It’s not the topic of George Packer’s latest essay that’s particularly surprising. Inequality, he writes, is undermining democracy. Progressives have been hammering home this message for years if not decades.
Nor is the choice of publication necessarily a shocker. Foreign Affairs is the flagship publication of the elite that runs American foreign policy. But it is no longer the exclusively center-right publication of the Cold War years. After all, it has published the likes of former Institute for Policy Studies staffers Michael Klare and Julia Sweig as well as my predecessor at Foreign Policy In Focus John Gershman.
No, it’s the prominent placement of the Packer essay that merits attention. It’s the lead article of the November/December issue. And it comes with the bold headline, “Is America Over?”
When Foreign Affairs puts inequality on its cover – and hosts a debate on the topic at the tony offices of the Council on Foreign Relations – the Occupy Wall Street movement has achieved a major victory that eclipses even the generally favorable coverage in liberal bastions such as The New York Times, The New York Review of Books, and The New Yorker. It’s also a sign that a profound anxiety gnaws at the foreign policy elite in this country. The question is: why are foreign policy mandarins suddenly so fretful? Or, put another way, why does Foreign Affairs want its readers to take this issue so seriously?
Packer argues that the U.S. economy went off the rails in the late 1970s, when the top 1 percent stopped thinking about the national interest and focused instead on the preservation of their own economic and political power. Powerful lobbyists, anti-government politicians on the right, and a newly unregulated Wall Street all combined to boost the wealth of the very rich and leave everyone else behind. Although globalization and technology accelerated these trends, they were fundamentally political choices made by our leaders (and the powerful interests that helped them to power).
“We can upgrade our iPhones, but we can’t fix our roads and bridges,” Packer writes to illustrate our economic predicament. “We invented broadband, but we can’t extend it to 35 percent of the public. We can get 300 television channels on the iPad, but in the past decade 20 newspapers closed down all their foreign bureaus.”
In other words, the public realm has deteriorated over the last two decades even as the private realm continues to promise cutting edge speed and novelty. Worse, it’s a self-reinforcing dynamic. “The more wealth accumulates in a few hands at the top, the more influence and favor the well-connected rich acquire, which makes it easier for them and their political allies to cast off restraint without paying a social price,” Packer continues. “That, in turn, frees them up to amass more money, until cause and effect become impossible to distinguish.”
This all makes sense to me, and to my colleagues at the Institute for Policy Studies who have done so much work on inequality over the last decade. What’s not so clear to me is why Foreign Affairs has decided to highlight this message. The November/December issue features a Shell ad on the inside front cover and a Goldman Sachs ad on the back cover: these are not exactly OWS boosters. The Council on Foreign Relations, which publishes Foreign Affairs, has long had a cozy relationship with Wall Street and such figures as David Rockefeller and Peter Peterson. It seems as though Foreign Affairs is biting the hand that feeds it.
Here are three possible reasons for the sudden interest in inequality.
Disappearing Jobs: Many of the young people spearheading the OWS movement have followed the rules, gone to college, racked up lots of students loans, and still can’t get decent jobs. In the early 1970s, Adam Davidson writes in The New York Times Magazine, “less than 11 percent of the adult population graduated from college, and most of them could get a decent job. Today nearly a third have college degrees, and a higher percentage of them graduated from non-elite schools.” And the jobs are simply not there. The OWS message resonates in mainstream society – and publications such as Foreign Affairs – because middle-class parents have become acutely concerned about their children’s future. Sure, inequality has adversely affected working-class America and African Americans for a long time. But the elite pricks up its ears when college-educated white kids, saddled with debt and dependency, become the functional equivalent of Third World countries.
Declining Competitiveness: Free-market advocates have traditionally had a quick answer to the complaint that the United States is no longer competitive globally. Even with so many manufacturing jobs sucked overseas, they argue, America remains a leading center for innovation: iPhones, gene sequencing, dodgy financial instruments. Even if our health care system is so obviously broken, our high-end care remains the best in the world, and the global elite continue to flock to our hospitals for the most sophisticated treatments. Even if our military-industrial complex is a bloated horror, the world still buys our fighter jets. Yet the plain truth is that by all objective standards, the United States is falling behind. In the World Economic Forum’s latest Global Competitiveness Index, the United States slipped for a third year in a row to fifth place. The top positions continue to go to European countries: Switzerland, Finland, Sweden. Despite debt and eurozone troubles, European countries number 11 of the top 20. Although inequality does not explicitly factor into this ranking, it has indirect influence through such measures as public infrastructure and GDP per capita. In The Atlantic, urban studies theorist Richard Florida underscores the negative relationship between inequality and competitiveness to emphasize that creativity can go hand in hand with equity. We can have our cake and distribute it fairly too.
It’s Not Just the Global South Anymore: The Arab Spring followed the classic revolutionary pattern of a rising economic class thwarted in its ambitions by sclerotic states in Tunisia, Egypt, and Libya. When the aftershocks of the Arab Spring hit the OECD club of economically advanced countries, the focus shifted to inequality. This summer, for example, Israel experienced the largest protests in its history. They had nothing to do with Palestinians or settlements or the issues that generally catapult Israel into the media. Before the tents appeared in Zuccotti Park in New York City, they appeared on the streets of Tel Aviv under the slogan “We want a welfare state.” Israel’s “economic miracle,” created largely by a high-tech boom, had benefitted only a small segment of the population. As Eyal Press notes in The New York Review of Books, Israel ranks the fifth highest in the OECD in terms of inequality and has the highest poverty rate to boot. Even in countries touted for their ability to surf the new wave of innovation, the middle class was losing out. According to the OECD, inequality has increased rather dramatically among the most economically advanced countries of the world. It’s one thing for inequality to undermine democracy, something that foreign policy mandarins have never worried about too terribly much. But when inequality undermines stability and the overall investment climate, the Foreign Affairs crowd starts to fidget.
So, it seems, the foreign policy mandarins are slowly realizing that their Bush-era hangover has not one but two major symptoms. The military invasions and violations of international law continue to cause enormous headaches. And the deregulatory fervor and tax cuts for the wealthy are causing major stomach distress. The watchword for this crowd is prudence. The race for profit and the embrace of greed is all fine and good up to a point for these folks. But when it approaches the danger point, a correction is necessary. The decision to publish and promote Packer’s essay is comparable to parents showing up in the wee hours of a loud party and ordering the kids to turn down the music before the neighbors call the cops.
Ronald Reagan used to say rather fatuously that Democrats had gone so far left they’d left the country. Now the foreign policy elite is realizing that the Republicans have gone so far right, they’ve gone right off the rails. The Republican Party has been so extreme in its defense of the 1 percent – actually the 0.1 percent, as Paul Krugman points out – that it has effectively seceded from the country to create a confederacy of cupidity. This confederacy is as single-minded in its pursuit of power and privilege as the North Korean nomenklatura. However closely connected to Wall Street they might be, the bigwigs at Foreign Affairs realize that this is not a confederacy to which they want to pledge allegiance.
The Bush Legacy
U.S. troops are supposed to exit Iraq by the end of next month. They leave behind a battered country. Some consequences of the occupation are obvious, such as the sectarian strife or the political congestion. Less obvious are the long-term health consequences.
FPIF columnist Hannah Gurman takes a close look at what has been happening in one particular city that has been hard hit by fighting. “Of the current problems in Fallujah, the most alarming is a mounting public health crisis,” she writes in The Under-Examined Story of Fallujah. “In the years since the invasion, doctors in Fallujah have reported drastic increases in the number of premature births, infant mortality, and birth defects—babies born without skulls, missing organs, or with stumps for arms and legs. Fallujah General Hospital reported that, out of 170 babies born in September 2009, 24 percent died within the first seven days, of which 75 percent were deformed — as compared to August 2002, when there were 530 babies born, only six deaths, and one deformity.”
NATO recently killed 24 Pakistani soldiers when it conducted airstrikes on two Pakistani army bases near the border with Afghanistan. It’s just the latest sign of deteriorating relations between Washington and Islamabad. FPIF contributor Nick Scott has a suggestion that could help repair the fraying ties: humanitarian assistance for the aftereffects of flooding that continues to devastate Pakistan. “A more comprehensive relief package from USAID might not repair the rift between the United States and Pakistan or even reverse public perception of America for many Pakistanis,” he writes in Disaster Times Two in Pakistan. “But it would at least provide a measure of goodwill in what has become an increasingly strained relationship and help avert a disaster that should transcend political considerations.”
Finally, the situation with Iran remains tense. Media reports of the country’s nuclear advances, however, have been misleading. Our blogmeister Russ Wellen summarizes three critiques of the recent International Atomic Energy Agency report on Iran in No, Really, Iran Isn’t Developing Nuclear Weapons.
And FPIF contributor Derek Bolton points out that all the speculation about Israel attacking Iran’s nuclear program is off base. Those attacks, after all, have already been happening. “The Mossad appears to have undertaken two distinct routes to counter Iran: industrial sabotage and targeted assassinations,” he writes in Israel’s Quiet War with Iran. “To accomplish the former, the Mossad has established a series of dummy companies to sell flawed components or faulty technical documents sought by Iran. For example, in April 2006, Iran’s Natanz facility suffered an explosion caused by faulty electrical devices purchased from such a company in Europe, causing the destruction of 50 centrifuges.”