Requiem for the American Dream Reaction

I recently joined the millions of folks that transitioning from expensive cable plans to less-expensive digital options. I joined the Netflix family, and was pleased to find a documentary focused on questions around finance.

Requiem for the American Dream featuring Noam Chomsky

Being unfamiliar with Noam Chomsky aside from his opposition to the Vietnam War, I decided to invest an hour to hear what one of America’s most prominent thinkers has to say about The American Dream.

I’m not an expert, and my hope with this post is not to make it unnecessary to watch the movie. I’ll touch on some sound bites that made me think, and I look forward to your comments below.

10 Principles of Concentration of Wealth and Power

Chomsky’s thoughts come to light based on these 10 principles of concentration of wealth and power. Right now I’m thinking it may be more worthwhile to just Google these and save 50 minutes for something else finance-related.

Policies favoring wealth and thus concentrating wealth and power

Since the beginning of time, those with wealth have gotten together with those who have power and shape policy. Not a huge shocker, but sometimes it helps to have a reminder that this happens to be the way that our democracy works. Not to get political, but you can totally put Trump and Clinton into this matrix and see that intertwining of policy and the wealthy.

Adam Smith and James Madison

In Wealth of Nations, Adam Smith refers to those with power and policymakers as the “masters of mankind”. I bet a candid moment with some members of Congress would have them having the same feeling towards their peers. James Madison wrote papers about making sure that power remained in the hands of the responsible wealthy. That leaves the other 97 percent or so of people that do not qualify as wealthy (like myself). Sounds like we need to let the wealthy and powerful make the decisions as to how the economy works.

The business of business

Lately I’ve been hearing a common refrain: “We don’t build anything anymore”. Or “All our jobs are going overseas”. Both are comments that refer to the business of business – a move away from manufacturing and towards complicated business dealings that create capital and nothing else. It also means that when something needs to be manufactured, US workers can’t compete in the global marketplace where work conditions can be significantly worse and labor is cheap. That puts a whole lot of our communities at risk for disappearing jobs.

Produce for the wealthy classes here and overseas

With many local communities disappearing (particularly in the rust belt and other industrial towns), companies are not producing goods only for the middle and upper class populations. While they previously had to serve a national market including the lower classes, they can now sell directly to wealthy populations overseas. Think of reaching consumers in Dubai and Macau as opposed to Camden, NJ or Allentown, PA.

Rough seas ahead

It goes without saying that some people are equipped to get by regardless of how ugly the economic picture gets (and half of Wall Street thinks the economic picture is not ugly), and some people continually make poor financial decisions even in good times. But more importantly, there are fundamental changes in industry which mean some jobs are disappearing completely, and there are also more opportunities for entrepreneurs to sell their wares. It’s good and bad, pretty and ugly, and with fewer people focused on the well-being of others, that puts certain populations at risk.

We’ve got some rough seas ahead.

Sincerely,

Joseph

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