1-Sentence-Summary: Requiem For The American Dream argues that the gap between the wealthy and the poor is not an accident, but rather the result of intentional policy decisions made by rich individuals and corporations to increase their power and decrease that of ordinary citizens.
Read in: 4 minutes
Favorite quote from the author:
Through financialization, select people turned everything into a commodity that can be traded on Wall Street, privatized every aspect of life, and sought profits over humanity.
Needless to say, those people became immensely wealthy, while the average American barely beat inflation year to year. What are the costs and implications of such practices? A trembling democracy and a societal gap wider than ever before.
Let’s explore what got the USA into this state by looking at three of my favorite lessons from the book:
- Deregulation of businesses and unions, as well as the privatization of public services, carry part of the blame.
- The middle class shrank as government spending on families lowered and corporations started outsourcing to low-income countries.
- Corporations are often above the law and democracy, which we fought so hard for.
Let’s take each lesson and explore it in detail to better understand the bigger picture.
Lesson 1: Deregulating can shake a democracy, and over-privatization can weaken governments
Over the last 40 years, income inequality in the United States has grown to shocking proportions. While there are many areas of the socio-economic environment of the USA that went downhill, deregulation, privatization and even globalization played a critical role in the process.
Financial institutions have become vastly more powerful than governments or corporations while also controlling much of their revenue streams—from taxes on investment income to fees paid by consumers who purchase credit cards or take out mortgages.
In other words, as everything is privatized, governments now rely on the financial industry for a large portion of their revenue while financial companies rely on governments for stability. The problem? The working class is carrying the burden of these rushed decisions.
Deregulation is another problem because it allows banks to charge higher interest rates, issue misleading statements, and overall protect corporations in exchange for more profits. These macro-organizations know that they may be skipping the law at certain times, but that doesn’t impose a problem for them anymore.
We can see this phenomenon occurring as corporations are bashing unions and targeting their leaders. As employees start to speak up about issues at work, their voices are often silenced by the officials while their unions are dissolved. The lives of these people often get destroyed, while executives get away with it.
Lesson 2: Globalization and reduced government spending on families is another main reason behind the increase in poverty
Noam Chomsky argues that globalization allowed corporations to import from low-income countries and grow even more powerful. Tax cuts for the rich and offshoring assets become a norm for every wealthy individual. Including organization that wants to maintain wealth, while the possibility doesn’t even exist for middle-income families.
Government spending on such families or poorer people lowered significantly. While the remaining budget helped support these companies in exchange for a place in their world. These tax cuts allowed corporations to grow richer but also pushed families into poverty.
For example, Chomsky says that in his view “the income tax has been converted into a device for subsidizing the rich.” How come? Well, the entire system of taxation works for the high-income profiles, as the money keeps on being redistributed upwards.
Simply put, the system taxes working people at a higher rate than it does corporations or wealthy individuals. Even more, government spending on families was reduced to help support these companies, all while the middle class shrank and the poor one grew.
American workers are left behind as corporations prefer to outsource jobs to other countries where labor is cheaper. This helps explain why many Americans are struggling financially today. However, the problems run to the roots of this wicked system, so naturally, there’s not only one cause for such major issues.
Lesson 3: Democracy is at the core of the American system, but it seems to stop at the corporational level
Noam Chomsky presents how corporations’ control of government has led to policies that favor their interests over the citizens. This book is illustrated by the fact that those who are most affected by these policies are often not consulted when they are created.
For example, he points out that even though most Americans want universal health care. Congress does not listen to them because it is beholden to lobbyists from powerful insurance companies.
What’s worse, the same elites have used their influence to shape tax policy. So it benefits the elites while hurting most Americans.
This is one of the main reasons behind skyrocketing fortunes that some people hold while others struggle for one percentage increase year over year. We need to change our current system because it isn’t working for most citizens.
Corporations also exert influence by lobbying Congress through campaign contributions and by filing lawsuits against anyone willing to disobey or hurt them. This form of corporate control over government undermines democracy itself.
Requiem For The American Dream Review
Requiem For The American Dream sheds light on the causes of income inequality in the US over the last 40 years.
The book argues that neoliberalism has been a major cause. With its principles of deregulation, privatization, and tax cuts for the wealthy leading to a concentration of wealth and power.
Reading it will open your eyes and widen your perspective of what’s going on behind the curtains. The so-called democratic superpower that America represents.
I recommend reading this book if you find that the system is rigged. And if you’re ready to see the reasons behind it through a powerful, yet grey lens.
Who would I recommend the Requiem For The American Dream summary to?
This book is recommended to the 30-year-old activist who wants to be informed about the affairs of their country. The 40-year-old electorate who wants to study the significant American problems up close. Or the 55-year-old sociology or economy professor who enjoys a great read in their field of study.
Last Updated on October 13, 2022