Status
Available
Collection
Publication
Center for Economic and Policy Research (2016), Edition: 1, 258 pages
Description
There has been an enormous upward redistribution of income in the United States in the last four decades. In his most recent book, Baker shows that this upward redistribution was not the result of globalization and the natural workings of the market. Rather it was the result of conscious policies that were designed to put downward pressure on the wages of ordinary workers while protecting and enhancing the incomes of those at the top. Baker explains how rules on trade, patents, copyrights, corporate governance, and macroeconomic policy were rigged to make income flow upward.
User reviews
LibraryThing member DLMorrese
The economic system of the U.S. is rigged. It consolidates wealth in the hands of a very few at the expense of many. Outrageously high pay for CEOs, rights holders, capital owners, professionals, and financiers is a drain on the overall economy. Very little if any of this disproportionate
Show More
compensation is justified in terms of improvements to efficiency, quality, or performance. I think this is obvious enough to anyone who has been paying the least amount of attention over the last forty years. This book isn't the best explanation of this that I've seen. The academic style makes for a fairly dull read, but it doesn't rise to the status of a scientific study. It often shows correlations but falls short of proving causation, and it frequently elevates suppositions to the status of explanations. It could also have been better edited. That said, its overall conclusions have merit. Show Less
LibraryThing member stillatim
Do I agree with many of Baker's points? Yes: there is no such thing as a neutral, natural market outcome; economic outcomes are always choices made by human policy-makers just as much as they are by human producers and consumers. Would less inequality be nice? Yes.
Is this a good book? Not
It is also a question of context. Baker suggests that the strength of the US dollar is a policy decision made by the US government to, duh, make life harder for the working class. If the government really wanted to, it could somehow get China to help weaken the dollar vis a vis China's currency. But there's no reason to believe that that is true: the weak Chinese currency helps China far more than anything the US could offer as a trade-off. Similarly, central banks focus on anti-inflation, not because of nefarious underhanded dealings, but because they have to focus on something, and it turned out that focusing on currency exchange rates wasn't a very good method for central banking. Could they have chosen something else to focus on? Yes. But they had focused on full employment in the past, and under that economic system, it didn't work. Baker thinks they should focus on full employment again. He might be right. But he constantly underestimates how hard it would be to bring out the changes he's calling for.
He also lacks much comparative breadth. US doctors are over-paid, but, I'm guessing, not primarily because the industry is heavily protected. The Australian medical profession is highly protected, but not as highly paid, nor as highly specialized. Why? Because Australia has universal healthcare, not privatized health insurance. With privatized health insurance, it's in everyone's economic interest to make medical procedures as expensive as possible: that way, the doctors make more money, the hospitals make more money, Pharma makes more money, and the patient doesn't see too much difference, because health care costs are taken out of the pay packet, rather than handed over at the counter. Install a system under which it's in most people's interests to keep medical costs down, and you'll have fewer trips to specialists, more GPs, cheaper pills, and so on. None of which is to say that medicine needs to be protected. Again, I agree with so many of Baker's points, but his rhetoric is so irritating that I find it hard to see my agreements.
In other words, he seems to have learned many lessons from contemporary 'right-wing' economics: the heartlessness, the unwillingness to examine the actual world rather than models, and so on.
On the other hand, this is a policy polemic, and part of the point is to make readers believe that change is possible. Many of his readers will be heartless context-and-history deniers who also have no interest in helping actual human beings. Baker wants to help people. He insists that major change is possible. Here's hoping he's right.
PS: he seems to have no idea how publishing works for novelists, poets, and essayists, who want to earn a living from their work. He essentially equates the economic effects of copyright and patent protection. But there's a pretty big difference between "it would be nice if nobody else could make money off the novel I spent three years writing" and "it would be nice if I could sell this life-saving cancer medication at 1000 times the production cost."
Is this a good book? Not
Show More
particularly. It is clearly written, but also written with rather too heavy a hand; Baker's statistics speak for themselves, for the most part, but his rhetoric suggests some grand upper middle-class conspiracy to defraud, well, someone else. For instance, anti-inflation policy "is a commitment by the government... to keep wages down." That's a bit like saying "Dutch dykes are a commitment by the government to jack up the price of water-front properties." Are the two things connected? Yes. But there are plenty of good reasons to pursue anti-inflation policies, and plenty of bad reasons, and keeping wages down is not generally the first one that leaps to mind. Again, this is a question of rhetoric. It is also a question of context. Baker suggests that the strength of the US dollar is a policy decision made by the US government to, duh, make life harder for the working class. If the government really wanted to, it could somehow get China to help weaken the dollar vis a vis China's currency. But there's no reason to believe that that is true: the weak Chinese currency helps China far more than anything the US could offer as a trade-off. Similarly, central banks focus on anti-inflation, not because of nefarious underhanded dealings, but because they have to focus on something, and it turned out that focusing on currency exchange rates wasn't a very good method for central banking. Could they have chosen something else to focus on? Yes. But they had focused on full employment in the past, and under that economic system, it didn't work. Baker thinks they should focus on full employment again. He might be right. But he constantly underestimates how hard it would be to bring out the changes he's calling for.
He also lacks much comparative breadth. US doctors are over-paid, but, I'm guessing, not primarily because the industry is heavily protected. The Australian medical profession is highly protected, but not as highly paid, nor as highly specialized. Why? Because Australia has universal healthcare, not privatized health insurance. With privatized health insurance, it's in everyone's economic interest to make medical procedures as expensive as possible: that way, the doctors make more money, the hospitals make more money, Pharma makes more money, and the patient doesn't see too much difference, because health care costs are taken out of the pay packet, rather than handed over at the counter. Install a system under which it's in most people's interests to keep medical costs down, and you'll have fewer trips to specialists, more GPs, cheaper pills, and so on. None of which is to say that medicine needs to be protected. Again, I agree with so many of Baker's points, but his rhetoric is so irritating that I find it hard to see my agreements.
In other words, he seems to have learned many lessons from contemporary 'right-wing' economics: the heartlessness, the unwillingness to examine the actual world rather than models, and so on.
On the other hand, this is a policy polemic, and part of the point is to make readers believe that change is possible. Many of his readers will be heartless context-and-history deniers who also have no interest in helping actual human beings. Baker wants to help people. He insists that major change is possible. Here's hoping he's right.
PS: he seems to have no idea how publishing works for novelists, poets, and essayists, who want to earn a living from their work. He essentially equates the economic effects of copyright and patent protection. But there's a pretty big difference between "it would be nice if nobody else could make money off the novel I spent three years writing" and "it would be nice if I could sell this life-saving cancer medication at 1000 times the production cost."
Show Less
Language
Original language
English
Physical description
9 inches
ISBN
0692793364 / 9780692793367