Delivering on the Promise for Shared Prosperity

This blog post originally appeared on 11/19/2016 in Walker View Points

It’s been 10 days, and no one knows how this is going to turn out. Some are pursuing a “not my President” campaign, including hoped for electoral college vote influencing which might overturn the expected election results–a very long shot. Some are already planning for the impeachment of the President-elect. Supporters are fighting over the 1,200 Government positions only requiring the President’s nomination and a majority of the Senate–seemingly “in the bag.” The news about his choice of advisors and Cabinet members from among the cronies who vocally supported his campaign is discouraging–people like Giuliani, Christy, Sessions, Flynn, and others.

Even a preliminary view depends on how he chooses his closest advisors and how the specifics of his policies emerge–policies which on the surface are wholly objectionable to my friends and I–such as having trade wars (see Edoardo Campenella’s description of how a trade war with China would backfire) and shipping 11 million people back to Mexico. But it is already evident that these promises will be “broken” before he even gets started–thanks for that! Not sure how his supporters will feel about that.  But hey, they didn’t care about any of the other negatives that emerged about their idol, so it’s likely they won’t bat an eye at failure to deliver–at least not for a year or two. They will all wait to see the “greatness,” in good paying jobs with increasing wages that he promised to bring back. This is the key promise–the rest will be forgotten or forgiven by most if he can deliver this. But that’s not going to happen, as I have been trying to explain in previous posts.

It should be apparent to everyone that this President has a mandate. He has won the election with a rabid group of supporters from across America, and his party controls both houses of Congress. Numerous pundits have identified the global forces which are behind the “Trumpism” which is spreading across the globe, evidenced by the British Brexit and populist parties gaining power throughout the developed world. So, the longer term view depends on his effectiveness in working with the American system of government, with which he has no experience and would appear to have little patience. But, beware– Congress has taken down men far better than Donald Trump. Republicans have control of both chambers, but there are many Republican members of Congress who are wise, and do not like Trump.

In an enlightening article in the issue of Foreign Affairs, Mark Blyth explains that the “debtor’s paradise” of the 1970s (characterized by increasing wages and high inflation reducing the cost of debt) was transformed by neoliberal policies beginning in the 80s. Ultimately, we have become a creditor’s paradise (characterized by increasing returns to capital and stagnant wages to the middle and lower classes). Neoliberal policies have been developing for more than 30 years, and are now spread throughout our entire system of government–regulations, policies, practices, law, etc. Robert ReichJoseph Stiglitz, and others have written extensively to argue that an entire “re-do” of our American system of government is in order, to truly re-establish a more egalitarian America.

For me, the epiphany came in my MSc program in 2012 at the School of Oriental and African Studies in London, where I studied Globalization and Development–which is the study of the global forces which have led to the current economic and political condition of the countries of the world. In this program,  going back from 50 years to the present, I began to understand the impact of “neoliberal” policies which emerged around 1980, and have steadily taken increasing control of political and economic power since. Some of those policies were justified at the inception, a response to cost plus inflation which had been like a pendulum swung too far by the 70s. But now we have let the (opposite) neoliberal policies run their course without (most of us) realizing the pendulum was swinging too far in the other direction, not controlled or moderated. These policies emphasized the benefits to capital over labor.

Furthermore, we allowed the strengthening of these neoliberal economic policies while globalization and technological advances accelerated the advance of inequality–in wages and in wealth. So now we have inequality which has risen to peak levels, and in the US it is worse than in any other developed country.

If Trump could deliver 6% economic growth, maybe we would experience just enough improvement in wages for the lower economic classes, to quiet some of their restiveness, even while the top echelon of wealth and income continues to gain more share of the pie. But this would only stave off the crisis for a little while. 6% is not going to happen and the most increase in growth he can deliver will not be adequate to create even a minimum level of “trickle down.” Growth is necessary to rebalance inequality, but it is not sufficient–a clear economic principle.

Since London, I have been convinced that the most significant problem facing the world is inequality.

That’s why I am a member of Patriotic Millionaires. We believe that some thoughtful forms of redistribution are urgently needed to restore fairness to those who have been the losers in the advance of neoliberal policies, and who are likely to be keenly disappointed by the Trump administration. Patriotic Millionaires is mobilizing to fight for what is best for the American people.  We will work with the new administration if they will work with us. We can help the Trump administration deliver on the most critical of their essential mandate–shared prosperity.

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