Blog #3

BLOG #3

In earlier blogs an thumbnail economic history was provided in order to set the stage for an explanation of the present situation we in the USA are in now. 
After the New Deal and World War II, America, virtually unharmed by the war in comparison with other nations and strengthened mightily by the tremendous productivity shown by the inudstrial might of its economic modernism and the work ethic of its people, was indeed on the top of the economic heap. 
Unions had grown very strong in the war years, and everyone wanted life to return to "normal" since the years of war had brought stress and deprivation.  This yearning for normality showed itself in many ways, for example in the "baby boom" that lasted from 1946 to about 1960.  With respect to unions, I have already mentioned the Taft-Hartley act of the late 40's, which was a way of lessening their power.  But, all in all, the fact that everyone who had eyes could see that the great corporations were like governments, planning for the far future, using new technologies, and oftentimes literally owning the very town in which they were situated. 
The two great conglomerates in production process and therefore of prosperity, unions and corporations, "coutervailed" one another (a phrase from John Kenneth Galbraith) and prosperity and labor peace were the results.  A feeling came over the economic writers that an era of labor peace and soaring prosperity would be a permanent condition. 
But, there was another shot across the bow by the Republican Party in 1964, when Barry Goldwater, scion of a very rich family in Arizona, was nominated for president with the slogan of rolling back the Welfare State. 

At this point there was a great desire to stop communism in Latin America.  Castro had come into power on the first day of 1959, and the Kennedys had bent their energies to assassinating him, to no avail.  But in 1964 the government of Brasil was overthrown by the army, who stayed in power for over 20 years, and the race to overthrowing governments all over the world got into high gear.  Actually it had begun in 1948 with the purchase of the election in Italy for the Christian Democratic Party, but that was Europe.
The point of the overthrow of various elected regimes in Latin America was a gross form of hatred for democracy, and the installation of military dictatorships was something that the citizens of the USA would never have tolerated here in their own country.  The details of all this disgusting history are contained in the excellent book by Naomi Klein, recently published, entitled The Shock Doctrine.  These coups were committed to preserve a medieval economic structure, with Kissinger playing the role of God, approving every bloodbath which occurred under his watch, from Chile to Indonesia.  But this ten year exercise in overthrowing governments had an unexpected outcome, which was the foisting on these nations the laissez faire doctrine of Milton Friedman, perhaps the most primitive economist who ever lived.  The gist of his thought was: break down economic structures like unions and large corporations and let the markets reign! 
Enter Ronald Woodrow Wilson Reagan, stage right.  The great turnaround of the economy was about to begin, with the rich getting fabuously richer than ever before, workers' combination such as unions being destroyed by various and sundry means, and those in the bottom third of the income ladder and wealth ladder becoming significantly poorer every decade until the present day.