alonovo.com (beta 2.0)

A fantastic work. 2009-10-29

Reviewer: D. Shaw

For the purposes of this review, I will separate my comments on the book itself from my evaluation of its conclusions. Any commenters please direct criticisms accordingly. It is two entirely different matters to disagree with his ideas and his writing. In terms of the book, simply put, this is a magnificent accomplishment by Mr. Phillips. The book is meticulously researched, well written, and chock full of helpful diagrams. I particularly liked the roadmap introductions and the logical organization of the sections. They helped to see the greater context of the book's argument. He also manages to mix expertly the dry areas of economic statistics with the more lurid stories of the colorful characters of history. From a literary standpoint, it is excellent.

Now, as to his conclusions, they are little short of mind-blowing. I really had no idea of the level of economic stratification this country has reached. This isn't just partisan moralizing, though. As Mr. Phillips points out, there is nothing wrong with concentration of wealth so long as it is neither ill-gotten, harmful to the public interest, or distortive of the political process. Unfortunately, the current situation is a violation of all three. Going all the way back to the privateers of the revolution, the great fortunes have, with some exceptions, been built upon thievery legal or otherwise. The last part was interesting in particular. Whether by illegal monopolies/trusts or government largesse bought by bribery, great wealth most decidedly did not accumulate by triumph of true free market principles. Indeed, if true laissez faire reigned (as conservative economics desires), there would be no bailouts, no subsidies, and no protectionism. To the contrary, the titans of finance have gained astronomically from government assistance while shedding american workers at nearly the same rate. One must also consider the extensive and pervasive political distortions wrought by the rise of the plutocracy. Add it all up, and the future of our country seems very much in peril. Bravo to Mr. Phillips for attempting to chronicle what has previously been hidden in the shadows.

Interesting But ..... 2009-09-01

Reviewer: libertarian reader

I have now read the author , Kevin Phillips' books : Wealth and Democracy, American Dynasty :
The Bush Family, Bad Money, and finally, The Politics of Rich and Poor.

I would be interested in learning more about Mr Phillips' experience as a GOP strategist under
President Nixon's administration. Mr Phillips' prose bashes Republican values and free market enterprise from beginning to end. I was particularly amused that he considers capital gains,
dividends, rental income, and common interest as "unearned income". Suffice it to say that
risk-taking does not involve work and effort ? My definition of 'unearned income' is synonymous with the IRS's definition. Unearned Income is a tax credit and subsidy for those who do not have income.

I consider his comparison of 17th century Spanish, 18th century Dutch, 19th century British,
and 20th century American economics to be brilliant in scope. I thought this was his insight
until I noticed that he credited it to another author in his book, Politics of Rich and Poor. However, he does expound well on this theme of economic demise. Mr. Phillip's criticism
of 'Paper Entrepreneurialism' is spot on.

However, his expose could use a more balanced posture other than it's constant left-leaning stance. The author fails to mention the socio-economic effects of labor unions, excessive and progressive taxation on productive people, excessive government regulations, and restrictive environmental laws. In his book, Bad Money, he blames the private sector for the entire
sub-prime crises but makes no mention of the Congressional and Senate Finance committee's
role in passing and enhancing the Community Re-Investment Act. Upon examination, one finds that
this particular act mandated that GSE's Fannie-Mae and Freddie Mac's loan portfolios include
a substantial percentage sub-prime mortgages. Formerly, Fannie and Freddie only accepted prime mortgage loans. Mr Phillips is too well informed not to include this aspect of the crises and must, in my opinion, be in denial.

Granted that the rich do not excrete marble. Nevertheless, Capitalists can only grow types of
business that the political and economic climate of the country permit. Implications that the poor deserve more government support, merely by virtue that they are poor, do not ring true and seem unsupported throughout Mr Phillips' text. Margaret Thatcher has been quoted as reminding us that
Socialism fails when the last of other people's money has been spent.

read it and learn about the USA and wealth... 2009-06-29

Reviewer: Rick Johnson

Great read if you want to know the inside story....interesting read it from start to finish in two days.

The Close Relationship Between the Rich and Politics. 2009-01-15

Reviewer: J.L. Populist

In this large book Kevin Phillips takes the reader on a lesson of economics and politics. Much of the history in WEALTH AND DEMOCRACY is of the American variety. He does, however, examine Spain, Holland,and Britain and the commonality these past governments have with the current American political and economic scene. The biggest common thread is the shrinking of the middle class a/k/a stratification of wealth.

One of Mr. Phillips observations is that in the 1990s transnational corporations posted record earnings while hiring few Americans. Sometimes slashing employment to boost the bottom line.
Along that line he quotes Peter Cepelli, a professor at Wharton School of Business- "Today, a CEO would be embarrassed to admit he sacrificed profits to protect employees or a community."

He also describes the shifting of the tax burden from corporations to low and middle income individuals through FICA taxes.

His quote on page 242 sums up American politics of the 1890s- "For two or three decades, then, democracy was corrupted at its constitutional core. Control of the Senate secured not just that chamber but the federal courts, the U.S.Supreme Court, and the U.S. Army to the service of American industry and finance."

He demonstrates in this book that wealth has been a factor in the politics of the United States from the very start. Finance (banking) has had it's proponents like Hamilton and some presidents through time while it has also had it's opponents; most notably Thomas Jefferson and Andrew Jackson.

The author takes a look at the worth of some former Cabinet members, Warren Harding's especially, although he wasn't the only president to tap the wealthy for his service.

Another interesting point that Mr. Phillips makes is that globalization can be, and has been in the past, reversed.

One of the curious inclusions in this book is found on page 71. It's an excerpt of a letter from FDR to Col. Edmund Mandell House. (House is a rather controversial, mysterious figure in American political history and the subject of conspiracy theories. He was a close adviser to Woodrow Wilson during his presidency). "The real truth... is, as you and I know, that a financial element in the larger centers has owned the government ever since the days of Andrew Jackson- and I am not wholly excepting the Administration of W.W. The country is going through a repetition of Jackson's fight with the Bank of the United Sates- only on a bigger and broader basis."

The author also quotes such figures as John Kenneth Galbraith and Thorstein Veblen

The moral of WEALTH AND DEMOCRACY as I take it, is that our economic ills now are nothing more than a recurring pattern that has been experienced by various powerful governments in their heydays. Part of the problem is hubris or the belief that it can't happen again.
This is a large book and some sections are laborious to read, but the message of the book is comprehensible and detailed very well. It may just be the most detailed book on the subject of wealth and it's adverse affect on government, especially a democratic form of government.

important issues, terrible writing 2008-08-04

Reviewer: Mr. Juan Liska

This book has been a slow read due to the author's disorganized writing and liberal use of big words for no apparent reason. It's typical of him to mention some phenomenon and then say, but we'll get back to that later. Or he'll say, we've already covered most of this in chapter 4 and table 2.1 but let me add... It's a total mess.

That said, the concepts are interesting, and I think Obama's popularity is a sign that most Americans are getting tired of footing the bill for the mistakes of the wealthy. The most interesting things i've read in this book:

- since the 80's, the US has seen the socialization of financial risk and privatization of risks that every person has (ie the risk of falling ill).
- laissez-faire is an illusion.
- the top individual tax bracket once paid 90% income tax
- the top individual tax bracket now pays about the same as the middle class (or less if the person is "savvy")
- Lincoln (republican) once said: "Labor is prior to and independent of capital. Capital is only the fruit of labor and could never have existed if labor had not first existed. Labor is the superior of capital, and deserves much higher consideration."
- capital has no country

I have not and may not finish reading this book because the prose is so tedious, but 100 pages from the end I have not encountered any mention of the Long Term Capital fiasco that also ended with a taxpayer bailout.

I am an entrepreneur and believe that capitalism is the only way to run economies/markets. However, my experience of over 5 years living in a country with a gini index of 55 has made clear the disadvantages of wealth disparity, even on purely pragmatic terms. Americans, inheritors of the first modern democracy, should do what they can to ensure the powerful do not continue to accumulate disproportionate wealth and power. The United States gini is already at 40.8, the highest since the 60's when the coefficient was first measured. It's also the highest/worst among developed countries and more typical of countries like Senegal and Turkmenistan.