The System: Who Rigged It, How We Fix It

I’ve felt for a long time that income inequality is one of the biggest problems in this country, but I’ve also had a sense that the problem isn’t just that a few people are making an obscene amount of money while many more struggle to get by, or even that the disparity between rich and poor is increasing. It also seemed to me that our country was drifting in the direction of becoming an oligarchy, in which a small number of people not only enjoy a disproportionate share of the country’s wealth but also an ever-increasing share of power over our politics and governance.

So it was a cathartic, almost electrifying experience to read Robert Reich’s new book, The System: Who Rigged It, How We Fix It. I’ve never read anything that so cogently and comprehensively describes the disproportionate power that the wealthiest Americans have acquired over not just the economy but also our political system, and how thoroughly they have rigged that system to ensure that their wealth and power increases at the expense of everybody else.

For four decades after WWII the growth of American prosperity was widely shared. The proverbial rising tide really did lift many if not all boats. But since the 1980s, increases in America’s wealth have disproportionately gone to the top ten percent while the incomes of everyone else have stagnated.

There is a widely held belief, even among some of my best friends, that the degree to which the fruits of our economy accrue to the wealthiest among us is just the natural order of things. It assumes that those who have amassed great wealth deserve it. It also assumes that any action we might take to redress wealth disparities would undermine our prosperity. These are key tenets of “market fundamentalism,” which Reich dismisses as rubbish.

Reich likens market fundamentalism to the concept of the divine right of kings. Both are myths invented to justify the retention of wealth and power by those who already have it.

The System is a searing take-down of America’s emerging oligarchy. It provides a comprehensive and yet concise accounting of the myriad ways that the oligarchy has used its vast wealth to buy legislation that advances its self-interest, and co-opt think-tanks and universities to overlook systemic causes of injustice and inequality. They have succeeded at reducing the taxes they pay, eliminating regulations designed to reign in their excesses, and abolishing limits on their ability to pour even more money into politics to ensure that legislators do their bidding.

One of the most corrosive ideas to arise in the last few decades is the assumption that corporations are responsible only to their shareholders. Reich notes that for decades corporate leaders saw it as their duty to serve the interests of multiple stakeholders — their employees, customers, and suppliers, as well as the communities in which they did business. That changed in the 1980s. Today’s CEOs consider themselves beholden only to those who own their company’s stock. Reich describes how this change came to pass and details its pernicious consequences. He makes a compelling case that it is neither just nor inevitable.

Increasingly, Reich insists, the major divide in our country is not between black and white, or Democrat and Republican. It is between the tiny portion of Americans who hold a huge and increasing share of the country’s wealth and power, and everyone else. The problem is not just that so many Americans struggle to get by as the rich become richer. It is that our democracy is being subverted by the corrupting influence of big money.

As dire as the situation is, Reich believes that the increasing concentration of wealth and power at the top is unsustainable. “Eventually,” he writes, “those who are bullied will gain the courage to fight back and reclaim economic and political power.” He cites historical instances of oligarchs becoming too powerful for the good of society and recounts how balance was restored. He also describes what it will take fix the system as it exists today.

A friend of mine told me the other day that he had heard of Reich’s book and was interested in reading it even though it would likely make him “even more depressed about current events” than he already is. I had a similar concern, but I am intensely interested in understanding what underlies the tension and dysfunction in America today and thought Reich’s book might provide insights. It did more than that. It went to the heart of the matter as nothing else I’ve read has. And rather than being demoralized, I was energized.

I consider The System required reading for anyone with a commitment to addressing the injustice and divisiveness that plagues our country. The underlying issue is not one of national character, or racial resentment, or the fundamental nature of human beings. It is a political and economic system that has been warped to benefit those at the top. And it doesn’t have to be that way.