HN Books @HNBooksMonth

TLDR: Hoarding wealth is normal. Redistribution is necessary to keep the peace. This last cycle, wealth was accrued faster than normal counter balancing measures could respond.

I wholly agree that technological change begets social unrest. And that regulation, applying rules to the open market, with competent referees, has struggled to keep pace with technological change.

However. OC does not propose a theory for technological disruption leading to accelerating inequity.

My best guess of the probable root cause is when wages were decoupled from productivity. Productivity boomed, wages remained stagnant. The Productivity-Wages Gap. There are insightful, complimentary narratives of this phenomenon from Piketty, Turchin, many others.

Buy why did this happen when it did?

My current best guess is when finance got super charged by IT. https://en.wikipedia.org/wiki/Financialization

When the majority of wealth creation transitioned from doing real world stuff to massaging balance sheets. When Capital transitioned from investment to rent seeking.

Advances in IT was the enabler, force multiplier, by dramatically decreasing transaction costs and improving financial analysis (eg playing what-if with spreadsheets),

Ok, fine. But why did wages stay decoupled?

At the same time, Capital led a sustained attack on Labor. Which hobbled the expected normal efforts society has historically done to redistribute wealth. There are many, many useful complimentary narratives about Milton Friedman, Chicago School of Economics, Heritage Foundation, etc.

Another "also true" story is Lobbying America: The Politics of Business from Nixon to NAFTA https://www.amazon.com/Lobbying-America-Politics-Business-So... Whereas other histories detail the obvious persons, ideologies, and culture war stuff, this book details the legislative knife-fight that actually made it happen.

PS- My starting assumption is the fight is, and always has been, wealth vs democracy.

Around 2005, I asked Kevin Phillips:

Me: According to your book, America's political parties have flipped every ~70 years. It should have happened around the time of Ross Perot, so I guess we're overdue. Do you think another realignment is emminent?

Phillips: No. It won't happen while Wall St. and finance remains in control of our political discourse.

--

It'll be amazing if Biden Admin is able to uncork the next cycle. But I'm not holding my breath.

Wealth and Democracy: A Political History of the American Rich [2003] https://www.amazon.com/Wealth-Democracy-Political-History-Am...

Here's a more recent account:

Lobbying America: The Politics of Business from Nixon to NAFTA [2015] https://www.amazon.com/Lobbying-America-Politics-Business-So...

Edit: I changed "Last decade" to "Around 2005". Time flies. My bad.

Have you heard of the Business Roundtable? (Most recently in the news for statement that corporations will have to abandon primacy of shareholder value and start considering all stakeholders. A major reversal of position.) https://en.wikipedia.org/wiki/Business_Roundtable

This is an illuminating history of the lobbying and policy efforts to rollback The New Deal and so forth.

Lobbying America: The Politics Of Business From Nixon To NAFTA

https://www.amazon.com/Lobbying-America-Politics-Business-So...

TLDR: The titans of industry who partnered with government for the greater good were pushed out by those opposed to government.

Lobbying America is a good history of corporate USA's transition from serving the public good to whatever we have today.

https://www.amazon.com/Lobbying-America-Politics-Business-So...

Amazon's blurb:

"Lobbying America tells the story of the political mobilization of American business in the 1970s and 1980s. Benjamin Waterhouse traces the rise and ultimate fragmentation of a broad-based effort to unify the business community and promote a fiscally conservative, antiregulatory, and market-oriented policy agenda to Congress and the country at large. Arguing that business's political involvement was historically distinctive during this period, Waterhouse illustrates the changing power and goals of America's top corporate leaders.

Examining the rise of the Business Roundtable and the revitalization of older business associations such as the National Association of Manufacturers and the U.S. Chamber of Commerce, Waterhouse takes readers inside the mind-set of the powerful CEOs who responded to the crises of inflation, recession, and declining industrial productivity by organizing an effective and disciplined lobbying force. By the mid-1970s, that coalition transformed the economic power of the capitalist class into a broad-reaching political movement with real policy consequences. Ironically, the cohesion that characterized organized business failed to survive the ascent of conservative politics during the 1980s, and many of the coalition's top goals on regulatory and fiscal policies remained unfulfilled. The industrial CEOs who fancied themselves the "voice of business" found themselves one voice among many vying for influence in an increasingly turbulent and unsettled economic landscape."

The criticisms of so called sunshine laws are unconvincing. Any one supporting more direct democracy will favor such reforms.

As for why things took a right-wing turn in the mid-70s, I prefer this thesis:

Lobbying America: The Politics of Business from Nixon to NAFTA

https://www.amazon.com/Lobbying-America-Politics-Business-So...

TL;DR: Titans of industry felt persecuted, rolled back The New Deal.

"Lobbying America tells the story of the political mobilization of American business in the 1970s and 1980s. Benjamin Waterhouse traces the rise and ultimate fragmentation of a broad-based effort to unify the business community and promote a fiscally conservative, antiregulatory, and market-oriented policy agenda to Congress and the country at large. Arguing that business's political involvement was historically distinctive during this period, Waterhouse illustrates the changing power and goals of America's top corporate leaders.

Examining the rise of the Business Roundtable and the revitalization of older business associations such as the National Association of Manufacturers and the U.S. Chamber of Commerce, Waterhouse takes readers inside the mind-set of the powerful CEOs who responded to the crises of inflation, recession, and declining industrial productivity by organizing an effective and disciplined lobbying force. By the mid-1970s, that coalition transformed the economic power of the capitalist class into a broad-reaching political movement with real policy consequences. Ironically, the cohesion that characterized organized business failed to survive the ascent of conservative politics during the 1980s, and many of the coalition's top goals on regulatory and fiscal policies remained unfulfilled. The industrial CEOs who fancied themselves the "voice of business" found themselves one voice among many vying for influence in an increasingly turbulent and unsettled economic landscape.

Complicating assumptions that wealthy business leaders naturally get their way in Washington, Lobbying America shows how economic and political powers interact in the American democratic system."