This is a great read on the history of neoliberalism and why this election will be the deciding factor in the direction of a split Democratic party: Back to FDR and New Deal-type policies, which helped offer the infirm and aging–as well as working individuals–a sense of security, or the way of Jimmy Carter, who introduced deregulation and pro-trade policies which harmed the middle class?
The following article is from the Huffington Post:
Lately the Internet has become full of arguments about the merits and demerits of Bernie Sanders and Hillary Clinton. Over the past couple weeks, I’ve been discussing and pondering all the various views about this, and I’m increasingly of the opinion that most of the people engaging in this debate don’t really understand what is at stake in the democratic primary.
This is in part because many Americans don’t really understand the history of American left wing politics and don’t think about policy issues in a holistic, structural way. So in this post, I want to really dig into what the difference is between Bernie and Hillary and why that difference is extremely important.
This is in large part because many democrats like to think of Hillary and Bernie as different flavors of the same Democratic Party popcorn.
Consequently, they mostly just pay attention to which candidate they feel they can more readily identify with. But Sanders and Clinton represent two very different ideologies. Each of these ideologies wants control of the Democratic Party so that this party’s resources can be used to advance a different conception of what a good society looks like. This is not a matter of taste and these are not flavors of popcorn.
What are these two groups? Bernie Sanders describes himself as a democratic socialist — he connects himself politically with Franklin Roosevelt and Lyndon Johnson, with the New Deal and the Great Society. To understand what that means, we need to know the history of this ideology. Under Calvin Coolidge’s right wing economic policy in the 1920s, economic inequality in the United States spiked:
The left in the 1930s understood rising inequality as the core cause of the Great Depression. Because wealth was concentrating in the hands of the top 1 percent, the amount of investment steadily increased while the amount of consumption stagnated. Whenever there is too little consumption to support the level of investment in the economy, investors struggle to find profitable places to invest their money.
Investment is usually a positive thing — it helps businesses increase their production and create jobs. But with consumption weak, businesses have little reason to increase their production, because no one will buy the additional goods and services provided. So instead, businesses that receive investment tend to reinvest that money rather than use it to grow. That investment circulates through the financial system and accumulates in speculative bubbles — places like the stock market, housing market, commodities market, or various foreign markets.
These assets become massively overvalued until one day, the markets recognize the overvaluation. The assets collapse in value and the bubble bursts. People relying on these assets to pay off other debts get into serious trouble, and a contagion can spread throughout the economy with horrifying consequences.
So what did the left do?
As you can see in the chart, between the 1930s and the 1970s, the United States drastically reduced economic inequality. It redistributed wealth from the top to the middle and the bottom, resulting in consistent wage increases and consequently consistent consumption increases. This allowed investment to be put to effective use — because the bottom and the middle were rising, they were able to support the additional spending that business owners needed to successfully expand.
Read the full article here.