Judith Stein says neoliberalism broke the American working class

Historians in the News
tags: neoliberalism, Judith Stein

The surprise success of Donald Trump and Bernie Sanders has generated a bevy of ethnographic inquiries from journalists puzzling over just why working class people, the white ones in particular, are so angry.

In reality, outside the New York and Washington bubbles, it’s not that complicated. Trump and Sanders have tapped a vein of alienation that runs from deep in the Rust Belt and beyond. As historian Judith Stein put it, America traded factories for finance. And workers lost. The populism on the right (quasi-fascist) and the left (semi-socialist) differ profoundly on the question of white supremacy but both are grounded in appealing rejections of outsourcing and so-called free trade deals like NAFTA.

Stein is Distinguished Professor of History at City College and the Graduate Center of the City University of New York. She is the author of “The World of Marcus Garvey” (1986), “Running Steel, Running America” (1998), and most recently “Pivotal Decade” (2010).  She is currently working on a book, “Fabulous or Fortunate?: The Clinton Years and the Origins of Our Time.”

Salon spoke with Stein recently about the history of trade politics and the future of manufacturing. This interviewed has been edited for brevity and clarity.

Are you surprised that two insurgent candidates, on the left and the right, are successfully appealing to anger over free trade? What is it about the American political economy in 2016 that is making this such a potent message right now?

Yes, I am surprised that trade has emerged as a big issue. It has not been part of presidential campaigns because both parties have supported “free trade.” There were always minorities in both parties, especially the Democratic, who supported what was once called “managed trade.” Congressman Richard Gephardt based his campaign for the Democratic presidential nomination in 1988 on ending the huge growth of manufacturing imports in the 1980s. And independent Ross Perot made trade a big issue in his 1992 presidential run.

But trade did not divide the parties, and so was absent from presidential campaigns. This history explains why the issue is propelled by two political outsiders. Of course, the economy helps. In the wake of the Great Recession, there was more criticism of corporations and political elites. Currently, U.S. growth is sluggish and wage stagnation continues despite relatively low unemployment. The enduring trade deficit offers an explanation for the combination of low wage and plentiful, unstable work. In addition, there have been several elite studies demonstrating the millions of jobs offshored to China. But the politics is as important. Insurgent candidates pick up issues that elites have ignored. And, this one, trade, has festered for many years.

Why did the sort of criticism of deindustrialization made by Gephardt lose out to New Democrats like Bill Clinton? And what political constituency was Perot’s anti-NAFTA message attractive to? Can he in some ways be seen as a precursor of Trump?

The Gephardt wing of the Democratic Party lost out to the New Democrats because of the different analyses of the 1980s. A group called the “Atari Democrats,” like Gary Hart, believed that post-industrialism was the wave of the future — high tech.  Therefore, attempting to “prop” up old and dying industries was futile. Thus, the 1988 Democratic candidate Michael Dukakis was known for producing the “Massachusetts Miracle,” a high-tech boom during his time as governor. The now-populist Robert Reich also believed in the high-tech transition. If this was an accurate view of the future, then education was the solution. The Clinton New Democrats shared this view but believed that the party had to expand beyond its traditional constituencies — unions and minorities. They would appeal to business with support for free trade and less regulation, Reagan Democrats, working class whites, with social issues, and suburbia with prudent fiscal policy. Although much of this was contradictory or unachievable, these differences made it impossible to address de-industrialization, which required a different analysis of the economics of the 1980s.

When Perot first ran in 1992 as an independent, outsourcing was an issue, but as important was the balanced budget.  So he got a diverse group who believed that a rich businessman, not a politician, could solve the nation’s problems. After the election, when Clinton made NAFTA a priority, Perot became the most public anti-NAFTA leader, debating the issue with Al Gore.  Yes, I do think that Perot was a precursor of Trump. Both made a virtue of their blunt, truth-telling style. Both appealed to white men more than other social groups. But Trump feasts on social divisions. Perot did not.

Read entire article at Salon

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