Robert Reich: The Economy and the Middle Class

When people think of public intellectuals, what often comes to mind are famous leaders and scholars such as presidents or leaders of countries and authors who comment on current issues concerning the economy, health and the society.  In fact, a public intellectual is held responsible for using their intelligence in a way that confronts societal issues and creates solutions to move past the issue at hand.  The role of the public intellectual is to address and respond to the problems of his or her society as the voice of the people. 


One man who is qualified to take on that role is Robert Reich.  Reich is a political economist who has held many positions in his life, but is currently passionate about finding solutions for our fallen economy. 

Robert Reich, born in Scranton, Pennsylvania, has started his political career from a young age and built an impressive education resume.  Reich earned his bachelor of arts from Dartmouth University graduating at the top of his class in 1968 which landed him a scholarship to Oxford University where he studied Philosophy, Politics and Economics. After earning his masters as a Rhoades Scholar, Reich then continued to Yale where he received a J.D. from Yale Law School. 


His affiliation with some of the most prestigious universities around the world did not stop as a student.  Reich later went on to teach at the John F. Kennedy School of Government at Harvard University, he taught Social and Economic Policy at Brandeis University and now currently is a Professor of Public Policy at University of California Berkeley’s Goldman School of Public Policy. 

Not only does Reich have a strong educational background, he also has picked up a thing or two regarding politics from his work experience.  In the early 70’s, he served as a law clerk for the Chief Judge of the U.S. Court of Appeals for Judge Frank Coffin.  After a short two-year stint as a clerk, he was appointed as the Director of Policy Planning Staff for the Federal Trade Commission in 1977 during the presidency of Jimmy Carter. 


In the more recent years, Reich has served as the 22^nd Secretary of Labor for President Bill Clinton is his first term as President.  Robert Reich and Bill Clinton were first introduced during their years at Oxford then once again at Yale.  Clinton was so fond of Reich’s way of thought, he actually used some of his ideas during the presidential campaign which got him elected.  The main basis of the Reich-inspired “Putting People First” 1992 campaign is stated in Clinton’s speech:

For more than a decade our government has been rigged in favor of the rich and special interests. While the wealthiest Americans get richer, middle class Americans work harder and earn less while paying higher taxes to a government that fails to produce what we need: good jobs in a growing economy, world-class education, affordable health care, and safe streets and neighborhoods. Economic growth will not come without a national economic strategy to invest in people and meet the competition. Today we have no economic vision, no economic leadership and no economic strategy.

Robert Reich firmly believes in this model where the middle class is the backbone of the economy.  In his video The Truth About the Economy in 2 Minutes and 15 Seconds, Reich breaks down the problems with today’s economy into 6 major points:

1)    Since 1980 the American Economy has doubled, but wages fell flat. 

The economy has doubled in size, but wages barely increased

2)    All gains from the economy go the super rich.

The top 1% used to take home just 10% of all income, but now that top 1% takes home nearly 20% of all U.S. income. The super rich have 40% of the nation’s entire wealth.

3)    With money comes political power.

All of this money at the top is given the super rich a lot of political power.  Specially the power to reduce their tax rates.  From 1980 to today, the top tax rate has decreased from 70%-35% and much of their income is considered capital gains which is subject to only a 15% tax rate. This means huge budget deficits.

4)    Huge budget deficits.

Tax revenues are down to less than 15% of the total economy.  In result, public services are being cut at all levels of government.  The effect of neglecting these services lead crowded schools, neglected roads, bridges and other infrastructure.

5)    Middle class divided.

The middle-class is competing against each other for jobs which brings up the battle between union and non-unions, public vs private, native-born and immigrant. 

6)    Anemic recovery.

The middle class is unable to borrow as it once did, no longer has the same purchasing power to stimulate the economy.  This leads to continued high unemployment and weak recovery. 

In conclusion, Reich states “ the only way we could have a strong economy is with a strong middle class.” He not only mentions this as a thought, but responds with reasoning and offers a solution. 

Robert Reich is the type of public intellectual that we need in this type of economy.  In an article regarding the future of public intellectuals, titled The Decline of the Public Intellectual, Dr. Stephen Mack analyzes the society’s need for the public intellectual.  In his concluding statement, Dr. Mack states:

           

 It is also, however, the obligation of every citizen in a democracy. Trained to it or not, all participants in self-government are duty-bound to prod, poke, and pester the powerful institutions that would shape their lives. 

This statement agrees with Reich’s opinion about how the small group of super rich have the most control in our economy.  Reich advocates for the middle class to fight for their rights in order to provide for themselves and a larger portion of income.  Robert Reich is a public intellectual that is passionate about bettering the community and objectively communicates the well being of the middle class.