Barack Obama: The Audacity Of Hope. Chapter Five: Opportunity; Part One. BOOK REVIEW: The Vision Of Alexander Hamilton And Abraham Lincoln.
This Chapter is entitled Opportunity, however it is about our recent and past economic history and the economic challenges that face us today. He mentions the differences in the financial stability for those who work in science/tech industries like those located in Silicon Valley and gives the example (2006) of blue collar people who work for a Maytag factory that is profitable but the CEO has decided to move the factory to Mexico to improve profit margins. One Union leader complained they have cut salaries and benefits and still management has decided to move probably to get the stock price up so the executives can exercise their stock options.
Obama analyzes Globalization and the benefits it has bought American consumers but also the dislocation it has caused the American worker. American companies have automated, downsized, outsourced and off shored to remain competitive and profitable. In the meantime many American workers have lost their high paying jobs to global competition and are left with no work or low paying service jobs. Those who are well educated and technologically inclined find jobs in the new information culture and other technological fields.
This has created a disparity in income for Americans. The percentage of those falling below the property line is increasing, shrinking the middle class, while the income of the wealthiest is increasing.
Obama sees education as one solution to the problem. We must educate our young people to be able to compete in the global market place. Government must take the lead in this process.
Obama notes that when the nation shifted from an agricultural economy to an industrial economy government made adjustments. President Lincoln created the land grant college system to reeducate farm workers. Theodore Roosevelt passed laws regulating the economy including breaking up the trusts and monopolies to protect smaller businesses and consumers. Later President Roosevelt saw that our industrial economy needed a social safety net for the new industrial worker and he created the new deal which saw a vast increase in the middle class until the last part of the last century when the idea that “free markets” would regulate themselves came into vogue.
However with the bursting of the financial and real estate bubble and the uncovering of the related corruption and fraud it became clear that markets were not free and needed guidance and regulation or the unscrupulous would manipulate them for illegal profit. Government needed to regulate but not to the extent that it smothered the actions of the free market and capitalistic system.
“The insights of Alexander Hamilton and Abraham Lincoln that the resources and power of the national government can facilitate rather than supplant a vibrant free market has continued to be one of the cornerstones of both Republican and Democratic policies at every stage of America’s development. The Hoover Dam, The Tennessee Valley Authority, the interstate highway system, the Internet, the Human Genome Project- time and again government has helped pave the way for an explosion of private economic activity. And through the creation of a system of public schools and institutions 0f higher education as well as programs like the G. I. bill, that made a college education available to millions, government has helped provide individuals the tools to adapt and innovate in a climate of constant technological change.” Again we are at another crossroads in American Society to which we must adapt to maintain America’s leadership in the World.