Just ran across this on Leo Casey's list. It is a New Republic article by John Judis titled "How Liberalism Came to the U.S.: Structural Flaw" forwarded by Danny Postel, a typically "god that failed" 1980s leftist who used to be involved with Central American solidarity, but nowadays frets about reds in the antiwar movement, etc. Judis began his own headlong flight to the right beginning in the 1980s when he took up the cause of the Nicaraguan contras. All that being said, Judis can be very perceptive on political economy. The excerpt from the article jibes with my own views on why the ABB logic was an exercise in futility. As long as American capitalism is forced to go "lean and mean" in competition with its G-7 partners, there is not much room for old-fashioned liberalism. Although the article is available only to New Republic subscribers, you can read the whole thing at:
http://groups.yahoo.com/group/DemocraticLeft/message/16273
Here's an excerpt:
New Deal liberalism had been nurtured by the political economy of the Great Depression and sustained by postwar prosperity, but sometime in the mid-'60s, the U.S. and world economy entered a new phase that was not as congenial to reform. Western European and Japanese companies, having fully recovered from World War II, began to compete effectively with U.S. firms. As East Asia industrialized, the world economy began to suffer from overcapacity in steel, autos, textiles, and other key postwar industries, putting additional pressure on profits, especially in manufacturing. According to economic historian Robert Brenner, author of The Boom and the Bubble, average net profit margins in U.S. manufacturing fell from 24.6 percent from 1959 to 1969, to 15.5 percent from 1969 to 1979, to 13 percent from 1979 to 1990.
With their profit rates in jeopardy, businesses no longer acquiesced in unionization and new federal regulatory reforms. Businesses increasingly resorted to tactics that violated the Wagner Act. In 1957, for instance, the nlrb ordered 922 organizers reinstated for being illegally fired; in 1970, 3,779; and, in 1980, over 10,000. At the same time, corporations set up shop in Washington to lobby for deregulation and tax cuts. In 1971, only 175 businesses had registered lobbyists in Washington. By 1982, 2,445 had. Business revived old organizations, including the National Association of Manufacturers (NAM), and established new ones like the Business Roundtable.
Business also joined the battle for ideas, funding new public policy groups and think tanks that issued reports, written by paid experts, arguing that government regulation and high taxes and spending were responsible for the country's economic slowdown. These ideas found a receptive audience among the country's opinion-makers. Just as the Great Depression lent credence to a Keynesian focus on effective demand, the stagflation and international competition of the '70s seemed to support classical economics and its focus on profit margins. These attitudes permeated public opinion, particularly in the late '70s. The public remained generally supportive of Social Security and Medicare, but became skeptical about taxes and regulations and any new program that appeared to be based on government expansion.
The forces favoring liberal reform had difficulty holding their own in the face of these obstacles. By 1976, the unionized labor movement had shrunk from one-third to one-quarter of the nonfarm workforce. The consumer and environmental movements could boast of a growing organizational presence in Washington, but, after the decline of the antiwar left, these movements lost the grassroots militancy that had commanded attention from the Nixon administration. Liberal reformers could call on the public to withstand challenges to the older New Deal reforms, but they lacked the clout and the public support to advance new reforms, block regressive tax cuts, or defend the narrower, more technical regulatory rules.
The test of reform under these new circumstances came during the Carter and Clinton administrations. Carter took office in January 1977 on the promise to move liberalism beyond the New Deal. But, in spite of large Democratic majorities, he failed to get any of his ambitious agenda through Congress. Business lobbies, working with Republicans and conservative Democrats, defeated labor law reform, a new consumer protection agency, and hospital cost containment. They also transformed the Humphrey-Hawkins Full Employment Bill into a toothless anti-inflation measure and progressive tax reform into regressive cuts on capital gains tax rates.
Louis Proyect Marxism list: www.marxmail.org
