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Has the American Dream Been Stolen? Athens to New York Spring, 1999 Prof. Kim Pearson.

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Presentation on theme: "Has the American Dream Been Stolen? Athens to New York Spring, 1999 Prof. Kim Pearson."— Presentation transcript:

1 Has the American Dream Been Stolen? Athens to New York Spring, 1999 Prof. Kim Pearson

2 Outline n Who Stole The American Dream? The Series and the Controversy n What has happened? n The Evolution of Capitalism n Current Issues

3 Who Stole The American Dream? The Series n 1996 series n Followed 1990 series -- “America: What Went Wrong” n Both became books

4 Who Stole the American Dream? Major Claims n American middle class is shrinking while ranks of rich and poor are growing n Major cause is export of high-paying manufacturing jobs, increase of lower- paying, less stable service jobs n U.S. tax and trade policy favors this trend, in effort to assist US corporations

5 The Controversy n Critics contend that Bartlett and Steele’s reporting was biased; ignored the good n Also contend that Bartlett and Steele’s reporting failed to take into account the realities of the global economy n Supporters argue that government and society should be more concerned about the losers in the current economic transformation

6 What has happened? n Shift from industrial to information economy, booming markets n Shift from industrial to global information economy, booming markets n Decline in US manufacturing jobs n Few jobs available for unskilled/low- skilled workers that support a family n Shortage of skilled workers n Labor union membership in decline n Two-income households the norm

7 An Old Debate: The Evolution of Capitalism n Adam Smith n Thomas Malthus n David Ricardo n Karl Marx n John Maynard Keynes n Arthur Laffer n Robert Reich

8 Adam Smith n 1776: Wealth of Nations; first description of capitalism n Pre-industrial revolution n Core concepts: free market, supply and demand, free trade n Believed “invisible hand” would ensure fairness n Ignored caste differences and other artificial barriers

9 Thomas Malthus n , a cleric n Published Essay on the Principle of Population, 1798 n Argued: Population rises faster than food supply; must cut birth rate n Critics cite history of growth

10 David Ricardo n , tycoon n Went in to business at 14, retired rich at 42 n Iron Law of Wages: Analyzed effects of markets on wages; argued against government role

11 Karl Marx n Work influenced by Dickensian world of the 1850s n A theory of history that was translated into an ideology n Declared, to his dying day, “I’m not a Marxist.”

12 Karl Marx n Progress comes from expanding the ownership of the means of production n When workers control the means of production, classes will disappear n Capitalism can reinvent itself

13 John Maynard Keynes n Studied “boom-bust” cycle of business n Businesses fail when demand is inconsistent. n Government can “prime the pump” when business is slow by cutting taxes and spending more n This was rationale behind “New Deal” policies during the Depression

14 Arthur Laffer n 1974: Argued that excessive tax rates can actually decrease revenue n Rationale for Reagan tax cut

15 Robert Reich n Former Labor Secretary under Clinton n Critic of “Corporate Welfare” n Argues for investments in worker education, retraining

16 Conclusions: It’s a Small World After All n Free market capitalism no longer exists n All industries are global, not national n While Mathus’ nightmare never materialized, sustainability is a real issue for the whole planet n Increasing dependence on technology makes the issues of education and equity more critical than ever.


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