Try to remember the kind of September when the median price for a new home rose more than 1,200 percent from $25,600 in 1968 to $309,700 in 2018 as median household income rose only 800 percent — from $7,700 to $62,175 during those same 50 years.
Try to remember when annual per-capita health expenditures exploded more than 3,000 percent, from $355 in 1968 to $10,759 in 2018.
Try to remember when in 1968 tuition, fees, and room and board for a year at a private four-year university skyrocketed from $2,673 to $48,510 in 2018 — an 1,800 percent jump in 50 years. Those happy with a four-year public university saw a year of public higher education grew more than 1,700 percent from $1,245 in 1968 to $21,370 in 2018.
Try to remember when a Volkswagen Bug cost $1,699 in 1968 and between $21,115 and $27,685 in 2018, a 1,600 percent increase.
Try to remember when a gallon of regular gas that cost 34 cents in 1968 plateaued in 2018 at $3.29, more than a 960 percent increase.
Try to remember when sending a first-class letter was a bargain, rising only 1,000 percent — from 5 to 50 cents — as targets of protest shifted from the war in Southeast Asia, to the crude behaviors of our current president.
Try to remember when a McDonald’s Big Mac was introduced for 49 cents in 1968 and rose in price to $3.99 in 2018, an increase of more than 800 percent — stalking median household income in the United States.
Try to remember when the top marginal income tax rate was 75.25 percent in 1968 — when the top 1 percent held 34 percent of U.S. wealth and received 9 percent of U.S. income — and then dropped to 37 percent in 2018 — when the top 1 percent held 38 percent of U.S. wealth and 24 percent of the nation’s income.
These statistics show that the chunks of the U.S. economy have grown for the wealthiest and shrunk for the poorest Americans both in terms of actual dollars and also in terms of what those dollars can purchase. The Occupy movement is right; the rich get richer and the poor poorer with assistance from D.C lobbyists, swamp critters and policy makers.
Steven Brill, a meticulous investigative and business magazine writer, offers context in “Tailspin: The People and Forces Behind America’s 50-Year Fall — and Those Fighting to Reverse It” that, at least in part, explains how Vietnam and an international Cold War waged distracted policy makers from growing economic distress as weakened labor unions unleashed corporate greed and a drive toward globalism that increasingly sent mills, factories and their middle-class jobs abroad. Shoved into service economy jobs, dislocated workers were whacked by hyper-inflation, lower earnings, corporate raiders and something called the information economy.
As prices accelerated and wages stagnated, workers, ill-prepared for the information economy, felt abandoned by Democratic politicians who ignored workers’ economic plight,while drafting civil rights, poverty and environmental legislation and drafting young men into an expensive, divisive war ten thousand miles away. Dick Nixon rolled out a Southern strategy to split off traditional Southern Democrats, George Wallace made inroads in Northern cities, Ronald Reagan built on their efforts and began to undermine both the New Deal and Great Society programs to make America great again.
The metaphor of a moat that protects denizens of Wall Street, corporate management, lawyers and information workers trained at elite universities for the new meritocracy from unprotected citizens with average incomes is central to Brill’s analysis of the fifty-year decline of the American Dream.
Those who excelled in the meritocracy rewarded themselves by undermining restrictive regulations, re-engineering the political landscape, creating new legal rights and exploiting digital technology to create a nation of moats to protect themselves from politicians and reformers. These overachievers ran circles around politicians and eroded institutions that provide government services to average citizens. The protected do not depend on government to provide good public schools, health care, disaster relief, safe workplaces, functioning Social Security and IRS offices and call centers and fair labor laws and elections. They hire lawyers.
And the number of lawyers coming into corporate law firms bloomed. They saw opportunities to enter corporate banking, where they assisted in raiding, merging and piecing out companies, always emphasizing short term profits. They developed new financial instruments that would later crash the housing mortgage industry.
They also created bigness as a new protective moat for bank management. Bank CEOs were not jailed following the 2008 recession because their lawyers argued they could not be held personally responsible for corporate actions. The bank was too large and complex for a single person to manage. Banks were fined because it was more efficient than prosecuting. So, this moat of “too-big-to-manage” was added to the “too-big-to-fail” and “too-big-to-jail” moats.
Brill basically argues that the reason government no longer functions can be blamed on the unintended consequences of merit-based hiring, providing inadequate training for government employees, developing the concept of corporate free speech, instituting fair treatment of government employees and insisting on scrupulous due process in developing regulations. The result: government agencies become overwhelmed by lobbyists, corporate lawyers and government employee unions.
The library has a copy of “Tailspin” awaiting anyone questioning why so many politicians are leaving their offices, as well as what drives partisan deadlock in Washington.