Evil Geniuses: The Unmaking of America: A Recent History (16 page)

BOOK: Evil Geniuses: The Unmaking of America: A Recent History
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The Decade When Everything Changed and Our Present Was Created: 57 Data Points
Some Key Cultural and Technological Changes in the 1980s
  • The fraction of women in the paid workforce rises from 47 percent in the late 1960s to 75 percent by the end of the 1980s.

  • The fraction of two-income households increases from a small minority to a large majority.

  • The immigrant population doubles from its twentieth-century low of fewer than 10 million in 1970 to nearly 20 million in 1990.

  • Americans begin staying put, moving to new places less frequently.

  • Cable TV takes off, with the number of channels and of homes with cable tripling.

  • Twenty-four-hour TV news begins.

  • Nostalgia becomes a full-fledged division of the fantasy-industrial complex, further enabled by old movies and shows now watchable on VCRs and cable TV, and by the massive rerelease of old albums on the new CD medium.

  • The federal rule that TV and radio broadcasters must present a diversity of views is repealed.

  • Personal computers become a mass-market product, and the mass-market Internet is invented.

Some Key Changes in the 1980s Good for Big Business
  • Corporate lobbying in Washington and the number of corporate political action committees wildly increase, and the costs of congressional campaigns begin their doubling and tripling over the next thirty years.

  • Corporate taxes as a fraction of GDP drop by more than half in just four years from the late 1970s to the early ’80s.

  • Federal enforcement of antitrust laws to rein in corporate power suddenly shrinks to a fraction of what it has been.

  • The deregulation of business by government accelerates.

  • Large, dominant companies start charging customers historically higher markups on the products they sell.

  • The rate at which entrepreneurs create new firms drops by almost a third.

  • After years of scholarly spadework and litigation here and there, the conservative legal and judicial counter-Establishment suddenly booms on its way to dominance.

Some Key Changes in the 1980s Good for the Financial Industry
  • Stock prices almost triple (before almost quadrupling again during the 1990s).

  • The long-standing federal prohibition on companies buying their own stock, meant to prevent share price manipulation, is repealed.

  • The new “shareholder value” movement’s redefinition of capitalism makes a company’s current stock price essentially the only relevant measure of corporate performance.

  • The share of all stocks owned by a few big institutional investors triples (on its way to doubling again in the 1990s).

  • Increasingly abstract and untried and unregulated financial bets on other financial bets, derivatives, become normalized and start becoming economically significant.

  • Leveraged buyouts, financial firms using frequently excessive debt to take over and often ruin companies, become normalized and significant.

  • Wall Street salaries increase by more than 25 percent (before increasing another 50 percent in the 1990s).

  • The financial industry’s (and real estate industry’s) share of the total U.S. national income rises from 14 percent to over 35 percent in less than a decade.

Some Key Changes in the 1980s Good for Rich People in General
  • The ratio of CEOs’ pay to their employees’ pay doubles (before
    sextupling
    in the 1990s).

  • The top income tax rate on the richest is reduced from 70 percent to 28 percent.

  • The maximum tax rate on stock profits (capital gains) is reduced from 28 percent to 20 percent.

  • Estate taxes on the rich drop more than ever—for instance, the heirs to a $3 million fortune would pay $1 million less in taxes on it.

  • The income of the most affluent top fifth increases by 25 percent and that of the richest top 1 percent almost doubles.

Some Key Changes in the 1980s Bad for Americans in General
  • The United States experiences the fastest and biggest increase in income inequality between the 1920s and 2020.

  • After a century of wages increasing in sync with increases in productivity, that synchronization ends.

  • Employees’ share of the national income abruptly declines from 62 percent to 56 percent and even more sharply for everyone but the richest tenth.

  • Median household income stagnates and median wages decline.

  • The share of all wealth owned by the bottom 90 percent peaks and begins to decline.

  • The withering of labor unions in companies accelerates dramatically, as public and political sentiment and regulations and laws turn against them.

  • Jobs in manufacturing rapidly disappear—by 22 percent during the decade.

  • Companies start eliminating fixed pensions for retiring employees.

  • The fraction of companies providing employee health insurance peaks and starts to decline.

  • The decline in the number of manufacturing jobs and the expansion of the economy’s service sector both accelerate.

  • Companies begin replacing low-skill, low-wage workers with even-lower-wage workers supplied by outside contractors.

  • The federal minimum wage is frozen for the entire decade, longer than ever, which translates to an effective pay cut of one-third for America’s lowest-paid workers.

  • Consumer credit is deregulated excessively, causing consumer debt suddenly to increase by a third and interest payments to balloon.

  • The number of jobs requiring a college degree increases significantly.

  • The salary premium for four-year college graduates starts increasing significantly.

  • The cost of four-year college and the student debt to pay for it suddenly start increasing significantly.

  • The fraction of men who graduate from four-year colleges plateaus.

  • The percentage of men working or looking for work begins dropping.

  • Inequality in incomes among different regions of the United States begins increasing significantly.

  • Home mortgage foreclosures quadruple.

  • Personal bankruptcies suddenly increase, more than doubling (before doubling again in the 1990s).

  • The up-and-down year-to-year volatility of family incomes starts increasing significantly.

  • Upward economic mobility—earning more than one’s parents did—begins to become much more unlikely.

  • The large-scale movement out of poverty for black men from 1960 to 1980 stops.

  • Federal spending on housing programs for low-income people is cut by 75 percent.

  • Incarceration of criminals begins its massive increase, doubling (before doubling again in the 1990s), and the first private profit-making prison companies are founded.
    *

  • U.S. healthcare spending and life expectancy both suddenly diverge from the rest of the rich world—heading from about average toward the top in spending and from about average toward the bottom in life expectancy.

  • After the scientific consensus definitively concludes a climate crisis is imminent, the petroleum industry and the political right begin aggressively downplaying and denying it, blocking government regulation to reduce CO
    2
    emissions.

*
In 1982 I reported and wrote a
Time
cover story called “Inmate Nation” about what’s now called mass incarceration, because the number of U.S. inmates had just started to increase sharply and, to my editor and me, alarmingly—that year by 43,000 to 412,000. The total number of inmates today is 1.5 million, of whom 130,000 are in privately run prisons.

The 99 percent of us who weren’t lawyers or judges or legal scholars or conservative activists in the 1980s had no clue that the law itself had become an important front in the war to remake the U.S. political economy. In a democracy, the economic right and business couldn’t depend on having friendly presidents (and state governors) or compliant Congresses (and state legislatures) forever. To make fundamental and
permanent
change, they also needed to cultivate power in the other, largely
un
elected branch of government, the judiciary. They needed to colonize the legal community and reframe the law itself to make sure they kept getting their way. Instead of litigation almost entirely being used
against
them by antitrust enforcers and class-action troublemakers and environmentalists and Ralph Naders, they needed to reshape fundamental American legal understandings—to make it a toolbox they could use to accumulate more power and wealth for big business and the rich over the long run. People these days throw around the phrase
fundamental structural change
a lot, but what the right did in the legal domain was exactly that, breathtakingly so.

You’ll recall the memo that Lewis Powell wrote in 1971 just before he joined the Supreme Court, his confidential call to arms and battle plan for the struggle to save big business and America from the rampaging socialist hordes and their agents embedded throughout the Establishment. “The judiciary is a vast area of opportunity,” he wrote, if only the rich and powerful would “provide the funds.” In 1980 came another lawyer’s call to arms and detailed battle plan for the legal front. It is not widely known. Like the Powell Memo, reading it now is kind of staggering, because we can see how thoroughly and successfully its vision was executed.

Like Powell, Michael Horowitz was a lawyer in private practice commissioned by politicized wealth to produce a report—in his case, by Richard Mellon Scaife’s foundation, which was funding right-wing “public interest” law firms. Horowitz’s memo runs more than a hundred pages. He had three big recommendations for the embryonic right-wing legal movement of which he was a member. His comrades had to begin the long process of recruiting and forming a network of top students and young graduates from the top law schools. Their ambitions had to extend way beyond an occasional lawsuit here or there against this or that regulation that constrained a particular business. Instead, they needed to adopt and fund a
strategy
that sought a genuine right-wing revolution in the high-end legal profession and the judiciary. And even though the not-for-profit conservative legal movement would inevitably be the servant of big business, he advised that it had to stop
looking
so much like that, to appear more idealistic and philosophical and independent.

The world of mainstream public interest law, Horowitz wrote, considered the new right-wing nonprofit law firms created in the 1970s to be “pretenders…largely oriented to and dominated by business interests, a description which is unhappily not wide of the mark for many such firms….All too often, conservative public interest law firms serve as mere conduits by which monies contributed by businessmen and foundations are given to private law firms to assist it in the prosecution of ‘its’ cases.” That is, instead of directly hiring litigators to fight government environmental protections or victims of corporate malfeasance, image-conscious companies were really just laundering money through “public interest” firms who then hired the necessary litigators to do the dirty work. This, remember, wasn’t a liberal take but a conservative’s critique funded by Scaife, the right-wing billionaire heir to an old banking and oil and aluminum fortune.

Yes, of course, Horowitz admitted, “the need to protect the profitability…of the private business sector” was a “significant premise” of “public interest” firms on the right. Nevertheless their movement would “make no substantial mark on the American legal profession or American life as long as it is seen as and is in fact the adjunct of [the] business community.” Lawyers in the new right-wing movement had to start
looking
like principled crusaders rather than poorly disguised minions of the greedy rich. “It is critical that the conservative movement seek out and find clients other than large corporations and corporate interests” in order to make itself “intellectually respectable.”

Instead of occasional “episodic tactical victories” in lawsuits, it needed permanent, large-scale changes in the legal academy and law and jurisprudence, switching from a focus only on “courts and legislatures to law schools and bar associations.” The movement as of 1980, he wrote, consisted of “appallingly mediocre” lawyers, the result of “still-prevailing notions of law students and young attorneys that their career options are largely restricted to serving the public interest (i.e., enhancing governmental power) or ‘selling out’ ” by working
directly
for corporations. Horowitz, a Yale Law School classmate of Gary Hart and Jerry Brown, said the right needed to create a bar “comprised [
sic
] of law review editors, former law clerks and, in no small part, of alumni of national law schools.” They needed to infiltrate the judiciary and the rest of government.

Voilà
. Just a little over a year later, a handful of law students at Yale, Harvard, and the University of Chicago, sharing an enthusiasm for what one called “free-market concepts,” founded the Federalist Society. It turned out to be the monumentally important first step in the plan Horowitz’s memo had laid out. The Chicago chapter enlisted a professor at their law school who was also on the payroll of the conservative Washington think tank AEI to be their faculty adviser—Antonin Scalia. The idea behind the society, in addition to hanging with young fellow travelers and organizing campus lectures and symposia, was to create an ongoing national network of like-minded future lawyers and judges, a right-wing but certifiably elite legal fraternity-cum-mafia. At birth the Federalist Society got funding from the new standard roster of right-wing billionaires’ foundations—Scaife, Olin, Bradley, the Kochs.

Michael Horowitz, who promptly joined the Reagan administration as David Stockman’s chief lawyer, also practiced what he’d just preached, cruising Federalist Society meetings to recruit promising true believers for entry-level administration jobs. Within just a few years of its founding, when Scalia began his tenure as the exemplary right-wing Supreme Court justice for the new legal age, the Federalist Society had two thousand members in seventy law school chapters, and scores of alumni embedded in key venues—working for the Justice Department in Washington and U.S. attorneys’ offices around the country, clerking for Scalia and other Reagan appointees in the judiciary. In 1987 Brett Kavanaugh entered Yale Law School, where he joined its Federalist Society chapter (its president, George Conway, had just graduated), and a year later Neil Gorsuch started at Harvard Law School and became a member.

The spectacular rightward swerve of legal thought starting in the 1980s had two freshly cast ideological pillars, one focusing narrowly on the Constitution, the other on more general criteria for determining proper legal outcomes. Each was a movement with its own builders and promoters. As with the rest of the right-wing makeover of the 1970s and ’80s that sought to take America back in time, both legal movements amounted to fundamentalisms, radical right turns presented as reassuring returns to original American first principles.

The one concerning the Constitution became known in the 1980s as
originalism
. How flexibly or rigidly the Constitution’s provisions should be applied to governance was a debate from the get-go, two centuries ago. In the early 1950s, the moderate Republican president Eisenhower appointed the moderate Republican governor of California, Earl Warren, to be chief justice of the Supreme Court. For a generation his court issued world-changing decisions interpreting the Constitution on behalf of progress—outlawing racial segregation and organized prayer in public schools, requiring that criminal defendants be advised of their basic rights and provided with lawyers, stipulating that contraceptives be freely sold. Reactionaries and other right-wingers castigated the Warren court and other federal judges for being “judicial activists” and called themselves “strict constructionists” who adhered to the plain old meanings of the Constitution. Accusing white liberals in the 1950s and ’60s of being constitutionally sloppy was more effective than calling them atheists and coddlers and race traitors. Conservatives figured the more they could get the Constitution to be interpreted narrowly and literally, supposedly the way Americans back in 1789 or the 1860s understood its eternal meanings, the less liberals could use it
now
to justify pieces of modern progress that the conservatives disliked.

By the 1980s that approach had become a respectable movement, and before long the legal scholar Jeffrey Rosen, nowadays president of the National Constitution Center, wrote that “we are all originalists now.” He meant that everyone in the legal world acknowledged that the original meanings of the Constitution and its amendments couldn’t be ignored. But originalism became a crude and self-justifying meme that the right used, from the 1980s on, simply to serve its own interests and prejudices. Originalism’s most important hidden agenda was to keep courts and judges completely out of the business of business, as if what worked for the U.S. economy for its first century, before modern corporations existed, was how things should work today. It was like the Friedman Doctrine, which turned a reasonable capitalist truism (
profits are essential
) into a simple-minded, unhinged, socially destructive monomania (
only profits matter
).

As movements, originalism in the law and libertarianism in economics were fraternal twins. Both were born of extreme nostalgia, fetishizing and distorting bygone America, so both more easily achieved mass appeal in the everything-old-is-new-again 1970s and ’80s. Both purported to be based on objective principles that transcended mere politics or special interests, even while both were vehicles for big business and the right to recover, fortify, and expand their economic and political power. And both shared key promoters, of whom probably the single most important was Robert Bork.

Bork was a founder of originalism in the 1970s, and in 1986 he was in the running for an open Supreme Court seat (as he had been in 1981). But Reagan made the safer choice from among the new generation of hard-right ideologues—Antonin Scalia, who as a result came to be the personification of originalism. A year later, however, Reagan finally did nominate Bork to fill the seat of—
perfect—
retiring Justice Lewis Powell. In the trivia-game category Failed Supreme Court Nominees, Bork is the most famous by far. The ascendant right in 1987 figured he would be a shoo-in—the Senate had just confirmed Scalia 98–0. Bork was a right-wing hard-liner but also, as an influential Yale Law School scholar, respected and liked by the liberal legal elite. So they were shocked and disappointed and angry at Bork’s bipartisan rejection in the Senate, a last-hurrah victory by Washington’s declining liberal-left political machine. What’s more, six years into the official right-wing takeover, six
Republican
senators had voted against him
.
Afterward, thanks to the new counter-Establishment—AEI fellow, George Mason University professor, Federalist Society standing ovations—Bork spent the rest of his life working his postrejection fame, making a second career out of right-wing martyrdom.

He’d joined the Yale faculty at age thirty-five in 1962, and in 1971, that seminal year for the great right-wing counterrevolution, Professor Bork wrote the law review article that became the foundational document for originalism. It remains one of the most frequently cited law review articles of all time.

Given that the notion underlying the movement Bork cofounded is the unchanging word-for-word sacredness of the Constitution, it’s very odd that Bork begins that essay by disparaging the Bill of Rights as a cynical political add-on stuck there in 1789 just to get the whole thing passed. Madison and Hamilton and the rest “had no coherent theory of free speech and appear not to have been overly concerned with the subject”—although to the degree the Founders cared at all, he claims, they were often
against
free speech, being “men accustomed to drawing a line, to us often invisible, between freedom and licentiousness.”
*1
Because “the law of free speech we know today grows out of the Supreme Court decisions” from the 1900s, Bork wrote, it is “Court-made law” and therefore wrong. He somehow decided that the First Amendment protects
only
“explicitly political” speech in an extremely narrow sense, “speech concerned with governmental behavior, policy or personnel.” He actually insisted that apart from opinions about government and politicians, “there is no basis” in the U.S. Constitution for any court or judge “to protect any other form of expression, be it scientific, literary, or that variety of expression we call obscene or pornographic.”

BOOK: Evil Geniuses: The Unmaking of America: A Recent History
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