“I’s the time of year,” the economist Robert Reich wrote on social media as he watched Goldman Sachs recruiters working at the table next to him at a hotel near Harvard Square, “when Wall Street treks to Cambridge [Massachusetts] to lure bright young things with the promise of big bucks, cachet and power.” For a university that demands so much ambition and imagination in its admissions essays – and particularly when you consider the number of applicants who write about wanting to change the world, often through public service – it is remarkable how many students succumb. There are several explanations but Bob Dylan said it best: “Money doesn’t talk. It swears.”
Reich would agree. He was in town to talk about his new book, Saving Capitalism, in which he seeks to counter the “sense of powerlessness, anger and frustration” people feel with a system that appears broken and out of control. The stream of money into US politics has become a flood, catalysed by the 2010 Citizens Unite v Federal Election Commission ruling that allowed corporations unlimited political spending in the name of free speech.
Economic and social inequality is rising, threatening to eclipse even the levels of division seen in the “gilded age” of the 1920s. And trust in the willingness of politicians and government to intervene, undermined by their apparent capture by moneyed interests, has never been lower. A woman in Reich’s audience said: “It just seems like it’s too late . . . Is there any hope?”
If there is hope, it is that the issue of economic inequality has moved to the heart of the ongoing presidential election debate. On the Democratic side, Bernie Sanders has done a lot to take it there. Coming from the very left of the party (he is registered as an independent in the Senate), his message of political revolution has gained a devout following.
As he told the Democratic convention in New Hampshire on 19 September: “What looked like a fringe campaign is now seen as a campaign that is standing up for working Americans and is prepared to take on the billionaire class.”
When Hillary Clinton spoke at the same event, she did not repeat Sanders’s claim that the system is so “corrupt . . . [that] we are not talking about democracy, we are talking about oligarchy”. Yet she did make economic inequality the cornerstone of her message, echoing her declaration in recent campaign adverts that: “The deck is stacked in favour of those at the top.”
To Reich, sidelined as labour secretary during Bill Clinton’s administration for supporting greater public investment and a focus on reducing inequality, it is a sign of changing times. “Her husband would never have said that,” he claimed.
In part, Hillary Clinton’s move is intended to close the ground on Sanders. In part, it is designed to shut the door on Joe Biden, whose blue-collar credentials will be crucial if he is to make a late entry to the race. Yet it also taps into a historical moment. Hearing her speech in New Hampshire felt like watching the defining economic lines of the next generation being drawn: a raise for middle-class families, rewards for success that don’t just go to those at the top, a share in the profits for those who produced them and overhauling a system in which “the top 25 hedge-fund managers earn more than all the kindergarten teachers in America combined”.
It is not only on the Democratic side that inequality will be a crucial issue. An important dynamic of the Republican debate will be, as Greg Sargent put it in the Washington Post, “the need to offer solutions to inequality while vowing to roll back Obama’s efforts [and particularly the Affordable Care Act] to redistribute resources downward”. So far, the dominant Republican policies remain variations on the vice-presidential candidate Paul Ryan’s 2012 platform of tax cuts in the name of reducing dependency and unleashing growth, but there is an anger growing among voters that demands deeper reforms.
With that anger comes unpredictability. In the UK, few predicted Jeremy Corbyn’s surge. In the US, nobody anticipated the rise of Bernie Sanders or Donald Trump. Perhaps nothing can or will be done about widening inequality but it feels that a change is coming. As Reich concluded at Harvard: “If you give up on politics, you give up on democracy. And if we give up on democracy, we allow the moneyed interests, the special interests, to have it all. We give up on any hope for change. So it is our obligation to fight.”
George Kynaston, an Obama 2012 campaign alumnus, is studying at the John F Kennedy School of Government at Harvard University
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This article appears in the 07 Oct 2015 issue of the New Statesman, Putin vs Isis