Book Presentation

When the US economy foundered in 2008, blame was directed almost universally at Wall Street. The real reason for the meltdown, however, was much more structural – there was an increasing concentration of income and wealth at the top rather than being spread across the American middle class. Specifically, in 2007, the richest 1 percent of the population took in 23.5 percent of total national income. By comparison, in the late 1970s, the richest 1 percent took in less than 9 percent of the nation’s total income. As a consequence, the middle class in recent times has had to go deeply into debt in order to sustain a decent standard of living which is a situation which is clearly and obviously unsustainable.

This concentration of income is at the heart of America’s current ongoing economic predicament. The challenge to move forward is not to get Americans to save more and borrow less from the rest of the world but to rebalance the American economy so the benefits of commercial activity are shared more widely than they are at present. Until this transformation is made, the US economy will experience phantom recoveries and damaging speculative bubbles. The only way sustainable growth will be achieved for the American economy is if the purchasing power of the middle class is restored. This is the central choice of the current political era and it is vital that we respond to this issue now rather than hoping it will go away.

Robert Reich is professor of public policy at the University of California, Berkeley. He served in three presidential administrations, most recently as secretary of labor under President Bill Clinton. He is the author of twelve books including The Work of Nations and Supercapitalism. Dr. Reich is cofounder of The American Prospectmagazineand provides weekly political commentarieson public radio’s Marketplace.

This is a summary and not a critique or a review of the book. It does not offer judgment or opinion on the content of the book.  This summary may not be organized chapter-wise but is an overview of the main ideas, viewpoints and arguments from the book as a whole. This means that the organization of this summary is not a representation of the book.