From: rich@pencil.cs.missouri.edu (Rich Winkel)
Subject: Book: America: What Went Wrong?
Followup-To: alt.activism.d
Originator: rich@pencil.cs.missouri.edu
Organization: PACH
Distribution: na
Date: Sun, 27 Sep 1992 08:15:11 GMT

INSIGHT FEATURES / September 1992

     If any IF articles are downloaded for use in the print
media, please call us. Our rates are cheap or, in many cases,
there is no cost at all.  There is no fee for downloads to other
BBS or for your private reading, but please send us your comments
anyway.  Call VOICE 312/384-8827 or leave E-MAIL with PEACENET's
NFD.GEN Conference or for Insight Features at NY ON-LINE.

/** nfd.ifeatures: 32.7 **/
** Written  8:17 pm  Sep  8, 1992 by ihandler in cdp:nfd.ifeatures **
Book Review / 920 Words

America:
What Went Wrong?
By Donald R. Barlett and James B. Steele
Andrews & McMeel, $6.95.

By Mary O'Connell
Insight Features

   Why are our cities getting so poor?  One reason is the loss of
manufacturing, which provided decent-paying jobs for city dwellers
for a hundred years.  So why are manufacturing jobs disaapppearing?

   The pat answer is "global economy."  Multinational companies,
it's argued, will go anywhere to get their work done at the lowest
possible wages.  I heard that some companies fax their typing to
Taiwan. According to this explanation, older, inefficient U.S.
plants--especially those with union workers--simply can't compete
with brand-new installations in countries where the daily wage
amounts to about as much as it costs here to buy a can of pop or a
package of potato chips.

   But in economics (as in environment), the label "global" usually
translates into "far beyond the power of mortal men," as they used
to say in the old Superman shows.  And while many features of our
environment are in fact beyond human control, it's critical to
remember that our economy, like our government, is a human system,
built on humasn needs and constructed out of millions of human
decisions.  That means they're both subject to human control--and
humans have some responsibility for how they work.

   That's the tremendous value of America: What Went Wrong?, the
stunning book produced by two journalists of the Philadelphia
Inquirer, Donald Barlett and James Steele.  They document how many
of the ills of the American economy--notably the loss of
manufacturing jobs, but also the disappearance of pensions,
elimination of health insurance, and growing inequality between
rich and poor--are the result, not just of those hard-to-pin-down
global forces, but of specific decisions made by real people, to
benefit their personal interest at tremendous cost to the common
good.

   In the decade of the 1980s, when its was "morning again in
America," American companies eliminated 300,000 manufacturing jobs.
By comparison, each of the three preceding decades had seen aboult
1.5 million new manufacturing jobs added to the economy.  In the
1980s, all the new jobs were in the service industries, where the
average pay was less than half that in manufacturing.  In switching
from one sector to the other, hundreds of thousands of Americans
moved from the solid middle class to the ranks of the working poor. 
But thousands of others--those who bought and sold the companies,
and their lawyers and consultants (and bankruptcy administrators)
became millionaires.

   Barlett and Steele document, in story after story, just how this
happened.  The most detailed example is is that of Simplicity
Pattern Co., whichh any anyone who was trained in housewifely arts
will recognize as the staple of the home-sewing market: the world's
largest pattern maker with its main factory in Niles, Michigan.

   In 1980, Simplicity was a rich, stable company, with $100 in
cash reserves and investments, and a net operating income of $7
million.  Clearly a tempting target for corporate raiders,
Simplicity was bought and sold five times during the 1980s.  Each
succeeding sale was financed by stripping the assets of the company
itself, and substituting debt.  Each seller made millions on the
deal.  To pay them off, each new owner raised cash by such measures
as laying off workers, reducing pay, and raiding the pension fund,
which was reduced from $39,535 covering each worker to $3,256. By
fall of 1990, the $100 cash reserves were gone, and the company was
$100 million in debt.

   Of course, in a free enterprise system, everybody expects big
corporations to act in their own best interests, no surprise there.
(Although it would be nice if the big money men were actually
interested in making things.) But behind the decisions made in the
boardrooms are those made in Washington committee rooms, where the
guys are supposed to be acting in the public interest.  And, as
Barlett and Steele demonstrate, time after time, they're not.

   The Washington decision makers have written what Barlett and
Steele call "the rule book."  It consists of thousands of tiny
provisions--in the tax code, the securities regulations, the trade
laws and other places ordinary citizens don't even know to look. 
One such provision provided tax breaks for drup companies to close
plants in places like Elkhart, Indiana and transfer the jobs to new
plants in Puerto Rico. Hourly wage in Elkhart: $13; in Puerto Rico:
$6.  Lost tax revenue: $60,000 per job. Now, private companies
might want to pursue lower wages outside the continental U.S., but
why should the government give them a tax break for doing so?

   Because, say Barlett and Steele, the people who want the rules
written that way pay big money to lobbyists and legislators to make
sure that it gets done--and it's all so complicated that noe of the
rest of us are paying attention.

   This book is in the best tradition of the muckrakers, the
journalists from the early days of this century who called
attention to corporate excess in the belief that Americans, through
their political system, would do something about it. The last
chapter makes clear the authors hope that Americans will rise up to
reclaim their democracy, and through it their economy, by forcing
public servants to act in the public interest once again. It's not
the only answer to the problems facing our economy, but it makes a
helluva good place to start.

                            -- 30 --

   Mary O'Connell is the editor of The Neighborhood Works,
published by the Center for Neighborhood Technology, 2125 W North
Ave, Chicago IL 60647. 312-278-4800. $30 yearly for 6 issues.
** End of text from cdp:nfd.ifeatures **
Newsgroups: misc.activism.progressive