http://www.thenation.com/article/155492/seventies-show
That Seventies Show Rick Perlstein | October 20, 2010 (snip) So how and why did the United States trade factories for finance in the 1970s? The young scholars collected in The Shock of the Global anthology have many more answers. Louis Hyman, a 2007 Harvard history PhD who landed at McKinsey & Co., gives us a groundbreaking account of how a new financial instrument called the "mortgage-backed security" emerged, irony of ironies, from the embers of the urban riots of the 1960s. It was intended as a safe way for industrial unions to invest their pension funds but ended up as the turbo-charged vehicle of choice for go-go hot-money investment banks seeking to "evade geographic and state boundary restrictions on lending." Vernie Oliveiro, a graduate student in the same department, uncovers how Democratic mandarins like George Ball (who pronounced before the International Chamber of Commerce in 1967 that national boundaries only "impede the fulfillment of the world corporation's full potential as the best means yet devised for using world resources") and Fortune magazine (whose managing editor the next year heralded the rise of the "Business Internationale") were joined in the yeoman work of propagating the notion that divesting themselves of American factories actually improved the lot of American workers. (From the archives of a business museum in Delaware, for example, Oliveiro excavated "Your Job Is Bigger Than You Think," a pamphlet 3M distributed to its employees explaining that unless they were "able to operate in those countries as a local business employing local people and giving local service, not as a foreign"—well, that local people in America would somehow lose their jobs.) Oliveiro's dissertation promises to be an outstanding addition to the crucial story of how big business organized to crush liberalism in the 1970s. Daniel Sargent, an assistant professor at the University of California, Berkeley, narrates how, by the time of the Carter administration, the very notion of Congress legislating in the national economic interest—instead of an abstract "global economy"—was beginning to seem anathema. America was being remade in the 1970s. But what these younger scholars much more effectively grasp was that this transformation—including the remaking of the country from a headquarters of factories to a headquarters for finance—cannot be understood as an exclusively or even predominantly economic process. It was also a cultural one. I was especially fascinated by Matthew Connelly's contribution to The Shock of the Global, an article about the 1970s obsession with predicting the future. The trend, he points out, joined evangelical Christians, environmental doomsayers, "Team B" neocons predicting imminent Soviet military dominance and even, yes, the psychics hired by the CIA and the Defense Intelligence Agency. "The different forms it assumed," he argues convincingly, "cannot easily be disaggregated." What they shared was a sense of apocalypse. What induced this shared dread? The experience of inflation, for one thing. Inflation was supposed to be a nugatory consideration in the brave new world of the Great Compression. The wizardly Keynesian economists who were the era's priests were fond of scything remarks. Here's Paul Samuelson in the 1950s: "By the proper choice of monetary and fiscal policy we as the artists, mixing the colors of our palette, can have the capital formation and rate of current consumption that we desire." If prices started going up, that means you had painted the economy in hues a bit too hot; cool it down, and the inflation would go away. Too cool, just add some heat. But then came something called "stagflation": the coexistence of a high inflation and stagnant unemployment. Stagflation was supposed to have been impossible, yet there it was. Its emergence, Samuelson sheepishly admitted, amounted to "a sad reflection on my generation of economists that we're not the Merlins that can solve the problem." It deflated not just economists' but an entire nation's ego. As Connelly points out, "Of all economic phenomena, inflation is particularly pernicious in stoking anxiety about the future. It forces people to readjust their expectations continuously, since their wages are worth less every day, while the goods they need cost more all the time." The continuous readjustment of expectations—downward: that was a key experience of the 1970s. An expectation can be wrenchingly hard to readjust because there is an awful existential lag involved. As historians go, Jefferson Cowie is that awful existential lag's bard. Cowie is a younger historian at Cornell, whose book Capital Moves: RCA's Seventy-Year Quest for Cheap Labor received a prize for the best book in labor history in 2000. In 2008, with Nick Salvatore, he published a major essay in International Labor and Working Class History, which argued that "while liberals of the seventies and eighties waited for a return to what they regarded as the normality of the New Deal order, they were actually living in the final days of what Paul Krugman later called the 'interregnum between Gilded Ages.'" I've struggled so long trying to figure out a way to summarize Cowie's new book, Stayin' Alive: The 1970s and the Last Days of the Working Class, that I started worrying I was losing my critical mojo. I've summarized dozens of books in my literary career; it's become rather second nature. Some books, however, are not easy to encapsulate. Often that means the author doesn't know what he or she is doing. Other times, though—much more rarely—the summary is difficult because the work is so fresh, fertile and real that the only thing it resembles is itself. I can't summarize my favorite movie, Jacques Tati's Play Time. You just have to see it. And I can't summarize Stayin' Alive. You just have to read it. It establishes its author as one our most commanding interpreters of recent American experience. It corrals all the generational energies coursing through the centrifuge of post–baby boomer '70s scholarship and churns them into the first compelling, coherent statement I've read of what happened in the '70s. Laura Kalman expresses well the consequences for a liberalism that formed its operative assumptions in an age of plenty and could not but run into tragedy when it carried forward those assumptions into an era of scarcity. "Inflation made desegregation more costly," she points out. "Democrats had assumed that a pluralistic, interest group–oriented liberalism would benefit all society." Instead of sharing in a cornucopia of abundance, working-class whites and minorities ended up competing "for a very limited piece of pie instead of joining forces to fight for a larger slice." Stein quotes a Nixon economic adviser explaining why that administration decided to repeal a 7 percent investment tax credit designed by the Kennedy/Johnson White House to encourage companies to expand their factories: "There were more important things at this juncture in history to do...than to make even more rapid a rate of growth that is already very rapid or making larger a gross national product in 1975 or 1980 which already in any case is going to be a staggering size." The American Century was supposed to be a century; no one thought it would last only thirty-two years. Cowie's accomplishment is to convey what this epic cheat felt like from the inside. The fact that he is able to do so from the perspective of working people does no less than revivify the moribund genre of labor history. Here is a taste. It is August 1974, the month of Nixon's resignation. An old-fashioned labor-liberal refuses to cross a picket line at his workplace, single-handedly shutting down production for a month. "It's a matter of principle for me," he says. "I simply refuse to work with anybody who takes money to do a union man's job while that man is on strike.... I could no more go into a building and work with scabs than I could play handball in church." His co-workers were liberals too, but of a newer type. "I don't think he has any support anywhere," one of them says. "It was very noble-sounding, but not, uh, wise." The holdout is a man named Carroll O'Connor, and the workplace is the set of All in the Family at CBS studios, where he plays Archie Bunker. "Ironically," Cowie discovers, "the real-life labor dispute at CBS prevented O'Connor from taping a four-part set of shows centered on another strike—this one down at Archie's plant.... The four installments of All in the Family, finally made once the strike was settled, centered on Archie's union going on strike over wages and cost-of-living adjustments—exactly the reason that the International Brotherhood of Electrical Workers (IBEW) was striking CBS." As usual, Archie is scripted by the show's creators—liberals too, of that newer type—into being the butt of the joke. "At the end of the made-for-TV dispute—during the entirety of which Archie could not grasp the difference between a flat raise and a cost-of-living adjustment—Archie boasts of winning a 15 percent raise," Cowie writes. "Let's have a toast to the good old US of A, where everybody gets his slice of the pie. All you gotta do is do your work, and in the end ya get it," Archie declares as he is humiliated by the laugh track. The joke—conveyed by the long-haired son-in-law, Mike—is that when the settlement is adjusted for inflation, the bamboozled lunks at Archie's plant make 5 percent less than before. "Archie, and his union (seemingly incapable of bargaining for real wage gains), are the fools as the show ends with everyone knowing that Archie really lost the strike—everyone, that is, except Archie." In hindsight the joke was on all of us. As Cowie explains, "In a 1976 episode, Archie, brooding over the Democrat Jimmy Carter's White House victory, may not have had the last laugh when he warned that liberals would not be so happy when Ronald Reagan won in 1980. The prophesy was supposed to be an attempt at absurdly dark humor." _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
