135 Comments

You could not have said it any better. So much work to do to turn this ship around. First step is to protect voting rights and ensure the integrity of the voting process.

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David, Because no one seems to have a ready answer about how to resuscitate momentum at the federal level, I think we might want to consider how we can defend democracy at the state and local levels. For example, we’ll need poll workers and other election officials—county clerks and election judges—who can help people to ensure that their votes are counted. We’ll also have to out-organize Republicans, who ruthlessly are organizing to fill state and local positions with their own people—people who don’t believe in free and fair elections. Perhaps some of us will run for office such as Secretary of State or maybe volunteer on campaigns. After all, we were only two votes shy of the 50 Senators we needed to pass federal voter protection legislation. Though I haven’t given up on getting some federal voter safeguards passed, I, nonetheless, think we need to get started mobilizing for democracy at the state and local level. Thoughts?

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I agree. Unfortunately it may prove foolhardy to rely on Congress to enact the laws necessary to safeguard our democracy. Much of the work will need to be done locally as you suggested. Indivisible is a powerful organization that helps concerned citizens work together and coordinate many of the activities you suggested. I am sure that is not new to you or most of the subscribers to Robert’s sub stack. We cannot allow ourselves to fret the past too much as that act will only be a governor on our current and future strategies as we continue to try to create a more perfect union.

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David, Though I understand Congress possibly could pass a narrowed version of the bill, considering the Freedom to Vote Act is an edited down version of its predecessor S.1 For the People, talk of increasingly narrowed versions of legislation intended to protect key mechanisms of democracy, indeed, is a sad commentary.

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Thanks Barbara I agree. I believe we can still flip the Senate and keep the House, but it will take a massive grassroots effort, determination, and in the face of these voter suppression laws, ingenuity as well.

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Geordie, Though the increasing possibility of no meaningful federal safeguards to offset the onslaught of GOP state-level bills restricting voting and nullifying votes, indeed, is troubling, like you, I know of no other way than to stay in the fight.

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I wonder why there are no paper receipts for our vote. I have read that in other European Democracies people get a paper receipt of their vote.?

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Laurie, Though our Town Clerk retains paper copies of all ballots, I don’t know if what happens here is widespread. Still, I’m quite sure the federal legislation that just failed had required paper ballot backups.

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Barbara Jo Krieger ; Frustrating that our voting integrity is opposed by the ones who accuse their opponents of voter fraud!

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I agree. The DNC does not seem to agree. Perhaps if enough people let them know how you think it will change their mind and they will start working at the local level.

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founding

If I was currently a PhD candidate in economics, I would want to look at switching costs. As you show it is much easier to switch a capital investment to a new higher performing investment than it is to create a new high performing investment. In this way the investment bankers "allocate capital efficiently" but they also skim off a big part of the entrepreneurs' reward for their creative efforts. Switching costs include taxes, and tax policy should much more evenly tax financial rewards versus the rewards from hard work and creativity. It is a downright shame that there are so many loopholes, preferential tax rates, "investment" credits, carried interest rules and other advantages for the purely financial players while the people who create value face many disadvantages and carry the highest tax burdens.

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Exactly. There's a new branch of political science focusing on "entrenchment" -- strategies to keep people and institutions where they are rather than enable them to change (closely analogous to the high "switching costs" economists refer to). So much about our political economy could be rectified if people had more mobility.

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founding

education! If we could wrench control of school boards away from localities, or at least build a universal curriculum, we could maybe improve general education levels across all demographies and geographies!

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Yes, why does Texas get to write our textbooks? I would think New York or California should have more clout for content of textbooks, but they don't seem to.

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Texas has oil revenue (from ear-marked taxes) to pay for their books, and the other states don't.

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Jan 22, 2022·edited Jan 22, 2022

This sounds good to me, but regular people can’t be expected to connect with theory. Regular citizens see that theory has screwed them, as you show and the Professor and other worthies have shown over the decades.

It shouldn’t be that way and doesn’t have to be that way.

$136 Trillion is the net personal wealth of the people of the USA. ( US Fed ‘Z.1’ Q3 )

Next year we need $200 or $300 Billion for Build Back Better.

This is like asking someone with $136 in their wallet for 20 or 30 cents.

Read that again, check it.

But we need to *know* and *say* the big number, the whole number, to make that clear.

The top 1% has about $43 Trillion, the top 10% about $95 Trillion. I’m looking at them. I recall that Mark Twain asked John D Rockefeller to stop giving beggars dimes, because the other gilded dopes would emulate him. ( looking for ref )

But so many years later all we need is a quarter a year, to repair, rebuild, upgrade and transform the foundations of our prosperity. That seems true to me, and crazy in context.

This has been a mantra, including in a 2014 letter to the Professor, Nick Hanauer, Paul Krugman, and Jeff Merkley, to pound the table with the magnitude of our wealth.

Didn’t register at the time, even among the willing and leading messengers. We still have the chance.

Stalwarts use the word wealth, usually we talk about ‘billionaires,’ as well we should.

Today the word we need is Trillions.

Senator Warren says a wealth tax will generate $2 Trillion over 10 years if I got her math right, but regular people need to know how big the whole number is.

We still have a chance to pound the table and show regular citizens just how much they have been screwed, and how easy it should be to substantially fix that.

best luck to US - b.rad

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ps source US .gov web site for US Federal Reserve: <https://www.federalreserve.gov/releases/z1/dataviz/dfa/distribute/chart/>

Touch the graph for details. Excellent work, must be thousands of people who make this happen from collecting data to interactive web site. - b.rad

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For 40 yrs I watched this happen with a seat on the front row. I was a Manufacturers Rep and wholesale re-distributor. You're right, trillions of dollars moved to the financial sector. It is/was called Free Market Capitalism, capital seeking the best return, capitalism without a tether. You've explained this change in the clearest and simplest language possible. It should be on the editorial page of every newspaper in the country and on Fox News and MSNBC! You have spent your life being a TEACHER! Your challenge has been taking complex subjects and making them understandable. This might be the most important column you have ever written. Everything you wrote about I've read books about. I'm not your target. The "Reich Nerds" that pay to read you already know this stuff. We're about "confirmation bias." Every member of Congress needs to read this AND understand it. MASS MEDIA needs to repeat this message again and again until it is second nature (buried in the unconscious). This is the culture that CREATED A TRUMP! We can fix it. We created it!

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author

Amen.

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I hope you noticed I referred to you as a TEACHER and not a professor. There are a lot of "professors" who cannot TEACH. It is your greatest gift. You've done the work! You're the cause of my reading many books. It is how you "give-back." Thanks

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Amen brother. I was a Manufactures Rep in Silicon Valley for 40 yrs. Concur with your above comments. Sat in that front row seat as well.

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I share these newsletters, along with others published here on substack, to spread the word.

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Robert Reich, you are a treasure. Both very informed and able to teach. I am grateful to have you as a resource for information, I cannot say enough how much I value your insights.

I do remember my disappointment when Obama left in place all of the Bush people, the last ones who should be influencing anything after the hard fought campaign to elect him for change. The republicans always do the same thing…they don’t stand for anything outside of stopping a Democrat from exposing their sheer greed and corporate love over people. I find Biden much better in terms of expressing the truth about republicans and calling them out. He has some very beneficial accomplishments already but still has major accomplishments to go.

Pandemic is still on but Biden must get out and talk about the Voting Rights Act and characterize the republicans for what they are. We must see indictments on Trump and all of those traitors connected, Michael Flynn, Flynn’s brother, Roger Stone etc. The American people need to witness justice! Especially after seeing murderer Rittenhouse presented as a hero.

The quagmire is that the traitors have everything in place to keep Dems from achieving goals..Supreme Court, federal judges, to slim of a margin in the Senate to pass anything.

How do these things get addressed now?

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Thank you for this sobering lesson. Private equity is destroying this country. These megafunds don't only buy up and plunder stores, they have also bought up and plundered ambulance services, apartment complexes, etc., vital entities whose mismanagement endangers people's lives.

Trump was a disaster, clearly unqualified for the presidency, and in way over his head. Because he had no clue how to govern, he served as a compliant puppet of the money worshippers you describe. But Hillary Clinton would almost certainly have continued the policies of her husband, maybe even worse. Between her stint as secretary of state and her candidacy for president, she received hundreds of thousands of dollars in speaking fees from large financial institutions and other corporations. These were not campaign contributions, which are bad enough, but money going straight into her own pocket. I wondered whether, in return, she would use her position as president if elected to enact policies favoring these benefactors, at the expense of ordinary Americans. The news media really didn't seem to care.

We voters need to look more closely not only at candidates' campaign donors, but also their personal finances.

Meanwhile, Republicans win elections by blaming Black people, immigrants, and AOC for our problems, and Democrats let them get away with it.

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I couldn't agree more--her connections to Wall Street were a major reason why I had to hold my nose when I voted for her.

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Yup.

I don't complain of the financial sector bailout-- and the general public doesn't seem to know what financial collapse would be like.

But the no-strings is just the US version of corruption, in which fealty-payments to large firms, especially finance firms, are required and endemic.

Joseph Stiglitz was right: support of the finance sector should have been accompanied by some combination of public ownership and regulation in the public interest.

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After my mother and husband died, I inherited my parents' life savings (which were considerable as I was the only child, never had a wedding, went to CUNY basically for free), an ironically large amount from his insurance (he died when the amount to be paid was at its highest, before plummeting). So I put this all with Schwabb. Over the past couple of years it has gone up, even a lot. I cannot survive without my widow's annuity, social security and rent from a daughter who lives with me (& has a fed gov't as a librarian -- both my husband and father had fed gov't jobs). I was terrified when Trump stopped social security payments: he was cutting off the central funding of social security, the 1st POTUS to have the nerve, though there have been attempts to privatize it (kill it another way). I know there are now attempts to privatize medicare: I don't understand them but know Biden is doing nothing to stop it. Yes the current economic situation of the US population is the result of directly enacted laws and appointed people

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author

Don't worry about Social Security and Medicare. They're the most popular government programs ever created. (Remember when the Affordable Care Act was being debated, and right-wing protesters showed up carrying placards "Don't threaten my Medicare!").

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You think that (terrible thought) if Trump won the POTUS again, he'd not get rid of it. My fear is he'd try and maybe get away with it. I know to take social security from the millions of people who need would cause tremendous and widespread dislocation. But I put nothing past him. I'd like to think that as when he tried to force people to work for no money, he found he couldn't do it, that he'd find he couldn't destroy SS, but he had begun. He had made the first steps and he could do it little by little. The Tories and after them the "middle-road" Labor people in the UK have been starving the Health System for years and making privatizing inroads on it. I do realize there might be limits but I wouldn't want to risk or try it.

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I am so glad you are touching this subject, Mr. Reich. It is at the core of the political demise of this country today.

The financialization of the economy is the great rip-off working people (vs. speculating ones) have been subjected to. I do not know if the real economy will be prioritized again before democracy is terminated due to right-wing populist demagoguery, but I certainly hope so.

In the meantime, Joe Biden is not having bad polls because of Manchin and Sinema's political games. If his presidency is in shambles, it is because he does not fight to deliver. When will Democrat lawmakers accept to acknowledge that the only way to be a genuine political force is to be backed up by the citizenry you serve? Our current president is probably a nice person. Politically, however, he is not Franklin D. Roosevelt but his exact opposite. I personally feel sad and frustrated that so many people who recognize themselves as Democrats seem to be unable to connect the dots on that.

It is not about the labels, people, it is about the policies and the will to enact them!

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I have not read or heard a clearer or broader explanation. Thank you!

I don't understand most of the financial instruments you mentioned. They aren't real for me except in the repercussions you describe.

In the 2016 and 2020 Bernie campaigns a significant number of people we talked with said they would vote for either Bernie or Trump over the preferred party candidates. It seems to me that "the establishment" was and is more afraid of Bernie than "the former guy" because Trump actually does their business while Bernie wants to curtail it. They can't say that openly because Trump's crazy presentation is embarrassing to them and they like to present a facade of caring for "the people". I find some evidence for that theory in headlines in "liberal" media slant against Biden because he has dared to propose some of Bernie's much needed people centered policies.

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author

There is not a "liberal" media. There's an establishment media that features good reporting but is slanted in terms of what's covered and what's not, and how much emphasis certain stories get. And then there's an anti-establishment rightwing media that's mostly crazy Trumpers and fringe conspiracy-theory groups. What's lacking is an anti-establishment progressive media. Other than MSNBC (sometimes) and groups like Inequality Media (which I'm very proud of), the void on the progressive media side is huge.

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Thank you, Professor Reich, for that correction. Words matter.

I often hear excellent New York Times journalists on DemocracyNow! but don't see their reporting reflected in the headlines in the on line version of the paper.

I am so grateful for Inequality Media.

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Yes. I've promoted all of them. And The American Prospect. But, as you say Janet, they're not widely viewed or read.

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I like Judd Legum's Popular Information, too.

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Thoroughly enjoy your writings and drawings. You are a National Treasure.

Biden is correct in worrying about the ascendancy of Authoritarianism in the world. The MEpublican "juggernaut" is moving us in that direction with money and power and the "supreme court" behind them. Many of our corporations and the very wealthy are with them also.

We appear to have no cohesive solution to counter them. We desperately need a unifying force to represent what polling says are the wishes of the majority of our population which I think is more positive than the minority which is currently winning the day.

Mepublicans fight like a well disciplined team; we fight like a herd of well meaning cats.

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We need to fight like a well-meaning AND well-disciplined team.

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Is there no way we can avoid the metaphors of sports (teams) and war?

While there are surely deeply different perspectives on nearly everything in life, is not the very purpose of a Democratic government to moderate that very human fact? In a democracy, factions and parties are there to make a case to voters who then choose who they want to govern (by resolving differences.) Why do we maintain teams (parties, sides of the aisle) when the purpose of Congress is to negotiate and resolve differences. As long as Congress is a framed as a sports league, there will be games with winners and losers, all based on rules that the contestants themselves get to make.

Does Congress have to be so politicized? Though this may seem like a naive question, I think it needs to be asked and considered if we are to break free from the existing gridlock and actually have a representative government.

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ONE team, like McConnell's mepublicans. I belong to 20+ organizations but don't see the co-ordination.

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"We are not prisoners of bad decisions made in the past." Why has the Democratic party avoided the solutions you have given, for decades? Why is the Democratic party so beholden to the rise of the financiers that they are willing to lose elections, to the point of sacrificing our entire democracy?

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author

Because Wall Street has been a major contributor to the Democratic Party.

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Looks like we here in America are a 'paper tiger', or at the very least, riding a paper tiger. We need to get off and live in a real world where people here can make things, grow things and live in a reality that is actually real. As far as the 'nuts and bolts' of what you described in that article 40 years ago, it might as well be Greek, but I get the gist of it. I was one of the home buyers who were stung by the 'housing collapse' or 'sub prime' housing market where 'instruments' of fraud were used widely. Can't wrap my head around it still, but it was a rip off I do know.

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We need to get the clothing industry back, and we should have OUR technology on our shores. Women’s tops all get holes in the front, every single clothing brand has this issue. All the tops are see-through thin. In the short and long run, we are wasting loads of money replacing these clothes. I’ve been trying my best to buy handmade items locally and from Etsy (preferably from individuals in the US). But I cannot find enough sources for decent clothing. I will pay $50 for a quality top over the $20 top that is lasting 2 months.

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Seeking Reason ; Same! I brought my kids up using lightly used clothes. My daughter buys from thrift shops what she does not make herself. Exceptions are shoes and pj's and the like. My DIL (daughter in law) is a minimalist, as is my son. They avoid clutter and 'overconsumption'. I'm happily donating clothes that are too large for me since losing weight. the local church has been able to pay taxes on their unused property with funds from donations. They let my customers park on their lot when needed.

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What you've shared here is why I had a hard time voting for, Joe Biden.

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I did too, Art. But the alternative was out of the question. Wouldn't it be nice to have a chance to vote for good candidates, instead of the least worst?

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I've never voted for a republican. Ever. My parents were UAW workers. It's not in my DNA to vote republican. Trump was never part of the equation. It boiled down to vote for Biden, or don't vote at all.

I want stellar candidates that can walk their talk.

https://truthout.org/articles/biden-dodges-question-about-his-failure-to-cancel-student-debt/

Our second eldest granddaughter graduated after 7 years of studying to be a Doctor of Pharmacy. Her grandmother and I did the math regarding student loans as she neared graduation... You don't even want to know...

Government of the People, by the People, and for the People.

We're running out of time

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If responsible citizens seek "A More Perfect Union" (a great book by Adam Russell Taylor), we must build from the bottom up. Since the 1980's we have primarily focused on a top-down approach, which has not worked, but only exacerbated wealth & income inequality. Don't trust me, read "The Triumph of Injustice" by Emmanuel Saez. It is time to "Make Capitalism Work for the Many, Not the Few" (another insightful book by the "tunnel rat"). It is time to support the poorpeoplescampaign.org & March on Washington on 6/18/22.

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author

I don't think we have to choose between top-down and bottom-up. It needs to be both.

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Agreed.

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I wholeheartedly agree with your assessment. You've been "right on" for lo these many years. Now, how can us aging lowly workers (and retired and barely surviving former lowly workers) get the oligarchs in Washington to implement ANY of the needed changes?

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author

There's only one way for most of us: make a ruckus, and continue to make a ruckus. Organize and mobilize. Write letters. Get involved in campaigns. Do what we can to be heard.

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Thank you thank you thank you for expressing it succinctly and completely!

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All so true, but where’s the outrage? At least two generations of Americans have grown up not knowing anything different. Their world view is that they better be happy with the dregs lest they lose even those. We are a beaten down and defeated society, and that’s why we have Donald Trump and all of the vile things that come with him.

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