Unfortunately, he does not see money itself with the same clarity.  For all his perceptiveness, he looks right past it.  Then he tries to wrap “solutions” within his ideology which is, in its turn, rooted in times and attempted solutions past.

Ascribing fundamental responsibility to an economic phenomenon he labels “Supercapitalism,” Reich wants his world back. He wants that world where the major corporations were first citizens and partners, then merchants and shareholder servers.  He remembers with overt nostalgia the servant leaders of the Fifties’ and Sixties’.  He suggests they could look right past their balance sheets to serve greater goods. 

This was the “Not Quite Golden Age” when entire industries effectively colluded to set prices without living in fear of overseas undercutting.  Rather, with the extra bounty thus generated by less than competitive markets, these corporations had the capacity to be great citizens while participating in a culture of greater civility, equality and universal pleasantries.  With price competition safely in its place, the servant leaders of big industry could split the difference with their middle-class unionized workers.  Their workers could then fully participate in their communities.  Their companies could care for the environment without complaint.  And the birds sang and happiness reigned supreme.

He recalls when there was just enough more pad in the profits to generate a country wide egalitarian ethos and a healthy participatory democracy.  Remembering the Main Streets of the Fifties and Sixties, he longs to stroll once more past the locally owned stores, waving at his friends, their owners and their customers.  He reminisces rhapsodically for the days when his government covered him with just enough safety nets to keep the wolves away while equalizing the benefits of a productive economy and establishing an egalitarian democracy.

No more.  Reich first laments the passing of this era, then he explodes with righteous indignation when he contemplates the manners in which the pursuits of price have come to dominate all other values in the economy.  As he looks back at the post World War II era, he observes that people increasingly bought and invested simply on price and value.  People did not buy the goods of a company that paid its workers extra if other goods of similar quality could be had for a lower price.  People did not invest in the stock of a company who took money from the bottom line to clothe the poor and feed the hungry.  This means that the prices on products manufactured by the socially responsible corporation can only reflect tangible, qualitative benefits.  This means product features not process and practices.  Shareholders demand profits.  Profits require maximized efficiencies and single-minded fidelity to the bottom-line.

Reich suggests that when price and profits control everything to this extent, other values are undermined.  And he misses them.  He was happier with a Main Street that brought with it camaraderie, convenience, orderliness and community.  He thought it was a good thing for more people to share in a general prosperity.  “Profits” are not enough to give us equality, functional democracy or desirable society.

Reich, former Secretary of Labor with the Clinton administration, perceptively grasps vital changes in the way our world works.  Sticking primarily to the United States but discerning global implications, he details the cultural and political shifts that have taken place since midway 20th century and grieves their passing.

He also grasps the paradox of dual perspectives.  Including himself in the inconsistencies, he notices that we may lament the passing of “Main Street,” but we also love Wal-Mart’s low, low prices in the store and the fast-growing prices of its stock.  For most of us, participatory democracy is fabulous so long as it does not interfere with consumption.  Lower prices trump the American ideal.  And that’s the point of Supercapitalism, money and its attendant money forces have gutted some good stuff.

Reich sees this and describes it beautifully.  Unfortunately, his lenses continue to reflect his visions of the sort of society where physical force and rule of law tend to dominate financial thinking.  They come at the expense of failing to grasp how money works and its implications for our culture.

Virtually every one of Reich’s grievances is rooted in money’s nature.  Speed, remorselessness, efficiency, single-mindedness all come as part of the money package and would seem to provide us with considerable conversation fodder.  Unfortunately, he whiffs and goes legal.  He blames corporations and the notion that a corporate vehicle is a legal person.  He then spends the last part of his book explaining why we should change the way we treat corporations.  He would take away its status as a “person” in the eyes of the law and terminate an array of corporate perks in the name of improved and accountable stewardship.  This is where his vision succumbs to ideology.  He sees “Supercapitalism” as a cause of socio-cultural deterioration, not the effect of the money force’s ascendance in our world.  By misinterpreting them as legal issues, he misses both the money piece and the opportunity to look at the money forces clearly.

Personally, I very much enjoyed reading Reich’s descriptions of a changed America.  He pulls a lot of information into one place and puts it in perspective.  He makes the case that we have given up some good stuff, stuff that we might well wish to reconsider and review.  Unfortunately, when he looks at the state of our world as it now is, he fails to grasp the money forces and their implications.  Rather, in looking for answers, he tends to see law, not money, at the core.  In so doing, his powers of interpretation fail him.

© 2008 Richard B. Wagner. Reprinted with permission.