Defanging a predatory nation: Here's an antidote to the corporate hijacking of America
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Occasionally there is a book that addresses a problem of primordial importance, provides the necessary background and analysis for understanding, and then puts forward a viable solution to the problem in question.
In my view, Charles H. Ferguson's "Predator Nation: Corporate Criminals, Political Corruption, and the Hijacking of America" falls in that category. He addresses the current major economic and governance dilemma in which America finds itself. He pulls apart how we got into the mess, addressing it chronologically, explaining even some of the more arcane terms surrounding it, and names the people on Wall Street and Pennsylvania Avenue responsible for getting us into -- and keeping us in -- the mess in question.
His last chapter sets out in order the steps he believes America needs to take to put us back on course toward the kind of exceptionalism in performance we have come to believe is our role in the world, to take Americans to a new, 21st-century level of improving national well-being. These include:
1. Improving educational opportunity and quality, including attacking child poverty, the American problem that bites me most deeply at the moment.
2. Bring the financial sector under control. They, unregulated, got us into the mess. The lack of regulation of them is a direct result of their having bought or coopted a good part of the personnel of the American national and state governmental structure.
3. Control the impact of money on American politics. (See No. 2 above.) Right now, the Democrats and President Barack Obama and the Republicans and putative presidential candidate Mitt Romney are competing with each other tooth and nail to build up indecent sums of money by any means to campaign against each other. The American people may understand that they need to change channels, hang up on robocalls and otherwise resist drinking the Kool-Aid being pushed at us by the candidates at the national, state and local level, fueled by the enormous sums they are extracting from future beneficiaries, seeking to get or keep themselves in office in November.
4. Reform the tax system, both individual and corporate. There is a temptation here for the observer to focus on the obscenities on the Republican side -- Mr. Romney claiming a $77,000 tax deduction for his wife's Olympic dressage horse, for example -- but the fact of the matter is that both sides, Democrat and Republican, have not yet acted to reverse the trend toward skyrocketing U.S. national debt that is now nearing $16 trillion, based on continuing $1 trillion-plus budget deficits.
Neither of the presidential candidates has yet had the courage to look the American people in the eye and say we are going to have to put together a combination of less spending and/or higher taxes to address this problem at all levels -- local, state and national -- or continue to proceed toward a financial state comparable to that of South Sudan. Can you believe that our postal system is collapsing, in 2012?
5. Greatly strengthen antitrust policy and the regulation of corporate governance. What he is talking about here is twofold. The CEOs and other senior officers of U.S. corporations and banks are being paid compensation in the double-digit millions. A schoolteacher's median wage is in the $40,000 range.
Corporate executives in many cases that we have learned about have showed themselves to be adept at nothing other than working with their counterparts in other companies and government to loot the public treasury and fleece the American consumer who used to have confidence in U.S. institutions such as Lehman Brothers, JPMorgan Chase, Merrill Lynch, and the Federal Reserve Bank.
Can you believe that Treasury Secretary Timothy F. Geithner knew in 2008 when he was head of the New York Fed that the British banks were cooking the London Interbank Offering Rate (LIBOR) and didn't stop it?
Given the importance that I attach to the work of teachers in educating America's young people to hold jobs and to live, I can't in any case imagine what would be the justification for paying a CEO 250 times what they are paid. That has to be the mark of a really screwed-up society.
6. Create a truly universally accessible, high-speed broadband Internet infrastructure, both wireline and wireless. Mr. Ferguson sees this project as the sine qua non for forward progress in American economic development. I'm ready to take his word for it.
He believes that at the rate we are going America is proceeding toward having "a very large, poor, angry underclass." He hopes that a movement will arise to force real progress. He cites the civil rights, women's rights and environmental movements as examples.
I am not so hopeful. I keep thinking France, 1789. Last year's "Occupy" movement died in Pittsburgh in the winter cold. According to me, the reason it died was because it was almost entirely unclear, or far too catholic, in its objectives. It was, in principle, in favor of all sorts of things, with no general agreement, no focus and no coordination in its push. That meant that not only did it rot from inside, it was also unable to mobilize effectively itself and potential strong allies.
In my view it should have gone straight for the jugular vein of the establishment, reform of the tax code. Instead, it was all over the place in its goals and, in the end, Bank of New York Mellon, which ironically enough provided Occupy Pittsburgh a nice Downtown park to camp in free of charge, took the park back through the courts and has now built a fence around it to keep the Occupy types from coming back.
Do read "Predator Nation." Rarely does an author lay out a problem and a potential solution with such charm, clarity and courage. He isn't especially partisan. Although he finds Mr. Obama preferable to Mr. Romney, he still dusts the president off with a high fastball, saying correctly that he "promises reform while protecting Wall Street."
The book will not cheer you up, but it will make things a lot clearer, and he does propose specifically what America needs to do to fix itself.
First Published August 1, 2012 12:00 am