I started Robert Reich's 2002 book, I'll Be Short: Essentials for a Decent Working Society. This book was published in the year that Reich was running for Governor of Massachusetts, as a Democrat. But Reich did not gain the Democratic nomination, and Republican Mitt Romney was elected Governor of Massachusetts.
In my latest reading, Reich was talking about
issues that I have discussed before on this blog, as I've gone through
other books: technological advancement and trade getting rid of jobs,
the decline of unions, disparity of wealth, etc. Jobs are lost and
wages are depressed, as corporations increase productivity and get more
profits for CEOs and shareholders. (UPDATE: Reich actually did not mention increased productivity, as far as I can remember, but he did mention more profits.) Reich says that he is not for
turning the clock back, but he recognizes that the decline of the
middle-class and growing disparities of wealth are a problem. In
the 1950's, Reich says, his parents' clothing shop made money when the
wages of local factory workers went up, for the factory workers had more
money in their pockets to spend.
It will be interesting to see how Reich proposes that we deal with this problem. I doubt that he is for decreasing productivity, but is he for limiting the amount that CEOs and shareholders can make?
But, without a profit motive, would CEOs take risks, and would
investors invest? That's a good question, and people of different
ideological persuasions would offer different answers. In my
opinion, even if the government takes more in taxes from profits, CEOs
and investors are still making more than they would make by not taking risks and investing, so an incentive could still be there.
One topic that Reich mentions that I was going to address but did not in my write-ups on Paul Krugman's The Conscience of a Liberal was the minimum wage. On pages 261-262, Krugman attempts to refute the argument that raising the minimum wage will increase unemployment.
He refers to a study by David Card of Berkeley and Alan Krueger of
Princeton that says that recent increases in the minimum wage did not
result in job losses. Krugman also notes that the state of Washington has a higher minimum wage than Idaho (higher by three dollars), but The New York Times
says that "Small business owners in Washington...say they have
prospered far beyond their expectation[, and] Idaho teenagers cross the
state line to work in fast-food restaurants in Washington" (the New York Times' words on page 262).
Krugman acknowledges that a fifteen dollar increase in the minimum wage
could result in a loss of jobs, but he doubts that a modest increase
would do so.
I'd like to close this post by quoting what Reich
says on page 21. "Hey, Reich, you might say. You were in Washington.
You were a cabinet member in the Clinton administration. Why didn't you
and your friends fix this problem? Well, we did raise the minimum
wage, implement the Family and Medical Leave Act, close sweatshops, get
millions of Americans the skills they need for better jobs, and get the
economy back on track. But we didn't get everything done by a long
shot." I've long wondered what exactly Reich thinks about the Clinton
Administration, since he was more progressive than some of the prominent
people who served in it. Maybe I'll one day read his memoir about that
time, Locked in the Cabinet. What I got out of that passage in I'll Be Short, however, is that he believes that the Clinton Administration did good things, but it was not enough.
Martyn Lloyd-Jones interview
3 hours ago