept a real rebellion burning against the government of his country year after year.


pages: 545 words: 137,789

How Markets Fail: The Logic of Economic Calamities by John Cassidy

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Albert Einstein, Andrei Shleifer, anti-communist, asset allocation, asset-backed security, availability heuristic, bank run, banking crisis, Benoit Mandelbrot, Berlin Wall, Bernie Madoff, Black-Scholes formula, Bretton Woods, British Empire, capital asset pricing model, centralized clearinghouse, collateralized debt obligation, Columbine, conceptual framework, Corn Laws, corporate raider, correlation coefficient, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Daniel Kahneman / Amos Tversky, debt deflation, diversification, Elliott wave, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, Financial Instability Hypothesis, financial intermediation, full employment, George Akerlof, global supply chain, Gunnar Myrdal, Haight Ashbury, hiring and firing, Hyman Minsky, income per capita, incomplete markets, index fund, information asymmetry, Intergovernmental Panel on Climate Change (IPCC), invisible hand, John Nash: game theory, John von Neumann, Joseph Schumpeter, Kenneth Arrow, laissez-faire capitalism, Landlord’s Game, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, Louis Bachelier, mandelbrot fractal, margin call, market bubble, market clearing, mental accounting, Mikhail Gorbachev, money market fund, Mont Pelerin Society, moral hazard, mortgage debt, Myron Scholes, Naomi Klein, negative equity, Network effects, Nick Leeson, Northern Rock, paradox of thrift, Pareto efficiency, Paul Samuelson, Ponzi scheme, price discrimination, price stability, principal–agent problem, profit maximization, quantitative trading / quantitative finance, race to the bottom, Ralph Nader, RAND corporation, random walk, Renaissance Technologies, rent control, Richard Thaler, risk tolerance, risk-adjusted returns, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, shareholder value, short selling, Silicon Valley, South Sea Bubble, sovereign wealth fund, statistical model, technology bubble, The Chicago School, The Great Moderation, The Market for Lemons, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, unorthodox policies, value at risk, Vanguard fund, Vilfredo Pareto, wealth creators, zero-sum game

Slight, quick-witted, and irascible, he viewed the tortuous derivations of general equilibrium theory as largely a waste of time and effort: to him, the efficacy of free markets was self-evident. Martin Anderson, one of Ronald Reagan’s economic advisers, has described Friedman as “the most influential economist since Adam Smith.” That may be an exaggeration, but nobody did more than Friedman to resurrect laissez-faire ideas. In academic venues, in his long-running column in Newsweek, and in two much-read books, Capitalism and Freedom, first published in 1962, and Free to Choose, which he and his wife, Rose, put out in January 1980, just as Ronald Reagan was beginning his successful run for the White House, Friedman furnished conservative politicians with a consistent and well-articulated set of ideas and policy proposals. After Friedman’s death in 2006, even Paul Krugman, the liberal Princeton economist and New York Times columnist, saluted his achievements, writing, “I regard him as a great economist and a great man.”

In many parts of the country, home prices had started falling, and the number of families defaulting on their mortgages was rising sharply. But among economists there was still a deep and pervasive faith in the vitality of American capitalism, and the ideals it represented. For decades now, economists have been insisting that the best way to ensure prosperity is to scale back government involvement in the economy and let the private sector take over. In the late 1970s, when Margaret Thatcher and Ronald Reagan launched the conservative counterrevolution, the intellectuals who initially pushed this line of reasoning—Friedrich Hayek, Milton Friedman, Arthur Laffer, Sir Keith Joseph—were widely seen as right-wing cranks. By the 1990s, Bill Clinton, Tony Blair, and many other progressive politicians had adopted the language of the right. They didn’t have much choice. With the collapse of communism and the ascendancy of conservative parties on both sides of the Atlantic, a positive attitude to markets became a badge of political respectability.

Frank Nothaft, the chief economist at Freddie Mac, ran through a list of “economic fundamentals” that he said justified high and rising home prices: low mortgage rates, large-scale immigration, and a modest inventory of new homes. “We are not going to see the price of single-family homes fall,” he said bluntly. “It ain’t going to happen.” As the housing boom continued, Nothaft’s suggestion that nationwide house prices were unidirectional acquired the official imprimatur of the U.S. government. In April 2003, at the Ronald Reagan Presidential Library and Museum, in Simi Valley, California, Alan Greenspan insisted that the United States wasn’t suffering from a real estate bubble. In October 2004, he argued that real estate doesn’t lend itself to speculation, noting that “upon sale of a house, homeowners must move and live elsewhere.” In June 2005, testifying on Capitol Hill, he acknowledged the presence of “froth” in some areas, but ruled out the possibility of a nationwide bubble, saying housing markets were local.


pages: 223 words: 10,010

The Cost of Inequality: Why Economic Equality Is Essential for Recovery by Stewart Lansley

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banking crisis, Basel III, Big bang: deregulation of the City of London, Bonfire of the Vanities, borderless world, Branko Milanovic, Bretton Woods, British Empire, business process, call centre, capital controls, collective bargaining, corporate governance, corporate raider, correlation does not imply causation, creative destruction, credit crunch, Credit Default Swap, crony capitalism, David Ricardo: comparative advantage, deindustrialization, Edward Glaeser, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, Goldman Sachs: Vampire Squid, high net worth, hiring and firing, Hyman Minsky, income inequality, James Dyson, Jeff Bezos, job automation, John Meriwether, Joseph Schumpeter, Kenneth Rogoff, knowledge economy, laissez-faire capitalism, light touch regulation, Long Term Capital Management, low skilled workers, manufacturing employment, market bubble, Martin Wolf, mittelstand, mobile money, Mont Pelerin Society, Myron Scholes, new economy, Nick Leeson, North Sea oil, Northern Rock, offshore financial centre, oil shock, Plutocrats, plutocrats, Plutonomy: Buying Luxury, Explaining Global Imbalances, Right to Buy, rising living standards, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, shareholder value, The Great Moderation, The Spirit Level, The Wealth of Nations by Adam Smith, Thomas Malthus, too big to fail, Tyler Cowen: Great Stagnation, Washington Consensus, Winter of Discontent, working-age population

It is no coincidence that in both these countries finance became an increasingly dominant force as the process of de-industrialisation accelerated. Indeed the fortunes of these two sectors have been moving in opposite directions—as finance has triumphed, manufacturing has slumped. The economic policies pursued by both Mrs Thatcher and Ronald Reagan—from a high exchange rate to financial and labour market de-regulation—were highly favourable to finance. One of the effects of Reaganomics was an overvalued dollar, hardly dream conditions for exporters. William Benedetto, head of corporate finance for Dean Witter Reynolds—one of America’s largest stock brokerage and securities’ firms—called Ronald Reagan’s eight-year Presidency ‘an investment banker’s dream world.’96 But while Wall Street flourished, key industrial sectors from timber and steel to chemicals and high-technology, sweated. Between 1970 and 1990, American employment in manufacturing shrank from 27 to 17 per cent of the workforce.

Then in early 1992, the debate became public when the findings were published in an article in the New York Times by the American academic, Paul Krugman, later to receive the Nobel Prize in Economics for his work on trade theory. The article caused something of a storm. The question of inequality was and remains a sensitive one in the United States, a nation that likes to see itself as having created the most opportunistic society in the world. ‘Even mentioning income distribution leads to angry accusations of “class warfare”’ is how Krugman put it.17 In 1989, George H W Bush had succeeded Ronald Reagan as President and continued the broad economic policies of his predecessor—a mix of freer markets, smaller government and lower taxes. Republican administrations from the 1980s had long claimed that ‘Reaganomics’—as President Reagan’s free-market experiment was known—had been highly successful, helping to boost growth and prosperity for all. These new findings challenged a key aspect of this claim—that all Americans had benefited from the new economic direction.

‘In its wake was a growing disillusion with the Keynesian economists, the Fabian planners, the postBeveridge social engineers, the consensual liberal positivists who had governed the realm like so many conquistadors for a quarter of a century.’49 Although Mrs Thatcher was, at heart, a conviction politician, she quickly came under the spell of this small group of thinkers on the right. Under their influence, she came to believe that Britain had created an economic model that killed incentives and stifled enterprise, that only freer markets and personal wealth accumulation would bring a more efficient, entrepreneurial and prosperous nation. A year after coming to power she was joined in this crusade by an even more powerful soul-mate, Ronald Reagan. The new American President, who was also heavily influenced by neoconservative thinkers, shared Mrs Thatcher’s belief in the dangers of big government and the virtues of a weakened state and low taxes. Central to this new economic philosophy was the idea that the rich should be allowed to get richer. For British advocates, improved rewards at the top, it was claimed, would correct for the failings of post-war welfare capitalism, lift Britain out of its tepid entrepreneurial culture and bring renewed economic dynamism.

Culture of Terrorism by Noam Chomsky

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anti-communist, Bolshevik threat, Bretton Woods, centre right, clean water, David Brooks, failed state, Farzad Bazoft, land reform, Monroe Doctrine, risk tolerance, Robert Bork, Ronald Reagan, union organizing

But it would be wrong to overlook the impact on the victims, who endure a lasting “culture of terror [that] domesticates the expectations of the majority” and undermines aspirations towards “alternatives that differ from those of the powerful,” in the words of the Salvadoran Jesuits who survived the project of “democracy promotion,” in a conference they sponsored in 1994. This book is concerned with the immediate consequences of Ronald Reagan’s war on terror, declared as he entered office. The war was redeclared by George W. Bush. The immediate consequences should be too well known to review, and should not have surprised those who are familiar with the continuities of policy and the way they are interpreted within mainstream articulate opinion. Moving to the present, the United States is now engaged in a global terrorist campaign of unprecedented character, targeting people suspected of having some intention of perhaps harming us some day.

As for the past, it is plainly irrelevant, since we have undergone a miraculous conversion and have changed course— despite the fact that the institutional structures and planning system that lie behind past atrocities remain intact and unchallenged, and there is little recognition in the intellectual or popular culture of what has happened in reality, apart from those (not insignificant) sectors of popular nonelite opinion that remain stricken by the “Vietnam syndrome.” The doctrine of “change of course,” which allows any past horror to be cheerfully dismissed, is highly functional within a terrorist culture. It is presented in its most vulgar form by 1987 Pulitzer Prize winner Charles Krauthammer, who assures us that “today’s America is not Teddy Roosevelt’s or Eisenhower’s or even that imagined by Ronald Reagan, the candidate.” Now “democracy in the Third World has become, for the right as well as the left, a principal goal of American foreign policy.” While it is true that “liberty has not always been the American purpose,” now all has changed: “We believe in freedom,” and the past can be consigned to oblivion along with all that it teaches us about American institutions and the way they operate.7 As for the present, it will be rendered with the same scrupulous concern for accuracy and honest self-criticism that was exhibited during past eras when, we now concede in retrospect, there may have been an occasional blemish.

It is the conclusion that anyone who gave the matter a moment’s thought would at once draw from the story that had been displayed on the television screen and the front pages for the preceding months. But the media were oblivious to these truisms. Doves and hawks alike pondered the prospects in ways to which I will return, but without any recognition of the fundamental absurdity of a “peace plan” under which Nicaragua disarms in exchange for a pledge of good behavior from Ronald Reagan and his cohorts.13 It was assumed on all sides that the Reagan administration would undergo the familiar miraculous conversion, that it would suddenly change course, would become law-abiding and would comply with agreements without monitoring or any meaningful supervision. There were concerns that Nicaragua would lie and cheat in the manner of all Communists, but no questions about the likelihood that the United States would live up to an unverifiable commitment.


pages: 147 words: 45,890

Aftershock: The Next Economy and America's Future by Robert B. Reich

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Berlin Wall, declining real wages, delayed gratification, Doha Development Round, endowment effect, full employment, George Akerlof, Home mortgage interest deduction, Hyman Minsky, illegal immigration, income inequality, invisible hand, job automation, labor-force participation, Long Term Capital Management, loss aversion, mortgage debt, new economy, offshore financial centre, Ralph Nader, Ronald Reagan, school vouchers, sovereign wealth fund, Thorstein Veblen, too big to fail, World Values Survey

.: Economic Policy Institute, 2008), pp. 220–24. 6 More than half of all the money: See Lawrence Bebchuk, “The Growth of Executive Pay,” Oxford Review of Economic Policy 21, no. 2 (2005): 283–303. 7 By 2007, financial and insurance companies: See Bureau of Economic Analysis, National Income and Product Accounts (NIPA) Tables, Section I: Domestic Product and Incomes, “Real Gross Value Added by Industry,” 2009. 8 In 2009, the twenty-five best-paid hedge-fund managers: See AR: Absolute Return + Alpha, annual survey, 2009. 9 in 2007, Ford’s financial division: Securities and Exchange Commission Filings. 10 according to presidential candidate Ronald Reagan: Ronald Reagan campaign address, “A Vital Economy: Jobs, Growth, and Progress for Americans,” October 24, 1980. 11 Moreover, they had no clear memory: See Technology Triumphs, Morality Falters, Section 5: “America’s Collective Memory,” the Pew Research Center for the People and the Press, January 3, 1999. 8. HOW AMERICANS KEPT BUYING ANYWAY: THE THREE COPING MECHANISMS 1 Coping mechanism #1: See U.S.

The argument does not acknowledge the consequences for an economy when the middle class lacks the means to buy what it produces. Others see the reversal of the pendulum as the inevitable result of declining confidence in government. In their view, the era that began with the Vietnam War and continued with the Watergate scandal culminated in the tax revolts and double-digit inflation of the late 1970s—which, according to presidential candidate Ronald Reagan, occurred not because Americans were living too well but “because the government [was] living too well.” Confidence in government did drop, but proponents of this view have cause and effect backward. The tax revolts that thundered across America starting in the late 1970s were not so much ideological revolts against government—Americans still wanted all the government services they had had before, and then some—as against paying more taxes on incomes that had flattened.

But the average market holdings of middle-class Americans remained tiny compared to those of wealthy Americans.) The rich and powerful also had substantial influence “in conditioning the attitude taken by people as a whole toward [the] rules,” as Eccles wrote in describing the pre-Depression years. They generously financed think tanks, books, media, and ads designed to persuade Americans that free markets always know best. Ronald Reagan, Margaret Thatcher, Alan Greenspan, Milton Friedman, and other apostles of free-market dogma reiterated a simple story: The choice was between a free market and big government. Government was the problem. Free markets were the solution. But how could the public have been so gullible as to accept this story? After all, America had gone through a Great Depression, suffering the consequences of an unfettered market and unconstrained greed.

On Power and Ideology by Chomsky, Noam

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anti-communist, Ayatollah Khomeini, Berlin Wall, British Empire, cuban missile crisis, feminist movement, imperial preference, land reform, Mikhail Gorbachev, Monroe Doctrine, RAND corporation, Ronald Reagan, Stanislav Petrov, union organizing

If the USSR were to warn about the threat posed by Denmark or Luxembourg to Soviet security and the need to “contain” this dire threat, perhaps even declaring a national emergency in the face of this grave danger, Western opinion would be rightly enraged. But when the mainstream U.S. press and a liberal Congress, echoing the Administration, warn ominously of the need to “contain” Nicaragua, the same thinkers nod their heads in sage assent or offer mild criticism that the threat is perhaps exaggerated. And when in May 1985, Ronald Reagan declared a “national emergency” to deal with the “unusual and extraordinary threat to the national security and foreign policy of the United States” posed by “the policies and actions of the Government of Nicaragua,” the reaction in Congress and the media—and in much of Europe—was not ridicule, but rather praise for these principled and statesmanlike steps. All of this provides yet another indication of the level of Western intellectual culture.

This theory has two variants. One, regularly invoked to frighten the domestic population, is that Ho Chi Minh (or whoever the current sinner may be) will climb into a canoe, conquer Indonesia, land in San Francisco, and rape your grandmother. While it may be difficult to believe that these tales are presented seriously by the political leadership, one should not be too sure. Leaders of the calibre of Ronald Reagan may well believe what they say. The same may be true of more serious political figures, for example, Lyndon Johnson, probably the most liberal President in American history and in many ways “a man of the people,” who was undoubtedly speaking honestly when he warned in 1948 that unless the U.S. maintained overwhelming military superiority, it would be “a bound and throttled giant; impotent and easy prey to any yellow dwarf with a pocket knife”; or when he said in a speech in Alaska in 1966, at the height of U.S. aggression in Vietnam, that “If we are going to have visits from any aggressors or any enemies, I would rather have that aggression take place out 10,000 miles from here than take place here in Anchorage,” referring to the “internal aggression” of the Vietnamese against U.S. military forces in Vietnam: There are 3 billion people in the world [Johnson continued] and we have only 200 million of them.

It was necessary to respond in the usual manner: by international terrorism, embargo, pressures on international institutions and allies to withhold aid, a huge campaign of propaganda and disinformation, threatening military maneuvers and overflights as part of what the Administration calls “perception management,” and other hostile measures available to a powerful and violent state. Near hysteria was evoked in the U.S. government when Nicaragua accepted the draft of the Contadora treaty in 1984, shortly after Ronald Reagan had informed Congress that the purpose of the contra war was to compel Nicaragua to accept the treaty and Secretary of State Shultz had praised the draft treaty and denounced Nicaragua for blocking its implementation. Hysteria reached a still higher peak when Nicaragua conducted elections described by the professional association of U.S. Latin America scholars (LASA) as remarkably open and honest despite massive U.S. efforts to undermine them, including pressures on the business-based opposition and a disinformation campaign about the delivery of MIG aircraft, carefully timed to remove the elections from the news; it is, of course, taken for granted across the political spectrum that if Nicaragua were to obtain aircraft to defend its national territory from a U.S. assault, that would be an intolerable offense, justifying bombing of Nicaragua, as Senatorial doves warned.


pages: 257 words: 64,763

The Great American Stickup: How Reagan Republicans and Clinton Democrats Enriched Wall Street While Mugging Main Street by Robert Scheer

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banking crisis, Bernie Madoff, Bernie Sanders, collateralized debt obligation, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, facts on the ground, financial deregulation, fixed income, housing crisis, invisible hand, Long Term Capital Management, mega-rich, mortgage debt, new economy, old-boy network, Ponzi scheme, profit motive, Ralph Nader, Ronald Reagan, too big to fail, trickle-down economics

THE HIGH PRIESTESS OF THE REAGAN REVOLUTION 26 “called her ‘The Margaret Thatcher of financial regulation’”: Wendy Gramm, Mercatus Center Distinguished Senior Scholar, Mercatus Center, George Mason University, mercatus.org/wendy-gramm. 27 “Unfortunately, this legislation does not deal”: Ronald Reagan, Remarks on Signing the Garn-St. Germain Depository Institutions Act of 1982, October 15, 1982, www.reagan.utexas.edu/archives/speeches/1982/101582b.htm. 28 “Ronald Reagan’s dream of carrying out a sweeping”: Richard Hornik, “Shortening the Tether on Bankers,” Time, August 17, 1987. 29 “the 1933 Glass-Steagall Act restrictions on securities activities”: Ronald Reagan, Statement on Signing Competitive Equality Banking Act of 1987, August 10, 1987, www.presidency.ucsb.edu/ws/index.php?pid=34677. 30 “These new anti-consumer and anti-competitive provisions could hold back a vital service industry”: Ibid. 30 “Oh, yuck”: Richard L.

Arrayed most prominently against them, far, far down the DC power ladder, were two female regulators, Born and Sheila Bair (an appointee of Bush I and II and retained as FDIC chair by Obama). They never had a chance, though; they were facing a juggernaut: The combined power of the Wall Street lobbyists allied with popular President Clinton, who staked his legacy on reassuring the titans of finance a Democrat could serve their interests better than any Republican. Clinton’s role was decisive in turning Ronald Reagan’s obsession with an unfettered free market into law. Reagan, that fading actor recast so effectively as great propagandist for the unregulated market—“get government off our backs” was his signature rallying cry—was far more successful at deregulating smokestack industries than the financial markets. It would take a new breed of “triangulating” technocrat Democrats to really dismantle the carefully built net designed, after the last Great Depression, to restrain Wall Street from its pattern of periodic self-immolations.

A tip-off to the answer might be that the lobbying forces—the power of that massive wealth to control politics which Obama in his speech referred to as “the $300 million lobbying effort that drove deregulation”—did not stop functioning with the election of Barack Obama to the presidency, and that to some degree, even a politician who read the danger signs so well could succumb to the very forces that he had earlier decried. CHAPTER 2 The High Priestess of the Reagan Revolution Ronald Reagan called her his favorite economist, and Wendy Lee Gramm seemed to deserve the praise. Both while she was an academic economist and after Reagan appointed her to various regulatory positions in his administration, she excelled in articulating antiregulatory rhetoric that marked her as a true believer in what would later be labeled the “Reagan Revolution.” Reagan himself had risen in politics after eight years of tutelage as a spokesman for the General Electric Company, from 1954 to 1962.


pages: 296 words: 78,112

Devil's Bargain: Steve Bannon, Donald Trump, and the Storming of the Presidency by Joshua Green

4chan, Affordable Care Act / Obamacare, Ayatollah Khomeini, Bernie Sanders, business climate, centre right, collateralized debt obligation, conceptual framework, corporate raider, crony capitalism, currency manipulation / currency intervention, Donald Trump, Fractional reserve banking, Goldman Sachs: Vampire Squid, Gordon Gekko, guest worker program, illegal immigration, immigration reform, liberation theology, low skilled workers, Nate Silver, nuclear winter, obamacare, Peace of Westphalia, Peter Thiel, quantitative hedge fund, Renaissance Technologies, Ronald Reagan, Silicon Valley, speech recognition, urban planning

And that is how, several years later, at a fund-raiser for Children’s National Medical Center in Washington, D.C., Steve Wynn called his friend Donald Trump over and introduced him to a man who would soon set the course for his unlikely political rise: David Bossie. — By the time he met Trump in the late 2000s, Bossie, then still in his early forties, was already a hardened veteran of Washington’s political wars. Smitten with Ronald Reagan as a teenager growing up in Boston, he became youth director of Bob Dole’s 1988 presidential campaign, and then a foot soldier in Newt Gingrich’s Republican revolution when the GOP took back the House of Representatives in the 1994 election. Not long afterward, the beefy, buzz-cut, hyperintense Bossie (who still resembles a Dick Tracy villain) landed a job as chief investigator for the House Government Reform and Oversight Committee.

Foster in the gulf, his darkening view of the wider world grew to encompass his civilian commanders—above all Carter, whose pusillanimous hesitancy, and failure of leadership when he did finally act, Bannon held directly responsible for damaging American prestige. Bannon’s experience as a naval officer in the gulf did more than sour him on Democratic politics. It pushed him into a different party. He became enraptured with a hawkish, outspoken, confrontational, and struttingly pro-military Republican, Ronald Reagan, whose searing critique of Carter’s weakness matched his own views. Bannon’s years abroad also opened his eyes to what struck him as a gathering threat. It was not the sort of immediate, existential danger posed by the Soviet Union. Rather, this was a more distant menace that loomed just over the horizon: Islam. Anyone seeking to trace the pathogenesis of the Islamophobia that would grip Bannon thirty years hence can follow it back to Tehran and his time in the Middle East.

The two decades in between, he realized, had done nothing to stanch the threat of radical Islam to the United States—in fact, Islamic terrorists had struck with greater force than anyone imagined they could and had chosen as a target of their attack the very Wall Street financial district where he had long toiled for Goldman Sachs. The Iranian hostage crisis first impelled Bannon toward Ronald Reagan, whose strength he was certain was vital to preserving America’s safety and influence in the world. Having long ago left the military, he didn’t have any obvious outlet to respond to the new attacks—a middle-aged Hollywood investment banker can’t exactly walk into a recruiter’s office and reenlist. But the following year, Bannon, an avid reader of biographies and political histories, picked up a new book, Reagan’s War: The Epic Story of His Forty-Year Struggle and Final Triumph Over Communism, by the conservative scholar Peter Schweizer.


pages: 441 words: 136,954

That Used to Be Us by Thomas L. Friedman, Michael Mandelbaum

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3D printing, Affordable Care Act / Obamacare, Albert Einstein, Amazon Web Services, American Society of Civil Engineers: Report Card, Andy Kessler, Ayatollah Khomeini, bank run, barriers to entry, Berlin Wall, blue-collar work, Bretton Woods, business process, call centre, carbon footprint, Carmen Reinhart, Cass Sunstein, centre right, Climatic Research Unit, cloud computing, collective bargaining, corporate social responsibility, creative destruction, Credit Default Swap, crowdsourcing, delayed gratification, energy security, Fall of the Berlin Wall, fear of failure, full employment, Google Earth, illegal immigration, immigration reform, income inequality, Intergovernmental Panel on Climate Change (IPCC), job automation, Kenneth Rogoff, knowledge economy, Lean Startup, low skilled workers, Mark Zuckerberg, market design, mass immigration, more computing power than Apollo, Network effects, obamacare, oil shock, pension reform, Report Card for America’s Infrastructure, rising living standards, Ronald Reagan, Rosa Parks, Saturday Night Live, shareholder value, Silicon Valley, Silicon Valley startup, Skype, Steve Jobs, the scientific method, Thomas L Friedman, too big to fail, University of East Anglia, WikiLeaks

“What I needed to say to win him over and win my election,” Inglis said, “was that ‘I am going to prevent that socialist in the White House, who is probably not even an American citizen and who is illegitimately in the White House, from getting his hands on your Medicare.’ Then I would have been a political hero—but I would have left them in ignorance. What is tragic right now is that we have people—leading people—who choose to leave audiences in ignorance or even encourage stupidity.” That same ignorance can be found in sectors of the business community, where scorn for the government and regulation has become the norm. Who can ever forget Ronald Reagan’s famous campaign line: “The nine most terrifying words in the English language are, ‘I’m from the government and I’m here to help.’” Of course, every businessperson in America wants lower taxes and less regulation. Most Americans do. But every one of us also benefits from, indeed depends upon, the five pillars of the American formula. Failing to recognize that fact endangers one of the major sources of our strength.

The right strategy is to have a strategy—a strategy for long-term American growth and nation-building at home. That will require us to cut spending, to raise taxes, and to invest in the sources of our strength, all in a coordinated way. But before we discuss that, let’s step back for a moment and ask: How in the world did we get into this position? Present at the Creation From the end of World War II until Ronald Reagan’s presidency, American budget history was pretty boring. The federal government ran manageable annual budget deficits and the economy steadily grew, so our debt-to-GDP ratio fell. Since the big change occurred during the Reagan presidency, we decided to ask someone who was present at the creation: David Stockman, the budget director during Reagan’s first term and a sharp critic of recent American fiscal policy.

Reagan also led a reform of Social Security in 1983 to shore up the system. Recall the words of former vice president Cheney, whom we quoted earlier: “Reagan proved deficits don’t matter.” Reagan not only did not prove that deficits don’t matter; he did not believe that deficits don’t matter. This is a fiction that would be manufactured later by a new generation of conservatives either out of ignorance or for their own selfish or ideological reasons. “Ronald Reagan never called them taxes,” recalled former senator Bennett, the Utah Republican. “They were ‘revenue enhancements.’ [Senator] Pete Domenici described it to me once: he said, ‘We went down to the White House and said, “Mr. President, we can’t survive on this level of revenue.” And, Reagan said, “Okay, maybe we ought to have some ‘revenue enhancements.’”’ And so the gas tax went up, which it should have, and should be going up now.”


pages: 484 words: 136,735

Capitalism 4.0: The Birth of a New Economy in the Aftermath of Crisis by Anatole Kaletsky

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bank run, banking crisis, Benoit Mandelbrot, Berlin Wall, Black Swan, bonus culture, Bretton Woods, BRICs, Carmen Reinhart, cognitive dissonance, collapse of Lehman Brothers, Corn Laws, correlation does not imply causation, creative destruction, credit crunch, currency manipulation / currency intervention, David Ricardo: comparative advantage, deglobalization, Deng Xiaoping, Edward Glaeser, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, F. W. de Klerk, failed state, Fall of the Berlin Wall, financial deregulation, financial innovation, Financial Instability Hypothesis, floating exchange rates, full employment, George Akerlof, global rebalancing, Hyman Minsky, income inequality, information asymmetry, invisible hand, Isaac Newton, Joseph Schumpeter, Kenneth Arrow, Kenneth Rogoff, laissez-faire capitalism, Long Term Capital Management, mandelbrot fractal, market design, market fundamentalism, Martin Wolf, money market fund, moral hazard, mortgage debt, new economy, Northern Rock, offshore financial centre, oil shock, paradox of thrift, Pareto efficiency, Paul Samuelson, peak oil, pets.com, Ponzi scheme, post-industrial society, price stability, profit maximization, profit motive, quantitative easing, Ralph Waldo Emerson, random walk, rent-seeking, reserve currency, rising living standards, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, short selling, South Sea Bubble, sovereign wealth fund, special drawing rights, statistical model, The Chicago School, The Great Moderation, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, too big to fail, Vilfredo Pareto, Washington Consensus, zero-sum game

These unprecedented political and economic traumas destroyed the classical laissez-faire capitalism of the nineteenth century and created a different version of the capitalist system, embracing Franklin Roosevelt’s New Deal, Lyndon Johnson’s Great Society, and the British and European welfare states. Then, forty years after the Great Depression, another enormous economic crisis—the global inflation of the late 1960s and 1970s—inspired the free-market revolution of Margaret Thatcher and Ronald Reagan, creating a third version of capitalism, clearly distinct from the previous two. Forty years after the great inflation of the late 1960s, the global economy was hit by another systemic crisis, in 2007-09. The argument of this book is that this crisis is creating a fourth version of the capitalist system, a new economy as different from the designs of Reagan and Thatcher as those were from the New Deal.

This assumption is now widely shared. Yet the many conservative politicians, financiers, and business leaders who vehemently denounce the credit expansion of the precrisis period as a fraud and illusion never seem to consider the logical implication: If most of the wealth created from the 1980s onward was a fraud, the same must be true of the free-market reforms that supposedly created this imaginary wealth. Ronald Reagan and Margaret Thatcher allegedly reversed the structural deterioration of Anglo-Saxon capitalism that began in the late 1960s by creating the free-market system described in this book as Capitalism 3.0. But postcrisis conventional wisdom implies that the Thatcher-Reagan reforms merely disguised the capitalist system’s malaise behind a froth of financial bubbles. Now that the phoney speculative froth has been blown away, we are told that very little genuine wealth and productive capacity was created in the period of rising leverage from the mid-1980s onward.

And indeed, nothing is preordained in history, nor anything immutable in economics. In the past forty years, dozens of relatively small events could have changed the course of history and transformed economic conditions the world over. Imagine if Deng Xiaoping had died in the Cultural Revolution alongside his mentor Liu Shaoqi. Or if Gorbachev had been passed over for the Soviet leadership. Or if John Hinckley’s bullet had been aimed an inch higher at Ronald Reagan’s chest. Or if Argentina had not invaded the Falklands, saving the government of Margaret Thatcher. Or if the hanging chads in Florida had fallen for Al Gore instead of George W. Bush. Any of these events would certainly have transformed the pace of change, but would they have moved history in a different direction? No one can say for certain, but an inexorable logic in both capitalism and democracy appears to favor self-improvement over self-destruction.


pages: 613 words: 151,140

No Such Thing as Society by Andy McSmith

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anti-communist, Ayatollah Khomeini, Berlin Wall, Big bang: deregulation of the City of London, Bob Geldof, British Empire, Brixton riot, call centre, cuban missile crisis, Etonian, F. W. de Klerk, Farzad Bazoft, feminist movement, fixed income, Francis Fukuyama: the end of history, friendly fire, full employment, glass ceiling, God and Mammon, greed is good, illegal immigration, index card, John Bercow, liberal capitalism, light touch regulation, Live Aid, loadsamoney, long peace, means of production, Mikhail Gorbachev, mortgage debt, mutually assured destruction, negative equity, Neil Kinnock, North Sea oil, Northern Rock, old-boy network, popular capitalism, Right to Buy, Ronald Reagan, Rubik’s Cube, Sloane Ranger, South Sea Bubble, spread of share-ownership, strikebreaker, The Chicago School, union organizing, upwardly mobile, urban decay, Winter of Discontent, young professional

Salaries were rising, and the higher tax rates had fallen and fallen for those who were paid enough to be affected; the generous cuts came at the start of the decade, but the biggest of all was in 1988, when the top rate went down from 60p to 40p, which put up the disposable income of the well-off by up to one-fifth overnight. It was one of those rare cases when London led the way, and Washington followed. When Ronald Reagan was inaugurated as president of the USA in January 1981, the phenomenon known in Britain as Thatcherism was already almost two years old. The politics of the 1980s was dominated by Margaret Thatcher – who was prime minister from May 1979 to November 1990 – in a way that no other decade is associated with one individual. And there is no other prime minister about whom opinion is so divided. Her arrival in Downing Street brought hope to people who feared that a sickness had overtaken the western democracies, in which individual liberty was being sacrificed to an obsession with social justice.

In December 1979, a small group of ministers agreed that they should buy the more modern and potentially destructive Trident missiles from the USA. President Jimmy Carter was at first reluctant to sell, having staked his reputation on disarmament talks, but changed his mind after the Soviet invasion of Afghanistan at the end of 1979. A deal was announced in the Commons on 15 July 1980. Four months later, Carter was defeated by his Republican challenger, Ronald Reagan. Reagan and Thatcher were soulmates. In time, their relationship would be the closest there had ever been between an American president and a British prime minister. But in the short term, Reagan’s arrival complicated her plans because he wanted to scrap the old Tridents and replace them with updated versions. Since the technology was undeveloped, it was impossible to say what it might cost.

Their first joint public appearance, in October 1981, brought camera crews from as far afield as Japan and the USA, which descended on Welsh villages for a shot of the young princess, who was terrified and feeling sick, as she was in the first stage of pregnancy. ‘I cried a lot in the car, saying I couldn’t get out, couldn’t cope,’16 she later told her biographer, Andrew Morton. When the couple paid a visit to the White House, the press corps stationed outside was twice as large as it had been for the Pope a week earlier, though Diana was not yet so famous that Ronald Reagan had remembered her name – he raised a toast to ‘Prince Charles and Princess Andrew.’ Early in her first pregnancy, Diana slipped out of the palace to buy wine gums; the photographers spotted her, and the news was all over the tabloids. This worried the palace to such an extent that the editors of twenty-one national newspapers, plus the BBC and ITN (but not including Kelvin MacKenzie of the Sun) were called to the palace to hear a plea from Michael Shea, backed up by the Queen, for the Princess to be allowed privacy.


pages: 430 words: 109,064

13 Bankers: The Wall Street Takeover and the Next Financial Meltdown by Simon Johnson, James Kwak

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Andrei Shleifer, Asian financial crisis, asset-backed security, bank run, banking crisis, Bernie Madoff, Bonfire of the Vanities, bonus culture, break the buck, capital controls, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, commoditize, corporate governance, corporate raider, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Edward Glaeser, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, financial intermediation, financial repression, fixed income, George Akerlof, Gordon Gekko, greed is good, Home mortgage interest deduction, Hyman Minsky, income per capita, information asymmetry, interest rate derivative, interest rate swap, Kenneth Rogoff, laissez-faire capitalism, late fees, light touch regulation, Long Term Capital Management, market bubble, market fundamentalism, Martin Wolf, money market fund, moral hazard, mortgage tax deduction, Myron Scholes, Paul Samuelson, Ponzi scheme, price stability, profit maximization, race to the bottom, regulatory arbitrage, rent-seeking, Robert Bork, Robert Shiller, Robert Shiller, Ronald Reagan, Saturday Night Live, Satyajit Das, sovereign wealth fund, The Myth of the Rational Market, too big to fail, transaction costs, value at risk, yield curve

A rating downgrade indicates that the agency is losing confidence in the issuer. * There was one huge difference, which was that money did not leave the country; instead, it left the private sector for the safety of U.S. Treasury obligations. But the effect on the private sector financial system was the same. 3 WALL STREET RISING 1980– In this present crisis, government is not the solution to our problem; government is the problem. —Ronald Reagan, inaugural address, January 20, 19811 On December 9, 1985, the cover of Business Week featured John Gutfreund, the CEO of Salomon Brothers and “The King of Wall Street.” “Merrill Lynch remains the best-known Wall Street house and Goldman Sachs the best-managed, but Salomon Bros. is the firm most feared by its competitors,” wrote Anthony Bianco. “It is the prototype of the thoroughly modern investment bank—the not-so-benevolent King of the Street.”2 Salomon was the epitome of the new breed of Wall Street investment bank, built around a swashbuckling, risk-taking bond trading operation powered by “quants” recruited from academic research institutions and filled with “financial engineers” designing new products.

While there were banking executives who hoped for wholesale deregulation, there was no concerted plan by the financial sector to overthrow its regulatory constraints. Instead, like many historical phenomena, this development emerged from a confluence of factors: exogenous events, such as the high inflation of the 1970s; the emergence of academic finance; and the broader deregulatory trend begun in the administration of Jimmy Carter but transformed into a crusade by Ronald Reagan. The eventual result was an out-of-balance financial system that still enjoyed the backing of the federal government—what president would allow the financial system to collapse on his watch?—without the regulatory oversight necessary to prevent excessive risk-taking. Like many major trends, this one was not entirely visible to its participants at the outset. Throughout American history, regulatory change has been more about settling disputes between segments of the business community than about sweeping social transformations, and the beginnings of financial deregulation were no different.

Jagdish Bhagwati argued in 1998 that trade in dollars was not the same as trade in goods, because free capital flows would generate financial crises whose potential costs needed to be taken into account.48 But the belief in free movements of capital, like the belief in efficient markets, became strong enough in some circles to shrug off the need for empirical justification.49 The Efficient Market Hypothesis, like the doctrine of free capital flows, provided ready ammunition for anyone who wanted to argue that banks should be allowed to do as they pleased, that financial innovations were necessarily good, and that free financial markets would always produce optimal social outcomes. Even so, it might have remained only a cry in the academic wilderness or an esoteric Wall Street doctrine. But it had the fortune of being in the right place at the right time—of coinciding with a once-in-a-generation shift in the American political climate. The election of Ronald Reagan marked a crucial turning point in American political history. Although Richard Nixon had already shown how to build a new Republican majority by capitalizing on resentment against Lyndon Johnson’s Great Society and the culture of the 1960s, it was Reagan who gave that movement a usable political ideology. Although Jimmy Carter had overseen the beginnings of deregulation with airlines, railroads, and trucking, it was more a topic for policy wonks than for the broader electorate; drawing in part on the ideas of economist Milton Friedman, Reagan made deregulation an ideological crusade.50 Like many successful leaders, Reagan managed to bring together many conflicting movements and beliefs in his coalition.


pages: 602 words: 120,848

Winner-Take-All Politics: How Washington Made the Rich Richer-And Turned Its Back on the Middle Class by Paul Pierson, Jacob S. Hacker

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accounting loophole / creative accounting, active measures, affirmative action, asset allocation, barriers to entry, Bonfire of the Vanities, business climate, carried interest, Cass Sunstein, clean water, collective bargaining, corporate governance, Credit Default Swap, David Brooks, desegregation, employer provided health coverage, financial deregulation, financial innovation, financial intermediation, fixed income, full employment, Home mortgage interest deduction, Howard Zinn, income inequality, invisible hand, knowledge economy, laissez-faire capitalism, Martin Wolf, medical bankruptcy, moral hazard, Nate Silver, new economy, night-watchman state, offshore financial centre, oil shock, Powell Memorandum, Ralph Nader, Ronald Reagan, shareholder value, Silicon Valley, The Wealth of Nations by Adam Smith, too big to fail, trickle-down economics, union organizing, very high income, War on Poverty, winner-take-all economy, women in the workforce

When we expand our view beyond income to take in the broader canvas of the winner-take-all economy, the argument for thinking that the gains of America’s top-heavy economic growth “trickled down” becomes even weaker. This is not just a story of relative income erosion. The fallout of the winner-take-all economy has reached broadly and deeply into the security of the middle class—and, as recent events reveal, the entire American economy. Trickle-Up Economics Ronald Reagan famously asked, “Are you better off than you were four years ago?” Our own version of the question is, “Are you better off than you were a generation ago?”—or, more specifically, “How much better off are middle- and lower-income Americans than they were a generation ago?” The answer has substantial implications for how we judge the economic trends of the last thirty years. After all, if everyone experienced very large gains and the rich just happened to experience even larger gains, this might not cause great concern.

By historical standards, the 1981 Economic Recovery and Tax Act (ERTA) was an astonishing acceleration of the 1978 formula of big tax cuts for business and the affluent. Extremely generous new depreciation rules and a vast expansion of tax loopholes sharply reduced overall taxes on corporations. Top income tax rates came down sharply, as did the capital gains tax (again). The top rate of taxation on the estate tax was cut from 70 percent to 50 percent, and the level of the individual exemption was raised substantially. ERTA was Ronald Reagan’s greatest legislative triumph, a fundamental rewriting of the nation’s tax laws in favor of winner-take-all outcomes. But in a deeper sense it was the nature of the conflict that had changed the most. Both parties were now locked in a determined struggle to show who could shower more benefits on those at the top. On Top of the World In 1899, Congress passed the Height of Buildings Act, prohibiting any new building from exceeding the height of the U.S.

Republicans have been pulled sharply to the right, while Democrats have confronted new strategic dilemmas. The story of this imbalanced struggle—and how it has furthered the politics and economics of winner-take-all—is the next part of our saga. Part III Winner-Take-All Politics Chapter 7 A Tale of Two Parties If any political figure is associated with the post-1970s transformation of American politics and the rise of a new (and newly unequal) economy, it is surely Ronald Reagan. To detractors and admirers alike, he is the obvious leading man in the drama of the New Deal’s demise. Reagan was simultaneously the conservatives’ most eloquent advocate and their most successful candidate. He was, in a word, a game-changer. There was American politics before Reagan, and American politics after Reagan. Full stop. Yet this familiar telling is profoundly misleading. Depicting Reagan as the personification of the modern Republican Party is twice mistaken: It overestimates the radicalism of Reagan’s GOP, and it underestimates the radicalism of the GOP that was to come fifteen years later (and whose activities and impact we will discuss in the next chapter).


pages: 391 words: 22,799

To Serve God and Wal-Mart: The Making of Christian Free Enterprise by Bethany Moreton

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affirmative action, American Legislative Exchange Council, anti-communist, Berlin Wall, big-box store, Bretton Woods, Buckminster Fuller, collective bargaining, corporate personhood, creative destruction, deindustrialization, desegregation, Donald Trump, estate planning, Fall of the Berlin Wall, Frederick Winslow Taylor, George Gilder, global village, informal economy, invisible hand, liberation theology, market fundamentalism, Mont Pelerin Society, mortgage tax deduction, Naomi Klein, new economy, New Urbanism, post-industrial society, postindustrial economy, prediction markets, price anchoring, Ralph Nader, RFID, road to serfdom, Ronald Reagan, Silicon Valley, Stewart Brand, strikebreaker, The Wealth of Nations by Adam Smith, union organizing, walkable city, Washington Consensus, white flight, Whole Earth Catalog, Works Progress Administration

The profamily constituency meanwhile could point to their inÂ�fluÂ�enÂ�tial new orÂ�gaÂ�niÂ�zaÂ�tions like the Moral Majority, the Religious Round Table, and the Concerned Women for America; the defeat of the Equal Rights Amendment; and the success of Anita Bryant’s antihomosexual campaign in Florida.9 Disappointed by the nation’s first born-Â�again president, Georgian 3 TO SERVE GOD AND WAL - Â�M ART Jimmy Carter, the New Christian Right swung its support to another Sun Belt governor in 1980. The Moral Majority registered 2.5 million new evangelical voters, the new conservative political action committees raised 8 million dollars, and Ronald Reagan informed evangelical opinion-Â�makers in Dallas, “I know you can’t endorse me, but I endorse you.”10 Reagan’s overwhelming victory and the growth of his evangelical base forced a sea change in the political and cultural landscape, moving the right from marginal fringe to controlling center. The new Republican coalition comprised a pair of strange bedfellows: laissez-Â�faire champions of the free market unevenly yoked to a broad base of evangelical activists.

Organized since World War II in vehicles like the Foundation for Economic Education and the American Enterprise Association, business elites in the postwar years had transformed themselves from “economic royalists” into the guarantors of individual liberty.2 But their hard-Â�won cultural prestige now was threatened by a student generation€in open revolt against white-Â�collar futures. “Business is in poor repute these days,” counseled a retail industry magazine, “and for some obvious reasons: anti-Â�establishment social upheavals spurred by Vietnam, Watergate and its attendant corporate scandals, oil price inÂ�flaÂ�tion, consumerism and the ecology movement.”3 “The young take for granted the affluence which is the rule,” groused Newsweek, and California governor Ronald Reagan wanted to know what gave these arrogant children the right to sneer at the very men who had brought them the world’s highest standard of living.4 Although business’s crusade against economic illiteracy in the 1970s 145 TO SERVE GOD AND WAL - Â�M ART was not entirely new, the source of hostility to business ends and means came as a shock. In the postwar years, the main ideological opposition to big business had come from Â�unions.

On average Benson’s activities pulled in $1 million annually from donors like Gulf Oil; defense contractor Boeing Aircraft gave the program $1 billion.96 In a 1961 report that censured a national campaign of “rabid, bigoted, one-Â�sided” presentations illegally incorporating active-Â�duty military ofÂ�fiÂ�cers to red-Â� bait the federal government, Secretary of Defense Robert McNamara singled out Benson for criticism along with professional anticommunists like Billy James Hargis, the fundamentalist radio preacher who memorably libeled the National Council of Churches as a communist front, and Fred Schwarz, founder of the Christian Anti-Â�Communist Crusade and an early promoter of Ronald Reagan.97 The Journal of Higher Education observed disapprovingly in 1967 that Harding served as “a kind of war college .€.€. dedicated to the teaching of conservatism.”98 But in Searcy this was now a compliment. The NEP spawned Harding’s American Studies program, with over half a million dollars in operating funding for the first five years. This 166 EVANGELIZING FOR FREE E N T ERPRI S E allowed the college at large to tap into the business network the NEP had already created for funding its physical plant.


pages: 409 words: 118,448

An Extraordinary Time: The End of the Postwar Boom and the Return of the Ordinary Economy by Marc Levinson

affirmative action, airline deregulation, banking crisis, Big bang: deregulation of the City of London, Boycotts of Israel, Bretton Woods, Capital in the Twenty-First Century by Thomas Piketty, car-free, Carmen Reinhart, central bank independence, centre right, clean water, deindustrialization, endogenous growth, falling living standards, financial deregulation, floating exchange rates, full employment, George Gilder, Gini coefficient, global supply chain, income inequality, income per capita, indoor plumbing, informal economy, intermodal, invisible hand, Kenneth Rogoff, knowledge economy, late capitalism, linear programming, lump of labour, manufacturing employment, new economy, Nixon shock, North Sea oil, oil shock, Paul Samuelson, pension reform, price stability, purchasing power parity, refrigerator car, Right to Buy, rising living standards, Robert Gordon, rolodex, Ronald Coase, Ronald Reagan, Simon Kuznets, statistical model, strikebreaker, structural adjustment programs, Thomas Malthus, total factor productivity, unorthodox policies, upwardly mobile, War on Poverty, Washington Consensus, Winter of Discontent, Wolfgang Streeck, women in the workforce, working-age population, yield curve, Yom Kippur War, zero-sum game

South Korea would fall into recession, and Brazil’s long run of strong economic growth would crash to a stop. But it was in the United States that the Volcker shock caused the first political casualties. Construction of new homes fell by half. Auto sales, running at an annual rate of fourteen million units in October 1979, dropped below ten million. The unemployment rate jumped nearly two percentage points. Although the recession would be brief, it was enough to elect Ronald Reagan president.7 RONALD REAGAN WAS AN ICON OF THE RIGHT. A FORMER ACTOR and corporate pitchman, he had served two terms as governor of the fast-growing state of California. He said the right conservative things, praising free enterprise and small government, and even the blunt promise to “send the welfare bums back to work,” which had carried him to the governorship in 1966, came with a smile and a friendly wave.

It is fair to say that the economic changes of the 1970s turned the world to the right. The global political climate warmed to market-oriented thinking because other ideas appeared to have failed. The demand for smaller government, personal responsibility, and freer markets transformed political debate, upended long-established public policies, and swept conservative politicians like Margaret Thatcher, Ronald Reagan, and Helmut Kohl into power. In the rich world, the postcrisis years brought a massive shift in income and wealth in favor of those who owned capital and against those whose only asset was their labor. In the poor world, they fueled a boom and subsequent bust among countries eager to join the advanced economies. Anger and frustration fed by stagnant wages, rising inequality, and the fecklessness of public officials swept country after country, reshaping culture, politics, and society.

But as domestic automakers and auto parts manufacturers shed some three hundred thousand jobs during the course of 1980, and as automobile output fell by one-fourth, the pressure for government action ahead of the November 1980 presidential election was impossible to ignore. In the midst of a closely fought campaign, Carter, who had publicly opposed sanctions against car imports from Japan, changed his stance. His opponent, Ronald Reagan, proudly heralded his support for free trade, but he told workers at a Chrysler plant in Detroit that autos were a special case; the US government, Reagan asserted, should “convince the Japanese one way or another, and in their own best interests, the deluge of their cars into the United States must be slowed while our industry gets back on its feet.”27 Faced with the implicit threat of US trade sanctions, MITI announced “voluntary restraints” on car exports to the United States on May 1, 1981, barely three months after Reagan’s inauguration.


pages: 267 words: 71,123

End This Depression Now! by Paul Krugman

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airline deregulation, Asian financial crisis, asset-backed security, bank run, banking crisis, Bretton Woods, capital asset pricing model, Carmen Reinhart, centre right, correlation does not imply causation, credit crunch, Credit Default Swap, currency manipulation / currency intervention, debt deflation, Eugene Fama: efficient market hypothesis, financial deregulation, financial innovation, Financial Instability Hypothesis, full employment, German hyperinflation, Gordon Gekko, Hyman Minsky, income inequality, inflation targeting, invisible hand, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, labour mobility, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, low skilled workers, Mark Zuckerberg, money market fund, moral hazard, mortgage debt, negative equity, paradox of thrift, Paul Samuelson, price stability, quantitative easing, rent-seeking, Robert Gordon, Ronald Reagan, Upton Sinclair, We are the 99%, working poor, Works Progress Administration

Many economists (and quite a few businessmen) expected America to slide back into depression once the war was over. What happened instead was a great boom in private spending, home purchases in particular, that kept the economy humming until the Great Depression was a distant memory. And it was the fading memory of the Depression that set the stage for an extraordinary rise in debt, beginning roughly in 1980. And yes, that coincided with the election of Ronald Reagan, because part of the story is political. Debt began rising in part because lenders and borrowers had forgotten that bad things can happen, but it also rose because politicians and supposed experts alike had forgotten that bad things can happen, and started to remove the regulations introduced in the 1930s to stop them from happening again. Then, of course, the bad things did indeed happen again.

Thanks to deposit insurance, as I’ve said, the old-fashioned bank run became a thing of the past. And thanks to regulation, banks grew much more cautious about lending than they had been before the Great Depression. The result was what Yale’s Gary Gorton calls the “quiet period,” a long era of relative stability and absence of financial crises. All that began to change, however, in 1980. In that year, of course, Ronald Reagan was elected president, signaling a dramatic rightward turn in American politics. But in a way Reagan’s election only formalized a sea change in attitudes toward government intervention that was well under way even during the Carter administration. Carter presided over the deregulation of airlines, which transformed the way Americans traveled, the deregulation of trucking, which transformed the distribution of goods, and the deregulation of oil and natural gas.

Yet it’s a story that needs qualifying, because the truth is that even the good times weren’t all that good, in a couple of ways. First, even though the United States avoided a debilitating financial crisis until 2008, the dangers of a deregulated banking system were becoming apparent much earlier for those willing to see. In fact, deregulation created a serious disaster almost immediately. In 1982, as I’ve already mentioned, Congress passed, and Ronald Reagan signed, the Garn–St. Germain Act, which Reagan described at the signing ceremony as “the first step in our administration’s comprehensive program of financial deregulation.” Its principal purpose was to help solve the problems of the thrift (savings and loan) industry, which had gotten into trouble after inflation rose in the 1970s. Higher inflation led to higher interest rates and left thrifts—which had lent lots of money long-term at low rates—in a troubled position.


pages: 261 words: 64,977

Pity the Billionaire: The Unexpected Resurgence of the American Right by Thomas Frank

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Affordable Care Act / Obamacare, bank run, big-box store, bonus culture, collateralized debt obligation, collective bargaining, commoditize, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, Deng Xiaoping, financial innovation, housing crisis, invisible hand, money market fund, Naomi Klein, obamacare, payday loans, profit maximization, profit motive, road to serfdom, Robert Bork, Ronald Reagan, shareholder value, strikebreaker, The Chicago School, The Myth of the Rational Market, Thorstein Veblen, too big to fail, union organizing, Washington Consensus, white flight, Works Progress Administration

In order for the rebellion to make sense, the entire history of the last few decades would have to be rewritten. Instead of the global embrace of market forces that historians see beginning in the seventies, we were now to understand that socialism had never been vanquished at all, that nearly every so-called conservative politician in those years was actually a liberal in disguise, that no one (with the peculiar exception of Ronald Reagan) had really been faithful to the free-market dogma.7 The era of regulatory permissiveness that allowed the financial crisis to happen had to become unmentionable, deliberately erased. It could not have happened, since conservatives knew now that progressives and crypto-socialists had controlled both parties and called the shots from the days of Woodrow Wilson to those of Hank Paulson and Ben Bernanke.

Like family farmers before them, entrepreneurs are thought to be sacred: they are individualism in the flesh, the plucky strivers who have always made the American economy go. If you put aside details like the benefits that mom-and-pop stores generally don’t provide their workers, small business can sometimes seem like the last redoubt of Jefferson’s independent yeomanry. In a 1983 speech commemorating Small Business Week, for example, Ronald Reagan started off by saying, “Every week should be Small Business Week, because America is small business.”* It just got sappier from there: “entrepreneurs are forgotten heroes”; they’re “the faithfuls who support our churches, schools, and communities, the brave people everywhere who produce our goods, feed a hungry world, and keep our homes and families warm while they invest in the future to build a better America.”15 Oh, they’re the salt of the earth.

The tales always unfolded in the same way: A small businessman was doing something eminently reasonable, minding his own beeswax, when—out of nowhere—he was hit with some outrageous EPA fine or tripped up by some hypertechnical OSHA demand. Obvious realities would be disregarded in the bureaucrat’s zeal for rule-following; time would be wasted; business would not get done. It was as though our government wished to punish productive effort! Stories of Invasive Regulators were a constant feature of the comfortable midwestern milieu into which I was born. Ronald Reagan tossed them off all the time on his way to the White House. The plot of Ghostbusters (1984) turned on just such a small-business set piece. And the Republican Revolution of 1994 was largely driven by small-business anecdotes like these—that is, if the account of that revolution written by the then president of the U.S. Chamber of Commerce is to be credited.19 But it’s no longer so much fun to swap stories about the ignorant overreaching of the Consumer Product Safety Commission, a favorite target of the storytellers of old.


pages: 278 words: 70,416

Smartcuts: How Hackers, Innovators, and Icons Accelerate Success by Shane Snow

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3D printing, Airbnb, Albert Einstein, attribution theory, augmented reality, barriers to entry, conceptual framework, correlation does not imply causation, David Heinemeier Hansson, deliberate practice, Elon Musk, Fellow of the Royal Society, Filter Bubble, Google X / Alphabet X, hive mind, index card, index fund, Isaac Newton, job satisfaction, Khan Academy, Law of Accelerating Returns, Lean Startup, Mahatma Gandhi, meta analysis, meta-analysis, pattern recognition, Peter Thiel, popular electronics, Ray Kurzweil, Richard Florida, Ronald Reagan, Ruby on Rails, Saturday Night Live, self-driving car, side project, Silicon Valley, Steve Jobs

Armchair explanations like good looks don’t make sense. Why would we be more likely to vote for a handsome young president but not a good-looking young congressperson? Data in presidential versus congressional elections indicates that youth voter turnout isn’t the culprit. Some sort of creeping mistrust of the elderly or the advent of televised elections aren’t skewing the results, either. The oldest-elected president, Ronald Reagan, took office at age 69, with the fourth-oldest, George H. W. Bush, succeeding him at 64. They brought up the average. Gerrymandering and changing campaign finance laws don’t seem to explain the data, and the losers in presidential elections actually tend to be the same average age as the winners. We’ve had rich presidents, poor presidents, political-insider presidents, Washington-outsider presidents, pretty presidents, ugly presidents, eloquent presidents, stammering presidents, old presidents, and young presidents.

The ones who bring down the average time spent on the political ladder. Here they are: President Years in Elected Political Office Zachary Taylor 0 Ulysses S. Grant 0 Herbert Hoover 0 William Howard Taft 0 Dwight D. Eisenhower 0 George Washington 1 Chester Arthur 1 Woodrow Wilson 2 Abraham Lincoln 2 Grover Cleveland 5 George W. Bush 5 Franklin D. Roosevelt 5 Rutherford B. Hayes 7 Jimmy Carter 8 Ronald Reagan 8 Here we have one-third of our presidents, most of whom had less time in elected office than it takes to get a political science degree. Now let’s look at what they did before president: President Occupation(s) Prior to Presidency Zachary Taylor US Army Lieutenant > Major General > President Ulysses S. Grant Soldier > Leather Worker > US Army General > President Herbert Hoover Philanthropist > Secretary of Commerce > President William Howard Taft Prosecutor > Judge > Governor-General of the Philippines > Secretary of War > President Dwight D.

Eisenhower Military Officer > WWII Supreme Allied Commander > University President > President George Washington Continental Congress Delegate > General > President Chester Arthur New York Port Collector > Vice President > President Woodrow Wilson University President > Governor > President Abraham Lincoln State Legislator > Congressman > Prairie Lawyer > President Grover Cleveland Sheriff > Mayor > Governor > President George W. Bush Businessman > Governor > President Franklin D. Roosevelt State Senator > Assistant Secretary of the Navy > Governor > President Rutherford B. Hayes Military Officer > Congressman > Governor > President Jimmy Carter Peanut Farmer > State Senator > Governor > President Ronald Reagan Actor > Governor > President The first thing you’ll notice is that no two presidents in this group had the same climb up the ladder. You may have also noticed that there are a lot of military men in this list. And governors, too. Then there are some weird ones. Philanthropist? University president? Actor? Many of these men did have political savvy. William Howard Taft, for example, came from a well-connected family, and his eight-plus-rung ladder climb involved being collector of internal revenue in Cincinnati and governor of the US-occupied Philippines.


pages: 261 words: 78,884

$2.00 A Day: Living on Almost Nothing in America by Kathryn Edin, H. Luke Shaefer

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Affordable Care Act / Obamacare, clean water, ending welfare as we know it, future of work, Home mortgage interest deduction, housing crisis, impulse control, indoor plumbing, informal economy, low-wage service sector, mass incarceration, race to the bottom, randomized controlled trial, Ronald Reagan, The Future of Employment, War on Poverty, working poor, Works Progress Administration

You might say that it all started with a charismatic presidential candidate hailing from a state far from Washington, D.C., running during a time of immense change for the country. There was no doubt he had a way with people. It was in the smoothness of his voice and the way he could lock on to someone, even over the TV. Still, he needed an issue that would capture people’s attention. He needed something with curb appeal. In 1976, Ronald Reagan was trying to oust a sitting president in his own party, a none-too-easy task. As he refined his stump speech, he tested out a theme that had worked well when he ran for governor of California and found that it resonated with audiences all across the country: It was time to reform welfare. Over the years, America had expanded its hodgepodge system of programs for the poor again and again. In Reagan’s time, the system was built around Aid to Families with Dependent Children (AFDC), the cash assistance program that was first authorized in 1935, during the depths of the Great Depression.

While welfare may have led to a small decrease in the rate of marriage among the poor during those years, it could not begin to explain the skyrocketing numbers of births to unwed women. Yet Americans were primed to buy the story that AFDC, a system that went so against the grain of the self-sufficiency they believed in, was the main culprit in causing the spread of single motherhood. And so it was that Ronald Reagan, preparing his run for the presidency during a period when discontent with this stepchild of the welfare state was particularly high, found an issue with broad appeal and seized on it as a way to differentiate himself from his more moderate opponent. His stump speech soon began to feature the “welfare queen”—a villain who was duping the government in a grand style. Unlike the average American, she wasn’t expected to work or marry.

By 1988, there were 10.9 million recipients on AFDC, about the same number as when he took office. Four years later, when Reagan’s successor, George H. W. Bush, left office, the welfare caseloads reached 13.8 million—4.5 million adults and their 9.3 million dependent children. How was it that welfare, an immensely unpopular program, could withstand such an offensive? If welfare’s chief nemesis, Ronald Reagan, had failed, who possibly stood a chance? David Ellwood was comfortable in his role as Harvard professor. He had sharp blue eyes, a scruffy beard, and a slight wave to his hair when it needed a trim. He was the smart kid who came to Harvard for college and never left, landing his first job as a professor there right after graduate school. The son of an influential Minnesota physician (who is credited with inventing the concept of the health maintenance organization, or HMO), Ellwood was raised to be a shaper of policy.


pages: 249 words: 79,740

The Next Decade: Where We've Been . . . And Where We're Going by George Friedman

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airport security, Ayatollah Khomeini, Berlin Wall, British Empire, continuation of politics by other means, creative destruction, Deng Xiaoping, facts on the ground, Fall of the Berlin Wall, full employment, hydraulic fracturing, illegal immigration, Monroe Doctrine, Ronald Reagan, South China Sea

The next decade / George Friedman. p. cm. 1. World politics—21st century—Forecasting. I. Title. D863.F75 2011 909.83’1—dc22 2010043116 eISBN: 978-0-385-53295-2 v3.1 For Don Kuykendall, Friend I hope to have God on my side, but I must have Kentucky. —ABRAHAM LINCOLN Rules are not necessarily sacred, principles are. —FRANKLIN ROOSEVELT We cannot play innocents abroad in a world that is not innocent. —RONALD REAGAN It is necessary for a prince who wishes to maintain his position to learn how not to be good, and to use this knowledge or not to use it according to necessity. —NICCOLÒ MACHIAVELLI CONTENTS Cover Other Books by This Author Title Page Copyright Dedication LIST OF ILLUSTRATIONS AUTHOR’S NOTE INTRODUCTION: REBALANCING AMERICA CHAPTER 1 THE UNINTENDED EMPIRE CHAPTER 2 REPUBLIC, EMPIRE, AND THE MACHIAVELLIAN PRESIDENT CHAPTER 3 THE FINANCIAL CRISIS AND THE RESURGENT STATE CHAPTER 4 FINDING THE BALANCE OF POWER CHAPTER 5 THE TERROR TRAP CHAPTER 6 REDEFINING POLICY: THE CASE OF ISRAEL CHAPTER 7 STRATEGIC REVERSAL: THE UNITED STATES, IRAN, AND THE MIDDLE EAST CHAPTER 8 THE RETURN OF RUSSIA CHAPTER 9 EUROPE’S RETURN TO HISTORY CHAPTER 10 FACING THE WESTERN PACIFIC CHAPTER 11 A SECURE HEMISPHERE CHAPTER 12 AFRICA: A PLACE TO LEAVE ALONE CHAPTER 13 THE TECHNOLOGICAL AND DEMOGRAPHIC IMBALANCE CHAPTER 14 THE EMPIRE, THE REPUBLIC, AND THE DECADE ACKNOWLEDGMENTS About the Author LIST OF ILLUSTRATIONS Major American Trade Relations Countries with a U.S.

Yet at the same time it is the most democratic, as the presidency is the only office for which the people, as a whole, select a single, powerful leader. In order to understand this office I look at three presidents who defined American greatness. The first is Abraham Lincoln, who saved the republic. The second is Franklin Roosevelt, who gave the United States the world’s oceans. The third is Ronald Reagan, who undermined the Soviet Union and set the stage for empire. Each of them was a profoundly moral man … who was prepared to lie, violate the law, and betray principle in order to achieve those ends. They embodied the paradox of what I call the Machiavellian presidency, an institution that, at its best, reconciles duplicity and righteousness in order to redeem the promise of America. I do not think being just is a simple thing, nor that power is simply the embodiment of good intentions.

At home he defied a Supreme Court ruling and authorized wiretapping without warrants as well as the interception and opening of mail. Yet his most egregious violation of civil liberties was to approve the detention and relocation of ethnic Japanese, regardless of their citizenship status. Roosevelt had no illusions about what he was doing. He was ruthlessly violating rules of decency in pursuit of moral necessity. Ronald Reagan also pursued a ruthless path toward a moral purpose. His goal was destruction of what he called the evil empire of the Soviet Union, and he pursued it—in part by ramping up the arms race, which he knew the Soviets could not afford. He then went to elaborate and devious lengths to block Soviet support for national liberation movements in the Third World. He invaded Grenada in 1983 and supported insurgents fighting the Marxist government of Nicaragua.


pages: 181 words: 50,196

The Rich and the Rest of Us by Tavis Smiley

affirmative action, Affordable Care Act / Obamacare, back-to-the-land, Bernie Madoff, Bernie Sanders, Buckminster Fuller, Corrections Corporation of America, Credit Default Swap, death of newspapers, deindustrialization, ending welfare as we know it, F. W. de Klerk, fixed income, full employment, housing crisis, Howard Zinn, income inequality, job automation, liberation theology, Mahatma Gandhi, mass incarceration, mega-rich, new economy, obamacare, Occupy movement, Plutocrats, plutocrats, profit motive, Ralph Waldo Emerson, Ronald Reagan, shareholder value, Silicon Valley, Steve Jobs, traffic fines, trickle-down economics, War on Poverty, We are the 99%, white flight, women in the workforce, working poor

Human identity is no longer defined by what one does, but by what one owns.”32 The sense of humanity and social responsibility that Carter encouraged took on a different tone after his term ended in defeat. As economist Jeffrey Sachs pointed out during an interview on Tavis Smiley on PBS, the 1980s introduced a dramatic and calculated shift in the War on Poverty: “But then came [President Ronald] Reagan and the backlash … when Ronald Reagan came into office, and he came into office on a platform that said government is not the solution, it’s the problem… . He started to dismantle. He gave tax cuts to the rich, started to cut the base out of our education spending, social safety net; [he] stopped investing in infrastructure—the things that make America productive.”33 Reagan was “no friend to America’s cities or its poor,” Peter Dreier, chair of the Urban & Environmental Policy Department at Occidental College, boldly asserted in a commentary shortly after the former President’s death.

POVERTY TIMELINE Year Poverty Percent 1959 22.4 percent Official tracking of the country’s poverty rate begins 1964 19.0 percent President Lyndon B. Johnson declares “War on Poverty” 1969 13.7 percent Johnson’s Great Society efforts help reduce poverty 1973 11.1 percent National poverty rate at an almost 20-year low 1979 12.4 percent Vietnam War, Conservative backlash, poverty ticks up 1983 15.2 percent A recession from mid-1981 to late 1982 takes its toll on the poor 1989 13.1 percent Economy steadies, poverty rate drops in Ronald Reagan’s 2nd term 1992 14.5 percent Reagan drastically slashes government benefit programs, poverty rises 1993 15.1 percent Ten-year gains reversed; Poverty back to 1983 level 1994 14.5 percent Economy perks, poverty level slightly reduced 1996 13.7 percent Poverty rate drops, Clinton introduces drastic welfare reform efforts 2000 11.3 percent Poverty rates fall dramatically due mostly to the opulent 1990s 2007 12.5 percent Poverty ticks up, 37.3 million in poverty before the recession begins 2008 13.2 percent Another 2.5 million fall below the poverty line 2009 14.3 percent 6.3 million more in poverty since 2007 2010 15.1 percent The largest percentage of long-term poor in five decades Number in Poverty and Poverty Rate: 1959 to 2010 The biggest blows to the already shrinking middle class were record unemployment and a housing bubble that burst, resulting in the foreclosure of nearly 4 million homes.

We suppose that the late Robert Lekachman was right in the best book written on Reaganomics, Greed Is Not Enough.36 Reagan may have set the tone and tenor for today’s political conversations on poverty, but President Bill Clinton, during his administration (1993–2000), became a surprising conductor of the right-wing’s “punish the poor” orchestra. In the runup to his re-election in 1996, Clinton out-GOP’d the GOP by signing a draconian welfare-to-work reform bill. Although the legislation reduced the numbers on welfare, it pushed unskilled people into a workforce that had no use for them. The effort may have helped win an election, but it reduced poverty by only 2.5 percent—from 13.7 percent in 1996 to 11.2 percent in 2000. Ronald Reagan may have shifted the dialogue and outreach to the poor, but what’s amazing, as Jeffrey Sachs noted during the PBS interview, is that the dialogue of denial, denigration, and dismissal of the poor continued throughout the Clinton administration: “The Bush era with more tax cuts, and tragically, it’s continued through the first years of the Obama administration.” JUST THE FACTS Before the Great Recession, roughly 37 million Americans were living in poverty.


pages: 363 words: 92,422

A Fine Mess by T. R. Reid

Affordable Care Act / Obamacare, Bernie Sanders, Capital in the Twenty-First Century by Thomas Piketty, carried interest, centre right, clean water, Donald Trump, Double Irish / Dutch Sandwich, game design, Gini coefficient, High speed trading, Home mortgage interest deduction, Honoré de Balzac, income inequality, industrial robot, land value tax, loss aversion, mortgage tax deduction, obamacare, Occupy movement, offshore financial centre, oil shock, Plutocrats, plutocrats, race to the bottom, Ronald Reagan, seigniorage, Silicon Valley, Skype, Snapchat, sovereign wealth fund, Tesla Model S, The Wealth of Nations by Adam Smith, Tim Cook: Apple, Tobin tax, We are the 99%, WikiLeaks

Even with one party controlling both Congress and the White House, tax reform would be a stretch in our acidic political atmosphere. So how could Congress and the White House agree on serious changes to the tax code when our country is ferociously divided? The fact is, we’ve done it before, in a time of severely divided government. In the mid-1980s, a strong conservative in the White House and a strongly liberal Speaker of the House—that is, Ronald Reagan and Tip O’Neill—reached agreement on the biggest transformation of the federal income tax since the tax was created in 1913. The Tax Reform Act of 1986, passed by a divided Congress and signed by a Republican president, was widely admired; it was precisely the kind of change that almost all tax experts favored. That reform was based on principles that have been adopted by countries around the world.

The government then was divided, with a conservative president from California battling a liberal House of Representatives led by a Democrat from Massachusetts. With leaders of both parties constantly maneuvering for political gain, Washington was gridlocked on the major issues. There wasn’t much hope for significant progress in any policy area and certainly not on tax reform. The election in 1980 of President Ronald Reagan, an unabashed tax hater, launched a flurry of tax laws that pushed rates down, up, down again, and up again with no clear pattern. In Reagan’s first months in office, he successfully pressured Congress to pass the Economic Recovery Tax Act of 1981—known inside the Beltway as ERTA—giving big tax cuts to every individual and corporate taxpayer. (ERTA was so laden with breaks and credits for various industries that it was called, accurately, “a frenzied craze of tax giveaways.”6) The economic rationale for this huge tax reduction was the so-called “supply-side” argument that lower taxes would stimulate business activity and bring in more revenue.

“The trade-off between loophole elimination and a lower top rate became obvious,” Bradley wrote later; “the lower the rate, the more loopholes had to be closed to pay for it.”8 Bradley stuck to the mantra of “broad base, low rates” for years, telling anybody who would listen that a significant cut in tax rates would win the votes needed to broaden the base. “The key to reform was to focus on the attractiveness of low rates, not on the pain of limiting deductions.” The enticement of low rates also helped land a crucially important supporter for tax reform: Ronald Reagan himself. As a major Hollywood star, Reagan had been a member of the financial 1% in the 1950s, when the top marginal income tax rate was 90%. The sting of the annual tax return, Reagan used to say, was one of the factors that converted him from a liberal labor union leader to a conservative champion of business. He saw himself as a defender of the hard-pressed average taxpayer. On the stump, he loved to tell an old joke: “The taxpayer—that’s the only person who works for the federal government without passing the Civil Service exam.”


pages: 376 words: 121,254

Cocaine Nation: How the White Trade Took Over the World by Thomas Feiling

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anti-communist, barriers to entry, crack epidemic, deindustrialization, illegal immigration, informal economy, inventory management, land reform, Lao Tzu, mandatory minimum, moral panic, offshore financial centre, RAND corporation, Right to Buy, Ronald Reagan, trade route, upwardly mobile, yellow journalism

The violence of Latino immigrants, the perceived permissiveness of cocaine users, and the threat to the innocence of American children galvanized conservatives into a firm rebuttal of liberal America. In 1980, Ronald Reagan was elected President, and in the autumn the Republicans also took control of the Senate for the first time since 1952. In 1981, then Vice-President George Bush Sr launched a special task force to take on the traffickers, firing the first salvo in an invigorated war on drugs. In the decade that followed, the political agenda was defined by ‘culture wars’ between liberals and conservatives. The latter emphasized moral renewal and respect for the law. But as it pertained to the growing market for illegal drugs, Ronald Reagan’s crusading zeal was to have many unforeseen consequences. Drug use is cultural and drug markets are driven by economics, so it was unclear how a moral crusade might affect either, however strong the temptation to launch one.

We had a whole lot of people who were hooked not on drugs, but on drug money. I thought about the era of alcohol prohibition in the United States and this era of drug prohibition, and it led me to think that prohibition, in the way that we were going about it, was doing more harm than good.’ Eric Sterling was a legal counsel to Congress in 1986 and was instrumental in drafting that year’s Anti-Drug Abuse Act, the cornerstone of Ronald Reagan’s war on drugs. He too has gone on to become a trenchant critic of how the law has been manipulated to serve the war on drugs. ‘Historically, federal law enforcement was limited to smuggling, robbery of the mails, and counterfeiting money,’ he told me. ‘The Harrison Narcotics Tax Act of 1914 was the first federal drug law. It was styled as a tax law. It created a tax of $1,000 per ounce of drugs, and if you didn’t have the tax stamp, you were violating the law.’

The Reagan administration saw the Contras as its allies in the global fight against communist subversion: the President even went as far as to describe them as the latter-day equivalents of the founding fathers. The United States Congress was less gung-ho in its support for the Contras, however, and passed amendments which prohibited the use of government funds ‘for the purpose of overthrowing the government of Nicaragua’. This meant that the Contras were strapped for cash to buy weapons. The Iran-Contra scandal is a well-known blot on Ronald Reagan’s copybook. Colonel Oliver North was found to have sold weapons to the Iranian government, supposedly an enemy of the White House, in order to raise money for the Contras. A lesser known chapter in the story, and one that throws the integrity of the Republicans’ war on drugs into real doubt, is that the CIA also approved and supported the Contras’ trafficking of cocaine into the United States.


pages: 538 words: 121,670

Republic, Lost: How Money Corrupts Congress--And a Plan to Stop It by Lawrence Lessig

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asset-backed security, banking crisis, carried interest, circulation of elites, cognitive dissonance, corporate personhood, correlation does not imply causation, crony capitalism, David Brooks, Edward Glaeser, Filter Bubble, financial deregulation, financial innovation, financial intermediation, invisible hand, jimmy wales, Martin Wolf, meta analysis, meta-analysis, Mikhail Gorbachev, moral hazard, Pareto efficiency, place-making, profit maximization, Ralph Nader, regulatory arbitrage, rent-seeking, Ronald Reagan, Silicon Valley, single-payer health, The Wealth of Nations by Adam Smith, too big to fail, upwardly mobile, WikiLeaks, Zipcar

His ideals resonated with just a few then. But they were the seeds of a revolution for the Republican Party, at least when properly cultivated by Ronald Reagan a decade later. Reagan’s first run for the presidency was also a defeat. On November 20, 1975, he announced he would challenge a wildly unpopular president of his own party, Gerald Ford. No one knows for sure whethert sn “ Dw Reagan really thought he could win. But no one expected that he would come so close to dislodging a sitting president. In 1980 he was the logical pick for his party’s nomination. He easily defeated the unpopular incumbent, Jimmy Carter. People forget how important ideas were to Ronald Reagan. By the end of his term, his opponents had painted him as little more than an actor on a very important stage. But I doubt we have had a president in the past fifty years who more carefully and completely thought through a philosophy for governing and government.

But if above that din, there are citizens who can glimpse a path to reform, that criticism is a small price to pay. Introduction There is a feeling today among too many Americans that we might not make it. Not that the end is near, or that doom is around the corner, but that a distinctly American feeling of inevitability, of greatness—culturally, economically, politically—is gone. That we have become Britain. Or Rome. Or Greece. A generation ago Ronald Reagan rallied the nation to deny a similar charge: Jimmy Carter’s worry that our nation had fallen into a state of “malaise.” I was one of those so rallied, and I still believe that Reagan was right. But the feeling I am talking about today is different: not that we, as a people, have lost anything of our potential, but that we, as a republic, have. That eigour capacity for governing—the product, in part, of a Constitution we have revered for more than two centuries—has come to an end.

Court of Appeals for the Seventh Circuit in Chicago. He is among the most prolific legal academics and the most prolific judges in the history of the nation. He is certainly among the most influential. His book Economic Analysis of Law (1973) founded the law and economics movement. Since then he has written fifty more books, hundreds of articles, and thousands of judicial opinions. He was appointed to the federal bench by Ronald Reagan thirty years ago. Whatever we can say, we can be certain, Posner is no socialist. Among Posner’s fifty-some books are two that deal specifically with the financial crisis.4 And at the core of Posner’s argument is an insistence that we understand the rationality behind this insanity. As he write.="1ems, criticizing a government report on the crisis: The emphasis the report places on the folly of private-sector actors ignores the possibility that most of them were behaving rationally given the environment of dangerously low interest rates, complacency about asset-price inflation (the bubbles that the regulators and, with the occasional honorable exception, the economics profession ignored), and light and lax regulation.5 This is the idea that I want to pursue here: that the gambling that Wall Street engaged in made sense to them given (1) “the environment of dangerously low interest rates,” (2) “complacency about asset-price inflation,” and (3) “light and lax regulation.”


pages: 651 words: 161,270

Global Spin: The Corporate Assault on Environmentalism by Sharon Beder

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American Legislative Exchange Council, battle of ideas, business climate, centre right, clean water, corporate governance, Exxon Valdez, Gary Taubes, global village, Intergovernmental Panel on Climate Change (IPCC), invisible hand, laissez-faire capitalism, oil shale / tar sands, old-boy network, price mechanism, profit maximization, Ralph Nader, RAND corporation, Ronald Reagan, shareholder value, telemarketer, The Bell Curve by Richard Herrnstein and Charles Murray, the market place, The Wealth of Nations by Adam Smith, urban planning

The economists that dominate the Senior Executive Service have their economic rationalism reinforced by fellow economists in key university departments, “in peak business groups, the private sector economists in the finance sector, and with the staff of the economic ‘think-tanks’.”62 Political Influence Conservative think-tanks have played a leading role in the conservative resurgence in English speaking countries. One White House official told The Atlantic that the AEI played a large part in getting Ronald Reagan elected by making conservatism ‘intellectually respectable’. During the Reagan years, the Heritage Foundation provided information to members of Congress and their staffs, and was extremely influential. Most of its policy recommendations were adopted by the Reagan administration, including a proposal to allow strip mining in designated wilderness areas.63 Edwin Feulner, President of the Foundation, received a Presidential Citizen’s Medal from Ronald Reagan for being “a leader of the conservative movement. . .who has helped shape the policy of our Government”. Like the Heritage Foundation, the Cato Institute was influential during the Reagan years.

They achieved the abolition of the Consumer Protection Agency, the reduction of automobile emissions standards, the deregulation of energy prices and the lowering of corporate taxes.33 In the late 1970s US business was spending a billion dollars each year on propaganda of various sorts “aimed at persuading the American public that their interests were the same as business’s interests”. The result of all this expenditure showed in the polls when the percentage of people who thought that there was too much regulation soared from twenty-two per cent in 1975 to sixty per cent in 1980.34 Ronald Reagan, who was elected President in 1980, owed his success partly to conservative corporate interests, which he served faithfully once in power through a combination of deregulation and political appointments and by directing funding away from agencies such as the Environmental Protection Agency (EPA). During the 1980s, under Reagan’s administration, the numbers of trade and professional associations, corporations and interest groups with offices in Washington continued to grow.

They join an international armada of advocates already active in Brussels, including. . . public relations groups, confederations of European trade associations, representatives of US states, German lander and British municipalities, small ‘boutique’ consultancies, in-house representatives of individual US, European, and Japanese companies, European trade unions, agricultural groups, and a growing number of public-interest associations.49 Conservative think-tanks, having been instrumental in bringing Ronald Reagan to power in the US and Margaret Thatcher to power in the UK, have turned their attention to environmental issues and the defeat of environmental regulations. They have sought to cast doubt on the very features of the environmental crisis that had heightened public concerns at the end of the 1980s, including ozone depletion, greenhouse warming and industrial pollution (see Chapters Five and Six).


pages: 692 words: 127,032

Fool Me Twice: Fighting the Assault on Science in America by Shawn Lawrence Otto

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affirmative action, Albert Einstein, anthropic principle, Berlin Wall, Brownian motion, carbon footprint, Cepheid variable, clean water, Climategate, Climatic Research Unit, cognitive dissonance, Columbine, commoditize, cosmological constant, crowdsourcing, cuban missile crisis, Dean Kamen, desegregation, double helix, energy security, Exxon Valdez, fudge factor, ghettoisation, Harlow Shapley and Heber Curtis, Harvard Computers: women astronomers, informal economy, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Isaac Newton, Louis Pasteur, mutually assured destruction, Richard Feynman, Richard Feynman, Ronald Reagan, Saturday Night Live, shareholder value, sharing economy, smart grid, Solar eclipse in 1919, stem cell, the scientific method, The Wealth of Nations by Adam Smith, Thomas Kuhn: the structure of scientific revolutions, transaction costs, University of East Anglia, War on Poverty, white flight, Winter of Discontent, working poor, yellow journalism, zero-sum game

Review of US Human Spaceflight Plans Committee, 2009. www.nasa.gov/offices/hsf/meetings/10_22_pressconference.html. 12. Franklin, J. The New Priesthood—The Scientific Elite and the Uses of Power. Engineering and Science 1965;28(9):4. http://calteches.library.caltech.edu/2383/1/books.pdf. 13. Lapp, R, The New Priesthood: The Scientific Elite and the Uses of Power. New York: Harper and Row, 1965. 14. Reagan, R. Address by Governor Ronald Reagan, Installation of President Robert Hill, Chico State College, May 20, 1967. Ronald Reagan Presidential Library, n.d. www.reagan.utexas.edu//archives/speeches/govspeech/05201967a.htm. 15. Gleason, R. Bob Dylan: Poet to a Generation. Jazz and Pop, December 1968. pp. 36–37. www.loc.gov/folklife/guides/BibDylan.html. 16. Vonnegut, K. American Notes: Vonnegut’s Gospel. Time, June 29, 1970. 17. Heppenheimer, T. A. The Space Shuttle Decision: NASA’s Search for a Reusable Space Vehicle.

The Virtue of Selfishness. New York: Signet, 1964. Rasmussen, C. Billy Graham’s Star Was Born at His 1949 Revival in Los Angeles. Los Angeles Times, September 2, 2007. http://articles.latimes.com/2007/sep/02/local/me-then2. Raven, C. E. John Ray, Naturalist: His Life and Works. Cambridge, UK: Cambridge University Press, 1942. Reagan, R. Address by Governor Ronald Reagan, Installation of President Robert Hill, Chico State College, May 20, 1967. Ronald Reagan Presidential Library, n.d. www.reagan.utexas.edu//archives/speeches/govspeech/05201967a.htm. Reagan, R. Farewell Address to the Nation. Miller Center of Public Affairs, January 11, 1989. http://millercenter.org/scripps/archive/speeches/detail/3418. RealClimate Group. The CRU Hack. RealClimate.org, November 20, 2009. www.realclimate.org/index.php/archives/2009/11/the-cru-hack/#more-1853.

The book’s argument reflected an emerging idea that “democracy faces its most severe test in preserving its traditions in an age of scientific revolution.”13 CARPE DIEM The live-for-today ethos was changing the way Americans approached living, consumption, and finance. The change was particularly evident among the emerging baby-boom generation. With the older generation having lost its moral credibility, the boomers felt the older crowd had no right to tell young people anything. “Today there is great concern among my generation that an era of permissiveness has resulted in unrest among our young people,” said California governor Ronald Reagan on May 20, 1967. “But just to keep things in balance there is a widespread feeling among our young people that no one over 30 understands them.”14 These baby boomers, feeling powerless, needed an outlet for their anger and moral distrust of the older generation, so they adopted the protest songs of folk music. Singer-songwriter Bob Dylan became an overnight sensation, the “poet to a generation.”15 Satire became a dominant cultural art form, lampooning all kinds of authority for its hypocrisy and failure.


pages: 613 words: 200,826

Unreal Estate: Money, Ambition, and the Lust for Land in Los Angeles by Michael Gross

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Albert Einstein, Ayatollah Khomeini, bank run, Bernie Madoff, California gold rush, clean water, corporate raider, Donald Trump, estate planning, family office, financial independence, Irwin Jacobs, Maui Hawaii, McMansion, mortgage debt, Norman Mailer, offshore financial centre, oil rush, passive investing, pension reform, Ponzi scheme, Right to Buy, Robert Bork, Ronald Reagan, Silicon Valley, stem cell, Steve Jobs, Steve Wozniak, The Predators' Ball, transcontinental railway, yellow journalism

It’s now occupied by parallel but separate and often opposing societies—quiet, ultraconservative local wealth; some lingering Hollywood glamour and its consort, decadence; and the latest iterations of fast money earned everywhere from cyberspace to infotainment to the lower depths of the financial industries. They may look askance at each other but they mix and mingle (even in bedrooms); in many ways the apogeal product of their union was Ronald Reagan, the movie star turned politician who emerged as a force in the Republican Party, backed by ultraconservative wealth, and became a Bel Air resident himself in 1989. Though Richard Nixon, another Southern Californian, also moved to La-La Land, and Jack Kennedy and Bill Clinton loved to party there, it was Reagan who was the apotheosis of its will to power. The kitchen cabinet who propelled Reagan to the White House were all Platinum Triangle residents; a few owned trophy houses there.

Beverly Park In February 1979, the Teamsters finally lost the Higgins Canyon land; the government-appointed asset manager sold off the 355 troubled acres for $7.9 million to a group of about twenty wealthy investors. The only one publicly identified at the time was Henry Salvatori, a multimillionaire oilman from Bel Air and member of the so-called kitchen cabinet of California conservatives who were then within months of placing Ronald Reagan in the White House—though both his family and the developers now say he wasn’t involved. The investors did include hair salon mogul Vidal Sassoon, a stereo component manufacturer named Bob Craig, local supermarket owner Bernie Gelson, a local car dealer, and Gerald Breslauer, a Hollywood money manager, as well as a number of his clients, including director Steven Spielberg, then flush with cash from Jaws and Close Encounters of the Third Kind.

Schick’s blades were made in Cuba until Fidel Castro took over the island nation and expropriated Schick’s factories that year, turning Frawley into an arch anticommunist and a vocal and financial supporter of conservative politicians and causes, beginning with then vice president Richard Nixon. Frawley and Alfred Bloomingdale of the department store family then put on the largest anticommunist youth rally in history, where the entertainers George Murphy (a song-and-dance man and Frawley protégé), John Wayne, Pat Boone, Ronald Reagan, Dale Evans, and Roy Rogers appeared before a hundred thousand schoolchildren. Frawley subsequently became a nationally known figure of controversy when he tried to cancel a million-dollar advertising deal with ABC after it ran a program he felt was anti-Nixon. Frawley was renowned for his business prowess if not always for his politics or ethics. In 1964, Frawley and his large family (seven daughters and two sons) were settling into Bing Crosby’s old Holmby Hills house when he personally bought and mailed copies of the book that launched Barry Goldwater’s right-wing campaign for president, A Choice, Not an Echo by Phyllis Schlafly, to forty thousand Roman Catholic priests, accompanied by a letter on Eversharp-Schick letterhead criticizing the press, attacking liberal foreign policy, and assailing the Democratic Party’s approach to civil rights legislation.


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The Global Auction: The Broken Promises of Education, Jobs, and Incomes by Phillip Brown, Hugh Lauder, David Ashton

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active measures, affirmative action, barriers to entry, Branko Milanovic, BRICs, business process, business process outsourcing, call centre, collective bargaining, corporate governance, creative destruction, credit crunch, David Ricardo: comparative advantage, deindustrialization, deskilling, Frederick Winslow Taylor, full employment, future of work, glass ceiling, global supply chain, immigration reform, income inequality, industrial cluster, industrial robot, intangible asset, job automation, Joseph Schumpeter, knowledge economy, knowledge worker, labour market flexibility, low skilled workers, manufacturing employment, market bubble, market design, neoliberal agenda, new economy, Paul Samuelson, pensions crisis, post-industrial society, profit maximization, purchasing power parity, QWERTY keyboard, race to the bottom, Richard Florida, Ronald Reagan, shareholder value, Silicon Valley, sovereign wealth fund, stem cell, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, Thomas L Friedman, trade liberalization, transaction costs, trickle-down economics, winner-take-all economy, working poor, zero-sum game

Keynes rejected this idea and argued that governments could intervene effectively in market economies to solve the problem of recession, or what one of his contemporaries called the “gales of creative destruction.”3 Thus, when demand for goods slackened and workers were threatened with unemployment, governments could act to keep the wheels of industry turning. Keynes also endorsed the idea of a welfare state to protect people from the chronic insecurities that characterize the boom-and-bust nature of capitalist development. By the 1980s, neoliberal ideas had regained popularity. Under Ronald Reagan in America and Margaret Thatcher in Britain, there was a return to preaching the virtues of free trade, self-interest, and the power of the market to deliver prosperity and justice. Keynes’s ideas were renounced as a recipe for big government and a growing underclass living off state handouts. Hence, the tenets of neoliberalism encouraged people to believe that welfare support introduced in the 1950s and 1960s was misguided because it rewarded failure and feckless behavior, whereas free markets offered a fair and efficient system where talent and hard work would be appropriately rewarded.

As President Barack Obama reaffirmed, “In a global economy where the most valuable skill you can sell is your knowledge, a good education is no longer just a pathway to opportunity, it is a pre-requisite.”23 Naked Capitalism The promise of a hi-tech future of highly paid knowledge workers was pivotal to the creation of a neoliberal opportunity bargain, which left individuals responsible for their employability through educational achievement and commitment to career development. Given that the knowledge economy now offered high-skill, high-wage jobs to those willing to invest in their human capital, the role of the state could be limited to improving educational standards, expanding access to higher education, and creating flexible job markets that reward talent, ambition, and enterprise. The False Promise 23 Neoliberal reforms introduced by Ronald Reagan and Margaret Thatcher in the 1980s—subsequently pursued by governments of different political persuasion on both sides of the Atlantic—stripped away much of the safety net that offered security to individuals and families through the welfare state that characterized midcentury America and Europe. The pillars of prosperity, security, and opportunity embedded in the relationships among employers, trade unions, and the state were torn down in the belief that state control over the economy and the rigid regulation of people’s lives were no longer appropriate or necessary in an age of consumer freedom, free trade, and market individualism.

Hayek, Reagan and Thatcher claimed that Western societies had run into trouble in the 1970s because of what was seen as unwarranted interference by the state.24 Inflation, high unemployment, economic recession, and urban unrest were all believed to stem from the legacy of Keynesian economics and an ideology that promoted economic redistribution, equality of opportunity, and welfare rights for all. In its place, a society would be built where individuals were encouraged to pursue their self-interest and where greed was treated as a virtue in the vain hope that the hidden hand of the market would miraculously benefit all through the trickle down of resources from the winners to the losers. “What I want to see above all,” Ronald Reagan stated, “is that this remains a country where someone can always get rich.” But Reagan was adamant that this could only be guaranteed by getting the state off the backs of the people, for “if the reins of government were removed, business would boom, spreading prosperity to all the people.”25 The neoliberal opportunity bargain involved changing the incentive structures for individuals and the business community.


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With Liberty and Justice for Some: How the Law Is Used to Destroy Equality and Protect the Powerful by Glenn Greenwald

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Ayatollah Khomeini, banking crisis, Bernie Madoff, Clive Stafford Smith, collateralized debt obligation, Corrections Corporation of America, crack epidemic, Credit Default Swap, credit default swaps / collateralized debt obligations, David Brooks, deskilling, financial deregulation, full employment, high net worth, income inequality, Julian Assange, mandatory minimum, nuremberg principles, Ponzi scheme, Project for a New American Century, rolodex, Ronald Reagan, too big to fail, Washington Consensus, WikiLeaks

Needless to say, the empathy Ford expressed for Nixon is rarely invoked as a means of arguing for leniency, let alone immunity, for ordinary Americans. That’s because Ford’s call for “empathy” is merely disguised aristocratic privilege. The Precedent Exploited The precedent established by the Nixon pardon would be exploited little more than a decade later, when another group of high-level offenders—the Iran-Contra criminals of the Ronald Reagan and George H. W. Bush administrations—were seeking immunity from prosecution. Sure enough, they got it: White House officials who clearly and knowingly broke the law, and then deliberately lied to Congress about what they had done (also a felony), were systematically protected from any consequences for their crimes. The Iran-Contra scandal erupted in 1986, when it was revealed that the Reagan administration had sold arms—anti-tank and antiaircraft missiles—to the Ayatollah Khomeini’s regime in Iran.

The Third Geneva Convention, which was enacted in the wake of severe detainee abuse during World War II, obliges each participating country to “search for persons alleged to have committed, or to have ordered to be committed, such grave breaches, and…bring such persons, regardless of their nationality, before its own courts.” Some have disputed the applicability of the Geneva Conventions to “war on terror” detainees, on the ground that they are not actually prisoners of war. But even if the Geneva Conventions do not apply, there is no such dispute about the Convention Against Torture, a treaty negotiated and signed by President Ronald Reagan, and ratified by the U.S. Senate in 1994. Article 4 of that treaty requires each country to “ensure that all acts of torture are offences under its criminal law,” and Article 5 dictates that “each State Party shall likewise take such measures as may be necessary to establish its jurisdiction over such offences in cases where the alleged offender is present in any territory under its jurisdiction.”

Felt was most famous for having been Bob Woodward’s “Deep Throat” source in the Watergate investigation, but Marcus focused on a different part of his life: the 1980 criminal trial in which Felt was convicted of having ordered illegal, warrantless searches of the homes of 1960s radicals and their friends and relatives. Less than twenty-four hours after Felt’s 1980 conviction, he (along with an FBI codefendant) was pardoned by Ronald Reagan. Reagan justified his pardon with these following words, obviously relevant to the contemporary debate about possible prosecution of Bush officials. [The men’s convictions] grew out of their good-faith belief that their actions were necessary to preserve the security interests of our country. The record demonstrates that they acted not with criminal intent, but in the belief that they had grants of authority reaching to the highest levels of government.


pages: 538 words: 141,822

The Net Delusion: The Dark Side of Internet Freedom by Evgeny Morozov

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A Declaration of the Independence of Cyberspace, Ayatollah Khomeini, Berlin Wall, borderless world, Buckminster Fuller, Cass Sunstein, citizen journalism, cloud computing, cognitive dissonance, Columbine, computer age, conceptual framework, crowdsourcing, Dissolution of the Soviet Union, don't be evil, failed state, Fall of the Berlin Wall, Francis Fukuyama: the end of history, global village, Google Earth, illegal immigration, invention of radio, invention of the printing press, invisible hand, John Markoff, John von Neumann, Marshall McLuhan, Naomi Klein, Network effects, new economy, New Urbanism, peer-to-peer, pirate software, pre–internet, Productivity paradox, RAND corporation, Ronald Reagan, Ronald Reagan: Tear down this wall, Silicon Valley, Silicon Valley startup, Sinatra Doctrine, Skype, Slavoj Žižek, social graph, Steve Jobs, technoutopianism, The Wisdom of Crowds, urban planning, Washington Consensus, WikiLeaks, women in the workforce

For most attendees at the Bush gathering, the struggle for Internet freedom was quickly emerging as the quintessential issue of the new century, the one that could help them finish the project that Ronald Reagan began in the 1980s and that Bush did his best to advance in the first decade of the new century. It seems that in the enigma of Internet freedom, neoconservatism, once widely believed to be on the wane, has found a new raison d’être—and a new lease on life to go along with it. Few exemplify the complex intellectual connections between Cold War history, neoconservatism, and the brave new world of Internet freedom better than Mark Palmer. Cofounder of the National Endowment for Democracy, the Congress-funded leading democracy-promoting organization in the world, Palmer served as Ronald Reagan’s ambassador to Hungary during the last years of communism. He is thus well-informed about the struggles of the Eastern European dissidents; he is equally knowledgeable about the ways in which the West nurtured them, for a lot of that support passed through the U.S. embassy.

The implications of such a view for the future of democracy promotion are tremendous, for they suggest that large doses of information and communications technology are lethal to the most repressive of regimes. Much of the present excitement about the Internet, particularly the high hopes that are pinned on it in terms of opening up closed societies, stems from such selective and, at times, incorrect readings of history, rewritten to glorify the genius of Ronald Reagan and minimize the role of structural conditions and the inherent contradictions of the Soviet system. It’s for these chiefly historical reasons that the Internet excites so many seasoned and sophisticated decision makers who should really know better. Viewing it through the prism of the Cold War, they endow the Internet with nearly magical qualities; for them, it’s the ultimate cheat sheet that could help the West finally defeat its authoritarian adversaries.

As far as Washington was concerned, having Clinton utter that highly seductive phrase—“a new information curtain”—in the same breath as the Berlin Wall was tantamount to announcing a sequel to the Cold War in 3D. She tapped into the secret desires of many policymakers, who had been pining for an enemy they understood, someone unlike that bunch of bearded and cave-bound men from Waziristan who showed little appreciation for balance-of-power theorizing and seemed to occupy so much of the present agenda. It was Ronald Reagan’s lieutenants who must have felt particularly excited. Having claimed victory in the analog Cold War, they felt well-prepared to enlist—nay, triumph—in its digital equivalent. But it was certainly not the word “Internet” that made Internet freedom such an exciting issue for this group. As such, the quest for destroying the world’s cyber-walls has given this aging generation of cold warriors, increasingly out of touch with a world beset by problems like climate change or the lack of financial regulation, something of a lifeline.


pages: 291 words: 87,296

Lethal Passage by Erik Larson

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mass immigration, Menlo Park, pez dispenser, Potemkin village, Ronald Reagan, The Great Moderation

A study of accidental shooting deaths of children in California highlighted how a momentary lapse of vigilance by gun owners could quickly lead to tragedy, even in households that treated guns with exemplary care. In one case, the study reported, a six-year-old boy shot himself in the head with a handgun he found “in the purse of a houseguest.” It is widely thought that Sarah Brady, chairperson of Handgun Control Inc., began her crusade against guns immediately after her husband, Jim Brady, was permanently injured in John Hinckley’s attempt to assassinate Ronald Reagan. In fact, she told a writer for the New York Times Magazine, the pivotal moment came later, in 1985, when her five-year-old son found a .22 handgun in a pickup owned by a family friend and pointed it at her. At first Brady thought it was a toy, then saw it was real and loaded. Parents, however, seem all too willing to ignore the risks and to assume that their own kids are responsible enough to recognize the harm guns can do and to learn to “respect” them.

Dickerson, defended the bureau, proclaiming to the House Judiciary Committee that the bureau had for the prior two years “focused over ninety-two percent of its enforcement resources on the prevention of violent crime and the pursuit of violent criminals.” ATF had used aggressive, proactive tactics to enforce firearms laws, he said, including undercover stings designed to trap dealers into making illegal sales. The NRA and other members of the gun lobby saw nothing positive in these measures and charged ATF with trampling the constitutional rights of ordinary gun owners. The charge fell on sympathetic ears. In 1981, then-president Ronald Reagan announced his plan to make good on a campaign promise to abolish the ATF. Today a chastened ATF (rescued at the last minute, as I’ll show, by a most improbable angel, the NRA itself) describes its mission in more modest terms. “There’s been a misconception that we’re in the prevention business,” said Jack Killorin, a former law-enforcement agent who now heads the bureau’s public affairs office.

So they penalized us for having the gall to initiate these programs. Needless to say, the regulations were withdrawn by Treasury, by the Carter administration, with their tails between their legs.” And ATF was left to cope with $10 million less in its operating budget. Nonetheless, ATF still had the benefit of an administration that at least in spirit favored gun control. But Carter wouldn’t be president forever. During the 1980 campaign, Ronald Reagan made it clear where his sympathies lay. He wooed the NRA with a campaign pledge that if elected president, he would abolish the hated bureau. The NRA and its powerful allies, including Rep. John Dingell of Michigan and Rep. John Ashbrook of Ohio, both members of the NRA’s board of directors, moved in for the kill. The NRA went so far as to produce a TV documentary called It Can Happen Here, alleging ATF abuses.


pages: 334 words: 98,950

Bad Samaritans: The Myth of Free Trade and the Secret History of Capitalism by Ha-Joon Chang

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affirmative action, Albert Einstein, Big bang: deregulation of the City of London, bilateral investment treaty, borderless world, Bretton Woods, British Empire, Brownian motion, call centre, capital controls, central bank independence, colonial rule, Corn Laws, corporate governance, David Ricardo: comparative advantage, Deng Xiaoping, Doha Development Round, en.wikipedia.org, falling living standards, Fellow of the Royal Society, financial deregulation, fixed income, Francis Fukuyama: the end of history, income inequality, income per capita, industrial robot, Isaac Newton, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, labour mobility, land reform, liberal world order, liberation theology, low skilled workers, market bubble, market fundamentalism, Martin Wolf, means of production, mega-rich, moral hazard, offshore financial centre, oil shock, price stability, principal–agent problem, Ronald Reagan, South Sea Bubble, structural adjustment programs, The Wealth of Nations by Adam Smith, trade liberalization, transfer pricing, urban sprawl, World Values Survey

Although greater competition from manufactured imports and more foreign ownership could … help the Korean economy, Koreans and others saw this … as an abuse of IMF power to force Korea at a time of weakness to accept trade and investment policies it had previously rejected’.28 This was said not by some anti-capitalist anarchist but by Martin Feldstein, the conservative Harvard economist who was the key economic advisor to Ronald Reagan in the 1980s. The IMF-World Bank mission creep, combined with the abuse of conditionalities by the Bad Samaritan nations, is particularly unacceptable when the policies of the Bretton Woods Institutions have produced slower growth, more unequal income distribution and greater economic instability in most developing countries, as I pointed out earlier in this chapter. How on earth can the IMF and the World Bank persist for so long in pursuing the wrong policies that produce such poor outcomes?

As I discussed in the earlier chapters, the rich countries had been quite willing to let poor countries use more protection and subsidies until the late 1970s. However, this began to change in the 1980s. The change was most palpable in the US, whose enlightened approach to international trade with economically lesser nations rapidly gave way to a system similar to 19th-century British ‘free trade imperialism’. This new direction was clearly expressed by the then US president Ronald Reagan in 1986, as the Uruguay Round of GATT talks was starting, when he called for ‘new and more liberal agreements with our trading partners – agreement under which they would fully open their markets and treat American products as they treat their own’.10 Such agreement was realized through the Uruguay Round of GATT trade talks, which started in the Uruguayan city of Punta del Este in 1986 and was concluded in the Moroccan city of Marrakech in 1994.

As one foreign banker reportedly told the Wall Street Journal in the middle of the 1980s Third World debt crisis, ‘[w]e foreign bankers are for the free market when we’re out to make a buck and believe in the state when we are about to lose a buck’.4 Indeed, many state bail-outs of large private sector firms have been made by avowedly free-market governments. In the late 1970s, the bankrupt Swedish shipbuilding industry was rescued through nationalization by the country’s first right-wing government in 44 years, despite the fact that it had come to power with a pledge to reduce the size of the state. In the early 1980s, the troubled US car maker Chrysler was rescued by the Republican administration under Ronald Reagan, which was in the vanguard of neo-liberal market reforms at the time. Faced with the financial crisis in 1982, following its premature and poorly designed financial liberalization, the Chilean government rescued the entire banking sector with public money. This was General Pinochet’s government, which had seized power in a bloody coup in the name of defending the free market and private ownership.

The Darwin Economy: Liberty, Competition, and the Common Good by Robert H. Frank

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carbon footprint, carried interest, Cass Sunstein, clean water, congestion charging, corporate governance, deliberate practice, full employment, income inequality, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Paul Samuelson, Plutocrats, plutocrats, positional goods, profit motive, Ralph Nader, rent control, Richard Thaler, Ronald Coase, Ronald Reagan, sealed-bid auction, smart grid, The Nature of the Firm, The Wealth of Nations by Adam Smith, Thomas Malthus, transaction costs, trickle-down economics, ultimatum game, winner-take-all economy

57 2007 CPI, ranked only twentieth-best on that list, primarily because of perceptions that our campaign finance system had corrupted Congress. In countries with honest and effective governments, the view that promoting good government is a worthwhile investment would not strike most observers as absurd. Yet that does not seem to be the position of antigovernment evangelists in the United States, many of whom view government service with thinly veiled contempt. As Ronald Reagan often remarked, “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” The foundation of honest and effective government is a professional civil service that takes pride in its work. Fostering a climate in which government is viewed with contempt inevitably makes it more difficult to recruit talented and dedicated civil servants.

It would have been far better for both nations if each had spent less on arms and more on schools, housing, hospitals, roads, and other nonmilitary goods. The standard solution is a military arms control agreement, under which both sides pledge to reduce their spending on armaments. Lack of trust is perhaps the biggest barrier to reaching such agreements, and successful ones have almost always granted liberal inspection rights to both sides. As Ronald Reagan liked to say, “Trust, but verify.” 64 PUTTING THE POSITIONAL CONSUMPTION BEAST ON A DIET 65 So far, so good. But this account leaves an important question unanswered. What conditions must be met, exactly, for a military arms race to occur? If someone says there is too much of something, the unspoken implication is that there must be too little of something else. In the military arms race, there are too many bombs and not enough domestic consumption goods.

But that doesn’t mean that arms control agreements themselves are always uncontroversial. For example, it may be perfectly rational for a nation’s leaders to refuse to participate in such an agreement if they have no practical way to prevent the opposing side from cheating. It may also be rational to refuse to sign an arms control agreement if leaders believe an arms race would play out to their own side’s advantage. Ronald Reagan, for example, was said to have embraced the development of strategic missile defense systems in the 1980s in part because he believed that pressuring the USSR to follow suit would hasten the economic collapse of America’s principal rival. In sum, there’s all but universal agreement that military arms races between closely matched rivals are wasteful, and that all parties can gain from collective agreements to limit spending on armaments.


pages: 347 words: 99,317

Bad Samaritans: The Guilty Secrets of Rich Nations and the Threat to Global Prosperity by Ha-Joon Chang

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affirmative action, Albert Einstein, banking crisis, Big bang: deregulation of the City of London, bilateral investment treaty, borderless world, Bretton Woods, British Empire, Brownian motion, call centre, capital controls, central bank independence, colonial rule, Corn Laws, corporate governance, David Ricardo: comparative advantage, Deng Xiaoping, Doha Development Round, en.wikipedia.org, falling living standards, Fellow of the Royal Society, financial deregulation, fixed income, Francis Fukuyama: the end of history, income inequality, income per capita, industrial robot, Isaac Newton, joint-stock company, Joseph Schumpeter, Kenneth Rogoff, labour mobility, land reform, liberal world order, liberation theology, low skilled workers, market bubble, market fundamentalism, Martin Wolf, means of production, mega-rich, moral hazard, offshore financial centre, oil shock, price stability, principal–agent problem, Ronald Reagan, South Sea Bubble, structural adjustment programs, The Wealth of Nations by Adam Smith, trade liberalization, transfer pricing, urban sprawl, World Values Survey

Although greater competition from manufactured imports and more foreign ownership could … help the Korean economy, Koreans and others saw this … as an abuse of IMF power to force Korea at a time of weakness to accept trade and investment policies it had previously rejected’.28 This was said not by some anti-capitalist anarchist but by Martin Feldstein, the conservative Harvard economist who was the key economic advisor to Ronald Reagan in the 1980s. The IMF-World Bank mission creep, combined with the abuse of conditionalities by the Bad Samaritan nations, is particularly unacceptable when the policies of the Bretton Woods Institutions have produced slower growth, more unequal income distribution and greater economic instability in most developing countries, as I pointed out earlier in this chapter. But how on earth can the IMF and the World Bank persist for so long in pursuing the wrong policies that produce such poor outcomes?

As I discussed in the earlier chapters, the rich countries had been quite willing to let poor countries use more protection and subsidies until the late 1970s. However, this began to change in the 1980s. The change was most palpable in the US, whose enlightened approach to international trade with economically lesser nations rapidly gave way to a system similar to 19th-century British ‘free trade imperialism’. This new direction was clearly expressed by the then US president Ronald Reagan in 1986, as the Uruguay Round of GATT talks was starting, when he called for ‘new and more liberal agreements with our trading partners – agreement under which they would fully open their markets and treat American products as they treat their own’.10 Such agreement was realized through the Uruguay Round of GATT trade talks, which started in the Uruguayan city of Punta del Este in 1986 and was concluded in the Moroccan city of Marrakech in 1994.

As one foreign banker reportedly told the Wall Street Journal in the middle of the 1980s Third World debt crisis, ‘[w]e foreign bankers are for the free market when we’re out to make a buck and believe in the state when we are about to lose a buck’.4 Indeed, many state bail-outs of large private sector firms have been made by avowedly free-market governments. In the late 1970s, the bankrupt Swedish shipbuilding industry was rescued through nationalization by the country’s first right-wing government in 44 years, despite the fact that it had come to power with a pledge to reduce the size of the state. In the early 1980s, the troubled US car maker Chrysler was rescued by the Republican administration under Ronald Reagan, which was in the vanguard of neo-liberal market reforms at the time. Faced with the financial crisis in 1982, following its premature and poorly designed financial liberalization, the Chilean government rescued the entire banking sector with public money. This was General Pinochet’s government, which had seized power in a bloody coup in the name of defending the free market and private ownership.


pages: 471 words: 97,152

Animal Spirits: How Human Psychology Drives the Economy, and Why It Matters for Global Capitalism by George A. Akerlof, Robert J. Shiller

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affirmative action, Andrei Shleifer, asset-backed security, bank run, banking crisis, collateralized debt obligation, conceptual framework, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, Deng Xiaoping, Donald Trump, Edward Glaeser, en.wikipedia.org, experimental subject, financial innovation, full employment, George Akerlof, George Santayana, housing crisis, Hyman Minsky, income per capita, inflation targeting, invisible hand, Isaac Newton, Jane Jacobs, Jean Tirole, job satisfaction, Joseph Schumpeter, Long Term Capital Management, loss aversion, market bubble, market clearing, mental accounting, Mikhail Gorbachev, money market fund, money: store of value / unit of account / medium of exchange, moral hazard, mortgage debt, Myron Scholes, new economy, New Urbanism, Paul Samuelson, Plutocrats, plutocrats, price stability, profit maximization, purchasing power parity, random walk, Richard Thaler, Robert Shiller, Robert Shiller, Ronald Reagan, South Sea Bubble, The Chicago School, The Death and Life of Great American Cities, The Wealth of Nations by Adam Smith, too big to fail, transaction costs, tulip mania, working-age population, Y2K, Yom Kippur War

We might view the United States as having undergone six such major shifts: at the time of the Revolution, after the elections of Andrew Jackson and later of Abraham Lincoln, at the end of Reconstruction, during the Great Depression, and after the election of Ronald Reagan. Historians may disagree with us on the details of these changes of story, but since much of history is about such shifts, they are unlikely to argue with us about their existence. Nor are they likely to disagree with us about the most recent such shift, coinciding with the election of Ronald Reagan. At that time the explanation of how the economy worked turned to the conservative image with which we began this book, the “invisible hand.” This shift was, of course, not just an American phenomenon. Britain had elected Margaret Thatcher eighteen months earlier.

The stories people tell are also stories about how the economy behaves. Indeed, it is in this last category, stories, where Animal Spirits itself fits in, because the goal of the book is to give its own story about how the economy behaves. Its intent is to tell a more accurate story than the dominant one of the past thirty years or so, ever since the free market revolution that swept the world, under the leadership of Margaret Thatcher, Ronald Reagan, Deng Xiaoping, Manmohan Singh, Mikhail Gorbachev, Brian Mulroney, Bertie Ahern, Carlos Salinas de Gotari, Fernando Henrique Cardoso, Carlos Menem, and others. These stories, embellished by oft told vignettes of newly successful people, and in their mostly justified enthusiasm for expanded free markets, led to too much economic tolerance. Underlying this revolution is the powerful principle of the “invisible hand”—that market forces should be the fundamental framework of resource allocation.

The belief that government should not interfere with people in pursuit of their own self-interest has influenced national policies across the globe. In England it took the form of Thatcherism. In America it took the form of Reaganism. And from these two Anglo-Saxon countries it has spread. This permissive-parent view of the role of government replaced the Keynesian happy home. Now, three decades after the elections of Margaret Thatcher and Ronald Reagan, we see the troubles it can spawn. No limits were set to the excesses of Wall Street. It got wildly drunk. And now the world must face the consequences. It has been a long time since we discovered how it was possible for a government to offset the rational and irrational shocks that occur to capitalist economies. But as Keynes’ legacy and the role of government have been challenged, the system of safeguards developed from the experience of the Great Depression has been eroded.

Rogue State: A Guide to the World's Only Superpower by William Blum

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anti-communist, Ayatollah Khomeini, Berlin Wall, British Empire, collective bargaining, Columbine, experimental subject, Fall of the Berlin Wall, Johann Wolfgang von Goethe, Joseph Schumpeter, land reform, Monroe Doctrine, profit motive, Ronald Reagan, union organizing

I love the First Amendment."15 It's interesting to note that when Madeleine Albright was heckled in Columbus, Ohio in February 1998, while defending the administration's Iraq policy, she yelled: "We are the greatest country in the world!" Patriotism is indeed the last refuge of a scoundrel, though Gore's and Albright's words don't quite have the ring of "Deutschland über alles" or "Rule Britannia". In 1985, Ronald Reagan, demonstrating the preeminent intellect for which he was esteemed, tried to show how totalitarian the Soviet Union was by declaring: "I'm no linguist, but I've been told that in the Russian language there isn't even a word for 'freedom'."16 In light of the above cast of characters and their declarations, can we ask if there's a word in American English for "embarrassment"? No, it is not simply that power corrupts and dehumanizes.

In other words, whatever the diplomats and policymakers at the time thought they were doing, the Cold War skeptics have been vindicated—it was not about containing an evil, expansionist communism after all; it was about American imperialism, with "communist" merely the name given to those who stood in its way. In sum total, all these post-Cold War non-changes engender a scenario out of the 1950s and 1960s. And the 1970s and 1980s. John Foster Dulles lives! Has Ronald Reagan been faking illness as he lurks behind the curtain of Oz? Why has all this continued into the 21st century? American foreign-policy makers are exquisitely attuned to the rise of a government, or a movement that might take power, that will not lie down and happily become an American client state, that will not look upon the free market or the privatization of the world known as "globalization" as the summum bonum, that will not change its laws to favor foreign investment, that will not be unconcerned about the effects of foreign investment upon the welfare of its own people, that will not produce primarily for export, that will not allow asbestos, banned pesticides and other products restricted in the developed world to be dumped onto their people, that will not easily tolerate the International Monetary Fund or the World Trade Organization inflicting a scorched-earth policy upon the country's social services or standard of living, that will not allow an American or NATO military installation upon its soil...To the highly-sensitive nostrils of Washington foreign-policy veterans, Yugoslavia smelled a bit too much like one of these governments.

They are believed to have also been behind the attempted assassination of President Hosni Mubarak while he was visiting Ethiopia.17 In August 1994, three "Afghans" robbed a tourist hotel in Morocco, killing tourists in an effort to destabilize Morocco's vital tourism industry.18 Throughout much of the 1990s, Kashmiris and other nationals trained in Afghanistan have been fighting against India in the mountains of Kashmir, waging "holy war" for secession from New Delhi.19 Since Algeria's cancellation of the 1992 election, Algerian veterans of the Afghanistan conflict have played a key role in the rise of the Armed Islamic Group, responsible for many thousands of gory murders in their crusade for an Islamic state.20 In Bosnia, beginning in 1992, Afghans fought ferociously alongside the predominantly Muslim Bosnian army for two years, attacking Serbian positions to liberate Muslim villages.21 One of those who confessed to the November 1995 bombing in Saudi Arabia, referred to above, said that he had fought with the Bosnian Muslims.22 In a 1999 interview, Libyan leader Moammar Qaddafi told a London-based Arabic newspaper that his government had crushed an Islamic militant movement of "Afghans". "They returned desperate and destructive," he said, "and adopted killing and explosives as their profession, according to the training they received from the American intelligence."23 And there has been more of the same in other places, from the men Ronald Reagan fancied as "freedom fighters". "This is an insane instance of the chickens coming home to roost," said a US diplomat in Pakistan in 1996. "You can't plug billions of dollars into an anti-Communist jihad, accept participation from all over the world and ignore the consequences. But we did. Our objectives weren't peace and grooviness in Afghanistan. Our objective was killing Commies and getting the Russians out."24 CHAPTER 3 : Assassinations I don't want to wipe out everyone...Just my enemies.


pages: 177 words: 50,167

The Populist Explosion: How the Great Recession Transformed American and European Politics by John B. Judis

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affirmative action, Affordable Care Act / Obamacare, Albert Einstein, anti-communist, back-to-the-land, Bernie Sanders, Bretton Woods, capital controls, centre right, collapse of Lehman Brothers, deindustrialization, desegregation, Donald Trump, eurozone crisis, financial deregulation, first-past-the-post, fixed income, full employment, ghettoisation, glass ceiling, hiring and firing, illegal immigration, immigration reform, income inequality, invisible hand, laissez-faire capitalism, mass immigration, means of production, neoliberal agenda, obamacare, Occupy movement, open borders, Plutocrats, plutocrats, Post-materialism, post-materialism, rolodex, Ronald Reagan, Silicon Valley, War on Poverty, We are the 99%, white flight, Winter of Discontent

In his book on American populism, The Populist Persuasion, historian Michael Kazin gets part of this logic. Populism, he writes, is “a language whose speakers conceive of ordinary people as a noble assemblage not bounded narrowly by class; view their elite opponents as self-serving and undemocratic; and seek to mobilize the former against the latter.” That’s a good start. It doesn’t describe someone like Ronald Reagan or Vladimir Putin, both of whom have sometimes been called “populist,” but it does describe the logic of the parties, movements, and candidates from America’s People’s Party of 1892 to Marine Le Pen’s National Front of 2016. I would, however, take Kazin’s characterization one step further and distinguish between leftwing populists like Sanders or Podemos’s Pablo Iglesias and rightwing populists like Trump and the National Front’s Le Pen.

But there are times, when, in the face of dramatic changes in the society and economy or in America’s place in the world, voters have suddenly become responsive to politicians or movements that raise issues that major parties have either downplayed or ignored. There are two kinds of such events. The first are what political scientists call realigning elections. In these, a party or a presidential candidate’s challenge to the prevailing worldview causes an upheaval that reorders the existing coalitions and leads to a new majority party. Franklin Roosevelt’s campaigns in 1932 and, even more so, 1936 did this, and so did Ronald Reagan’s campaign in 1980. Such elections are rare. They are usually precipitated by economic depression or war, and by a succession of political outbursts that challenge, but do not replace, the prevailing worldview. In American politics, these outbursts often take the form of populist candidacies and movements. These catalytic populists have defined politics in “us vs. them” terms—as struggles of the people against the establishment based on issues and demands that the latter had been sidestepping.

The key contention that sustained the neoliberal agenda was that the older New Deal liberalism, by focusing on raising consumer demand and reducing inequality, would stifle growth and reduce Americans’ standard of living. By contrast, the neoliberal and supply-side agenda, while not directly confronting economic inequality, promised to spur economic growth, which would benefit all Americans. As Ronald Reagan, borrowing from John Kennedy, put it in the 1980 campaign, “a rising tide will lift all boats.” Similar kinds of arguments would be made in Europe by the “Third Way” centrists, who were partially inspired by Tory Prime Minister Margaret Thatcher. But even by the late 1980s, reality on the ground appeared to contradict these claims of widespread prosperity. In the 1980s, growth and employment lagged behind that of previous decades.


pages: 204 words: 61,491

Amusing Ourselves to Death: Public Discourse in the Age of Show Business by Neil Postman, Jeff Riggenbach Ph.

affirmative action, Albert Einstein, global village, Index librorum prohibitorum, invention of the printing press, Louis Daguerre, Marshall McLuhan, Mikhail Gorbachev, Ralph Nader, Ralph Waldo Emerson, Ronald Reagan, Saturday Night Live, the medium is the message

Andrew Postman Brooklyn, New York November 2005 In 1985 ... If you were alert back then, this refresher may be unnecessary, even laughable. If you were not alert then, this may just be laughable. But it also may help to clarify references in the book about things of that moment. In 1985: The United States population is 240 million. The Cold War is still on, though Mikhail Gorbachev has just become the Soviet leader. Ronald Reagan is president. Other major political figures include Walter “Fritz” Mondale, Democratic presidential nominee the year before; Geraldine Ferraro, his vice-presidential running mate; and presidential hopefuls/Senators Gary Hart and John Glenn (the latter a former astronaut). Ed Koch is mayor of New York City. David Garth is a top media consultant for political candidates. Top-rated TV shows include Dynasty, Dallas (though it has been several years since the drama of “Who Shot J.R.?”

Indeed, the President continues to make debatable assertions of fact but news accounts do not deal with them as extensively as they once did. In the view of White House officials, the declining news coverage mirrors a decline in interest by the general public. (my italics) This report is not so much a news story as a story about the news, and our recent history suggests that it is not about Ronald Reagan’s charm. It is about how news is defined, and I believe the story would be quite astonishing to both civil libertarians and tyrants of an earlier time. Walter Lippmann, for example, wrote in 1920: “There can be no liberty for a community which lacks the means by which to detect lies.” For all of his pessimism about the possibilities of restoring an eighteenth- and nineteenth-century level of public discourse, Lippmann assumed, as did Thomas Jefferson before him, that with a well-trained press functioning as a lie-detector, the public’s interest in a President’s mangling of the truth would be piqued, in both senses of that word.

It is well understood at the National Council that the danger is not that religion has become the content of television shows but that television shows may become the content of religion. 9. Reach Out and Elect Someone In The Last Hurrah, Edwin O’Connor’s fine novel about lusty party politics in Boston, Mayor Frank Skeffington tries to instruct his young nephew in the realities of political machinery. Politics, he tells him, is the greatest spectator sport in America. In 1966, Ronald Reagan used a different metaphor. “Politics,” he said, “is just like show business.”1 Although sports has now become a major branch of show business, it still contains elements that make Skeffington’s vision of politics somewhat more encouraging than Reagan’s. In any sport the standard of excellence is well known to both the players and spectators, and an athlete’s reputation rises and falls by his or her proximity to that standard.


pages: 598 words: 172,137

Who Stole the American Dream? by Hedrick Smith

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Affordable Care Act / Obamacare, Airbus A320, airline deregulation, anti-communist, asset allocation, banking crisis, Bonfire of the Vanities, British Empire, business process, clean water, cloud computing, collateralized debt obligation, collective bargaining, commoditize, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, currency manipulation / currency intervention, David Brooks, Deng Xiaoping, desegregation, Double Irish / Dutch Sandwich, family office, full employment, global supply chain, Gordon Gekko, guest worker program, hiring and firing, housing crisis, Howard Zinn, income inequality, index fund, industrial cluster, informal economy, invisible hand, Joseph Schumpeter, Kenneth Rogoff, Kitchen Debate, knowledge economy, knowledge worker, laissez-faire capitalism, late fees, Long Term Capital Management, low cost carrier, manufacturing employment, market fundamentalism, Maui Hawaii, mega-rich, mortgage debt, negative equity, new economy, Occupy movement, Own Your Own Home, Paul Samuelson, Peter Thiel, Plutonomy: Buying Luxury, Explaining Global Imbalances, Ponzi scheme, Powell Memorandum, Ralph Nader, RAND corporation, Renaissance Technologies, reshoring, rising living standards, Robert Bork, Robert Shiller, Robert Shiller, rolodex, Ronald Reagan, shareholder value, Shenzhen was a fishing village, Silicon Valley, Silicon Valley startup, Steve Jobs, The Chicago School, The Spirit Level, too big to fail, transaction costs, transcontinental railway, union organizing, Unsafe at Any Speed, Vanguard fund, We are the 99%, women in the workforce, working poor, Y2K

The Interaction of Politics and Economics This book sets out to describe how, over the past four decades, we came to this point—how we became two such polarized and dissimilar Americas, how the great economic and political divide affects the lives of individual Americans, and how we might, through changed policies and a revival of citizen action, restore our unity and reclaim the American Dream for average people. In my first book, The Russians, I sought to give American readers an intimate human picture of what Russians were like beneath the veneer of Soviet communism and why they behaved the way they did. In The Power Game: How Washington Works, I went inside the American political system and the games politicians played in the era of Ronald Reagan and Jimmy Carter to describe how power really works in Washington and why some leaders succeed and others fail. In this book, I provide a reporter’s CAT scan of the Two Americas today, examining the interplay of economics and politics to disclose how the shifts of power and of wealth have led to the unraveling of the American Dream for the middle class. I tell the story, too, of how we evolved into such an unequal democracy—how we lost the moderate political middle and how today’s polarized politics reinforce economic inequality and a pervasive sense of economic insecurity.

—ALBERT ABRAHAMS, LOBBYIST, National Association of Realtors Business’s new lobbying weapon combines the power of new coalitions in Washington with grassroots organizations that reach into virtually every congressman’s home district. —Business Week, May 1978 1978 IS A YEAR LARGELY FORGOTTEN or overlooked by many political commentators, but the legislative session of the Ninety-fifth Congress that year was one of the most pivotal in our modern political history. The power shift in favor of pro-business policies began not under Ronald Reagan and the Republicans in the 1980s, but earlier—under Jimmy Carter, in the Democratic-controlled Congress of the late 1970s. In part, that was because Jimmy Carter came to Washington in 1976 with a reform agenda to help the middle class, but as a one-term governor of Georgia, he was unprepared for the rough-and-tumble of the Washington power game. But Carter was also confronting a hidden new reality: The newly organized legions of business, energized by the Powell memo, were ready to play hardball.

Major corporations, which were used to dealing with unions, were inclined to go along with some labor demands to keep peace in their own backyards. But there was a growing sentiment among medium-sized corporations, small businesses, and retailers that labor had gone too far and had gotten too strong. Anti-union feeling was particularly on the rise among the Sun Belt business community, some of it stirred up by the blazingly anti-union rhetoric of Barry Goldwater, the right-wing Republican presidential candidate in 1964, and by Ronald Reagan’s run for the presidency in 1976. With employee health and pension costs rising sharply and a growing gap between union and non-union wages, even employers accustomed to unions were taking a harder line. Some business leaders were determined to roll back union power. The National Association of Manufacturers, with thirteen thousand member companies, set up its own Council on Union-Free Environment to try to get rid of unions as the go-between for management’s dealings with employees.


pages: 956 words: 267,746

Command and Control: Nuclear Weapons, the Damascus Accident, and the Illusion ofSafety by Eric Schlosser

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Albert Einstein, anti-communist, Berlin Wall, cuban missile crisis, Fall of the Berlin Wall, Haight Ashbury, impulse control, interchangeable parts, Isaac Newton, life extension, Mikhail Gorbachev, mutually assured destruction, nuclear winter, packet switching, RAND corporation, Ronald Reagan, Stanislav Petrov, Stewart Brand, too big to fail, uranium enrichment, William Langewiesche

Although Carter was a devout Christian, a newly created evangelical group, the Moral Majority, was attacking his support for legalized abortion and a constitutional amendment to guarantee equal rights for women. A midsummer opinion poll found that 77 percent of the American people disapproved of President Carter’s performance in the White House—a higher disapproval rate than that of President Richard Nixon at the height of Watergate. The Republican candidate for president, Ronald Reagan, had a sunnier disposition. “I refuse to accept [Carter’s] defeatist and pessimistic view of America,” Reagan said. The country could not afford “four more years of weakness, indecision, mediocrity, and incompetence.” Reagan called for large tax cuts, smaller government, deregulation, increased defense spending to confront the Soviet threat, and a renewed faith in the American dream. A popular third-party candidate, Congressman John B.

The Russian city of Minsk is hit by nuclear weapons in retaliation, and the shock of its destruction causes the swift collapse of the Soviet Union. The moral of the story was clear: the United States and its allies needed to increase their military spending. “In the last few years before the outbreak of war the West began to wake up to the danger it faced,” Hackett wrote, “and in the time available did just enough in repair of its neglected defenses to enable it, by a small margin, to survive.” Ronald Reagan later called The Third World War an unusually important book. And it helped to launch a new literary genre, the techno-thriller, in which military heroism was celebrated, the intricate details of weaponry played a central role in the narrative, and Cold War victories were achieved through the proper application of force. On television, The Waltons, a long-running drama about an ordinary family’s struggles during the Great Depression, was facing cancellation.

Having gained almost two thirds of the popular vote in 1978, Bill Clinton now faced a tough campaign for reelection, confronting not only the anger and frustration in his own state but also the conservative tide rising across the United States. Frank White, the Republican candidate for governor, was strongly backed by the religious right and many of the industry groups that Clinton had antagonized. The White campaign embraced the candidacy of Ronald Reagan, attacked Clinton for having close ties to Jimmy Carter, ran ads that featured dark-skinned Cubans rioting on the road to Barling, raised questions about all the longhairs from out of state who seemed to be running Arkansas, and criticized the governor’s wife, Hillary Rodham, for being a feminist who refused to take her husband’s name. While Lee Epperson, director of the Office of Emergency Services, tried to find out what was happening at the Titan II site in Damascus, Governor Clinton spent the evening in Hot Springs.


pages: 415 words: 103,231

Gusher of Lies: The Dangerous Delusions of Energy Independence by Robert Bryce

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Berlin Wall, Colonization of Mars, decarbonisation, en.wikipedia.org, energy security, energy transition, financial independence, flex fuel, hydrogen economy, Intergovernmental Panel on Climate Change (IPCC), John Markoff, Just-in-time delivery, new economy, oil shale / tar sands, oil shock, peak oil, price stability, Project for a New American Century, rolodex, Ronald Reagan, Silicon Valley, Stewart Brand, Thomas L Friedman, Whole Earth Catalog, X Prize, Yom Kippur War

Factories in China would not be able to export as many products to the rest of the world. America has been ensuring Saudi Arabia’s security since World War II, when Franklin Roosevelt met with the Saudi king, Abdul Aziz, Why We Think We Want Energy Independence 51 aboard the USS Quincy. Ever since then, the basic arrangement has stayed in place: The Saudis provide the world with a predictable stream of oil, and the U.S. ensures that the House of Saud will stay in power. Ronald Reagan probably summed it up best in 1981 when he said, “There is no way” that the U.S. would stand by and see Saudi Arabia “taken over by anyone that would shut off that oil.”6 Of course, America’s energy interests—and therefore, its economic interests—in the Persian Gulf go beyond Saudi Arabia. America has significant military investments in Kuwait, Qatar, Bahrain, the United Arab Emirates, Iraq, and Oman, and it is not going to abandon all of those multi-billion-dollar air bases, army depots, and transportation hubs just because American motorists might, at some point in the future, be burning more ethanol-flavored gasoline.

He also got new basing rights in Somalia, which gave the U.S. the ability to patrol the entrance to the Gulf of Aden and the Red Sea.14 Carter also created a 98 GUSHER OF LIES new military command within the Department of Defense called the Rapid Deployment Joint Task Force. Now known as Central Command, the task force was given the responsibility of managing all U.S. military operations in the Persian Gulf. (Today, in their briefing materials, Central Command officials note that their territory, which covers 27 predominantly Muslim countries that stretch from Sudan in the west to Kazakhstan in the east, contains 65 percent of the world’s known oil reserves.) Ronald Reagan followed Carter’s lead and continued the militarization. In 1981, the Reagan administration pushed through an $8.5-billion weapons deal for Saudi Arabia that included advanced surveillance aircraft as well as aerial tankers, air-to-air missiles, and other gear.15 Like Carter, Reagan made it clear that U.S. policy was to protect the Persian Gulf. In 1983, Reagan signed National Security Decision Directive 114, which said that the U.S. was ready to deter any attacks on “critical oil productions and transshipment facilities in the Persian Gulf.”

The panels, which cost $28,100 (about $84,000 in 2006 dollars), were used to heat water for the staff mess and other parts of the White House.31 When Carter showed the panels to a group of reporters, he said that in a generation, they would “either be a curiosity, a museum piece, an example of a road not taken, or it can be a small part of one of the greatest and most exciting adventures ever undertaken by the American people; harnessing the power of the Sun to enrich our lives as we move away from our crippling dependence on foreign oil.”32 Ronald Reagan beat Carter in the 1980 presidential race. And while Carter obsessed about energy, Reagan largely ignored the industry, figuring that it would manage itself. Reagan also worked to undo some of the regulatory obstacles that had been imposed on the industry by Congress and prior administrations. But the Great Communicator, like his predecessors (and successors), couldn’t resist the allure of a familiar catch phrase.


pages: 525 words: 138,747

Love All the People: Letters, Lyrics, Routines by Bill Hicks

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friendly fire, rolodex, Ronald Reagan, Saturday Night Live

Bush (1990) Hello, I’m Bill Hicks, and I’m standing at one of the foot of one of the halls of justice of our great country. You know, when the producers of this video asked me to discuss my opinions on the George Bush administration, I was struck by the very cynical thought, ‘What is the fucking point? People still love Ronald Reagan.’ After eight years of lies and hypocrisy, people love this guy. Leads me to a very disturbing question: how far up your ass does this guy’s dick have to be before you realize he’s fuckin’ ya? Ha, people are just, ‘I like Ronald Reagan. He looks good on TV, he made the country stronger, patriotism’s at an all-time high. Hold on a minute, something’s slappin’ my ass. Hey, he’s fuckin’ us!’ What’s the point of George Bush? Reagan-lite. No one cares that he was the ex-head of the CIA, now elected president. The CIA – political assassinations, overthrowing governments, death squads, drug-running.

‘You know, Jesus, it doesn’t get better’n this.’ You don’t see the imminent danger, do you? You’re staring at me like, ‘Bill, they’re just musicians, and they’re, you know, and they’re just doing their thing, and’ NO! They are DEMONS SET LOOSE ON THE EARTH TO LOWER THE STANDARDS FOR THE PERFECT AND HOLY CHILDREN OF GOD! Which is what we are. Make no mistake about it. What’s happened to us? After eight years of Ronald Reagan and Yuppies we live on like the third mall from the sun now, you know? Come on, man. Is it fuckin’ me? Debbie Gibson7had the number one album in this country, y’all. Now, if this doesn’t make your blood fucking curdle . . . I mean, who buys that shit, you know? Is there that much babysitting money being passed around right now? Have you seen that little mall creature at work? (singing) ‘Shake your love.’

I mean, he’ll tell you he’s not . . . but he’s gonna. A vote for Clinton is a vote for higher taxes, Bill.’ See, I have news for ya, folks: there’s other reasons not to vote for George Bush than taxes, OK? I don’t know what’s happened to us as a world – maybe twelve years of Republicanism has made us think this way. But the reason I didn’t vote for George Bush is because George Bush, along with Ronald Reagan, presided over an administration whose policies towards South America included genocide.47 (laughs) So, yeah, you see . . . the reason I didn’t vote for him is cos he’s a mass murderer. Yeah. I, yeah. OK. Yeah. Yeah. I’ll . . . I’ll pay that extra nickel on, you know, a litre of petrol just knowing little brown kids aren’t being clubbed to death like baby seals in Honduras so Pepsi can put a plant down there.


pages: 484 words: 131,168

The Big Sort: Why the Clustering of Like-Minded America Is Tearing Us Apart by Bill Bishop, Robert G. Cushing

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1960s counterculture, affirmative action, American Legislative Exchange Council, assortative mating, big-box store, blue-collar work, Cass Sunstein, citizen journalism, cognitive dissonance, David Brooks, demographic transition, desegregation, Edward Glaeser, immigration reform, income inequality, industrial cluster, Jane Jacobs, knowledge economy, mass immigration, meta analysis, meta-analysis, Milgram experiment, music of the spheres, New Urbanism, post-industrial society, Post-materialism, post-materialism, Ralph Nader, Richard Florida, Ronald Reagan, Silicon Valley, stem cell, Steve Jobs, superstar cities, The Death and Life of Great American Cities, union organizing, War on Poverty, white flight, World Values Survey

What we wanted to know was how they got there and whether the four groups had anything more in common than how they voted for president on the first Tuesday in November 2004. First, we looked to see if the groups had any political coherence. From 1948 to 1960, the four groups jumped about, voting for Democrats in some years, Republicans in others. In 1976, the groups all voted at about the national average (see Figure 2.2). Beginning in 1980 with the first election of Ronald Reagan, the counties began to diverge in their political inclinations, and they continued to separate for the next quarter century. This pattern appeared again and again as we evaluated other demographic measures. Education. In 1970, the county groups were well balanced in the proportion of the population that had a college degree. After that, the percentage of college-educated people increased in every group—but the well-educated were especially attracted to Democratic counties (see Figure 2.3).

In November, Gene Roberts wrote a story headlined "Negroes Still Angry and Jobless Three Months After Watts Riot."50 That was 1965. Within every event were the beginnings of political alignments that would extend for the next forty years. Days after troops subdued the Watts rioters, the New York Times reported that "California candidates of both parties, openly or warily, viewed the Los Angeles riots today as providing a ready-made issue for next year's important campaign for Governor." Ronald Reagan was considered the front-runner and the primary beneficiary of the riots.51 Earlier, in June, the U.S. Supreme Court struck down a Connecticut law that officials had used to close and fine a Planned Parenthood birth control clinic. In Griswold v. Connecticut, the Court ruled for the first time that there was a limited constitutional "right to privacy." (It would base its 1973 Roe v. Wade decision legalizing abortion on reasoning used in the earlier decision.)

By September 1966, the proportion who said that integration was proceeding "too fast" nearly doubled, jumping from 28 percent to 52 percent. Similarly, in 1965 street crime appeared just behind public education on the list of most important issues. Street crime had never before been of much concern. By 1968, 81 percent of Americans agreed that "law and order has broken down in this country."86 Ronald Reagan did not lead white men out of the Democratic Party with his 1980 campaign. Rather, the switch can be traced to 1964, when "men's support for the Democratic Party dropped precipitously from 51 percent to the high 30s throughout the seventies to a low of 28 percent in 1994." The gap in the party preferences of white men and women that became so pronounced in the 1990s and has continued into this century resulted from white men leaving the Democratic Party beginning in the mid-1960s.87 The Decline of Polarization The collapse of social institutions, the dropping levels of trust, and the abandonment of political parties beginning in 1965 all contributed to a decline in partisan political behavior.


pages: 590 words: 153,208

Wealth and Poverty: A New Edition for the Twenty-First Century by George Gilder

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affirmative action, Albert Einstein, Bernie Madoff, British Empire, capital controls, cleantech, cloud computing, collateralized debt obligation, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, deindustrialization, diversified portfolio, Donald Trump, equal pay for equal work, floating exchange rates, full employment, George Gilder, Gunnar Myrdal, Home mortgage interest deduction, Howard Zinn, income inequality, invisible hand, Jane Jacobs, Jeff Bezos, job automation, job-hopping, Joseph Schumpeter, knowledge economy, labor-force participation, margin call, Mark Zuckerberg, means of production, medical malpractice, minimum wage unemployment, money market fund, money: store of value / unit of account / medium of exchange, Mont Pelerin Society, moral hazard, mortgage debt, non-fiction novel, North Sea oil, paradox of thrift, Paul Samuelson, Plutocrats, plutocrats, Ponzi scheme, post-industrial society, price stability, Ralph Nader, rent control, Robert Gordon, Ronald Reagan, Silicon Valley, Simon Kuznets, skunkworks, Steve Jobs, The Wealth of Nations by Adam Smith, Thomas L Friedman, upwardly mobile, urban renewal, volatility arbitrage, War on Poverty, women in the workforce, working poor, working-age population, yield curve, zero-sum game

And as for defense, the budget bias significantly distracts attention from the campaign gumming up and agglutinating our military with unisex rites and social experiments, sharia sensitivity-training, and globalistic goo while letting our nuclear capabilities and civil defenses atrophy. Nonetheless, the Left still feels haunted and harried both by the vestigial survival of Wealth & Poverty and by the gilded memory of Ronald Reagan, who made me his most quoted living author. Jonathan Chait, an editor and columnist at the New Republic—a social register of the upper-class Left—delighted me a couple years ago by writing a book called The Big Con about the vast influence of supply-side economics, its “imbecility” as a “scam” and a “hoax,” its “lunacy” and its utter lack of socially acceptable academic proponents. Chait described me—if I may be so self-serving as to quote him—as “deranged . . . a crank and charlatan,” even a “barking moonbat.”

Of course,” he notes, rather impatiently, “there are still exceptions,” but “their small number [as if exceptional riches could ever be commonplace] only proves the rule” of economic sclerosis.6 This mode of thinking also sometimes afflicts conservatives when they have been sufficiently trained in the social sciences. In the late 1970s, Martin Anderson, an economist who wrote speeches for both President Nixon and Ronald Reagan, began his book Welfare by declaring, “The ‘war on poverty’ that began in 1964 has been won.”7 He quoted the conclusion of Alice Rivlin, head of the Congressional Budget Office, that the combination of expanded welfare payments and in-kind benefits had effectively lifted all but a very small proportion (6.4 percent) of Americans above the poverty line. The Wall Street Journal editorial writers enlisted their formidable eloquence to propagate the good news to its 6 million readers.

Senator Moynihan announced, with great courage and simplicity, “I was wrong.” Books and articles poured forth, declaring that the present welfare system, for all its manifest faults, was, as it were, “our welfare system, right or wrong,” an almost geological feature, one expert described it, with rocks and rills and purpled hills like America itself. “A wonderfully complex array of programs, payment levels, and eligibility rules,” wrote Martin Anderson, Ronald Reagan’s counselor, “a complex welfare system dealing with the very complex problem of the poor in America.”2 Anderson thought benefit levels could even be raised if work and child-support requirements were stiffly enforced. Richard Nathan, Nelson Rockefeller’s former adviser on the subject and long a high level Republican at HEW (now the HHS) and the White House, agreed: no large changes were needed, just marginal reforms.

Killing Hope: Us Military and Cia Interventions Since World War 2 by William Blum

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anti-communist, Berlin Wall, Bolshevik threat, centre right, collective bargaining, colonial rule, cuban missile crisis, currency manipulation / currency intervention, deindustrialization, kremlinology, land reform, liberation theology, Mikhail Gorbachev, Monroe Doctrine, nuremberg principles, Ronald Reagan, South China Sea, trickle-down economics, union organizing

Instead, some of the planes and boats were seized by US authorities for non-payment of debts claimed by American firms against the Cuban government.4 But then there were the bad hijackings— planes forced to fly from the United States to Cuba. When there began to be more of these than flights in the opposite direction, Washington was obliged to reconsider its policy. It appears that there are as well good and bad terrorists. When the Israelis bombed PLO headquarters in Tunis in 1985, Ronald Reagan expressed his approval. The president asserted that nations have the right to retaliate against terrorist attacks "as long as you pick out the people responsible".5 But if Cuba had dropped bombs on any of the headquarters of the anti-Castro exiles in Miami or New Jersey, Ronald Reagan would likely have gone to war, though for 25 years the Castro government had been on the receiving end of an extraordinary series of terrorist attacks carried out in Cuba, in the United States, and in other countries by the exiles and their CIA mentors.

Greece 1964-1974: "Fuck your Parliament and your Constitution,"said the President of the United States Bolivia 1964-1975: Tracking down Che Guevara in the land of coup d'etat Guatemala 1962 to 1980s: A less publicized "final solution" Costa Rica 1970-1971: Trying to topple an ally, part II Iraq 1972-1975: Covert action should not be confused with missionary work Australia 1973-1975: Another free election bites the dust Angola 1975 to 1980s: The Great Powers Poker Game Zaire 1975-1978: Mobutu and the CIA, a marriage made in heaven Jamaica 1976-1980: Kissinger's ultimatum Seychelles 1979-1981: Yet another area of great strategic importance Grenada 1979-1984: Lying—one of the few growth industries in Washington Morocco 1983: A video nasty Suriname 1982-1984: Once again, the Cuban bogeyman Libya 1981-1989: Ronald Reagan meets his match Nicaragua 1978-1990: Destabilization in slow motion Panama 1969-1991: Double-crossing our drug supplier Bulgaria 1990/Albania 1991: Teaching Communists what democracy is all about Iraq 1990-1991: Desert holocaust Afghanistan 1979-1992: America's Jihad El Salvador 1980-1994: Human rights, Washington style Haiti 1986-1994: Who will rid me of this turbulent priest? The American Empire: 1992 to present 215 221 229 239 242 244 249 257 263 267 269 278 279 280 290 305 314 320 338 352 370 383 Notes PART II Appendix I: This is How the Money Goes Round Appendix II: Instances of Use of United States Armed Forces Abroad, 1798-1945 Appendix III: U.S.

Edgar Hoover "helped spread the view among the police ranks that any kind of mass protest is due to a conspiracy promulgated by agitators, often Communists, 'who misdirect otherwise contented people'."19 The last is the key phrase, one which encapsulates the conspiracy mentality of those in power—the idea that no people, except those living under the enemy, could be so miserable and discontent as to need recourse to revolution or even mass protest; that it is only the agitation of the outsider which misdirects them along this path. Accordingly, if Ronald Reagan were to concede that the masses of El Salvador have every good reason to rise up against their god-awful existence, it would bring into question his accusation, and the rationale for US intervention, that it is principally (only?) the Soviet Union and its Cuban and Nicaraguan allies who instigate the Salvadoreans: that seemingly magical power of communists everywhere who, with a twist of their red wrist, can transform peaceful, happy people into furious guerrillas.


pages: 432 words: 127,985

The Best Way to Rob a Bank Is to Own One: How Corporate Executives and Politicians Looted the S&L Industry by William K. Black

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accounting loophole / creative accounting, affirmative action, Andrei Shleifer, business climate, cognitive dissonance, corporate governance, corporate raider, Donald Trump, fear of failure, financial deregulation, friendly fire, George Akerlof, hiring and firing, margin call, market bubble, money market fund, moral hazard, offshore financial centre, Ponzi scheme, race to the bottom, Ronald Reagan, short selling, The Market for Lemons, transaction costs

The FSLIC fund had only $6 billion in reserves, so it was hopelessly insolvent. The Reagan administration refused to admit that the industry was insolvent, refused to give the FSLIC any additional money to close failed S&Ls, and ordered Pratt not to use the FSLIC’s statutory right to borrow even the paltry sum of $750 million from the treasury. Pratt’s orders were to cover up the S&L crisis. The cover-up was particularly critical to the administration in 1981. Ronald Reagan’s campaign promises were to cut taxes, increase defense spending, and balance the budget. Those three promises, of course, were inconsistent, as his budget director, David Stockman, would later admit.2 The administration knew that if the public realized that the budget deficit was really $150 billion larger than reported, the resulting outcry could have prevented passage of the large tax cuts that the Economic Recovery Tax Act of 1981 (generally called the 1981 Tax Act) provided for.

Why did he remain loyal to them even after it became clear that doing so would have disastrous consequences for his constituents, the nation, and his party? Why did he, after striving for decades to become Speaker, continue to support the control frauds, even though doing so cost him his life’s ambition and his reputation? How did three control frauds and a real estate developer, each of whom voted for Ronald Reagan in 1980, get Wright, a populist Democrat, to champion wealthy GOP frauds despite the warnings of fellow Democrats? Wright’s actions on behalf of the control frauds had enormous direct consequences: they were decisive in forcing him to resign in disgrace from the House, and because they delayed the closure of dozens of (mostly Texas) control frauds, they led to billions of dollars in additional costs to the taxpayers.

Bank Board counsel and my aide on FSLIC recap. AMERICAN SAVINGS. Largest S&L, victimized by fraud. ANDERSON, JACK. Syndicated columnist. ANDREWS, MIKE (D-TX). Congressman allied with Jim Wright. ANGOTTI, OTTAVIO. Senior officer at Consolidated Savings Bank. ANNUNZIO, FRANK (D-IL). Member of the House Banking Committee. ATCHISON, JACK. AY audit partner for Lincoln Savings. BAKER, JAMES. Secretary of the Treasury under Ronald Reagan. BANK BOARD. Federal regulator of Savings and Loans. BARABOLAK, ALEX. Lead FHLB-Chicago examiner of ACC. BARCLAY, GEORGE. CEO of FHLB-Dallas. BARNARD, DRUIE DOUGLAS, JR. (D-GA). Member of the House Banking Committee. BARRY, JOHN. Author of a book about Jim Wright. BARTH, JIM. Bank Board chief economist. BARTLETT, HARRY STEPHEN “STEVE” (R-TX). Member of the House Banking Committee. BASS, ROBERT.


America Right or Wrong: An Anatomy of American Nationalism by Anatol Lieven

British Empire, centre right, cognitive dissonance, colonial rule, cuban missile crisis, desegregation, European colonialism, failed state, Francis Fukuyama: the end of history, full employment, Gunnar Myrdal, illegal immigration, income inequality, laissez-faire capitalism, mass immigration, Mikhail Gorbachev, millennium bug, mittelstand, Monroe Doctrine, moral hazard, moral panic, new economy, Norman Mailer, oil shock, Ralph Waldo Emerson, Robert Bork, Ronald Reagan, Thomas L Friedman, World Values Survey, Y2K

Thus the first months of the new Bush administration further demonstrated the power of what I have called the American nationalist thesis, and have analyzed in the second chapter of this book: a widely shared and almost religious belief in the values of the "American Creed;" in America's role as the supreme exemplar of democratic civilization in the world; America's right and ability to spread its values to the rest of the world; and above all, of faith in democracy. George W. Bush, like Ronald Reagan before him, won a second term in part because he and his advisers were able to express and exploit national myths, which are believed in by the great majority of Americans. In doing so the Bush administration not only gained votes itself, but also disabled the Democratic Party, forcing it in several areas of debate to become a paler shadow of the Republicans. The messianic aspect of American civic nationalism dominated Bush's inaugural address of February 2, 2005.

Some of the bitter lessons of Vietnam have sunk deeply into the American consciousness. In 20032004, the bloody and chaotic aftermath of victory in Iraq recalled them to life. In the two years after 9/11, however, they were largely swept away by a tide of mythbased nationalism against which it was very difficult to argue. The period during which the memories of Vietnam were suspended was not very long—but it was long enough to get America into Iraq.51 The figure of Ronald Reagan is critical to an understanding of how America dealt with the legacy of Vietnam and the consequences for America today and in future.52 On one hand, Reagan's external policy demonstrated that he and most of 57 AMERICA RIGHT OR WRONG his administration were determined not to get involved in any major conflict, and realized full well how bitterly unpopular a serious war would be with a majority of Americans.

After the conquest of Iraq and the failure to find the promised weapons of mass destruction, motives of democratization and human rights were turned post facto into the central justification for the war.138 Nor was the ostensible support for democratization limited to those countries under American military occupation. It was also argued that the democratization of Afghanistan and Iraq would initiate the democratization of the entire Middle East, beginning with Iran. And, of course, the emphasis on democratization among powerful sections of the modern American Right does not date from 2002. The most important historical moment in this regard was Ronald Reagan's adoption of the language of democratic revolution and human rights as a key part of his struggle against the "Evil Empire" of the Soviet Union, involving a deliberate and open repudiation of the "Realist" considerations which had supposedly governed the policies of the previous Republican administrations of Ford, Nixon and Eisenhower. Largely in consequence of this, leading intellectual Scoop Jackson Democrats completed their drift away from the Democratic Party and into the ideological camp of the neoconservatives and the political camp of the Republicans.


pages: 546 words: 176,169

The Cold War by Robert Cowley

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anti-communist, Berlin Wall, British Empire, cuban missile crisis, defense in depth, Dissolution of the Soviet Union, Doomsday Clock, friendly fire, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, means of production, Mikhail Gorbachev, mutually assured destruction, RAND corporation, refrigerator car, Ronald Reagan, South China Sea, Stanislav Petrov, transcontinental railway

Democratic Senate leader Mike Mansfield of Montana called it a “Stone Age tactic.” Democratic Senator Edward Kennedy of Massachusetts said it was an “outrage.” In an editorial, The Washington Post charged that the bombing caused millions of Americans “to cringe in shame and to wonder at their President's very sanity.” James Reston, in The New York Times, called it “war by tantrum.” Nixon did have supporters, including Governors Nelson Rockefeller of New York and Ronald Reagan of California and Republican senators James Buckley of New York, Howard Baker of Tennessee, and Charles Percy of Illinois. John Connally, former governor of Texas and treasury secretary, called Nixon daily to encourage him and assure him that, regardless of what politicians and the media said, the people were behind him. That was probably an exaggeration, but not as gross as the exaggerations of Nixon's critics.

“It is a question not of too many friends but really too few—one of the inevitable consequences of this position.” He received very few Christmas salutations, even from Republicans on Capitol Hill and members of his Cabinet. As a result, he told interviewer David Frost four years later, “it was the loneliest and saddest Christmas I can ever remember, much sadder and much more lonely than the one in the Pacific during the war.” He did make some telephone calls, including one to Ronald Reagan, who complained about CBS News coverage of the bombing and said that under World War II circumstances, the network would have been charged with treason. The day after Christmas, despite urgings from some of his aides and much of the media that he extend the Christmas Day truce, Nixon ordered the biggest bombing raid yet, 120 B-52s over Hanoi. Five were shot down, but that afternoon Nixon received a message from Hanoi.

IRBMs from Turkey and Italy—and that here, as with the Soviet and American response to the strategic dilemmas posed first by the possibility and then by the reality of the ICBM, technology ruled. The presence of mobile Soviet SS-20 IRBMs in Europe from 1977, and the threat of a subsequent tit-for-tat Pershing II deployment by the U.S., loomed large in the logic behind the negotiations between President Ronald Reagan and Premier Mikhail Gorbachev that, as we now know, marked the beginning of the end of the Cold War. The logic of the scenarios posited above is debatable. What is not is that ICBM-based mutual deterrence was central to the Cold War, a reality reflected in the strategic vocabulary. Such expressions as circular error probable (CEP), preemptive first strike, survivable second-strike capability, and launch on warning, while not exclusively related to ICBMs, arose within a context shaped by the intercontinental ballistic missile.

The Age of Turbulence: Adventures in a New World (Hardback) - Common by Alan Greenspan

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air freight, airline deregulation, Albert Einstein, asset-backed security, bank run, Berlin Wall, Bretton Woods, business process, call centre, capital controls, central bank independence, collateralized debt obligation, collective bargaining, conceptual framework, Corn Laws, corporate governance, corporate raider, correlation coefficient, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, cuban missile crisis, currency peg, Deng Xiaoping, Dissolution of the Soviet Union, Doha Development Round, double entry bookkeeping, equity premium, everywhere but in the productivity statistics, Fall of the Berlin Wall, fiat currency, financial innovation, financial intermediation, full employment, Gini coefficient, Hernando de Soto, income inequality, income per capita, invisible hand, Joseph Schumpeter, labor-force participation, labour market flexibility, laissez-faire capitalism, land reform, Long Term Capital Management, Mahatma Gandhi, manufacturing employment, market bubble, means of production, Mikhail Gorbachev, moral hazard, mortgage debt, Myron Scholes, new economy, North Sea oil, oil shock, open economy, Pearl River Delta, pets.com, Potemkin village, price mechanism, price stability, Productivity paradox, profit maximization, purchasing power parity, random walk, reserve currency, Right to Buy, risk tolerance, Ronald Reagan, shareholder value, short selling, Silicon Valley, special economic zone, the payments system, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, total factor productivity, trade liberalization, trade route, transaction costs, transcontinental railway, urban renewal, working-age population, Y2K, zero-sum game

So it was natural for me to get involved in Ronald Reagan's campaign. It made no difference that Ford and Reagan had competed four years earlier for the 1976 Republican nomination. My old friend and ally Martin Anderson joined the Reagan team—Marty had spent the post-Nixon years as a fellow at the Hoover Institution—and I resumed my old campaign role too. Marty was chief domestic policy adviser, a full-time position on the campaign plane, and I was an unpaid part-time consultant to the staff, much the same relationship I'd had to the Nixon campaign in 1968. I worked mainly from New York, but on occasion I'd fly out to spend a few days with the campaign. It was on one such trip, in late August, that I clumsily made what was probably my most important contribution to the election of Ronald Reagan. He had by this time already received the Republican nomination, and had been stepping up his criticism of the Carter administration.

Photograph by Neil Leifer More ebooks visit: http://www.ccebook.cn ccebook-orginal english ebooks This file was collected by ccebook.cn form the internet, the author keeps the copyright. During the presidential campaign of 1980, my mission on this cross-country flight with Ronald Reagan was to brief him on a long list of domestic issues. Adviser Martin Anderson, in the foreground, put me up to it. "He'll listen to you," he said. But I couldn't get Reagan to stop telling Stories. Michael Evans photograph, courtesy of the Ronald Reagan Presidential Foundation At the Republican convention that July, Henry Kissinger and I tried to persuade former president Ford to become Reagan's running mate. Polls showed that Reagan and Ford would be a "dream ticket," but after a suspenseful twenty-four hours, the negotiations fell apart and the vice presidential nomination went to George H.W.

"The president wanted me to tell you he'll be speaking to the nation and he'll be announcing wage and price controls." That evening is memorable to me for two reasons: First, Nixon preempted Bonanza, America's favorite TV western and a show I loved to watch, to *The discomfort index was later renamed t h e misery index and w e n t on to figure in at least two presidential campaigns. Jimmy Carter used it to criticize President Ford in 1976, and Ronald Reagan used it to criticize President Carter in 1980. 61 More ebooks visit: http://www.ccebook.cn ccebook-orginal english ebooks This file was collected by ccebook.cn form the internet, the author keeps the copyright. T H E AGE OF T U R B U L E N C E announce his policy; and second, I reached for something on the floor and threw my back out. I had to go to bed for six weeks. To this day, I like to believe that it was wage and price controls that did me in.


pages: 684 words: 188,584

The Age of Radiance: The Epic Rise and Dramatic Fall of the Atomic Era by Craig Nelson

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Albert Einstein, Brownian motion, cognitive dissonance, Columbine, continuation of politics by other means, corporate governance, cuban missile crisis, dark matter, Doomsday Clock, El Camino Real, Ernest Rutherford, failed state, Henri Poincaré, hive mind, Isaac Newton, John von Neumann, Louis Pasteur, Menlo Park, Mikhail Gorbachev, music of the spheres, mutually assured destruction, nuclear winter, oil shale / tar sands, Project Plowshare, Ralph Nader, Richard Feynman, Richard Feynman, Ronald Reagan, Skype, Stuxnet, technoutopianism, too big to fail, uranium enrichment, V2 rocket, William Langewiesche, éminence grise

Trabacchi, chief physicist of the Health Department, who shared his excellent collection of instruments and materials with untoward generosity, earning him the Fermi-engineered nickname Divine Providence. Trabacchi was especially providential when he loaned Fermi the radon-gas effluence of a gram of radium, which was at the time worth around $34,000. Hans Bethe (Beta), who won a Nobel for his fusion theory on the origin of starlight and who would become the chief of the Los Alamos theory group (inadvertently thrusting Edward Teller into a career combining Dr. Strangelove with Ronald Reagan), spent most of 1931 with the Fermi team: Fermi worked in the Institute of Physics, which was on a small hill in the middle of Rome, surrounded by a sea of traffic but very quiet on that little hill. There were trees, ponds, a nice garden, a fountain—really quite an oasis in the hectic traffic of Rome. Fermi was twenty-nine years old when I got there. He was a full professor since he published Fermi’s Statistics at the age of twenty-five.

Yet, a colony of white mice seem to be developing a resistance to radiation that is passed on to their descendants, which could be of great benefit to humans. And from inside the still-burning Reactor #4 itself, one robot emerged covered in a black goo—radiographic fungus, growing ecstatically on the unit’s very walls. 15 Hitting a Bullet with a Bullet AFTER his speeches as a presidential candidate repudiated the live-and-let-live détente of Nixon, Ford, and Carter in favor of hawkish Cold Warrior aggression, Ronald Reagan’s ascension to the Oval Office in 1981 alarmed the Kremlin. Then in the first days of his administration, CIA director William Casey reprised LeMay’s bear-baiting by throwing bombers over the pole into Soviet airspace until Russian radar took notice. Similarly, NATO fighter jets crossed over the empire’s Eurasian border every week, performed a variety of erratic maneuvers, and then vanished . . . until starting up all over again.

These “war games” were so realistic that they included the drafting of a speech for Queen Elizabeth to read to the nation as atomic missiles fell on England’s mountain green: “I have never forgotten the sorrow and the pride I felt as my sister and I huddled around the nursery wireless set listening to my father’s inspiring words on that fateful day in 1939. Not for a single moment did I imagine that this solemn and awful duty would one day fall to me. We all know that the dangers facing us today are greater by far than at any time in our long history. The enemy is not the soldier with his rifle nor even the airman prowling the skies above our cities and towns but the deadly power of abused technology.” In his diaries, Ronald Reagan’s sole mention of feeling sad occurs on October 10, 1983, after watching a preview of a TV movie on nuclear horror, The Day After: “It’s powerfully done, all $7 mil. worth. It’s very effective and left me greatly depressed. So far they haven’t sold any of the 25 spot ads scheduled & I can see why. . . . My own reaction was one of our having to do all we can to have a deterrent & to see there is never a nuclear war.”


pages: 350 words: 109,220

In FED We Trust: Ben Bernanke's War on the Great Panic by David Wessel

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Asian financial crisis, asset-backed security, bank run, banking crisis, banks create money, Berlin Wall, Black Swan, break the buck, central bank independence, credit crunch, Credit Default Swap, crony capitalism, debt deflation, Fall of the Berlin Wall, financial innovation, financial intermediation, fixed income, full employment, George Akerlof, housing crisis, inflation targeting, information asymmetry, London Interbank Offered Rate, Long Term Capital Management, market bubble, money market fund, moral hazard, mortgage debt, new economy, Northern Rock, price stability, quantitative easing, Robert Shiller, Robert Shiller, Ronald Reagan, Saturday Night Live, savings glut, Socratic dialogue, too big to fail

As frightening as some of those seemed at the time, the Fed managed them with the standard central banker tools — moving interest rates up and down, lending to healthy banks that needed quick cash, cajoling the chief executives of big banks to do what was needed to prevent crises that threatened the financial system. Jimmy Carter had recruited Paul Volcker to restore global confidence in the U.S. economy and the U.S. dollar and to end an inflationary spiral that, at the time, seemed unstoppable. In Ronald Reagan’s years, Volcker helped big American banks cope with massive losses on loans they had made to Latin American governments. His successor, Alan Greenspan, steered the economy through the storms of the 1987 market crash and then helped clean up the mess left by savings and loan associations that were pulled under by a combination of shortsighted regulation and lousy real estate loans. But the Great Panic was much bigger — in price tag, in geographic scale, and in duration.

“I … am but a sprout in the crop of otherwise experienced men and women here … but I’m sure they will agree with me that Henry V’s remarks at Agincourt are appropriate: economists and bankers now asleep shall think themselves accursed they were not here.” Greenspan responded with a smile, and then said, “I went to school with Henry V. And the last time I spoke to him he gave me a good notion of strategy.” Everyone laughed. In the 1980s, Greenspan had turned his interest in and facility for understanding the inner workings of the American economy into a successful consulting business when Ronald Reagan’s Treasury secretary, James Baker, and chief of staff, Howard Baker, recruited him to succeed Paul Volcker. Volcker had put the U.S. economy through a wrenching recession and accomplished what most people — economists and ordinary folk — thought impossible: bring inflation from the double digits to below 5 percent. But he was not in favor in the Reagan White House. He was a Democrat, for one thing.

Volcker’s crankiness and his I’m-above-politics air were hard to take.” Greenspan, in contrast, was both reliably conservative — an acolyte of philosopher Ayn Rand — and politically agile. He had come to Washington in the last dark days of the Nixon White House. (His confirmation hearing to be chairman of Nixon’s Council of Economic Advisers came the same day Nixon went on national TV to resign.) He stayed on to advise Ford and later candidate Ronald Reagan. He was comfortable with politicians and, having dated TV news stars Barbara Walters and Andrea Mitchell, with the press. He was skillful at courting and manipulating both sets of people to protect the Fed’s credibility and independence and to burnish his own reputation. Volcker was physically intimidating at six feet seven inches and famously opaque in his utterances. Greenspan was not physically imposing.


pages: 376 words: 110,796

Realizing Tomorrow: The Path to Private Spaceflight by Chris Dubbs, Emeline Paat-dahlstrom, Charles D. Walker

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Berlin Wall, call centre, desegregation, Donald Trump, Doomsday Book, Elon Musk, high net worth, Iridium satellite, iterative process, Jeff Bezos, Mark Shuttleworth, Mikhail Gorbachev, multiplanetary species, Norman Mailer, Richard Feynman, Richard Feynman, Ronald Reagan, Search for Extraterrestrial Intelligence, Silicon Valley, Skype, Steve Jobs, Steve Wozniak, technoutopianism, V2 rocket, X Prize, young professional

Preparing this civilian for space was as much a learning experience for NASA as the flight preparation was for Walker. One of the lessons learned from his own training, according to Walker, "was that those guys actually can be trained in just a few months' time ... and become a good, acceptable working complement to a crew." The need to define appropriate flight training for civilians was driven home on 27 August 1984, just three days before Walker's first trip into space, when President Ronald Reagan announced, "I am directing NASA to begin a search in all of our elementary and secondary schools and to choose as the first citizen passenger in the history of our space program one of America's finest: a teacher." NASA'S motivation to send civilians to space came as an outgrowth of an explosion of public interest in the space program, thanks to the shuttle. Its main purpose was to maintain and build that interest.

"At this time Life magazine was working on an article speculating about what private citizen would be selected. They already had a layout that included photographs of movie stars." Ladwig, who was sworn to secrecy, phoned the magazine and informed them as carefully as he could that it might not be a movie star flying on the shuttle but a more ordinary citizen, maybe even a teacher. The message got through, and the photograph of a teacher appeared with the article. President Ronald Reagan made the announcement on 27 August 1984 that a teacher would travel on the shuttle. Within days of Reagan's announcement, teachers began writing to inquire and volunteer. "Look no further; I'm the one," was the most frequent statement in the letters. Astronaut David Leestma would later describe 1985 as the "hoo-ha, `Let's go fly' year," as if the groundwork had been laid and NASA could now pull out all the stops.

Ladwig felt a sense of relief. Now that NASAS first citizen in space was a reality, full attention could shift to the second. With four months of required training, and a planned September launch, the pace was about to pick up. Discussion had no sooner resumed in the meeting then a second interruption brought the terrible news that the Challenger and its crew were lost in an explosion. That night, President Ronald Reagan had planned to laud the Teacher in Space program during his State of the Union address, saying, "Tonight while I am speaking to you, a young secondary school teacher from Concord, New Hampshire, is taking us all on the ultimate field trip, as she orbits the earth as the first citizen passenger on the Space Shuttle." Within hours of the tragedy, however, a different scenario unfolded. Reagan addressed a shocked nation, consoling it for its loss and reassuring it that "there would be more shuttle flights and more shuttle crews and, yes, more volunteers, more civilians, more teachers in space.


pages: 385 words: 111,807

A Pelican Introduction Economics: A User's Guide by Ha-Joon Chang

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Affordable Care Act / Obamacare, Albert Einstein, Asian financial crisis, asset-backed security, bank run, banking crisis, banks create money, Berlin Wall, bilateral investment treaty, borderless world, Bretton Woods, British Empire, call centre, capital controls, central bank independence, collateralized debt obligation, colonial rule, Corn Laws, corporate governance, corporate raider, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, David Ricardo: comparative advantage, deindustrialization, discovery of the americas, Eugene Fama: efficient market hypothesis, eurozone crisis, experimental economics, Fall of the Berlin Wall, falling living standards, financial deregulation, financial innovation, Francis Fukuyama: the end of history, Frederick Winslow Taylor, full employment, George Akerlof, Gini coefficient, global value chain, Goldman Sachs: Vampire Squid, Gordon Gekko, greed is good, Gunnar Myrdal, Haber-Bosch Process, happiness index / gross national happiness, high net worth, income inequality, income per capita, information asymmetry, intangible asset, interchangeable parts, interest rate swap, inventory management, invisible hand, Isaac Newton, James Watt: steam engine, Johann Wolfgang von Goethe, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Maynard Keynes: technological unemployment, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, knowledge economy, laissez-faire capitalism, land reform, liberation theology, manufacturing employment, Mark Zuckerberg, market clearing, market fundamentalism, Martin Wolf, means of production, Mexican peso crisis / tequila crisis, Northern Rock, obamacare, offshore financial centre, oil shock, open borders, Pareto efficiency, Paul Samuelson, post-industrial society, precariat, principal–agent problem, profit maximization, profit motive, purchasing power parity, quantitative easing, road to serfdom, Robert Shiller, Robert Shiller, Ronald Coase, Ronald Reagan, savings glut, Scramble for Africa, shareholder value, Silicon Valley, Simon Kuznets, sovereign wealth fund, spinning jenny, structural adjustment programs, The Great Moderation, The Market for Lemons, The Spirit Level, The Wealth of Nations by Adam Smith, Thorstein Veblen, trade liberalization, transaction costs, transfer pricing, trickle-down economics, Vilfredo Pareto, Washington Consensus, working-age population, World Values Survey

During the recession, a huge chunk of British manufacturing industry, which had already been suffering from declining competitiveness, was destroyed. Many traditional industrial centres (such as Manchester, Liverpool and Sheffield) and mining areas (North England and Wales) were devastated, as depicted in movies such as Brassed Off (about coal miners in Grimley, a thinly disguised version of Yorkshire coal town Grimethorpe). The actor: Ronald Reagan and the re-making of the US economy Ronald Reagan, the former actor and a former governor of California, became the US president in 1981 and outdid Margaret Thatcher. The Reagan government aggressively cut the higher income tax rates, explaining that these cuts would give the rich greater incentives to invest and create wealth, as they could keep more of the fruits of their investments. Once they created more wealth, it was argued, the rich would spend more, creating more jobs and incomes for everyone else; this is known as the trickle-down theory.

PAGANO Work and Welfare in Economic Theory (Oxford: Blackwell, 1985). G. STANDING The Precariat: The New Dangerous Class (London: Bloomsbury Academic, 2011). J. TREVITHICK Involuntary Unemployment: Macroeconomics from a Keynesian Point of View (New York and London: Harvester Wheatsheaf, 1992). ‘Government exists to protect us from each other. Where government has gone beyond its limits is in deciding to protect us from ourselves.’ RONALD REAGAN ‘The proof that the state is a creation of nature and prior to the individual is that the individual, when isolated, is not self-sufficing; and therefore he is like a part in relation to the whole.’ ARISTOTLE The State and Economics Political economy: a more ‘honest’ name? In the old days, no country had a Ministry of Defence. They all had a Ministry of War because, well, war is what it really does.

However, the philosopher Robert Nozick, the economist James Buchanan, the winner of the 1986 Nobel Prize in Economics, and other modern advocates of contractarianism have developed Hobbes’s ideas in a different direction and advanced a political philosophy to justify the minimal state. In this pro-free-market version of contractarianism, more commonly known as libertarianism in the US, Leviathan came to depict the state as a potential monster that needs to be restrained (which is not what Hobbes intended). This view is best summed up in Ronald Reagan’s comment that ‘Government exists to protect us from each other. Where government has gone beyond its limits is in deciding to protect us from ourselves.’ According to the libertarians, any state intervention without the unanimous consent of all individuals in society is illegitimate. Therefore, the only justified actions of the government are things like provision of law and order (especially the protection of property rights), national defence and supply of infrastructure.


pages: 355 words: 92,571

Capitalism: Money, Morals and Markets by John Plender

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activist fund / activist shareholder / activist investor, Andrei Shleifer, asset-backed security, bank run, Berlin Wall, Big bang: deregulation of the City of London, Black Swan, bonus culture, Bretton Woods, business climate, Capital in the Twenty-First Century by Thomas Piketty, central bank independence, collapse of Lehman Brothers, collective bargaining, computer age, Corn Laws, corporate governance, creative destruction, credit crunch, Credit Default Swap, David Ricardo: comparative advantage, deindustrialization, Deng Xiaoping, discovery of the americas, diversification, Eugene Fama: efficient market hypothesis, eurozone crisis, failed state, Fall of the Berlin Wall, fiat currency, financial innovation, financial intermediation, Fractional reserve banking, full employment, God and Mammon, Gordon Gekko, greed is good, Hyman Minsky, income inequality, inflation targeting, information asymmetry, invention of the wheel, invisible hand, Isaac Newton, James Watt: steam engine, Johann Wolfgang von Goethe, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Meriwether, joint-stock company, Joseph Schumpeter, labour market flexibility, liberal capitalism, light touch regulation, London Interbank Offered Rate, London Whale, Long Term Capital Management, manufacturing employment, Mark Zuckerberg, market bubble, market fundamentalism, mass immigration, means of production, Menlo Park, money market fund, moral hazard, moveable type in China, Myron Scholes, Nick Leeson, Northern Rock, Occupy movement, offshore financial centre, paradox of thrift, Paul Samuelson, Plutocrats, plutocrats, price stability, principal–agent problem, profit motive, quantitative easing, railway mania, regulatory arbitrage, Richard Thaler, rising living standards, risk-adjusted returns, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, shareholder value, short selling, Silicon Valley, South Sea Bubble, spice trade, Steve Jobs, technology bubble, The Chicago School, The Great Moderation, the map is not the territory, The Wealth of Nations by Adam Smith, Thorstein Veblen, time value of money, too big to fail, tulip mania, Upton Sinclair, Veblen good, We are the 99%, Wolfgang Streeck, zero-sum game

Nuances may have been lost in the translation, but this embrace of capitalist values by a hardened veteran of the Communist struggle definitively put the big battalions behind the materialist side of the moral argument and appeared to draw down the curtain on the socialist backlash. It is no coincidence that Deng’s conversion broadly coincided with the ascendancy of the Chicago school of economics and the presidency of Ronald Reagan, who oversaw the conclusion of the Cold War. Reagan lauded ‘the magic of the market’. Like Margaret Thatcher in Britain, he ushered in an era of liberalisation and neo-conservatism, policies favoured by economists at the University of Chicago. Other intellectual champions of this ethos included Ayn Rand, mentor of the subsequent chairman of the Federal Reserve Alan Greenspan. Rand, a true inheritor of Mandeville’s shock-and-awe approach to philosophical issues, trumpeted free markets, argued the merits of selfishness in all things, including sexual relations, and called for a radical reduction in the role of the state.

There is, in fact, something curiously Manichean about the way the capitalist political economy works, as the chapters that follow will show. Things that are in themselves a benefit to society – banking, debt, speculation, animal spirits – become damaging when taken to excess. And excess seems to be a recurring feature of economic cycles and of capitalism itself. After the long period of market fundamentalism introduced by Ronald Reagan and Margaret Thatcher, and after the worst recession since the 1930s, people are understandably resentful of huge boardroom pay awards, fat bank bonuses and rising inequality. How far society’s waning tolerance of these excesses will lead to a much more heavily regulated, lower growth form of capitalism turns heavily on these difficult issues about the moral character of money. Certainly money and business have suffered a major setback on the path towards respectability as a result of the great financial crisis that struck in 2008.

When finance becomes increasingly remote from servicing industry and commerce, it is time to watch out. And when it becomes disproportionately large in relation to the economy, it needs to be cut down to size. CHAPTER FIVE SOPHISTERS, ECONOMISTS AND CALCULATORS A striking feature of the Anglo-American approach to capitalism in the two and a half decades before the great financial crisis was a belief in what Ronald Reagan called ‘the magic of the marketplace’. This, the US President declared in a radio address in 1984, would create opportunities for growth and progress, free from the deadweight of government interference. His faith in the unfettered market’s ability to deliver the economic and social goods was underpinned by the best efforts of economists at the University of Chicago. These high priests of capitalism have had a potent influence on the behaviour of the financial community.


pages: 317 words: 100,414

Superforecasting: The Art and Science of Prediction by Philip Tetlock, Dan Gardner

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Affordable Care Act / Obamacare, Any sufficiently advanced technology is indistinguishable from magic, availability heuristic, Black Swan, butterfly effect, cloud computing, cuban missile crisis, Daniel Kahneman / Amos Tversky, desegregation, drone strike, Edward Lorenz: Chaos theory, forward guidance, Freestyle chess, fundamental attribution error, germ theory of disease, hindsight bias, index fund, Jane Jacobs, Jeff Bezos, Kenneth Arrow, Mikhail Gorbachev, Mohammed Bouazizi, Nash equilibrium, Nate Silver, obamacare, pattern recognition, performance metric, Pierre-Simon Laplace, place-making, placebo effect, prediction markets, quantitative easing, random walk, randomized controlled trial, Richard Feynman, Richard Feynman, Richard Thaler, Robert Shiller, Robert Shiller, Ronald Reagan, Saturday Night Live, Silicon Valley, Skype, statistical model, stem cell, Steve Ballmer, Steve Jobs, Steven Pinker, the scientific method, The Signal and the Noise by Nate Silver, The Wisdom of Crowds, Thomas Bayes, Watson beat the top human players on Jeopardy!

The tip-of-your-nose perspective can work wonders but it can also go terribly awry, so if you have the time to think before making a big decision, do so—and be prepared to accept that what seems obviously true now may turn out to be false later. It is hard to argue with advice that feels about as controversial as a fortune-cookie platitude. But tip-of-your-nose illusions are often so convincing that we bypass the advice and go with our gut. Consider a forecast made by Peggy Noonan—the Wall Street Journal columnist and former speechwriter for Ronald Reagan—the day before the presidential election of 2012. It will be a Romney victory, Noonan wrote. Her conclusion was based on the big numbers turning out to Romney rallies. The candidate “looks happy and grateful,” Noonan observed. And someone who attended a campaign stop had told Noonan about “the intensity and joy of the crowd.” Add it up, Noonan concluded, and “the vibrations are right.” It’s easy to mock Noonan’s vibrations.

The long-serving Soviet leader Leonid Brezhnev had died in 1982 and been replaced by a frail old man who soon died and was replaced by another, Konstantin Chernenko, who was also expected to die soon. There was both agreement and disagreement about what would come next. Liberals and conservatives alike largely expected the next Soviet leader to be another stern Communist Party man. But they disagreed on why things would work out that way. Liberal experts were sure that President Ronald Reagan’s hard line was strengthening Kremlin hard-liners, which would bring a neo-Stalinist retrenchment and worsening relations between the superpowers. Experts of a conservative bent thought that the Soviet system had pretty much perfected the art of totalitarian self-reproduction, hence the new boss would be the same as the old boss and the Soviet Union would continue to threaten world peace by supporting insurgencies and invading its neighbors.

Within hours of Chernenko’s death, the Politburo anointed Mikhail Gorbachev, an energetic and charismatic fifty-four-year-old, the next general secretary of the Communist Party of the Soviet Union. Gorbachev changed direction swiftly and sharply. His policies of glasnost (openness) and perestroika (restructuring) liberalized the Soviet Union. Gorbachev also sought to normalize relations with the United States and reverse the arms race. Ronald Reagan responded cautiously, then enthusiastically, and in just a few years the world went from the prospect of nuclear war to a new era in which many people—including the Soviet and American leaders—saw a glimmering chance of eliminating nuclear weapons altogether. Few experts saw this coming. And yet it wasn’t long before most of those who didn’t see it coming grew convinced they knew exactly why it had happened, and what was coming next.


pages: 422 words: 89,770

Death of the Liberal Class by Chris Hedges

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1960s counterculture, Albert Einstein, Berlin Wall, call centre, clean water, collective bargaining, Columbine, corporate governance, deindustrialization, desegregation, Donald Trump, Fall of the Berlin Wall, Henry Ford's grandson gave labor union leader Walter Reuther a tour of the company’s new, automated factory…, hive mind, housing crisis, Howard Zinn, illegal immigration, Jane Jacobs, Jaron Lanier, Lao Tzu, Pearl River Delta, post scarcity, profit motive, Ralph Nader, Ronald Reagan, strikebreaker, the scientific method, The Wisdom of Crowds, Tobin tax, union organizing, Unsafe at Any Speed, Upton Sinclair, WikiLeaks, working poor, Works Progress Administration

Those left in these institutions lack the vision and fortitude to challenge dominant free-market ideologies. They have no ideological alternatives, even as the Democratic Party openly betrays every principle the liberal class claims to espouse: nonprofit health care; an end to our permanent war economy; high-quality, affordable public education; a return of civil liberties; jobs and welfare for the working class. Since the presidency of Ronald Reagan, the corporate state has put the liberal class on a death march. Liberals did not protest the stripping away of the country’s manufacturing base, the dismantling of regulatory agencies, and the destruction of social service programs. Liberals did not decry speculators, who in the seventeenth century would have been hanged, as they hijacked the economy. Liberals retreated into atrophied institutions.

Ticket prices were kept low, and, as in the 1930s, the productions attracted a wide and varied audience. “What happened?” Malpede asked.The Vietnam War finally ended, but the Peace Movement persisted in large numbers through the dirty wars in South America and the growing antinuclear movement. Yet, it became more and more difficult to produce socially conscious, poetic theater. The old dogma of the 1950s reasserted itself: art and politics don’t mix. When Ronald Reagan was elected in 1980, he immediately ordered that NEA grants to small - read leftist - theaters be abolished. Reaganism eroded the public perception that a great democracy deserves great art. “Without government support for funding innovation and the non-commercial, the theater began to institutionalize and to censor itself,” Malpede went on.The growing network of regional theaters became ever more reliant upon planning subscription seasons which would not offend any of their local donors, and the institutional theaters began to function more and more as social clubs for the wealthy and philanthropic.

This may seem obvious, but it is a point that needs to be stressed. The disappearance of the communist movement weakened American liberalism. Because its adherents were now on the left of the political spectrum, instead of at the center, they had less room within which to maneuver.48 In the wake of the witch hunts, networks such as CBS forced employees to sign loyalty oaths. Walt Disney and Ronald Reagan, president of the Screen Actors Guild, cooperated in hounding out artists deemed disloyal. Those who refused to cooperate with the witch hunts or who openly defied HUAC instantly became nonpersons. One such resister was Paul Robeson, who went before the committee in June 1956. A celebrated singer and actor, Robeson, who was a communist sympathizer and vocal supporter of civil rights, was banned from commercial radio and television.


pages: 324 words: 92,805

The Impulse Society: America in the Age of Instant Gratification by Paul Roberts

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2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, 3D printing, accounting loophole / creative accounting, activist fund / activist shareholder / activist investor, Affordable Care Act / Obamacare, American Society of Civil Engineers: Report Card, asset allocation, business process, Cass Sunstein, centre right, choice architecture, collateralized debt obligation, collective bargaining, computerized trading, corporate governance, corporate raider, corporate social responsibility, creative destruction, crony capitalism, David Brooks, delayed gratification, double helix, factory automation, financial deregulation, financial innovation, fixed income, full employment, game design, greed is good, If something cannot go on forever, it will stop - Herbert Stein's Law, impulse control, income inequality, inflation targeting, invisible hand, job automation, John Markoff, Joseph Schumpeter, knowledge worker, late fees, Long Term Capital Management, loss aversion, low skilled workers, mass immigration, new economy, Nicholas Carr, obamacare, Occupy movement, oil shale / tar sands, performance metric, postindustrial economy, profit maximization, Report Card for America’s Infrastructure, reshoring, Richard Thaler, rising living standards, Robert Shiller, Robert Shiller, Rodney Brooks, Ronald Reagan, shareholder value, Silicon Valley, speech recognition, Steve Jobs, technoutopianism, the built environment, The Predators' Ball, the scientific method, The Wealth of Nations by Adam Smith, Thorstein Veblen, too big to fail, total factor productivity, Tyler Cowen: Great Stagnation, Walter Mischel, winner-take-all economy

Pay,” New York Times, June 29, 2013, http://www.nytimes.com/2013/06/30/business/an-unstoppable-climb-in-ceo-pay.htmlpagewanted=all. 12. Diane Stafford, “High CEO Pay Doesn’t Mean High Performance, Report Says,” Kansas City Star, Aug. 28, 2013, http://www.kansascity.com/2013/08/28/4440246/high-ceo-pay-doesnt-mean-high.html. 13. Brian Montopoli, “Ronald Reagan Myth Doesn’t Square with Reality,” CBSNews, Feb. 4, 2011, http://www.cbsnews.com/news/ronald-reagan-myth-doesnt-square-with-reality/. 14. Peter Beinart, “The Republicans’ Reagan Amnesia,” The Daily Beast, Feb. 1, 2010, http://www.thedailybeast.com/articles/2010/02/01/the-republicans-reagan-amnesia.html. 15. Richard W. Fisher, “Ending ‘Too Big to Fail.” 16. Evan Pérez, “First on CNN: Regulator Warned against JPMorgan Charges,” CNN, Jan. 9, 2014, http://www.cnn.com/2014/01/07/politics/jpmorgan-chase-regulators-prosecutors/. 17.

In part, our seesawing mood reflected a string of economic shocks, starting with the rise of competition from Europe and Asia and ending with oil price spikes, and the most severe recessions (in 1974 and again in 1980) since the Great Depression. Almost overnight, our postwar prosperity vanished. Incomes stagnated. Joblessness was epidemic. The confidence we’d enjoyed in American economic dominance had been replaced by the insecurity and unfamiliarity of a more global economy. But our wavering sentiment reflected another, deeper change. In the 1980s, conservative politicians such as Ronald Reagan had embarked on a series of bold new economic and social policies. Where governments since Roosevelt’s New Deal had played a heavy role in the economy, we now shifted to a free-market, or “laissez-faire,” policy that granted the maximum degree of economic freedom for businesses and individuals alike. This return to a more unfettered economic policy (laissez-faire means, literally, “let us do”) marked an abrupt end to decades of government strategy, but it was probably inevitable.

The more we relied on finance, the more we came to share the sector’s new imperative for faster, higher returns. That was clearly the case in the ballooning world of consumer credit, where credit’s guiding logic of immediate rewards and deferred costs became the consumer’s logic as well. But the deeper effects of this “financialization” of the economy were felt elsewhere. For instance, as governments began borrowing more heavily—it was Ronald Reagan, that free-market conservative, who discovered it was easier to finance a budget than balance one—policymakers grew increasingly beholden to the desires and agendas of the debt markets. When President Clinton tried to fulfill a campaign promise for more infrastructure and schools, bond traders, anxious about more government spending causing inflation,5 bid up long-term interest rates, which threatened the housing market and, by extension, Clinton’s chances for a second term.


pages: 378 words: 102,966

Affluenza: The All-Consuming Epidemic by John de Graaf, David Wann, Thomas H Naylor, David Horsey

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big-box store, Community Supported Agriculture, Corrections Corporation of America, Donald Trump, Exxon Valdez, financial independence, Ford paid five dollars a day, full employment, God and Mammon, greed is good, income inequality, informal economy, invisible hand, Isaac Newton, Mark Shuttleworth, McMansion, medical malpractice, new economy, Ralph Nader, Ray Oldenburg, Ronald Reagan, Silicon Valley, Simon Kuznets, single-payer health, The Great Good Place, trade route, upwardly mobile, Yogi Berra, young professional

“They started to feel ‘poor on $100,000 a year’ as the well-known phrase puts it, because they were comparing themselves to the Donald Trumps and the other newly wealthy.” It happened all the way down the income line, Schor says. “Everybody felt worse compared to the role models, those at the top.” By the late ’90s, polls showed that Americans believed they needed $75,000 (for a family of four) to lead a “minimum” middle-class life. I’VE GOT MINE, JACK In the years just after World War II the super-rich sought to conceal their profligacy, but after Ronald Reagan’s first inaugural ball many began to flaunt it again. As economist Robert Frank points out, there’s been a rush on $15,000 purses, $10,000 watches, even $65 million private jets. Twenty million Americans now own big-screen TVs costing at least $2,000 each. Some buy their children $5,000 life-size reproductions of Darth Vader and $18,000 replicas of Range Rovers, $25,000 birthday parties, and million-dollar bar mitzvahs.14 Yachts the size of mansions burst their berths in many a marina.

James Dobson, a child psychologist whose radio program is heard by millions of people, FOF is a mini-empire of conservative family advisers based in Colorado Springs. Its operations are housed in palatial hillside headquarters that might embarrass the Parthenon. Inside, the feel is expensive and dynamic. Tour groups learn about Dobson’s vision for FOF, while the photographs lining the walls establish his connection to past and present Republican stalwarts, including Ronald Reagan and Newt Gingrich. Dozens of neatly dressed men and women respond to hundreds of phone callers every day, counseling them and sending out audiotapes, videotapes, and publications geared to teens, single parents, and other readers. “We get thousands of letters every week,” said Stanton when we first met him at FOF. “People write to us looking for help to hold their marriage together, their family together.”

One fact is simply undeniable: there is no economic system even remotely capable of producing consumer goods as cheaply as the unfettered, deregulated free market. It can, for example (especially with the help of regimes that allow workers little freedom to organize), produce children’s toys so cheaply that they can be shipped halfway around the world and still be given away with two-dollar meals at fast-food restaurants like McDonald’s and Burger King. The deregulation of the American economy, which began in the 1980s under Ronald Reagan, coupled with a precipitous decline in the influence of organized labor, has increased domestic productivity. It delivers the goods, but in a manner far less equitable than before. In contrast to other societies, Americans have long considered theirs a “classless” one, with few citizens who are either very rich or very poor. This notion of a “classless” America has always been suspect. Even in 1981, when all political efforts to counteract or quarantine affluenza were abruptly abandoned, the United States ranked thirteenth among twenty-two leading industrial nations in income equality.1 But today we’re dead last.2 THE OTHER AMERICA The rising tide of American affluence hasn’t lifted all boats, but it has drowned a lot of dreams.

The Ghosts of Berlin: Confronting German History in the Urban Landscape by Brian Ladd

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Albert Einstein, Berlin Wall, Frank Gehry, full employment, New Urbanism, rent control, Ronald Reagan, Ronald Reagan: Tear down this wall, urban planning, urban renewal

A brochure prepared for the Fort Lee auction described the segments of Wall as the perfect way to "decorate the entrance hall of your corporate headquarters, museum, or estate." 4 Some pieces were re-erected as works of artor were they just souvenirs? Others stood as victory monuments or Cold War booty, such as the piece ("hated symbol of, yes, an evil empire") proudly unveiled by former president Ronald Reagan at the dedication of his presidential library.5 It was difficult enough to define the meaning of Wall fragments removed to sites where they stood alone. The idea of leaving pieces on their original site made no sense at all to most Berliners. Proposals to preserve parts of the Wall, and to create a Wall memorial in Berlin, faced organized and unorganized opposition. Every suggestion to preserve one section or another was met with a chorus of objections, particularly from neighbors.

Immediately after the Wall's construction, Berlin represented something of a political embarrassment, a place to avoid, since Western leadersAdenauer of West Germany, Macmillan of Britain, Kennedy of the United Stateswere criticized for their failure to respond to it, and since they could scarcely admit to being relieved at its construction. Before long, however, West Germany and its allies began to exploit the propaganda value of the Wall as a symbol of Communism's failure. 11 By the time of Kennedy's triumphal visit in June of 1963, a pilgrimage to the safely fortified forward post had become a favorite photo opportunity. Every state visitor in Bonn was if possible brought to Berlin to view the infamous Wall. President Ronald Reagan's visit in 1987, for example, sounded the metaphor of mobility and connectedness. He stood before the walled-off Brandenburg Gate and demanded, "Mr. Gorbachev, open this gate. Mr. Gorbachev, tear down this wall." The East could respond in kind: it declared the statements of Western politicians at the Wall to be a provocation showing the necessity and the efficacy of the border fortifications, which they, too, proudly displayed to guestsat least to carefully selected ones.

Courtesy of German Information Center. inaccessible, and could only be seen from a dead-end street in the middle of the Tiergarten. Nevertheless, tourist buses regularly came by, and state visitors were brought there too. In 1963, when John F. Kennedy came to see it, he found that the East had hung red banners between the columns to block any view beyond the gatea Cold War gesture with more figurative meaning than the East had intended. In 1987, the gate served as the backdrop for Ronald Reagan's speech, with bulletproof glass erected behind the rostrum. (Bill Clinton, in 1994, was the first U. S. President privileged to speak on Pariser Platz, under the heads of the quadriga's horses instead of their posteriors.) Both East and West Berliners claimed the gate as the symbol of their city and of their version of German unity. But it may have been the foreign media from the West that made the gate < previous page page_78 file:///Volumes/My%20Book/arg/ladd-Ghosts_Berlin/files/page_78.html [24/03/2011 13:48:20] next page > page_79 < previous page page_79 next page > Page 79 the preeminent symbol of the less telegenic Berlin Wall.

Pirates and Emperors, Old and New by Chomsky, Noam

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anti-communist, Berlin Wall, collective bargaining, conceptual framework, cuban missile crisis, drone strike, Fall of the Berlin Wall, land reform, liberation theology, Mikhail Gorbachev, RAND corporation, Ronald Reagan, union organizing, urban planning

Box 180165 Chicago, IL 60618 773-583-7884 www.haymarketbooks.org info@haymarketbooks.org ISBN: 978-1-60846-442-5 Trade distribution: In the US, Consortium Book Sales and Distribution, www.cbsd.com All other countries, Publishers Group Worldwide, www.pgw.com This book was published with the generous support of Lannan Foundation and Wallace Action Fund. Cover design by Josh On. Cover photo of the aircraft carrier USS Ronald Reagan on the Pacific Ocean. Photo by U.S. Navy Mass Communication Specialist 3rd Class Dylan McCord. Library of Congress Cataloging-in-Publication data is available. Contents Preface to the 2015 Edition vii Preface to the First Edition xiii Introduction 1 1. Thought Control: The Case of the Middle East 25 2. Middle East Terrorism and the American Ideological System 49 3. Libya in U.S.

There is agonized debate in the media over whether it is proper to permit the pirates and thieves to express their demands and perceptions. NBC, for example, was bitterly condemned for running an interview with the man accused of planning the Achille Lauro hijacking, thus serving the interests of terrorists by allowing them free expression without rebuttal, a shameful departure from the uniformity demanded in a properly functioning free society. Should the media permit Ronald Reagan, George Shultz, Menachem Begin, Shimon Peres, and other voices of the emperor and his court to speak without rebuttal, advocating “low-intensity warfare” and “retaliation” or “preemption”? Are they thereby permitting terrorist commanders free expression, thus serving as agents of wholesale terrorism? The question cannot be asked, and if raised, could only be dismissed with distaste or horror.

“Operation Peace for Galilee—the Israeli invasion of Lebanon—was originally undertaken” to protect the civilian population from Palestinian gunners, Friedman reports in one of the numerous human interest stories on the travail of the suffering Israelis. Political figures regularly expound the same doctrine. Zbigniew Brzezinski writes that “the increased Syrian military presence and the use of Lebanon by the Palestine Liberation Organization for incursions against Israel precipitated the Israeli invasion [of 1982],” and Ronald Reagan, in a yet another display of moral cowardice, asks us to “remember that when [the invasion] all started, Israel, because of the violations of its own northern border by the Palestinians, the P.L.O., had gone all the way to Beirut,” where it was “10,000 Palestinians [!] who had been bringing ruin down on Beirut,” not the bombers whom he was supporting.45 These and innumerable other accounts, many with vivid descriptions of the torment of the people of the Galilee subjected to random Katyusha bombardment, help create the approved picture of Soviet-armed Palestinian fanatics, a central component of the Russian-based international terror network, who compel Israel to invade and strike Palestinian refugee camps and other targets, as any state would do, to defend its people from merciless terrorist attack.


pages: 354 words: 92,470

Grave New World: The End of Globalization, the Return of History by Stephen D. King

9 dash line, Admiral Zheng, air freight, Albert Einstein, Asian financial crisis, bank run, banking crisis, barriers to entry, Berlin Wall, Bernie Sanders, bilateral investment treaty, bitcoin, blockchain, Bonfire of the Vanities, borderless world, Bretton Woods, British Empire, capital controls, Capital in the Twenty-First Century by Thomas Piketty, central bank independence, collateralized debt obligation, colonial rule, corporate governance, credit crunch, currency manipulation / currency intervention, currency peg, David Ricardo: comparative advantage, debt deflation, deindustrialization, Deng Xiaoping, Doha Development Round, Donald Trump, Edward Snowden, eurozone crisis, facts on the ground, failed state, Fall of the Berlin Wall, falling living standards, floating exchange rates, Francis Fukuyama: the end of history, full employment, George Akerlof, global supply chain, global value chain, hydraulic fracturing, Hyman Minsky, imperial preference, income inequality, income per capita, incomplete markets, inflation targeting, information asymmetry, Internet of things, invisible hand, joint-stock company, Long Term Capital Management, Martin Wolf, mass immigration, Mexican peso crisis / tequila crisis, moral hazard, Nixon shock, offshore financial centre, oil shock, old age dependency ratio, paradox of thrift, Peace of Westphalia, Plutocrats, plutocrats, price stability, profit maximization, quantitative easing, race to the bottom, rent-seeking, reserve currency, reshoring, rising living standards, Ronald Reagan, Scramble for Africa, Second Machine Age, Skype, South China Sea, special drawing rights, technology bubble, The Great Moderation, The Market for Lemons, the market place, trade liberalization, trade route, Washington Consensus, WikiLeaks, Yom Kippur War, zero-sum game

It was not, however, until the election of Margaret Thatcher as the UK’s prime minister in 1979 and, a year later, Ronald Reagan’s election as president of the US that things really began to change: no amount of novel economic ideas would be likely to get off the ground without some form of democratic endorsement. Thatcher and Reagan were not just enthusiastic supporters of monetarism. They also, it turned out, shared a deep antipathy towards government. As Reagan put it – in a more memorable way than Hayek ever managed – ‘The nine most terrifying words in the English language are “I’m from the government and I’m here to help”.’5 Even then, the early years were touch and go: in 1981, Ronald Reagan sacked around 13,000 American air traffic controllers who went on strike in violation of the terms of their contracts, while even in her second term in office Margaret Thatcher was engaged in a ferocious battle with Britain’s coal miners.

In this case, behaviours should somehow be judged relative to moral norms established by America’s Founding Fathers and subsequently delivered to the world through the benevolent exercise of American ‘soft power’. Yet the US itself has never offered a vision of moral stability. Notably, it has been unable to show any consistent approach in its foreign policies, especially in the Middle East. In 1983, Donald Rumsfeld, later to become George W. Bush’s hawkish secretary of defense, was sent by Ronald Reagan to ‘initiate a dialogue and establish a personal rapport’ with Saddam Hussein. The aim was to reassure Saddam that Washington ‘would regard any major reversal of Iraq’s fortunes as a strategic defeat for the West’.1 As this conversation came only a handful of years after the US had been selling its nuclear technologies to pre-revolutionary Iran and shortly before it broke its own embargo on selling arms to post-revolutionary Iran, it is no wonder that many in the Middle East struggled to form a positive – let alone consistent – view of US involvement in the region.

Since the mid-1980s, the US has vetoed more UN Security Council Resolutions than the other four permanent members of the Council put together.3 Frankly, given that it has more teeth – economically and militarily – than anyone else, the US does not need to go in search of support from the ‘international community’ to reach decisions that, in many cases, the international community would be powerless to resist. A good example is the 1983 US-led invasion of Grenada which, at the time, led to huge condemnation from the General Assembly of the United Nations. On being asked about the 108 to 9 vote deploring the invasion – intriguingly, a much greater level of opposition than had been offered in response to the Soviet invasion of Afghanistan – Ronald Reagan pithily observed that ‘it didn’t upset my breakfast at all’.4 Then there are the asymmetric extradition arrangements between the US and much of Europe. Even if, say, a UK citizen has broken no UK or European law, he or she can still be extradited to the US to face US justice which, as a UK citizen, might sound completely unjust. Europe’s position, meanwhile, is tainted by its own historical baggage.


pages: 278 words: 82,069

Meltdown: How Greed and Corruption Shattered Our Financial System and How We Can Recover by Katrina Vanden Heuvel, William Greider

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Asian financial crisis, banking crisis, Bretton Woods, capital controls, carried interest, central bank independence, centre right, collateralized debt obligation, conceptual framework, corporate governance, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, declining real wages, deindustrialization, Exxon Valdez, falling living standards, financial deregulation, financial innovation, Financial Instability Hypothesis, fixed income, floating exchange rates, full employment, housing crisis, Howard Zinn, Hyman Minsky, income inequality, information asymmetry, John Meriwether, kremlinology, Long Term Capital Management, margin call, market bubble, market fundamentalism, McMansion, money market fund, mortgage debt, Naomi Klein, new economy, offshore financial centre, payday loans, pets.com, Plutocrats, plutocrats, Ponzi scheme, price stability, pushing on a string, race to the bottom, Ralph Nader, rent control, Robert Shiller, Robert Shiller, Ronald Reagan, savings glut, sovereign wealth fund, structural adjustment programs, The Great Moderation, too big to fail, trade liberalization, transcontinental railway, trickle-down economics, union organizing, wage slave, Washington Consensus, women in the workforce, working poor, Y2K

Until recently American politics remained mired in the cultural controversies passed down from the late sixties, with right-wing populists forever reminding “normal Americans” of the hideous world that the “establishment” had built, a place where blasphemous intellectuals violated the principles of Americanism at every opportunity, a place of crime in the streets, of unimaginable cultural depravity, of epidemic disrespect for the men in uniform, of secular humanists scheming to undermine family values and give away the Panama Canal, of judges gone soft on crime and politicians gone soft on communism. The thirty-year backlash brought us Ronald Reagan’s rollback of government power as well as Newt Gingrich’s outright shutdown of 1995. But for all its accomplishments, it never constituted a thorough endorsement of the free market or of laissez-faire politics. Barbara Ehrenreich, one of its most astute chroniclers, points out that the backlash always hinged on a particular appeal to working-class voters, some of whom were roped into the Republican coalition with talk of patriotism, culture war and family values.

Most of these writers properly feel that the crash was caused by a combination of all or most of these influences: deregulation to the point of anarchy; a towering secrecy that conceals the financial world from ordinary investors; greed that distorts capitalism and the character of those who administer it; a justice system that Wall Street malefactors know they need not fear; and, to personalize the problem, we are offered Alan Greenspan and his fellow conspirators, chief of whom were Clinton and his Treasury Secretary, Robert Rubin, who was a top exec at Goldman Sachs before joining Clinton’s Cabinet and a top exec at Citigroup after leaving it. In Lowenstein’s opinion, Clinton was, except for Ronald Reagan, “the most market-oriented president since the Roaring Twenties.” If the crash proved anything, it was that crime pays. Sufficient tax credits were claimed to offset the measly $1.4 billion fine that J. P. Morgan, Morgan Stanley, Merrill Lynch, Credit Suisse First Boston, Citigroup, Goldman Sachs and four others agreed to fork over for misdeeds that, as Stiglitz says, “put most acts of political crookedness to shame. ...

Treasury proposes to spend $700 billion to buy mortgage-backed securities, accountable to no one. Paulson asks for trust. But has he earned it? Remember, he started out in office gutting the Sarbanes-Oxley Act; he tried to cripple the SEC and recently relied on Morgan Stanley—not a disinterested party—for advice on the nationalization of Fannie Mae and Freddie Mac. Therefore “trust but verify,” as Ronald Reagan would (and did) say. Congress must impose conditions to protect the public, the national interest and, not least, the interests of the next administration. Herewith a short list: 1. Disclosure clause. Treasury should have immediate and complete access to information about portfolios, counterpar-ties, the internal valuation methods used by financial firms, their proprietary models and the history of adjustments made to those models to recognize or conceal losses as the crisis unfolded. 2.


pages: 306 words: 78,893

After the New Economy: The Binge . . . And the Hangover That Won't Go Away by Doug Henwood

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accounting loophole / creative accounting, affirmative action, Asian financial crisis, barriers to entry, borderless world, Branko Milanovic, Bretton Woods, capital controls, corporate governance, corporate raider, correlation coefficient, credit crunch, deindustrialization, dematerialisation, deskilling, ending welfare as we know it, feminist movement, full employment, gender pay gap, George Gilder, glass ceiling, Gordon Gekko, greed is good, half of the world's population has never made a phone call, income inequality, indoor plumbing, intangible asset, Internet Archive, job satisfaction, joint-stock company, Kevin Kelly, labor-force participation, liquidationism / Banker’s doctrine / the Treasury view, manufacturing employment, means of production, minimum wage unemployment, Naomi Klein, new economy, occupational segregation, pets.com, profit maximization, purchasing power parity, race to the bottom, Ralph Nader, Robert Gordon, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, Silicon Valley, Simon Kuznets, statistical model, structural adjustment programs, Telecommunications Act of 1996, telemarketer, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, total factor productivity, union organizing, War on Poverty, women in the workforce, working poor, Y2K, zero-sum game

The next year brought the first post-World War II financial panic, the credit crunch of 1966, and the beginning of the slide in corporate profit rates that lasted into the early 1980s. CEOs and journalists should note the bibUcal correlation of pride and imminent falls. The Gildered Age Speaking of scripture, you can actually push the birth of the most recent New Era back a little farther than ShiUer did. Baffler editor Tom Frank (personal communication) says that the earUest claim he could find for the existence of a "new economy" was a 1988 speech by Ronald Reagan at Moscow State University. In it, Reagan said: In the new economy, human invention increasingly makes physical resources obsolete. We're breaking through the material conditions of existence to a world where man creates his own destiny. Even as we explore the most advanced reaches of science, we're returning to the age-old wisdom of our culture, a wisdom contained in the book of Genesis in the Bible: In Novelty the beginning was the spirit, and it was from this spirit that the material abundance of creation issued forth.

In the 1980s, real incomes at the middle and lower levels were heading down; in the late 1990s, they were heading up—not as rapidly as those in the upper brackets, but probably enough to soothe. A more cynical interpretation of the disappearance of inequaUty as a poHtical issue is that Hberal pundits became a lot less interested in the problem when there was a Democrat in the White House; it was a lot easier to blame Ronald Reagan than it would be to blame the structural workings of American capitalism. With a RepubUcan back in power, we're hearing a bit more about polarization, but only wimps obsess about inequaUty when there's a fifty-year war against terror to fight. Why should anyone care about income inequahty? Certainly the irrepressible Sylvia Nasar (1999) of the New York Times —a rare journalist with formal economics training—has no problem with it.

Keynes's goal, the euthanasia of the rentier, had been largely achieved. This nice world came apart in the 1970s. Stocks had their worst decade since the 1930s, and bonds performed miserably, failing even to keep up with inflation. As we saw earHer in the chapter, to the ruHng classes, things were wildly out of whack, with American workers acting insolent and the Third World in rebeUion. Subduing the Third World was left to Ronald Reagan and the contras, but Wall Street declared war on the workers' insolence—and in this case, corporate managers were a special kind of worker that also needed to be subdued. To accompHsh that subduing, WaU Street has tried several strategies over the last two decades. First was the wave of hostile takeovers and leveraged buyouts that dominated the financial landscape of the 1980s. Underperforming companies—those generating insufficient profits to satisfy shareholders—^were taken over, either by allegedly more competent rivals or by corporate raiders (or, as Alan Greenspan dubbed them at the time, "unaffiliated corporate restructurers"), or they were taken private by a management team in partnership with outside investors using lots of borrowed money.


pages: 293 words: 74,709

Bomb Scare by Joseph Cirincione

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Albert Einstein, cuban missile crisis, Dissolution of the Soviet Union, energy security, Ernest Rutherford, Mahatma Gandhi, Mikhail Gorbachev, Ronald Reagan, uranium enrichment, Yogi Berra

The secret smuggling operations he started to acquire machinery for this effort later formed the basis of his global nuclear black market that provided equipment to Iran, Libya, North Korea and perhaps other nations beginning in the 1980s. (More information on AQ Khan can be found in Chapter 4.) THE TWO RONALD REAGANS After almost two decades of arms limitation agreements and an overall increase in global nuclear arsenals the pendulum swung back with the inauguration of Ronald Reagan as president in 1981. Treaties were out, and talk of preparing to fight and win a global thermonuclear war was in. Richard Perle, then assistant secretary of defense for international security policy, told Newsweek in 1983, “Democracies will not sacrifice to protect their security in the absence of a sense of danger, and every time we create the impression that we and the Soviets are cooperating and moderating the competition, we diminish the sense of apprehension.”40 President Reagan began programs to increase U.S. nuclear and conventional military power, including production of the MX missile (a new ten-warhead intercontinental ballistics missile), the B-1 intercontinental strategic bomber, additional Trident ballistic missile submarines, and, most famously, the elaborate anti-missile program knows as the Strategic Defense Initiative, or “Star Wars.”

He also negotiated the first strategic treaty that actually reduced (rather than limited) deployed strategic nuclear forces. The Strategic Arms Reduction Treaty (START) cut both U.S. and Soviet-deployed strategic nuclear forces down to an agreed limit of 6,000 warheads each. Today, defenders of both Reagan’s first- and second-term policies insist the buildup was necessary to encourage Soviet reform and to reach real arms reduction agreements. “It was Ronald Reagan, by his arms buildup and his inability to contemplate anything but an American victory,” says Irving Kristol, “that persuaded the Soviet leaders they were fighting a losing war. And so they folded their tents and stole away.”44 Not so, says Anatoly Dobrynin, longtime Soviet ambassador to the United States. “The impact of Reagan’s hard-line policy on the internal debates in the Kremlin and on the evolution of the Soviet leadership was exactly the opposite from the one intended by Washington,” he says.

President Jimmy Carter in 1977 planned to withdraw almost all U.S. forces and nuclear weapons from Korea, and the South Koreans once again rattled their nuclear weapons program. Their primary goal, according to Reiss, was not actually to develop their own weapons, which would have led to a cutoff of the nuclear technology trade necessary for its burgeoning civilian nuclear power program, but “to use the threat of an ROK nuclear arsenal in order to persuade Washington to maintain it conventional and nuclear forces in the South.”26 When President Ronald Reagan won election in 1980, he assured the South Korean president that the United States would not withdraw any forces. Whether the U.S. assurances helped stop the South Korean program or the South Korean program helped keep the U.S. assurances is a bit unclear, but the outcome satisfied both nations. There is one final footnote to this story. New inspection authority granted to the IAEA helped uncover secret experiments South Korean scientists had conducted in the 1970s and 1980s and as recently as 2000.


pages: 322 words: 77,341

I.O.U.: Why Everyone Owes Everyone and No One Can Pay by John Lanchester

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asset-backed security, bank run, banking crisis, Berlin Wall, Bernie Madoff, Big bang: deregulation of the City of London, Black-Scholes formula, Celtic Tiger, collateralized debt obligation, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, Daniel Kahneman / Amos Tversky, diversified portfolio, double entry bookkeeping, Exxon Valdez, Fall of the Berlin Wall, financial deregulation, financial innovation, fixed income, George Akerlof, greed is good, hindsight bias, housing crisis, Hyman Minsky, intangible asset, interest rate swap, invisible hand, Jane Jacobs, John Maynard Keynes: Economic Possibilities for our Grandchildren, John Meriwether, laissez-faire capitalism, light touch regulation, liquidity trap, Long Term Capital Management, loss aversion, Martin Wolf, money market fund, mortgage debt, mortgage tax deduction, mutually assured destruction, Myron Scholes, negative equity, new economy, Nick Leeson, Norman Mailer, Northern Rock, Own Your Own Home, Ponzi scheme, quantitative easing, reserve currency, Right to Buy, risk-adjusted returns, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, South Sea Bubble, statistical model, The Great Moderation, the payments system, too big to fail, tulip mania, value at risk

Instead of being a special case, the unbridled and unregulated operation of the free market became the new normal. It wasn’t so much that this version of capitalism won the argument as that it won by sheer force: countries which had adopted it were growing their economies faster than those that weren’t. You can’t accurately measure subjective changes in the texture of people’s experiences, but you can measure growth in GDP, and the evidence from GDP was irrefutable. With Ronald Reagan in power in the United States and Margaret Thatcher in power in the United Kingdom, a Hong Kongite version of free-market capitalism took over the world. I couldn’t go home again, but in some important respects it made no difference, because home was coming to me. The version of capitalism which spread so thoroughly around the world had its ideological underpinnings from Adam Smith, via Friedrich von Hayek and Milton Friedman, and tended to act as if there were a fundamental connection between capitalism and democracy.

The collectivist tradition in Iceland is so strong that it is more like a fact of national character than like an ideology—and this doesn’t seem inappropriate in a country very aware of its isolation, its history as a Viking settlement, and the always-apparent inhospitability of the geography and climate. In the 1980s, however, the Independence Party, which had been more or less permanently in power since Iceland became independent from Denmark, began to adopt a more ideological turn. Its younger and more energetic politicians looked admiringly at the free-market policies being adopted by Ronald Reagan and Margaret Thatcher and began to wonder what Iceland might be capable of if it were freed from the current model of nationalization and regulation. A long march toward the free market began, and in 2001 the banks were privatized, a policy which was a triumphant success—until it turned into a total disaster. That’s how fast, and how completely, things can go wrong for a society if its banks go bad.

Congress’s House Committee on Oversight and Government Reform on October 23, 2008, and spoke about “a once-in-a-century credit tsunami” based on a “whole intellectual edifice” which had now collapsed. That’s an amazing admission for Greenspan to have made, given that he more than anyone else was in charge of the monetary policies behind both the long boom and the abrupt bust. He had charge of the Federal Reserve under four presidents, from Ronald Reagan, who appointed him in 1987, to the second President Bush, whom he served until his retirement in 2006, and during that time he oversaw the response to several crises, from the crash of October 1987 (during which share prices fell 20 percent in a single day) through the recession of 1991, the implosion of LTCM in 1998, and the dot-com bust of 2001. For most of this time, Greenspan’s militant advocacy of deregulation and laissez-faire capitalism seemed to be an effective intellectual underpinning of his policies.


pages: 302 words: 74,878

A Curious Mind: The Secret to a Bigger Life by Brian Grazer, Charles Fishman

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4chan, Airbnb, Albert Einstein, Apple II, Asperger Syndrome, Bonfire of the Vanities, en.wikipedia.org, game design, Google Chrome, Howard Zinn, Isaac Newton, Jeff Bezos, Kickstarter, Norman Mailer, out of africa, RAND corporation, Ronald Reagan, Silicon Valley, stem cell, Steve Jobs, Steve Wozniak, the scientific method, Tim Cook: Apple

He became director of the nation’s premier nuclear weapons research facility, Lawrence Livermore Laboratory in California. He was more than just brilliant, he was a vigorous advocate of a strong defense, and passionate about the importance of nuclear weapons to that defense. By the time I was working as a movie producer, Teller was in his seventies, but he had found a fresh role advocating for and helping to design President Ronald Reagan’s controversial Star Wars missile defense shield, formally called the Strategic Defense Initiative. Teller was a cantankerous, difficult personality—he was widely rumored to be the inspiration for the title character “Dr. Strangelove” in Stanley Kubrick’s 1964 movie. I wanted to meet him simply because I wanted to understand the personality of someone who could be passionate about inventing the most destructive weapon in the history of humanity.

Mullany: former special agent for the FBI, pioneered FBI’s offender profiling Kary Mullis: biochemist, Nobel laureate in chemistry for his work with DNA Takashi Murakami: artist, painter, sculptor Blake Mycoskie: entrepreneur, philanthropist, founder and chief shoe giver of TOMS shoes Nathan Myhrvold: former chief technology officer at Microsoft Ed Needham: former managing editor of Rolling Stone and editor in chief of Maxim Sara Nelson: cofounder of the public interest law firm Christic Institute Benjamin Netanyahu: prime minister of Israel Jack Newfield: journalist, author, former columnist for the Village Voice Nobuyuki “Nobu” Matsuhisa: chef and restaurateur Peggy Noonan: speechwriter and special assistant to President Ronald Reagan, author, columnist for the Wall Street Journal Anthony Norvell: expert on metaphysics, author Barack Obama: president of the United States, former U.S. senator from Illinois ODB: musician, music producer, founding member of Wu-Tang Clan Richard Oldenburg: former director of the Museum of Modern Art, New York City Mary-Kate and Ashley Olsen: actresses, fashion designers Olu Dara & Jim Dickinson: musicians, record producers Estevan Oriol: photographer whose work often depicts Los Angeles urban and gang culture Lawrence Osborne: journalist, author of American Normal: The Hidden World of Asperger Syndrome Manny Pacquiao: professional boxer, first eight-division world champion David Pagel: art critic, author, curator, professor of art history at Claremont College specializing in contemporary art Anthony Pellicano: high-profile private investigator in Los Angeles Robert Pelton: conflict-zone journalist, author of The World’s Most Dangerous Places books Andy Pemberton: former editor in chief of Blender magazine David Petraeus: director of the CIA, 2011–2012, retired four-star U.S.

Army general Ned Preble: former executive, Synectics creative problem-solving methodology Ilya Prigogine: chemist, professor at the University of Texas at Austin, Nobel laureate in chemistry, author of The End of Certainty: Time, Chaos, and the New Laws of Nature Prince: musician, music producer, actor Wolfgang Puck: chef, restaurateur, entrepreneur Pussy Riot: Maria Alyokhina and Nadezhda Tolokonnikova, the two members of the Russian feminist punk rock group who served time in prison Steven Quartz: philosopher, professor at California Institute of Technology, specializing in the brain’s value systems and how they interact with culture James Quinlivan: analyst at the RAND Corporation, specializing in introducing change and technology into large organizations William C. Rader: psychiatrist, administers stem cell injections for a variety of illnesses Jason Randal: magician, mentalist Ronald Reagan: president of the United States, 1981–1989 Sumner Redstone: media magnate, businessman, chairman of CBS, chairman of Viacom Judith Regan: editor, book publisher Eddie Rehfeldt: executive creative director for the communications firm Waggener Edstrom David Remnick: journalist, author, editor of the New Yorker, winner of the Pulitzer Prize David Rhodes: president of CBS News, former vice president of news for Fox News Matthieu Ricard: Buddhist monk, photographer, author of Happiness: A Guide to Developing Life’s Most Important Skill Condoleezza Rice: U.S. secretary of state, 2005–2009, former U.S. national security advisor, former provost at Stanford University, professor of political economy at the Stanford Graduate School of Business Frank Rich: journalist, author, former columnist for the New York Times, editor at large for New York magazine Michael Rinder: activist and former senior executive for the Church of Scientology International Richard Riordan: mayor of Los Angeles, 1993–2001, businessman Tony Robbins: life coach, author, motivational speaker Robert Wilson and Richard Hutton: criminal defense attorneys Brian L.

Blindside: How to Anticipate Forcing Events and Wild Cards in Global Politics by Francis Fukuyama

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Asian financial crisis, banking crisis, Berlin Wall, Bretton Woods, British Empire, capital controls, Carmen Reinhart, cognitive bias, cuban missile crisis, energy security, flex fuel, income per capita, informal economy, Intergovernmental Panel on Climate Change (IPCC), invisible hand, John von Neumann, mass immigration, Menlo Park, Mikhail Gorbachev, moral hazard, Norbert Wiener, oil rush, oil shale / tar sands, oil shock, packet switching, RAND corporation, Ray Kurzweil, reserve currency, Ronald Reagan, The Wisdom of Crowds, trade route, Vannevar Bush, Vernor Vinge, Yom Kippur War

National Strategy” (The White House, August 24, 1977) (www.jimmycarterlibrary.org/documents/pddirectives/pd18.pdf). 6. National Security Decision Directive 32, “U.S. National Security Strategy” (The White House, May 20, 1982). A declassified copy is available at (www.fas.org/irp/offdocs/nsdd/nsdd-032.htm). 7. See Kiron K. Skinner, Annelise Anderson, and Martin Anderson, eds., Reagan in His Own Hand: The Writings of Ronald Reagan That Reveal His Revolutionary Vision for America (New York: Free Press, 2001), pp. 30-1; also see my review, “Ronald Reagan on Reaganism,” Orbis (Summer 2001): 475–84. 8. National Intelligence Council, Domestic Stress on the Soviet System, declassified National Intelligence Estimate (Washington, November 18, 1985). 9. Directorate of Intelligence, CIA, “Rising Political Instability under Gorbachev: Understanding the Problem and Prospects for Resolution” (April 1989), memorandum available in Benjamin B.

According to National Security Decision Directive 32, U.S. goals were to “foster, if possible in concert with our allies, restraint in Soviet military spending, discourage Soviet adventurism, and weaken the 2990-7 ch04 berkowitz 7/23/07 12:09 PM Page 33 u.s. intelligence estimates of soviet collapse 33 Soviet alliance system by forcing the USSR to bear the brunt of its economic shortcomings, and to encourage long-term liberalizing and nationalist tendencies within the Soviet Union and allied countries.”6 In the late 1970s, though, before he became president, not even Ronald Reagan was willing to propose that the Soviet Union was on a course to collapse. In his speeches and essays during this period, Reagan was fully prepared to argue that the Soviet Union was evil and that its economy was inefficient and unable to sustain itself indefinitely. But he was not ready to say that it was on a course to collapse or that U.S. policy could accelerate this collapse. Reagan did not make those statements until after he entered office, specifically in his June 1982 address to the British Parliament, and his March 1983 speech to the National Association of Evangelicals.7 If the documentary record is clear, then why do so many people believe that the intelligence community failed to detect the Soviet Union’s social and economic problems in the late 1970s?

This discovery was an important signal that the Soviet Union was already beginning to collapse under the weight of its own economic contradictions. The only question was what the postcollapse environment would look like. When Peter presented these findings to Shell’s board of directors in 1984, the idea that the Soviet Union would soon collapse seemed thoroughly implausible. Although President Ronald Reagan talked incessantly about America’s long-term battle with the Evil Empire, people within Shell (and within the U.S. government) had trouble believing collapse was possible. Even if it was, they did not know what they could do about it. Fortunately, the Shell scenario team had also identified the key indicators that would signal which scenario was unfolding, and over the next eighteen months, all the “collapse” indicators flashed.


pages: 255 words: 75,172

Sleeping Giant: How the New Working Class Will Transform America by Tamara Draut

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affirmative action, Affordable Care Act / Obamacare, always be closing, battle of ideas, big-box store, blue-collar work, collective bargaining, creative destruction, David Brooks, declining real wages, deindustrialization, desegregation, Detroit bankruptcy, Donald Trump, Edward Glaeser, ending welfare as we know it, Ferguson, Missouri, financial deregulation, full employment, immigration reform, income inequality, invisible hand, job satisfaction, knowledge economy, knowledge worker, low skilled workers, mass incarceration, minimum wage unemployment, mortgage tax deduction, new economy, obamacare, occupational segregation, payday loans, pink-collar, Plutocrats, plutocrats, Powell Memorandum, profit motive, race to the bottom, Ralph Nader, rent-seeking, rising living standards, Ronald Reagan, The Bell Curve by Richard Herrnstein and Charles Murray, The Wealth of Nations by Adam Smith, trickle-down economics, union organizing, upwardly mobile, War on Poverty, white flight, women in the workforce, young professional

This freeze would cut the deficit by more than $400 billion over the next decade, bringing this kind of spending—domestic discretionary spending—to its lowest share of our economy since Dwight Eisenhower was president. Let me repeat that. Because of our budget, this share of spending will be at its lowest level since Dwight Eisenhower was president. That level of spending is lower than it was under the last three administrations, and it will be lower than it was under Ronald Reagan. It’s unfair to blame Obama alone for the failure of much-needed labor law reform for a working class on its knees, or for appeasing corporate America with a shrunken budget. The political calculus and ideology displayed by the administration reflected decades of shifting allegiances and power in the country, including the formerly proud “party of labor.” In fact, you, reader, may even be thinking to yourself that unions are some kind of industrial-age relic with no relevance in today’s economy—that they’re dying because they make no sense in today’s tech-rich, global-scale economy.

But progress ground to a halt in the 1980s, with only white women advancing over the next three decades. At the national level, our political debate became increasingly racialized, particularly around the issue of affirmative action. Conservatives successfully recast affirmative action as “reverse discrimination,” and when they secured electoral advantage, they were able to transform this rhetoric into action. Upon winning the presidency, Ronald Reagan quickly knocked the teeth out of federal enforcement, slashing the budget of the EEOC and the office responsible for federal contracting.17 He appointed Clarence Thomas (now a Supreme Court justice) to head the EEOC and ordered a near stoppage to enforcement of the law. Class-action lawsuits by the EEOC, the easiest way to secure remedies for discrimination, dropped from 1,106 in 1975 to just 51 in 1989.18 Today progress has stalled on all fronts.

As companies shipped entire industries overseas and the central cities lost white middle-class residents to the job-exploding suburbs, urban black people found little support or sympathy from our political elites. Laissez-faire, trickle-down economics was gaining prominence and power just as globalization tore through American manufacturing. After the widespread shedding of factories in the urban core, Ronald Reagan made it to the White House, in no small part thanks to his astute use of racial anxiety to win over white working-class voters. Help most assuredly would not be on the way. Patrisse Cullors, one of the three founders of Black Lives Matter, directly experienced the simultaneous havoc created by closing factories and the “war on drugs.” Her father worked for General Motors in Van Nuys, California, a job that made her dad exclaim with pride, “I could build a car from scratch.”


pages: 222 words: 70,132

Move Fast and Break Things: How Facebook, Google, and Amazon Cornered Culture and Undermined Democracy by Jonathan Taplin

1960s counterculture, 3D printing, affirmative action, Affordable Care Act / Obamacare, Airbnb, Amazon Mechanical Turk, American Legislative Exchange Council, Apple's 1984 Super Bowl advert, back-to-the-land, barriers to entry, basic income, battle of ideas, big data - Walmart - Pop Tarts, bitcoin, Brewster Kahle, Buckminster Fuller, Burning Man, Clayton Christensen, commoditize, creative destruction, crony capitalism, crowdsourcing, data is the new oil, David Brooks, David Graeber, don't be evil, Donald Trump, Douglas Engelbart, Douglas Engelbart, Dynabook, Edward Snowden, Elon Musk, equal pay for equal work, Erik Brynjolfsson, future of journalism, future of work, George Akerlof, George Gilder, Google bus, Hacker Ethic, Howard Rheingold, income inequality, informal economy, information asymmetry, information retrieval, Internet Archive, Internet of things, invisible hand, Jaron Lanier, Jeff Bezos, job automation, John Markoff, John Maynard Keynes: technological unemployment, John von Neumann, Joseph Schumpeter, Kevin Kelly, Kickstarter, labor-force participation, life extension, Marc Andreessen, Mark Zuckerberg, Menlo Park, Metcalfe’s law, Mother of all demos, move fast and break things, move fast and break things, natural language processing, Network effects, new economy, Norbert Wiener, offshore financial centre, packet switching, Paul Graham, Peter Thiel, Plutocrats, plutocrats, pre–internet, Ray Kurzweil, recommendation engine, rent-seeking, revision control, Robert Bork, Robert Gordon, Robert Metcalfe, Ronald Reagan, Sand Hill Road, secular stagnation, self-driving car, sharing economy, Silicon Valley, Silicon Valley ideology, smart grid, Snapchat, software is eating the world, Steve Jobs, Stewart Brand, technoutopianism, The Chicago School, The Market for Lemons, Tim Cook: Apple, trade route, transfer pricing, trickle-down economics, Tyler Cowen: Great Stagnation, universal basic income, unpaid internship, We wanted flying cars, instead we got 140 characters, web application, Whole Earth Catalog, winner-take-all economy, women in the workforce, Y Combinator

Rand told individuals that “achievement of your happiness is the only moral purpose of your life.” As recently as the late 1970s these theories were viewed as the crackpot musings of reactionaries. A review of Rand’s essay collection Capitalism: The Unknown Ideal in the New Republic simply referred to Rand as “Top Bee in the communal bonnet, buzzing the loudest and zaniest throughout this all but incredible book.” But since the election of Ronald Reagan, these libertarian principles have won the Washington, DC, battle of ideas. Since then, notions that the state should regulate the free market have been out of favor in both Republican and Democratic administrations. It may be that the Great Recession of 2008 led many to realize that this philosophy is a dead end for both culture and politics, but we seem to be lacking the political and cultural will to direct society onto a new path.

The absence of effective State, and, especially, national, restraint upon unfair money-getting has tended to create a small class of enormously wealthy and economically powerful men, whose chief object is to hold and increase their power. The prime need is to change the conditions which enable these men to accumulate power which it is not for the general welfare that they should hold or exercise. 3. Even though it was Ronald Reagan who created the break with historical antitrust policy, the blame cannot be placed on Republican administrations alone. As Barry Lynn points out, Bill Clinton’s “attitudes towards monopolization were even more favorable than those of Reagan or George H. W. Bush.” And even though Clinton and Gore ran in the 1992 presidential campaign as opponents of media monopolization, Lynn says, “their decision to allow the consolidation of U.S. media companies that had begun under Reagan to continue… cut the number of big firms from more than fifty to six.”

Coppin writes that Charles was attracted to the most far-right—anarchist—factions of the libertarian movement: “He was driven by some deeper urge to smash the one thing left in the world that could discipline him: the government.” He is like a character in Ayn Rand’s Atlas Shrugged. 2. Upon their father’s death, Charles and David started to organize their own political movement. In an indication of how far to the right they were, Charles persuaded David to accept the Libertarian Party’s nomination for vice president so they could run to the right of Ronald Reagan in the presidential election of 1980. Before the existence of Citizens United—the organization that won the 2010 Supreme Court decision allowing unlimited corporate contributions to political action committees—David funneled $2 million into the campaign to finance his own candidacy. The campaign was a total flameout, attracting only 1 percent of the vote. From that point on, Charles, who is the brains in the family and controls Koch Industries with an iron hand, declared he would never support a third party.


pages: 558 words: 168,179

Dark Money: The Hidden History of the Billionaires Behind the Rise of the Radical Right by Jane Mayer

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affirmative action, Affordable Care Act / Obamacare, American Legislative Exchange Council, anti-communist, Bakken shale, bank run, battle of ideas, Berlin Wall, Capital in the Twenty-First Century by Thomas Piketty, carried interest, centre right, clean water, Climategate, Climatic Research Unit, collective bargaining, corporate raider, crony capitalism, David Brooks, desegregation, diversified portfolio, Donald Trump, energy security, estate planning, Fall of the Berlin Wall, George Gilder, housing crisis, hydraulic fracturing, income inequality, Intergovernmental Panel on Climate Change (IPCC), invisible hand, job automation, low skilled workers, mandatory minimum, market fundamentalism, mass incarceration, Mont Pelerin Society, More Guns, Less Crime, Nate Silver, New Journalism, obamacare, Occupy movement, offshore financial centre, oil shale / tar sands, oil shock, Plutocrats, plutocrats, Powell Memorandum, Ralph Nader, Renaissance Technologies, road to serfdom, Ronald Reagan, school choice, school vouchers, The Bell Curve by Richard Herrnstein and Charles Murray, The Chicago School, the scientific method, University of East Anglia, Unsafe at Any Speed, War on Poverty, working poor

They challenged the widely accepted post–World War II consensus that an activist government was a force for public good. Instead, they argued for “limited government,” drastically lower personal and corporate taxes, minimal social services for the needy, and much less oversight of industry, particularly in the environmental arena. They said they were driven by principle, but their positions dovetailed seamlessly with their personal financial interests. By Ronald Reagan’s presidency, their views had begun to gain more traction. For the most part, they were still seen as defining the extreme edge of the right wing, but both the Republican Party and much of the country were trending their way. Conventional wisdom often attributed the rightward march to a public backlash against liberal spending programs. But an additional explanation, less examined, was the impact of this small circle of billionaire donors.

He became not just the group’s financial angel but also the author of its plank on energy policy, which called for the abolition of all government controls. The brothers took an even more audacious step into electoral politics in 1979, when Charles, who preferred to operate behind the scenes, persuaded David, then thirty-nine, to run for public office. The brothers were by then backing the Libertarian Party’s presidential candidate, Ed Clark, who was running against Ronald Reagan from the right. They opposed all limits on campaign donations, so they found a legal way around them. They contrived to make David the vice presidential running mate, and thus according to campaign-finance law he could lavish as much of his personal fortune as he wished on the campaign rather than being limited by the $1,000 donation cap. “David Koch ran in ’80 to go against the campaign-finance rules.

All of which calls into question how in 1990 the Scaife Foundation could justify pressing the Heritage Foundation, of which it was the largest funder, to focus more on conservative social and moral issues and in particular family values. Heritage’s president, Ed Feulner, quickly complied with his donor’s request, hiring William J. Bennett. Soon after, Bennett, an outspoken social conservative who had been the secretary of education under Ronald Reagan and the director of National Drug Control Policy under George H. W. Bush, was appointed Heritage’s new distinguished fellow in cultural policy studies. Lee Edwards, who wrote Heritage’s official history, confirms that the Scaife Foundation “had particularly in mind the disintegration of the family, an issue which became a major Heritage concern.” Bennett also served as a Scaife Foundation director.


pages: 88 words: 22,980

One Way Forward: The Outsider's Guide to Fixing the Republic by Lawrence Lessig

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collapse of Lehman Brothers, crony capitalism, crowdsourcing, en.wikipedia.org, Filter Bubble, jimmy wales, Occupy movement, Ronald Reagan

Put most simply: We as a nation suffered a massive economic crisis; the government intervened in a massive way; that intervention no doubt helped the economy generally, but it also helped a tiny slice of America most. The 1 percent, as the Occupiers would brilliantly frame the meme, had been saved. The 99 percent continued to suffer. And when you think about it like that, the movement had a point. Whether intentional or not, whether planned or accidental, there is something outrageous about a safety net for the rich only. This is not the social justice of John Stuart Mill, or even Ronald Reagan. It is the social justice of the Titanic: Our economy had hit an iceberg. The first class had their lifeboats made ready by the crew; the rest of us were told to swim. This recognition has fueled its own passion. The majority of that passion has come from the Left. Some from the Far Left. Some even from the anarchist Left (or Right, depending on how you classify anarchists). But most of the Occupiers call themselves not Democrats (27.3 percent), but independents (70 percent).

Engaging the President Changing Congress would be a great first step. It is no doubt a necessary step. But we’ve not seen Congress take the lead on fundamental reform since Reconstruction. I don’t have high expectations that Congress will recover its capacity for leadership anytime soon. Instead, it has been presidents who have been the engine of reform in American politics. FDR, Lyndon Johnson, Ronald Reagan—these were the transformational figures of the last century. It thus makes sense to look to the presidency for the leadership that this movement will require. Or maybe it did make sense, until Barack Obama showed us once again that we were Charlie Brown, and reform presidents were Lucy, pulling the football out from under us. No candidate for president in the past half-century made change as central to his campaign as Obama.


pages: 105 words: 18,832

The Collapse of Western Civilization: A View From the Future by Naomi Oreskes, Erik M. Conway

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anti-communist, correlation does not imply causation, creative destruction, en.wikipedia.org, energy transition, Intergovernmental Panel on Climate Change (IPCC), invisible hand, laissez-faire capitalism, market fundamentalism, mass immigration, means of production, oil shale / tar sands, Pierre-Simon Laplace, road to serfdom, Ronald Reagan, stochastic process, the built environment, the market place

In the 1950s and 1960s, the West experienced high overall prosperity, and individual nations developed mixed economies that suited their own national cultures and contexts. Things began to shift in the late 1970s and 1980s, when Western economies stalled and neoliberal ideas attracted world leaders searching for answers to their countries’ declining economic performance, such as Margaret Thatcher in the United Kingdom and Ronald Reagan in the United States. M a r k e t F a i l u r e 43 Friedman became an advisor to President Reagan; in 1991, von Hayek received the Presidential Medal of Freedom from President George H. W. Bush.8 An ironic aspect of this element of our story is that Friedrich von Hayek had great respect and admiration for the scientific enterprise, seeing it as the historical companion to enterprise capitalism.

Rather, government intervention was required: to raise the market price of harmful products, to prohibit those products, or to finance the development of their replacements. the toxic effects of DDt, acid But because neoliberals were rain, the depletion of the ozone so hostile to centralized gov- layer, and climate change were ernment, they had, as Amer- serious problems for which icans used to say, “painted markets did not provide a themselves into a corner.” The spontaneous remedy. American people had been persuaded, in the words of U.S. President Ronald Reagan (r. 1980–1988), that government was “the problem, not the solution.” Citizens slid into passive denial, accepting the contrarian arguments that the science was unsettled. Lack-ing widespread support, government leaders were unable to shift the world economy to a net carbon-neutral energy base. As the world climate began to spin out of control and the implications for market failure became indisput-able, scientists came under attack, blamed for problems they had not caused, but had documented.


pages: 538 words: 147,612

All the Money in the World by Peter W. Bernstein

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Albert Einstein, anti-communist, Berlin Wall, Bill Gates: Altair 8800, call centre, corporate governance, corporate raider, creative destruction, currency peg, David Brooks, Donald Trump, estate planning, family office, financial innovation, George Gilder, high net worth, invisible hand, Irwin Jacobs: Qualcomm, Jeff Bezos, job automation, job-hopping, John Markoff, Long Term Capital Management, Marc Andreessen, Martin Wolf, Maui Hawaii, means of production, mega-rich, Menlo Park, Mikhail Gorbachev, new economy, Norman Mailer, PageRank, Peter Singer: altruism, pez dispenser, popular electronics, Renaissance Technologies, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, Sand Hill Road, school vouchers, Search for Extraterrestrial Intelligence, shareholder value, Silicon Valley, Silicon Valley startup, stem cell, Stephen Hawking, Steve Ballmer, Steve Jobs, Steve Wozniak, the new new thing, Thorstein Veblen, too big to fail, traveling salesman, urban planning, wealth creators, William Shockley: the traitorous eight, women in the workforce

The very richest… Of the richest women on the 400 over the last 25 years, only one (Doris Fisher, cofounder of the Gap with her husband) didn’t inherit her money from a family or spouse. …and the working rich Most of the working women on the 400 are heiresses. But some, like eBay’s Margaret Whitman, Pleasant Rowland (creator of the American Girl doll empire), Oprah Winfrey, and Martha Stewart are self-made. * * * While Ronald Reagan wasn’t solely responsible for the historic economic boom reflected in the Forbes 400, there can be little doubt that he created the environment in which the list took root and flourished. Elected to the presidency in 1980, two years before the list was invented, Reagan was in certain respects a characteristic voice of the corporate fifties: After his movie career faded, he became well-known as a spokesman for General Electric (GE) and as the genial program host for its hit television show, General Electric Theater.

What happened to McNamara as secretary of defense during the 1960s—as American culture was shocked in turn by the assassination of a president, a failed war, and the rise of the counterculture—helped bring this idealization of the corporation to an end. The company man became, in the eyes of many, a soulless automaton. In the aftermath of the Vietnam War, moreover, a frightening inflation ripped through the economy, destroying public faith in the weight and stability of the dollar. As president, Ronald Reagan inherited a nation that had lost its confidence in business. He instinctively knew that the country was not in a mood to restore the corporation to iconic status. Instead, he invoked a simpler era, exalting individual pluck over institutional power. It was the entrepreneur, not the bearer of a famous name or the holder of a corporate title, who represented the true spirit of wealth in America.

Spelling was well-known for opulent gestures both on and off the small screen. The sets of Dynasty were luxuriously furnished, and so was his own home, one of Hollywood’s largest. Once he had a ton of snow5 trucked to his 123-room home so his family could enjoy a white Christmas. When, in 1983, the Federal Communications Commission (FCC), Justice, and Commerce Departments under then president Ronald Reagan decided to rescind the regulations regarding the sale of syndication rights, a move that would hurt the Hollywood studios but help the Big Three TV networks, Wasserman lobbied hard to maintain the status quo. Among other things, he visited6 President Reagan, his former client, in the Oval Office, and the decision was eventually reversed. Not until a decade later were the rules finally changed, giving the syndication rights to the networks.


pages: 401 words: 112,784

Hard Times: The Divisive Toll of the Economic Slump by Tom Clark, Anthony Heath

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Affordable Care Act / Obamacare, British Empire, Carmen Reinhart, credit crunch, Daniel Kahneman / Amos Tversky, debt deflation, deindustrialization, Etonian, eurozone crisis, falling living standards, full employment, Gini coefficient, hiring and firing, income inequality, interest rate swap, invisible hand, John Maynard Keynes: Economic Possibilities for our Grandchildren, Kenneth Rogoff, labour market flexibility, low skilled workers, mortgage debt, new economy, Northern Rock, obamacare, oil shock, Plutocrats, plutocrats, price stability, quantitative easing, Right to Buy, Ronald Reagan, science of happiness, statistical model, The Wealth of Nations by Adam Smith, unconventional monetary instruments, War on Poverty, We are the 99%, women in the workforce, working poor

Thanks to the intervening century of economic growth, the hungry 1930s did not bring the sort of mass starvation witnessed in the hungry 1840s. Whereas in days gone by hard times had been synonymous with famine and early graves, in the United States of the 1930s many went without gasoline rather than bread, and a drop in traffic accidents actually pushed the mortality rate down.37 There was enough ambiguity in the patchy crime data from the era38 for a right-wing romantic like Ronald Reagan to be able to get away with looking back and claiming ‘we had possibly the lowest crime rate in our history at a time when poverty was most widespread’.39 And as the likes of Steinbeck's Joads were making their terrified trek from the Dustbowl to the West, there were those who said that they could not truly be poor because they were driving in trucks. Indeed, in 1931 President Hoover himself told a journalist: ‘Nobody is actually starving … The hobos, for example, are better fed than they have ever been.’40 With average incomes far higher than in the distant past, one would indeed hope that we would be better able to keep destitution and hunger at bay.

But consideration of another (younger) British generation – Gen Xers – using a second tracking survey merely reinforces the results.73 However the calculation is done for this younger cohort, the penalty for having been raised workless is always on a par with, and sometimes greater than, the penalty suffered by the ‘boomer’ generation. The heritability of joblessness, then, is hard to dispute. Unlike many of the maladies we have uncovered, there will be no need to persuade the political Right that this problem exists. Indeed, if anything the tendency is to exaggerate it – to suggest that the poor live in a parallel culture with different norms, something that Ronald Reagan implied when he summoned up the bogeywoman of the ‘Welfare Queen’ during his unsuccessful tilt for the White House in 1976.74 And in the UK of today, Work and Pensions Secretary Iain Duncan Smith has spoken of whole communities in which nobody in three generations has worked. These are overblown and misleading claims.75 They also wrongly imply that there are places so permanently downtrodden and marginalised that hard times can come and go without making much difference.

When that same crisis first deepened in the US, the governor of New York and future president, Franklin Roosevelt, summoned the state legislature not only to demand financial relief for the poor, but also to set out a new philosophical basis for providing it: In broad terms I assert that modern society, acting through its government, owes the definite obligation to prevent the … dire want of any of its fellow men and women who try to maintain themselves but cannot … not as a matter of charity but as a matter of social duty.2 For all Foot's hopes, however, there was to be no return to the spirit of Beveridge, or indeed Roosevelt, in 1979. Instead, Margaret Thatcher swept into Downing Street in the British election of that year, before Foot himself went on to lead the Labour party into oblivion at the ballot boxes in 1983 – the moment that finally buried a post-war settlement founded on that ideal of compassion in the hour of need. Between these two British elections, a third had taken place across the Atlantic and brought Ronald Reagan to power. The drift of the next 30 years is familiar. Of course, there are important and distinct qualifications to be made about particular policies on either side of the ocean, but there is a good deal of truth in the common caricature of the post-1980s age as an era of deregulation, deunionisation and the squeezing, freezing and dismantling of various post-war social protections.3 The programme of the New Right was controversial at every pass; but it won sufficient victories and became sufficiently associated with the perception of prosperity for it to survive, in modified form, after the partisan pendulum finally swung away from its instigators.


pages: 632 words: 159,454

War and Gold: A Five-Hundred-Year History of Empires, Adventures, and Debt by Kwasi Kwarteng

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accounting loophole / creative accounting, anti-communist, Asian financial crisis, asset-backed security, Atahualpa, balance sheet recession, bank run, banking crisis, Big bang: deregulation of the City of London, Bretton Woods, British Empire, California gold rush, capital controls, Carmen Reinhart, central bank independence, centre right, collapse of Lehman Brothers, collateralized debt obligation, credit crunch, currency manipulation / currency intervention, Deng Xiaoping, discovery of the americas, Etonian, eurozone crisis, fiat currency, financial innovation, fixed income, floating exchange rates, Francisco Pizarro, full employment, German hyperinflation, hiring and firing, income inequality, invisible hand, Isaac Newton, John Maynard Keynes: Economic Possibilities for our Grandchildren, joint-stock company, joint-stock limited liability company, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, liberal capitalism, market bubble, money: store of value / unit of account / medium of exchange, moral hazard, new economy, oil shock, Plutocrats, plutocrats, Ponzi scheme, price mechanism, quantitative easing, rolodex, Ronald Reagan, South Sea Bubble, The inhabitant of London could order by telephone, sipping his morning tea in bed, the various products of the whole earth, the market place, The Wealth of Nations by Adam Smith, too big to fail, War on Poverty, Yom Kippur War

M0 was the narrowest definition and just included notes and coins in circulation, while M4, the broadest definition in the British context, included bank and building society deposits. Of course, critics also suggested that monetarism, by squeezing the money supply, constricted economic growth and exacerbated recessions. Similar problems in defining money and in the practical application of monetarist ideas were also encountered in the United States. Ronald Reagan had been elected as the fortieth President of the United States in 1980. Born in Illinois in 1911, Reagan was nearly seventy when he was inaugurated in January 1981. He had a showman’s gift for communication and could win an easy rapport with almost any audience. Intellectually, perhaps as a consequence of his age, he did not pay such close attention to the musings of economists as did Margaret Thatcher.

He was a strong, idealistic budget hawk, who like his master saw government as ‘the problem not the solution’. He hated government spending, and was openly ideological in his support for what he called the ‘Reagan Revolution’. Revolutions, as described by Stockman in his 1987 account The Triumph of Politics, were characterized by ‘drastic, wrenching changes in an established regime’. This was not ‘Ronald Reagan’s real agenda in the first place’. It was Stockman’s mission, however, and ‘that of a small cadre of supply-side intellectuals’. ‘The Reagan Revolution, as I had defined it, required a frontal assault on the American welfare state.’ In Stockman’s radical analysis, ‘forty years’ worth of promises, subventions, entitlements, and safety nets issued by the federal government to every component and stratum of American society would have to be scrapped or drastically modified’.

At 3.6 per cent, inflation was ‘far milder than the double-digit nightmare people remembered from the 1970s’.59 In Britain too, inflation had been tamed. Nigel Lawson could boast that inflation ‘was down to 3.5 per cent in 1986’, a startling change from the 1970s when the inflation rate had hit over 20 per cent.60 Thatcher’s attempts to balance the books were probably more successful than those of Ronald Reagan, although such public-finance figures were flattered by the asset sales known as privatizations. By 1988, Thatcher could boast of a £14 billion projected surplus for the 1988–9 fiscal year,61 though this may have been somewhat misleading as it reflected very buoyant economic conditions. Looking back at the Thatcher era in Britain and the Reagan era in the United States, many people have drawn different conclusions.

Little Failure: A Memoir by Gary Shteyngart

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Albert Einstein, anti-communist, Anton Chekhov, East Village, glass ceiling, Gordon Gekko, greed is good, New Journalism, Ronald Reagan, Yom Kippur War, young professional

Maybe the Hebrew school librarian thought Tubman was Jewish (her moniker was Moses). It’s a tough book because it’s in English, but there are many thrilling pictures of Tubman and her rescued slaves running through the awful Maryland on their way to Canada. And I am so angry at slavery, at this horrible thing, as angry as the people around me are at the blacks, so angry, in fact, that we’ve heard the new president, Ronald Reagan, is really going to give them one “across the neck.” Lying on my army cot, Emmanuelle in the back of my mind, Harriet Tubman out front, I conjure an imaginary friend, a black boy or a girl just fled from Maryland. I am still ecumenical on the subject of gender, so s/he is lying next to me, his/her arms around me, my arms around him/her, and I just say over and over something I picked up on the street, “It’s all going to be okay, Sally, I promise.”

Five years earlier I had written the novel Lenin and His Magical Goose for my grandmother Galya, who is now six years away from a horrible death back in Leningrad. But now I know to avoid anything even remotely Russian. My Flyboy is as Atlantan as apple pie. And his Iarda, while vaguely Israeli sounding (a reference to the Yordan, the River Jordan?), is also a hot, principled taxpayer who can blow a Lopez or a Rodriguez out of the sky as surely as Ronald Reagan will soon joke, “We begin bombing [the Soviet Union] in five minutes.” Bombing Grandma Galya back in Leningrad, he means, and the rest of us Russian liars. I write because there is nothing as joyful as writing, even when the writing is twisted and full of hate, the self-hate that makes writing not only possible but necessary. I hate myself, I hate the people around me, but what I crave is the fulfillment of some ideal.

You are not to become emotionally involved with Boy George or his mother. Allow abortion because what if someone like Jerry Himmelstein is born in such cases it is wise to say the two parents agoofed. And what if a natural disaster like Eedo Kaplan [an Israeli boy who harasses the two Russian girls in school] is born? Think about it. Here are things you should not crossbreed … A long list that includes “Ronald Reagan and Geraldine Ferraro” and ends, sadly, with “Gary Gnu and any Female Gnu” and then the same words with which my father would end all of his Planet of the Yids tales: “To be continued.” Once it is finished I read it over and over again. I cannot sleep. I want to be loved so badly, it verges on mild insanity. The next day in school I wait impatiently until recess, and then unfurl my Gnorah for a few kids, mindful of Rabbi Sofer’s thick presence.


pages: 196 words: 53,627

Let Them In: The Case for Open Borders by Jason L. Riley

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affirmative action, creative destruction, David Ricardo: comparative advantage, declining real wages, deindustrialization, desegregation, guest worker program, hiring and firing, illegal immigration, immigration reform, income inequality, labor-force participation, labour market flexibility, low skilled workers, lump of labour, mass immigration, open borders, RAND corporation, Ronald Reagan, school choice, Silicon Valley, trade liberalization, War on Poverty, working poor, working-age population, zero-sum game

She welcomes them still. She represents our open door. All of the immigrants who came to us brought their own music, literature, customs, and ideas. And the marvelous thing, a thing of which we’re proud, is they did not have to relinquish these things in order to fit in. In fact, what they brought to America became American. And this diversity has more than enriched us; it has literally shaped us.— RONALD REAGAN Someone’s knockin’ at the door, Somebody’s ringin’ the bell. Do me a favor. Open the door, and let ’em in. — PAUL MCCARTNEY INTRODUCTION The magazines and the illustrators are long gone and largely forgotten, but the images endure. Like the 1903 print from Judge, a popular political magazine of the period. It’s titled, “The Immigrant: Is he an Acquisition or a Detriment?” and depicts a hulking, exhausted new arrival to America’s shores.

They go to great lengths to demonstrate that today’s new arrivals are different from yesterday’s, that those coming from Latin America are sui generis, uniquely incapable of assimilation. They cite special circumstances that made the past acculturation of European and Asian immigration possible but render it impossible for Latinos. They view these foreigners as a liability rather than an asset. They want an immigration “time-out.” WHAT WOULD REAGAN DO? If you’re a free-market conservative in the Ronald Reagan tradition, this debate has been doubly depressing because so much of the bellyaching has originated with the political right, where many people have convinced themselves that scapegoating immigrants for America’s economic and social ills—real and imagined—is a winner at the polls. On the topic of immigration, at least, too many conservatives have pocketed their principles and morphed into reactionary Populists.

Nor were Hugh Hewitt, Dennis Prager, Mike Gallagher, Glenn Beck, Bill Bennett, Michael Savage, and other popular radio personalities with millions of listeners. Some of us watched in disbelief as principled conservatives morphed into reactionary populists. These profiles in courage used immigration to declare their independence from Bush at a time when he was highly unpopular. Gee, how brave. Limbaugh and Bennett, who normally worship at the political altar of pro-immigrant Ronald Reagan, were instead urging Republicans to follow in the footsteps of Pete Wilson. Ingraham regularly denounced the Republican “elites” supporting comprehensive immigration reform at the supposed expense of America’s working class. Ingraham, self-styled enemy of “elites,” is a Connecticut-bred, Ivy League-educated, former Supreme Court law clerk. But on immigration, she sounded like Sally Field in Norma Rae.

Imperial Ambitions: Conversations on the Post-9/11 World by Noam Chomsky, David Barsamian

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British Empire, collective bargaining, cuban missile crisis, declining real wages, failed state, feminist movement, Howard Zinn, Intergovernmental Panel on Climate Change (IPCC), invisible hand, Joseph Schumpeter, liberation theology, Monroe Doctrine, offshore financial centre, Ronald Reagan, The Wealth of Nations by Adam Smith, Thomas L Friedman, Upton Sinclair, uranium enrichment, Westphalian system

It’s a picture of the angel of death standing over the archbishop of El Salvador, Oscar Romero, who was assassinated in 1980.1 Romero was assassinated only a few days after he had written a letter to President Jimmy Carter pleading with him not to send aid to the military junta in El Salvador, which would be used to crush people struggling for their elementary human rights.2 The aid was sent, and Romero was assassinated. Then Ronald Reagan took over. The kindest thing you can say about Reagan is that he may not have known what the policies of his administration were, but I’ll pretend he did. The Reagan years were a period of devastation and disaster in El Salvador. Maybe seventy thousand people were slaughtered.3 The decade began with the assassination of the archbishop. It ended, rather symbolically, with the brutal murder of six leading Latin American intellectuals, Jesuit priests, by an elite battalion, trained, armed, and run by the United States, which had a long, bloody trail of murders and massacres behind it.4 The painting shows the priests, along with their housekeeper and her daughter, who were also murdered.

Thomas McCann, the public relations officer of the United Fruit Company, actually wrote an interesting book about this, An American Company, in which he describes the propaganda efforts, led by Edward Bernays, to persuade the public and the press to support the coup. And then he says, “It is difficult to make a convincing case for manipulation of the press when the victims proved so eager for the experience.”26 The cover of the Pakistani writer and activist Eqbal Ahmad’s book Terrorism: Theirs and Ours has a photograph of Ronald Reagan sitting in the White House with a group of mujahideen from Afghanistan. This is not a photograph that is being widely circulated in any of the major media. The Reagan administration was instrumental in supporting the mujahideen, elements of which later morphed into the Taliban and Al Qaeda.27 They went beyond supporting them. They organized them. They collected radical Islamists from around the world—the most violent, crazed elements they could find—and tried to forge them into a military force in Afghanistan.

Not only that but the logic is reversed, so that people here feel they’re the ones who are oppressed. The line of the soldiers who carried out atrocities in Iraq is that the Iraqis did it to us, so we’re going to do it to them. What did the Iraqis do to us? 9/11. Of course, the Iraqis had nothing to do with it, but the feeling still is that we’re the ones under attack; they’re the ones who are attacking us. And that inversion goes on all the time. Take Ronald Reagan and his rhetoric about “welfare queens.” We poor people, like Reagan, are being oppressed by these rich black women who drive up in Cadillacs to get their welfare checks. We’re being oppressed. And in fact that’s a strain that goes right through U.S. history. There’s a book by Bruce Franklin, a literary theorist, that traces this strain through American popular literature, going back to the colonists.

Necessary Illusions by Noam Chomsky

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anti-communist, Ayatollah Khomeini, British Empire, centre right, collective bargaining, colonial rule, cuban missile crisis, full employment, Howard Zinn, Khyber Pass, land reform, long peace, New Journalism, Ronald Reagan, strikebreaker, union organizing

The study of media coverage of conflicts in the Third World mentioned earlier follows a similar pattern, which is quite consistent, though the public regards the media as too conformist.28 The media cheerfully publish condemnations of their “breathtaking lack of balance or even the appearance of fair-mindedness” and “the ills and dangers of today’s wayward press.”29 But only when, as in this case, the critic is condemning the “media elite” for being “in thrall to liberal views of politics and human nature” and for the “evident difficulty most liberals have in using the word dictatorship to describe even the most flagrant dictatorships of the left”; surely one would never find Fidel Castro described as a dictator in the mainstream press, always so soft on Communism and given to self-flagellation.30 Such diatribes are not expected to meet even minimal standards of evidence; this one contains exactly one reference to what conceivably might be a fact, a vague allusion to alleged juggling of statistics by the New York Times “to obscure the decline of interest rates during Ronald Reagan’s first term,” as though the matter had not been fully reported. Charges of this nature are often not unwelcome, first, because response is simple or superfluous; and second, because debate over this issue helps entrench the belief that the media are either independent and objective, with high standards of professional integrity and openness to all reasonable views, or, alternatively, that they are biased towards stylishly leftish flouting of authority.

In earlier years, the United States was defending itself from other evil forces: the Huns, the British, the Spanish, the Mexicans, the Canadian Papists, and the “merciless Indian savages” of the Declaration of Independence. But since the Bolshevik revolution, and particularly in the era of bipolar world power that emerged from the ashes of World War II, a more credible enemy has been the “monolithic and ruthless conspiracy” that seeks to subvert our noble endeavors, in John F. Kennedy’s phrase: Ronald Reagan’s “Evil Empire.” In the early Cold War years, Dean Acheson and Paul Nitze planned to “bludgeon the mass mind of ‘top government,” as Acheson put it with reference to NSC 68. They presented “a frightening portrayal of the Communist threat, in order to overcome public, business, and congressional desires for peace, low taxes, and ‘sound’ fiscal policies” and to mobilize popular support for the full-scale rearmament that they felt was necessary “to overcome Communist ideology and Western economic vulnerability,” William Borden observes in a study of postwar planning.

This is a primary function it has continued to serve as illustrated, for example, by its criminal acts to undermine the rising “crisis of democracy” in the 1960s and the surveillance and disruption of popular opposition to U.S. intervention in Central America twenty years later.15 The effectiveness of the state-corporate propaganda system is illustrated by the fate of May Day, a workers’ holiday throughout the world that originated in response to the judicial murder of several anarchists after the Haymarket affair of May 1886, in a campaign of international solidarity with U.S. workers struggling for an eighthour day. In the United States, all has been forgotten. May Day has become “Law Day,” a jingoist celebration of our “200-year-old partnership between law and liberty” as Ronald Reagan declared while designating May 1 as Law Day 1984, adding that without law there can be only “chaos and disorder.” The day before, he had announced that the United States would disregard the proceedings of the International Court of Justice that later condemned the U.S. government for its “unlawful use of force” and violation of treaties in its attack against Nicaragua. “Law Day” also served as the occasion for Reagan’s declaration of May 1, 1985, announcing an embargo against Nicaragua “in response to the emergency situation created by the Nicaraguan Government’s aggressive activities in Central America,” actually declaring a “national emergency,” since renewed annually, because “the policies and actions of the Government of Nicaragua constitute an unusual and extraordinary threat to the national security and foreign policy of the United States”—all with the approbation of Congress, the media, and the intellectual community generally; or, in some circles, embarrassed silence.


pages: 394 words: 85,734

The Global Minotaur by Yanis Varoufakis, Paul Mason

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active measures, banking crisis, Berlin Wall, Big bang: deregulation of the City of London, Bretton Woods, business climate, capital controls, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, colonial rule, corporate governance, correlation coefficient, creative destruction, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, debt deflation, declining real wages, deindustrialization, endogenous growth, eurozone crisis, financial innovation, first-past-the-post, full employment, Hyman Minsky, industrial robot, Joseph Schumpeter, Kenneth Rogoff, labour market flexibility, light touch regulation, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, market fundamentalism, Mexican peso crisis / tequila crisis, money market fund, mortgage debt, Myron Scholes, negative equity, new economy, Northern Rock, paper trading, Paul Samuelson, planetary scale, post-oil, price stability, quantitative easing, reserve currency, rising living standards, Ronald Reagan, special economic zone, Steve Jobs, structural adjustment programs, systematic trading, too big to fail, trickle-down economics, urban renewal, War on Poverty, Yom Kippur War

In June 1981, Volcker raised interest rates to a lofty 20 per cent, and then again to 21.5 per cent. While his brutal monetary policy did tame inflation (pushing it down from 13.5 per cent in 1981 to 3.2 per cent two years later), its harmful effects on employment and capital accumulation were profound, both domestically and internationally. Nevertheless, the two prerequisites had been met even before Ronald Reagan settled in properly at the White House. A new phase thus began. The United States could now run an increasing trade deficit with impunity, while the new Reagan administration could also finance its hugely expanded defence budget and its gigantic tax cuts for the richest Americans. The 1980s ideology of supply-side economics, the fabled trickle-down effect, the reckless tax cuts, the dominance of greed as a form of virtue, etc. – all these were just manifestations of America’s new ‘exorbitant privilege’: the opportunity to expand its twin deficits almost without limit, courtesy of the capital inflows from the rest of the world.

The problem was, however, deeper and larger. The loss of the private money brought the Global Minotaur to its knees. With it came crashing down the only mechanism the world economy had for recycling its surpluses. The upshot is a Crisis from which no liquidity-pumping by the Fed and the other central banks can help us escape. Toxic theory, Part A: trickle-down politics, supply-side economics When Ronald Reagan entered the White House in 1981, the fledgling Global Minotaur was already in residence, if not in complete control. Within the United States, its handmaidens5 were cradling it, preparing it for the bigger and better things to come. With the twin US deficits gradually expanding, the beast’s imprint on American society and its influence on the world economy were growing by the day. What the Reagan presidency undoubtedly added to the mix was a political and economic ecology that suited the Minotaur down to the ground.

The Global Minotaur could not have hoped for better handmaidens in the White House and the various corridors of power. As the US budget deficit exploded, it accelerated the tsunami of foreign capital that rushed into New York. Eager to buy safe American debt at a time of general uncertainty, the world’s surplus was pouring into the US, allowing Wall Street to create even more private money to fuel even greater consumer spending. The year before Ronald Reagan’s presidential victory, Margaret Thatcher had won office in the UK on a similar political manifesto. The difference was that her government inherited an economy that had been on the decline for almost a century. Moreover, it was a social economy in which the working class had managed, especially after the Second World War, to secure considerable power over economic affairs (both through the establishment of a large welfare state and through the nationalization of large industrial sectors, e.g. coal and steel).

Comedy Writing Secrets by Mel Helitzer, Mark Shatz

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Albert Einstein, Donald Trump, elephant in my pajamas, fear of failure, index card, Ronald Reagan, Saturday Night Live, the scientific method, Yogi Berra

Wit is the salt of conversation, not the meat. The recipe for being a successful after-dinner speaker includes using plenty of shortening. A good speaker is one who rises to the occasion and then promptly sits down. A speech, including introductory material, should never take more than twenty minutes. The normal speaking rate is two and a half words per second, and that means a speech should be a maximum of 3,000 words long. That was Ronald Reagan's favorite time frame, and his motto was that an immortal speech should not be eternal. If you can't write your message in a sentence, you can't say it in an hour. —Dianna Booher Sentences in speeches must be shorter than sentences meant for reading, because the audience members have no chance to reread something they haven't comprehended. The best length for a sentence in a speech is approximately fourteen words.

It must be delivered confidently, and memorizing it encourages a more accurate rendition. Personalize and localize the humor whenever possible, even though many in the audience will know it's fabricated. Humor, as we've already 206 Comedy Writing Secrets noted, permits the audience to set aside disbelief. No one will stand up and challenge you. Use words like "I" and "last week," and mention local names and places. President Ronald Reagan usually began each speech—particularly the less formal ones—with self-deprecating humor. For example, when hundreds of school principals and teachers gathered on the South Lawn of the White House for a recognition ceremony, the president's gag writer gave him a typical Reagan charmer. Y'know, I've been out of school for some time now, but I still get nervous around so many principals. This opener is also a perfect example of using the right joke for the right audience.

Bush, former Texas governor Ann Richards described Bush as having been "born with a silver foot in his mouth." Richards's oft-quoted remark opened the humor floodgates, and Bush was stigmatized as a mixed-up, double-talking politician for his entire losing campaign. John F. Kennedy lambasted Richard Nixon's dark facial make-up by claiming, "Nixon was offered two million dollars by Schick to do a TV commercial for Gillette." Unquestionably, former president Ronald Reagan was the most expert at delivering great lines. Like this triple: Recession is when your neighbor loses his job. Depression is when you lose yours. And recovery is when President Carter loses his. During his campaign against Walter Mondale in 1984, Reagan's humor completely spiked the Democrats' best personal attack—the age issue 218 Comedy Writing Secrets (Reagan was seventy-two years old).

Powers and Prospects by Noam Chomsky

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anti-communist, Berlin Wall, Bretton Woods, colonial rule, declining real wages, deindustrialization, deskilling, Fall of the Berlin Wall, invisible hand, Jacques de Vaucanson, John von Neumann, liberation theology, Monroe Doctrine, old-boy network, RAND corporation, Ronald Reagan, South China Sea, theory of mind, Tobin tax, Turing test

Vietnam was the guilty party according to the standard version, though, admittedly, there is a spectrum. Keeping to high office for illustration, at the dovish extreme we find Jimmy Carter, who explained, in the course of one of his sermons on human rights, that we owe Vietnam no debt, because ‘the destruction was mutual’, as a walk through Quang Ngai province and San Francisco quickly reveals. There was no reaction, apart from margins of the usual margins. At the other extreme, we find Ronald Reagan—or more accurately, those who handed him his note cards—and the Senators who demand that we continue to punish Vietnam for the crimes it committed against us. And in the middle there are the moderates, like George Bush, who explained that ‘Hanoi knows today that we seek only answers without the threat of retribution for the past’. We can never forgive them for what they have done to us, but we are willing to ‘begin writing the last chapter of the Vietnam war’ if they dedicate all their efforts to locating the remains of American pilots who they viciously shot down from the skies.

Similarly, the huge social engineering project that led to the ‘suburbanization of America’, with enormous consequences, relied on extensive state intervention, from the local to national level, along with major corporate crime that received a tap on the wrist in the courts; consumer choices were a slight factor.12 There are fluctuations, to be sure. The statist reactionaries of the Reagan years broke new records in protectionism and public subsidy, boasting about it quite openly to their business audience. Secretary of the Treasury James Baker ‘proudly proclaimed that Mr Ronald Reagan had “granted more import relief to US industry than any of his predecessors in more than half a century”’, international economist Fred Bergsten writes, adding that the Reaganites specialised in ‘the most insidious form of protectionism’: ‘managed trade’ that most ‘restricts trade and closes markets’, and ‘raises prices, reduces competition and reinforces cartel behaviour’. Baker was much too modest.

People would like to do the right thing, but have been drowned in ‘enduring truths’ about our altruism and awesome benevolence, and the ingratitude of a hostile world. For similar reasons, overwhelming majorities support more help for the poor but call for cutting welfare: why spend our hard-earned money for Black mothers in Cadillacs who breed like rabbits to get more welfare cheques? And having been deluged with these and other fairy tales—sometimes related by figures like Ronald Reagan, who may even have believed his famous anecdotes—they also much overestimate the share of the Federal budget that goes to welfare, and are quite unaware that it has fallen radically over the past 20 years from a level that was low to begin with by comparative standards. A similar barrage leads the public to feel crushed by an overwhelming tax burden; only Turkey and Australia are lower, relative to GDP, among the OECD countries (1991).


pages: 124 words: 39,011

Beyond Outrage: Expanded Edition: What Has Gone Wrong With Our Economy and Our Democracy, and How to Fix It by Robert B. Reich

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2013 Report for America's Infrastructure - American Society of Civil Engineers - 19 March 2013, affirmative action, banking crisis, carried interest, collateralized debt obligation, collective bargaining, Credit Default Swap, credit default swaps / collateralized debt obligations, desegregation, full employment, Home mortgage interest deduction, job automation, Mahatma Gandhi, minimum wage unemployment, money market fund, new economy, Occupy movement, offshore financial centre, Plutocrats, plutocrats, Ponzi scheme, race to the bottom, Ronald Reagan, single-payer health, special drawing rights, The Wealth of Nations by Adam Smith, Tim Cook: Apple, too big to fail, trickle-down economics, women in the workforce, working poor, zero-sum game

The Republican Party of that era had its share of kooks and crackpots, such as Senator Joe McCarthy of Wisconsin, who conducted an infamous communist witch hunt, and General Douglas MacArthur, who told the Republican convention of 1952 that the Democratic Party had “become captive to the schemers and planners who have infiltrated its ranks of leadership to set the national course unerringly toward the socialistic regimentation of a totalitarian state.” But for the most part, the party’s elders controlled the nutcases. Yet the Republican Party that emerged at the end of the twentieth century began to march backward to the nineteenth. Ronald Reagan lent his charm and single-mindedness to the movement, but he was not a true regressive. It was only when Newt Gingrich and his followers took over the House of Representatives in 1995 that regressives began retaking the GOP. The Koch brothers bankrolled the so-called Tea Party movement, and in 2010 Tea Party Republicans led the way toward capturing the House of Representatives and many state governments.

The Cornell political scientist Suzanne Mettler found that more than 44 percent of Social Security recipients say they “have not used a government social program,” as do more than half of families receiving government-backed student loans, 43 percent of unemployment insurance beneficiaries, and almost 30 percent of recipients of Social Security disability. Add in the relentless government hating and baiting of Fox News and Rush Limbaugh and his imitators on rage radio; include more than thirty years of Ronald Reagan’s repeated refrain that government is the problem; pile on hundreds of millions of dollars from regressive billionaires like Charles and David Koch, intent on convincing the public that government is evil, and some public support for stop-at-nothing tactics is not all that surprising. Yet neither the regressives’ stop-at-nothing tactics nor their social Darwinist message would have gained much traction were it not for the stunning failure of Democrats to make the case for a strong and effective government that responds to the needs of average people.


pages: 449 words: 127,440

Moscow, December 25th, 1991 by Conor O'Clery

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Anton Chekhov, Berlin Wall, central bank independence, Dissolution of the Soviet Union, Donald Trump, Doomsday Clock, Fall of the Berlin Wall, Francis Fukuyama: the end of history, haute couture, land reform, Mikhail Gorbachev, Ronald Reagan, Sinatra Doctrine, The Chicago School

Yeltsin is so taken with the golf cart that he orders some for his grandchildren to drive around the garden of the presidential dacha in Moscow. In May, accompanied by Raisa, their daughter, Irina, and interpreter Pavel Palazchenko, Gorbachev also travels to the United States, on a trip cohosted by Ronald Reagan and George Shultz and organized by his American admirer Jim Garrison, and is once more able to drink in the intoxicating brew of celebrity adulation and peer worship so lacking at home.7 The wealthy publisher Malcolm Forbes Jr. puts his private jet, named Capitalist Tool, at Gorbachev’s disposal to fly the party around eleven American cities, where they are accommodated in five-star hotels and greeted by fawning hosts, among them Donald Trump, Ronald Reagan, and David Rockefeller. Twenty thousand people come to hear Gorbachev speak in Fulton, Missouri, the location of Winston Churchill’s “Iron Curtain” speech. In the New York Stock Exchange the former communist leader is cheered by traders as he declares that “anybody who comes to the Russian market will have the opportunity to extract enormous profits.”

They have been dictated by Gorbachev and are addressed to foreign presidents, prime ministers, and royalty. The recipients comprise an A list of current and former world leaders whom he has met and befriended during his years in office: George H. W. Bush, Helmut Kohl, François Mitterrand, John Major, Giulio Andreotti, Bria n Mulroney, King Juan Carlos and Queen Sofia of Spain, Lech Walesa, Vaclav Havel, Ronald Reagan, Margaret Thatcher, and the heads of the governments of Korea, Finland, Egypt, Syria, Israel, Iran, and Norway. Gorbachev has worked hard to get the tone and content of the letters right. The warm relationship with his counterparts abroad is most important to the Soviet president. It is a measure of his international standing, a recognition of what he has achieved in reforming the Soviet Union, and an assurance of global approval for lessening world tensions, reversing the nuclear arms race, allowing the Berlin Wall to fall, and letting Eastern European countries have their freedom.

We had worked very hard to push the Soviet Union in this direction, at a pace which would not provoke an explosion in Moscow, much less a global confrontation.”11 Colin Powell, who as chairman of the Joint Chiefs of Staff has made a number of trips to Moscow, reckons Gorbachev hoped to revive a dying patient “without replacing its Marxist heart.” He believes that the end of the Cold War was made possible because of the bold brand of leadership practiced by Mikhail Gorbachev and President Ronald Reagan. “That Christmas Day, the unimaginable happened,” he wrote. “The Soviet Union disappeared. Without a fight, without a war, without a revolution. It vanished . . . with the stroke of a pen.”12 CHAPTER 25 DECEMBER 25: NIGHT Boris Yeltsin can hardly bring himself to look at the television screen in his office as Gorbachev begins to speak. He has not been provided with a copy of the text, and he does not know what the outgoing occupant of the Kremlin is about to say.


pages: 390 words: 119,527

Armed Humanitarians by Nathan Hodge

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Andrei Shleifer, anti-communist, Berlin Wall, British Empire, clean water, colonial rule, European colonialism, failed state, friendly fire, IFF: identification friend or foe, jobless men, Khyber Pass, kremlinology, land reform, Mikhail Gorbachev, old-boy network, Potemkin village, private military company, profit motive, RAND corporation, Ronald Reagan, Silicon Valley, South China Sea, The Wealth of Nations by Adam Smith, too big to fail, walking around money

After the city fell to the Northern Alliance in late 2001, a team of CIA and U.S. Special Operations commandos made their way through downtown Kabul to reclaim the embassy, which had been shuttered during Afghanistan’s civil war and the years of Taliban rule. Gary Berntsen, a counterterrorism officer, was one of the first Americans to set foot in the embassy since 1989; he found rotary-dial telephones and official photographs of President Ronald Reagan and Vice President George H. W. Bush on the wall. On the floor of the ambassador’s office Berntsen found a more somber memento: a photograph from the funeral of Adolph Dubs, the last U.S. ambassador to Afghanistan, who was killed in an exchange of fire during a botched hostage rescue attempt at a Kabul hotel in 1979.22 Among the many bureaucratic tribes in Washington, the Foreign Service had always conceived of itself as something of an elite.

* This section draws in part on Wingtips on the Ground, an unpublished memoir by Mines, who kindly gave permission to quote from his manuscript. * Asked about his recollection of the briefing, Wolfowitz told me through an intermediary that Mines’s story “doesn’t square with his recollection of this event from eight years ago,” without offering any further account of what happened at the meeting. CHAPTER 2 The PowerPoint Warrior The cavernous, air-conditioned auditorium of the Ronald Reagan Building in downtown Washington was packed to capacity with Pentagon bureaucrats, defense contractors, and men and women in dress uniform. Covering a naval research and development conference was not the most exciting reporting assignment, but Admiral Vern Clark, the chief of naval operations, was scheduled to deliver the keynote address that day. After fortifying myself with cheap coffee and a stale bagel, I made my way into the hall and sank into a plush chair.

.”* Still, after a few months of persuading, Hillen received the National Security Council’s blessing to begin working on whole-of-government counterinsurgency guidelines. “Which is probably why Dave [Petraeus] cannily pushed it off on me,” Hillen told me. “I mean, why should he get the crap beat out of him in Washington for three months, when I was willing to do it?” The governmentwide counterinsurgency conference was held at the Ronald Reagan Building in downtown Washington that September. The agenda read like a roster of luminaries from the counterinsurgency world: An opening panel on counterinsurgency best practices featured David Kilcullen, the Australian military officer who had won a cult following with his “Twenty-Eight Articles,” and Colonel H. R. McMaster, the former commander of the Third Armored Cavalry Regiment in Tal Afar.


pages: 435 words: 127,403

Panderer to Power by Frederick Sheehan

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Asian financial crisis, asset-backed security, bank run, banking crisis, Bretton Woods, British Empire, call centre, central bank independence, collateralized debt obligation, corporate governance, credit crunch, Credit Default Swap, credit default swaps / collateralized debt obligations, crony capitalism, deindustrialization, diversification, financial deregulation, financial innovation, full employment, inflation targeting, interest rate swap, inventory management, Isaac Newton, John Meriwether, Long Term Capital Management, margin call, market bubble, McMansion, Menlo Park, money market fund, mortgage debt, Myron Scholes, new economy, Norman Mailer, Northern Rock, oil shock, Paul Samuelson, place-making, Ponzi scheme, price stability, reserve currency, rising living standards, rolodex, Ronald Reagan, Sand Hill Road, savings glut, shareholder value, Silicon Valley, Silicon Valley startup, South Sea Bubble, supply-chain management, supply-chain management software, The Great Moderation, too big to fail, transaction costs, trickle-down economics, VA Linux, Y2K, Yom Kippur War, zero-sum game

Nathaniel Branden, who was closest to Greenspan’s mind during this period, reflected decades later: “I wondered to what extent he was aware of Ayn’s opinions.”7 Alan Greenspan’s contributions to group discussions were meager. Alan Greenspan was not philosophical; he was practical and, either by nature or by design, vague, remote, and impenetrable. Greenspan used his Randian acquaintances to climb the political ladder. He joined Martin Anderson’s policy research group during Richard Nixon’s 1968 campaign for the presidency. Anderson, who traveled in Objectivist circles, later introduced Greenspan to Ronald Reagan. Greenspan was riding the wave of the growing influence of accredited economists. By the late 1950s, Greenspan’s stock market predictions and economic forecasts were quoted in Fortune and the New York Times. His forecasts were usually wrong, as are those of most economists. Accuracy was less important than publicity.8 6 Bureau of Economic Analysis (BEA) National Income and Product Accounts (NIPA) Table 6.16B,C,D.

He was a regular in the Times’s “Evening Hours” and “Notes on Fashion” columns. Greenspan is classified as a Republican. In practice, however, his flattery was nonpartisan. When Ted Kennedy ran for the Democratic nomination in 1980, Greenspan hosted a breakfast for the Massachusetts senator in New York with “key Wall Street figures.”19 At the 1980 Republican convention, Greenspan almost corralled Ronald Reagan into offering him the position of treasury secretary. 17 Ibid., p. 127. 18 John H. Allan, “Thrift Adrift: Why Nobody Saves,” New York Times, February 17, 1980. 19Steven Rattner, “The Candidates’ Economists,” New York Times, November 18, 1979, p. F1. Greenspan remained in the public eye during the early Reagan years. He was called a “superstar” (New York Times) on the speaking circuit, making 80 speeches a year for up to $40,000 a speech.20 He joined corporate boards.

Martin Anderson, the Randian who had befriended Greenspan since the Nixon campaign, now an economist at the Hoover Institution, was Reagan’s issues advisor for both his 1976 and 1980 presidential campaigns. Anderson’s role included meeting and screening outside economists on behalf of the candidate.32 Theory aside, a presidential candidate intent on halting the dismal results of the past three presidencies would be on the lookout for a new voice. Supply-side economics emphasized the need to cut personal income taxes to stimulate the economy. Ronald Reagan was opposed to state interference in people’s lives. Whether it all added up (literally—would the rising tax revenues cut the mountainous Carter budget deficits?) was never his prime concern. Alan Greenspan was an outsider to supply-side economics. An expert juggler, Greenspan became an economic advisor to Reagan after Reagan was nominated as the Republican candidate. Martin Anderson tapped him for the role.


pages: 566 words: 155,428

After the Music Stopped: The Financial Crisis, the Response, and the Work Ahead by Alan S. Blinder

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Affordable Care Act / Obamacare, asset-backed security, bank run, banking crisis, banks create money, break the buck, Carmen Reinhart, central bank independence, collapse of Lehman Brothers, collateralized debt obligation, conceptual framework, corporate governance, Credit Default Swap, credit default swaps / collateralized debt obligations, Detroit bankruptcy, diversification, double entry bookkeeping, eurozone crisis, facts on the ground, financial innovation, fixed income, friendly fire, full employment, hiring and firing, housing crisis, Hyman Minsky, illegal immigration, inflation targeting, interest rate swap, Isaac Newton, Kenneth Rogoff, liquidity trap, London Interbank Offered Rate, Long Term Capital Management, market bubble, market clearing, market fundamentalism, McMansion, money market fund, moral hazard, naked short selling, new economy, Nick Leeson, Northern Rock, Occupy movement, offshore financial centre, price mechanism, quantitative easing, Ralph Waldo Emerson, Robert Shiller, Robert Shiller, Ronald Reagan, shareholder value, short selling, South Sea Bubble, statistical model, the payments system, time value of money, too big to fail, working-age population, yield curve, Yogi Berra

I often muse about how much better things might have been had Congress revived the HOLC idea back in 2008, when the foreclosure problem was much smaller than it subsequently, and predictably, became. Reviving the HOLC was not the only foreclosure mitigation idea to emerge from the academy in 2008, and they didn’t all come from spend-thrifty (actually borrow-thrifty) Democrats like me. Two weeks after my HOLC piece appeared, the Wall Street Journal—a newspaper not known then or now for its Left-leaning views*—published an op-ed by Martin Feldstein of Harvard, who had once chaired Ronald Reagan’s Council of Economic Advisers (CEA). Feldstein offered a plan to replace 20 percent of each homeowner’s mortgage with a low-interest loan from the government. The new loans would be made with recourse, however, so the government could go after other assets of any defaulting borrower. In October 2008, Columbia’s Glenn Hubbard, who had been George W. Bush’s first CEA chairman, writing with his colleague Chris Mayer, a noted housing expert, suggested using Fannie Mae and Freddie Mac (which were by then under government control) to refinance all mortgages on primary residences into 30-year fixed-rate mortgages at 5.25 percent.

As soon as the financial industry was back on its feet, tycoons started bridling against excessive regulation and complaining about being treated as scapegoats. Scapegoats? How about perpetrators? President Obama was labeled a socialist and worse by arch-conservatives, who railed against “big government.” By the time of the November 2010 elections, Tea Party Republicans were running—and often winning—on virulently antigovernment platforms that placed them far to the right of Ronald Reagan, whom they professed to idolize. Think about it: The crisis was the result of a series of grievous errors, misjudgments, and even frauds by private companies and individuals, aided and abetted by a hands-off policy from a government unduly enamored of laissez-faire. America was plainly a victim of too little regulation, not too much. Only after the blowup in September 2008 did the formerly passive government turn interventionist—in desperation.

Loose money men, the critics screamed, sure to cause inflation. Keynesian policy is often identified with the idea that governments can and should spend their way out of recessions—hence, the common association with “big government.” But that is an overly narrow interpretation of Keynesianism. For one thing, governments can fight recessions by cutting taxes rather than by raising spending, which is just what Ronald Reagan and George W. Bush did—two Keynesians in deed though not in word. More germane to the present discussion, most American Keynesians (including Bernanke) have long believed that expansionary monetary policy is a better way to fight recessions than expansionary fiscal policy. Using monetary policy to expand the economy means, principally, cutting interest rates. And, of course, the Fed cut interest rates to the bone in 2008.


pages: 444 words: 151,136

Endless Money: The Moral Hazards of Socialism by William Baker, Addison Wiggin

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Andy Kessler, asset allocation, backtesting, bank run, banking crisis, Berlin Wall, Bernie Madoff, Black Swan, Branko Milanovic, break the buck, Bretton Woods, BRICs, business climate, capital asset pricing model, commoditize, corporate governance, correlation does not imply causation, credit crunch, Credit Default Swap, crony capitalism, cuban missile crisis, currency manipulation / currency intervention, debt deflation, Elliott wave, en.wikipedia.org, Fall of the Berlin Wall, feminist movement, fiat currency, fixed income, floating exchange rates, Fractional reserve banking, full employment, German hyperinflation, housing crisis, income inequality, index fund, inflation targeting, Joseph Schumpeter, laissez-faire capitalism, land reform, liquidity trap, Long Term Capital Management, McMansion, mega-rich, money market fund, moral hazard, mortgage tax deduction, naked short selling, negative equity, offshore financial centre, Ponzi scheme, price stability, pushing on a string, quantitative easing, RAND corporation, rent control, reserve currency, riskless arbitrage, Ronald Reagan, school vouchers, seigniorage, short selling, Silicon Valley, six sigma, statistical arbitrage, statistical model, Steve Jobs, The Great Moderation, the scientific method, time value of money, too big to fail, upwardly mobile, War on Poverty, Yogi Berra, young professional

Nonetheless he pushed the limit in expanding government, thus continuing the circumvention of a constitutionally limited federal sector begun under Woodrow Wilson. 199 Sharecroppers $1,000,000 90 80 Marginal Tax Rate (%) 500,000 70 60 250,000 50 100,000 40 30 75,000 20 45,000 10 0 2007 1993 1982 1987 1964 1941 1932 1913 25,000 Year Figure 8.1 Marginal Tax Brackets of Various Inflation-Adjusted Incomes (1913–2007) However, near-confiscatory tax rates did not make the scene until the advent of World War II, and in inflation-adjusted terms these remained in effect until the presidency of Ronald Reagan. The mountainous formation of this era dominates the center of the chart, and makes it hard to appreciate how upper-middle class tax rates remained higher than in the Roosevelt era even after the Reagan revolution occurred. Figure 8.1 thus reveals that the era of the 1930s looks little different from the post-Reagan/Bush years (which include Clinton and a Congress inspired by the Contract with America).

The final chapter of Part 4 asks an even larger question: whether democracy itself might be a fatal condition that would make republics succumb to the wishes of the mob. So entrenched is the modern socialistic and technocratic state that political strategies that buck the trend and advocate restraint of government expenditures have been barred from consideration since prior to the crash of 1929. Even notable conservatives who shared power with a liberal Congress or executive branch, such as Ronald Reagan or Newt Gingrich, respectively, were unable to restrain the growth of government, much less undo the empowerment extended beyond its original constitutionally enumerated powers. Chapter 9 The Heart of the Financial System ousing is probably the most heavily subsidized industry in the United States. Mortgages are tax deductible, and $5 trillion of them piggyback upon the full faith and credit of the U.S. government, providing an interest rate subsidy to homeowners in addition to the tax savings1.

A video of the proceedings is available on YouTube.10 If accounting had been the only issue as things stood in the precarious market conditions that emerged in 2008, a fix could have been made and cash flow would have remained unchanged at presumably healthy levels. If management had been the problem, executive housecleaning would have sufficed. However, the underlying proposition of why the entities exist, whether they are achieving their mission, and most important, whether they are counterproductive are the questions that must be asked and resolved. Ronald Reagan quipped in his first 216 ENDLESS MONEY inaugural address (1981) that “Government is not the solution to our problem. Government is the problem.”11 The record shows that Fannie Mae and Freddie Mac follow in the footsteps of previous failures. As Ronald Utt writes, “… federally sponsored financial institutions, including those that the federal government closely regulates and insures, have a knack of frequently exploding in hugely horrific and costly ways.


pages: 466 words: 127,728

The Death of Money: The Coming Collapse of the International Monetary System by James Rickards

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Affordable Care Act / Obamacare, Asian financial crisis, asset allocation, Ayatollah Khomeini, bank run, banking crisis, Ben Bernanke: helicopter money, bitcoin, Black Swan, Bretton Woods, BRICs, business climate, capital controls, Carmen Reinhart, central bank independence, centre right, collateralized debt obligation, collective bargaining, complexity theory, computer age, credit crunch, currency peg, David Graeber, debt deflation, Deng Xiaoping, diversification, Edward Snowden, eurozone crisis, fiat currency, financial innovation, financial intermediation, financial repression, fixed income, Flash crash, floating exchange rates, forward guidance, G4S, George Akerlof, global reserve currency, global supply chain, Growth in a Time of Debt, income inequality, inflation targeting, information asymmetry, invisible hand, jitney, John Meriwether, Kenneth Rogoff, labor-force participation, labour mobility, Lao Tzu, liquidationism / Banker’s doctrine / the Treasury view, liquidity trap, Long Term Capital Management, mandelbrot fractal, margin call, market bubble, market clearing, market design, money market fund, money: store of value / unit of account / medium of exchange, mutually assured destruction, obamacare, offshore financial centre, oil shale / tar sands, open economy, Plutocrats, plutocrats, Ponzi scheme, price stability, quantitative easing, RAND corporation, reserve currency, risk-adjusted returns, Rod Stewart played at Stephen Schwarzman birthday party, Ronald Reagan, Satoshi Nakamoto, Silicon Valley, Silicon Valley startup, Skype, sovereign wealth fund, special drawing rights, Stuxnet, The Market for Lemons, Thomas Kuhn: the structure of scientific revolutions, Thomas L Friedman, too big to fail, trade route, uranium enrichment, Washington Consensus, working-age population, yield curve

I immediately asked to pre-pay my hotel bill in lire. . . . The manager clapped his hands in delight. He and the rest of the staff treated me as if I were royalty. I wasn’t like those other Americans with their stupid dollars. For the rest of my stay, no merchant or restaurant wanted my business until I demonstrated I could pay in lire. The subsequent efforts of Fed chairman Paul Volcker and the newly elected Ronald Reagan would save the dollar. Volcker raised interest rates to 19 percent in 1981 to snuff out inflation and make the dollar an attractive choice for foreign capital. Beginning in 1981, Reagan cut taxes and regulation, which restored business confidence and made the United States a magnet for foreign investment. By March 1985, the dollar index had rallied 50 percent from its October 1978 low, and gold prices had dropped 60 percent from their 1980 high.

Since the Second World War, the system has passed through distinct phases known as Bretton Woods, the Washington Consensus, and the Beijing Consensus. All three of these phrases are shorthand for shared norms of behavior in international finance, what are called the rules of the game. The Washington Consensus arose after the collapse of the Bretton Woods system in the late 1970s. The international monetary system was saved between 1980 and 1983 as Paul Volcker raised interest rates, and Ronald Reagan lowered taxes, and together they created the sound-dollar or King Dollar policy. The combination of higher interest rates, lower taxes, and less regulation made the United States a magnet for savings from around the world and thereby rescued the dollar. By 1985, the dollar was so strong that an international conference was held at the Plaza Hotel in New York in order to reduce its value. This was followed by another international monetary conference in 1987, at the Louvre in Paris, that informally stabilized exchange rates.

When a customer buys a bottle of Coke, he hands the seller a dollar. This is not mere barter, but rather a value exchange. What is the source of the dollar’s value? How does it hold up as an example of trust consistently honored? To answer that question, one needs to dig deeper. The dollar itself, whether in paper or digital form, is a representational object. What does the dollar represent? To whom is the trust directed? When trust is required, Ronald Reagan’s dictum applies: Trust, but verify. The Federal Reserve System, owned by private banks, is the issuer of the dollar. The Fed asks for our trust, but how can one verify if the trust is being honored? In a rule-of-law society, a customary way of verifying trust is the written contract. A first-year law student in contracts class immediately learns to “get it in writing.” The beliefs and expectations of the parties to a contract are written down and read by both parties.

Turning the Tide by Noam Chomsky

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anti-communist, Bolshevik threat, British Empire, collective bargaining, cuban missile crisis, declining real wages, failed state, feminist movement, Howard Zinn, land reform, means of production, Monroe Doctrine, Paul Samuelson, RAND corporation, Ronald Reagan, union organizing

A six-month notice was required “to terminate this declaration,” a commitment plainly violated when the Reagan Administration, three days before Nicaragua’s complaint was filed, attempted to modify the 1946 declaration so as to exclude “disputes with any Central American states or arising out of or relating to events in Central America.”12 The Reagan Administration was also sharply criticized by Senator Daniel Patrick Moynihan of New York for “forsaking our centuries-old commitment to the idea of law in the conduct of nations” and for its “mysterious collective amnesia” in “losing the memory that there once was such a commitment,” losing “all memory of a vital and fundamental tradition.” Our UN Delegation headed by Jeane Kirkpatrick “does not know the history of our country,” he proclaimed, echoed by Anthony Lewis, who decried Reagan’s “failure to understand what the rule of law has meant to this country.”13 Once again, history teaches a different lesson: in fact, it is Ronald Reagan and Jeane Kirkpatrick who understand “what the rule of law has meant to this country.” The World Court incident serves as a clear illustration. It is a reenactment of events of the Taft and Wilson Administrations 70 years earlier. In 1907, at US initiative, a Central American Court of Justice was established to adjudicate conflicts among the American states. A few years later, the Court was destroyed by US refusal to recognize its decisions with regard to US intervention in Nicaragua.

But the facts about the historical and contemporary US attitude towards “pluralistic democracy” in Central America are virtually never discussed in this context, a Nicaraguan proposal to demilitarize the borders with the aid of the Contadora group receives a 40-word notice (a Nicaraguan proposal 3 months later for a joint patrol with Honduras to eliminate border incidents apparently was unmentioned), and the Times reports its neutral and objective poll which asks Americans whether they agree with Ronald Reagan, who “says the U.S. should help the people in Nicaragua who are trying to overthrow the pro-Soviet Government there”; even with this wording, they were unable to generate majority support for the operation.136 6.3 The Elections and the Opposition US war aims are further clarified by the hysterical reaction to the Nicaraguan election in November 1984. In a well-crafted propaganda coup, the US government succeeded in deflecting attention from the election by regular diatribes, seriously reported as “news” in the nation’s press, and by concocting a story about Russian MIGs in Nicaragua, quickly abandoned after it had served its function of eliminating the (minimal) danger of honest coverage of the election and eliciting appropriate outrage by dovish Senators—e.g., Massachusetts Democrat Paul Tsongas, who warned that the US would have to bomb Nicaragua to eliminate the MIGs because “they’re also capable against the United States.”

The incident can leave no doubt that once again, the US fears a political settlement and prefers that disputes remain in the arena of military conflict, in which its supremacy is unchallenged. We might ask what term other than “hysterical fanaticism” can be used with reference to the President’s declaration of May 1, 1985, announcing an embargo “in response to the emergency situation created by the Nicaraguan Government’s aggressive activities in Central America”: I, Ronald Reagan, President of the United States of America, find that the policies and actions of the Government of Nicaragua constitute an unusual and extraordinary threat to the national security and foreign policy of the United States and hereby declare a national emergency to deal with that threat. And what term applies to the “key Congressional leaders” who, in this grim emergency situation when our very existence is under threat, “generally praised President Reagan’s imposition of a trade embargo as a useful first step in pressing the Sandinista Government to change its policies”?


pages: 493 words: 132,290

Vultures' Picnic: In Pursuit of Petroleum Pigs, Power Pirates, and High-Finance Carnivores by Greg Palast

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anti-communist, back-to-the-land, bank run, Berlin Wall, Bernie Madoff, British Empire, capital asset pricing model, capital controls, centre right, Chelsea Manning, clean water, collateralized debt obligation, creative destruction, Credit Default Swap, credit default swaps / collateralized debt obligations, Donald Trump, energy security, Exxon Valdez, invisible hand, means of production, Myron Scholes, offshore financial centre, random walk, Ronald Reagan, sensible shoes, transfer pricing, uranium enrichment, Washington Consensus, Yogi Berra

Answer: It’s Monrovia. The capital of Liberia is named after the U.S. President James Monroe, who helped former American slaves give birth to the longest-lived democracy in Africa, founded in 1847. Its democracy dropped dead when, in 1980, a Corporal Sam Doe marched every member of the elected president’s cabinet out to the nearby beach, tied them to poles and shot them, TV cameras rolling. Ronald Reagan was elated and helped the killer dictator Sam Doe turn Liberia into a Cold War killing zone. One in ten Liberians would die. Richard and I arrived in Liberia without two clues to rub together. But Ricardo had one. He had just learned some Arabic the hard way: As an involuntary guest of some bad guys in Basra, Iraq. He said, “You know, Hamsah in Arabic means ‘Five.’ ” Ah. More significantly, a Hamsah looks like this: The symbol is Lebanese.

During her shift, she kept an eye on the second-story plate-glass window on Second Avenue, where Greg Palast and his team worked late, noting the time Palast would put on his fedora and leave. She wasn’t stalking; she had decided to work for me and needed to find a way to inform me of her decision. My research chief, Oliver Shykles, a genius with a rational dose of paranoia, hated working in front of that huge floor-to-ceiling window, especially after nearly one hundred threats of death and bodily harm that came after I published what The Guardian called my “robust” obituary of Ronald Reagan (“Reagan: Killer, Coward, Con Man”). Ollie had removed all signs visible from the street identifying our location. I loved that office up the dirty stairs. Lots of sun for a downtown place and, at night, when it rained, the red blur of ambulance lights and the caffeine of their sirens. It was midnight. I was walking the dog. It was cold and my brain was freezing. Then, “Mr. Palast?” Although lost in two huge winter coats, muffler and fur hat, I could make out it was a young lady—college age?

This brought to mind the Zambian finance minister who used a voodoo charm to make himself invisible from the police. Did BP and Exxon and ChevronTexaco and Phillips (now of ConocoPhillips) have some kind of magical fairy dust that made them invisible to the Justice Department? It seemed so. And I think I know the names of some of the fairies. Most were in the “P-group,” a slough of top politicos, a lobbying power team headed by Ronald Reagan’s former chief of staff, Michael Deaver, former Attorney General Dick Thornburgh, and former Justice Department lawyer Reid Weingarten. Reid told Thornburgh’s successors in the Bush Jr. Administration that naming Nazarbayev in the indictment would mean the axe for U.S. oil companies, an odd legal defense but extraordinarily effective. There was fairy dust everywhere. On September 6, 2005, while Justice pondered indicting Nazarbayev and his Big Oil funders, Canadian financier Frank Giustra flew out of Almaty, Kazakhstan, in his private jet.

Poisoned Wells: The Dirty Politics of African Oil by Nicholas Shaxson

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Asian financial crisis, Berlin Wall, blood diamonds, business climate, central bank independence, clean water, colonial rule, energy security, Exxon Valdez, failed state, Fall of the Berlin Wall, Hernando de Soto, income per capita, inflation targeting, Martin Wolf, mobile money, offshore financial centre, old-boy network, Ronald Reagan, Scramble for Africa, Yom Kippur War, zero-sum game

The leaders even tried to recover some of the funds stolen under the civilians, but Britain and other western governments and banks, nervous about getting a reputation among dictators and crooks for not protecting their lucrative cash deposits from foreign investigations, disgracefully declined to help.39 But the soldiers became more authoritarian, bulldozing informal settlements and markets, and imprisoning many people. Fela’s “Beasts of No Nation,” which he wrote in jail while serving time for foreign currency violations, captures the spirit of the time. The album cover depicts Margaret Thatcher, Ronald Reagan, and South African apartheid president P. W. Botha with devil horns and blood dripping from their mouths. Even as the oil revenues collapsed, the factions kept guzzling cash, so yawning deficits opened up, and foreign debt grew.40 In the boom years Nigeria had found it easy to borrow money (bankers love lending to rich people, and in the 1970s their coffers were stuffed with Arab petrodollars), and foreign debt had reached $5 billion by 1980.

His soldiers carved “pockets” into their captives’ sides, jeering as they forced their hands down into them, and they would beat pregnant women face down, first digging a hole for their bellies. Savimbi burned UNITA dissidents on public bonfires,5 along with their families. Graffiti in Luanda succinctly embraced the character of the two sides: “UNITA kills, the MPLA steals.” Savimbi slept with his aides’ wives, to put his underlings in their place and to make them worry what he knew about them. Apartheid South Africa invaded to support him, and Ronald Reagan, who sent him guns and missiles in the 1980s, once hosted him in the White House and predicted that Savimbi would win “a victory that electrifies the world.” In 1985, the now-disgraced Washington lobbyist Jack Abramoff joined Savimbi in southern Angola to host a meeting of Afghan Mujahedin, Nicaraguan Contras, Laotian guerrillas, and what one South African newspaper called the “Oliver North American Right.”

“[The rise of Mitterrand] provoked real trepidation among the Elf networks, which feared the Socialists would destroy them. There were some on the left of the Socialist Party who indeed intended just that. A lengthy political struggle ensued that finished with an almost complete victory by the old Foccart networks, whose effective leader was Bongo.” As part of his strategy, Bongo even threatened Mitterrand with the nuclear option: turning toward the Americans under the recently elected Ronald Reagan.51 But he never did. Instead, a compromise was reached, which left the Clan unscathed: French rightwingers kept their fingers firmly in the fabulous Gabonese pie, but it was expanded to let the French Socialists get a piece too. It is remarkable to think how far this African president had influenced politics in a big western democracy. Libreville also became a rear base for Igbo secessionists in Nigeria’s Biafra war, whose cause de Gaulle had foolishly backed, hoping to split Nigeria’s oil zones off from the English-speaking parent.

Goddess of the Market: Ayn Rand and the American Right by Jennifer Burns

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anti-communist, bank run, barriers to entry, centralized clearinghouse, collective bargaining, creative destruction, desegregation, feminist movement, financial independence, George Gilder, invisible hand, jimmy wales, John Markoff, Joseph Schumpeter, knowledge worker, laissez-faire capitalism, lone genius, Menlo Park, minimum wage unemployment, Mont Pelerin Society, new economy, Norman Mailer, offshore financial centre, Ponzi scheme, profit motive, RAND corporation, rent control, road to serfdom, Robert Bork, rolodex, Ronald Reagan, side project, Stewart Brand, The Chicago School, The Wisdom of Crowds, union organizing, urban renewal, white flight, Whole Earth Catalog

The senator himself seemed to accept Rand’s explanation for his defeat, quoting her in his syndicated column.49 In The Objectivist Newsletter, her private forum, Rand openly blamed Goldwater for his loss. She was appalled that the only voters he had drawn to his banner were southern whites: “As it stands, the most grotesque, irrational and disgraceful consequence of the campaign is the fact that the only section of the country left in the position of an alleged champion of freedom, capitalism and individual rights is the agrarian, feudal, racist South.” 50 The only glimmer of hope had been Ronald Reagan’s principled and philosophical speech on behalf of Goldwater, but it had been too little, too late. Despite her enthusiasm for Goldwater, Rand was blazing a trail distinct from the broader conservative movement, as indicated by the title of her second nonfiction book, The Virtue of Selfishness. Whereas traditional conservatism emphasized duties, responsibilities, and social interconnectedness, at the core of the right-wing ideology that Rand spearheaded was a rejection of moral obligation to others.

For all the emotional upheavals she had suffered, rationality was still her only guide and source of wisdom, individualism her favored theme. “Well, I told you so,” she sighed. “I have been telling you so since We the Living, which was published in 1936.”70 Rand had one last word of warning to issue. Referring to the upcoming Republican primaries she wrote, “I urge you, as emphatically as I can, not to support the candidacy of Ronald Reagan.” Reagan was a conservative in “the worst sense of the word,” she told her readers.71 Not only did he support a mixed economy, a compromise between laissezfaire and government controls, but his opposition to abortion demonstrated a dangerous disregard for individual rights. Reagan represented the triumph of all the political trends on the right Rand had fought throughout her long career. He blended libertarianism with religion, submerging a rational defense of capitalism under altruistic ethics.

Recently historians have begun to trace the connections between th