In “The Sign of Four,” as Sherlock Holmes walked out of 221B Baker Street on a brief excursion to investigate the disappearance of Captain Arthur Morstan, he recommended to Dr. Watson a book that he described as “one of the most remarkable ever penned,” Winwood Reade’s The Martyrdom of Man. First published in 1872, it is an iconoclastic history of the world that George Orwell described as one of the formative books of his youth. In it, the dutiful Watson could have read Reade’s description of the last days of Rome, a time in which, he said, the emperor and his favorites dined on nightingales and flamingo tongues as their world crumbled.

“Industry is the only true source of wealth,” Reade wrote,

and there was no industry in Rome. By day the Ostia road was crowded with carts and muleteers, carrying to the great city the silks and spices of the East, the marble of Asia Minor, the timber of the Atlas, the grain of Africa and Egypt; and the carts brought nothing out but loads of dung. That was their return cargo.

And there went Rome.

In an economy where billions are made and lost on the rise and fall of dot.com ventures that have no visible means of support, Reade’s words about the importance of industry, vivid though they are, seem as charmingly outdated as a Sherlock Holmes plot. But the political echoes of his dour analysis can be heard today in the anti-globalization demonstrations in Seattle and Washington, D.C., in the populist presidential campaigns of Ralph Nader and Pat Buchanan, and on the floor of the House as the American labor movement and its few remaining allies decry the shift to a postindustrial society.

For American labor, the price of globalization has been the loss of traditional jobs—and consequent declines in labor income—as capital prefers to invest in low-wage countries where government regulation is weak or nonexistent. Most Republicans predictably champion this trend, and labor’s traditional political vehicle, the Democratic Party, also appears to be conniving in capital flight and the hardships it inflicts on a large part of the workforce.

In America’s Forgotten Majority, Ruy Teixeira and Joel Rogers write that “from 1973 to 1998, in an economy that almost doubled in real terms, the wage of the typical worker in production and nonsupervisory jobs (80 percent of the workforce) actually declined by 6 percent, from $13.61 to $12.77 an hour.”

Trade may not have been the entire cause of the wage decline, but it is a highly visible factor. In Government Works, Professor Milton J. Esman of Cornell University writes:

The openness of American markets to foreign products, including those produced by US-owned firms in low-wage countries, has been a major disincentive to US firms to invest in improving the efficiency and productivity of home-based plants. It has been economically rational for them to abandon US facilities entirely. The loss of manufacturing jobs, in turn, has contributed to the decline in real wages for displaced workers; their replacement jobs in the services sector usually pay less than the manufacturing jobs they have lost.

This cause and effect may be intuitively obvious, but to American working people the linkage seems to have eluded the leaders of their government. President Clinton has used his considerable charms to sell the North American Free Trade Agreement with Canada and Mexico and Permanent Normal Trade Relations with China by promising that free trade will mean more and better jobs for American workers. They have not believed him, and for the most part they have been right not to do so.

Instead of personal prosperity, traditional working-class voters get condescending lectures about the virtues of free trade, often couched in language suggesting that anyone who doubts the benefits of globalization is a knuckle-dragging mouth-breather too dim to understand the works of David Ricardo. In postindustrial Washington, Clinton and his favorites (wearing blue jeans to seem folksy) dine not on nightingales but on barbecue at a Democratic National Committee dinner that raises $25.5 million, much of it in $500,000 contributions, for the party that supposedly represents the common man.

Labor leaders boycotted the event to protest the Clinton administration’s support for normal trade relations with China, and also threatened to withdraw support from Democratic congressional candidates. “This is a betrayal,” George Becker, president of the United Steelworkers of America, said of the China vote. Stephen Yokich, president of the United Auto Workers, suggested his union would back Ralph Nader for the presidency rather than Vice President Al Gore.

Clinton’s faith in free trade may eventually prove correct; even now, the working class is just beginning to share in the economic gains of recent years. But in the short run, the Democrats, led by Gore (a far less persuasive salesman than Clinton), are seeking to retain the presidency and win back the House and Senate next November. Working people, their traditional base, do not appear to be especially enthusiastic, and the upper-middle-income suburbanites—“soccer moms”—their new infatuation, seem tempted by George W. Bush’s “compassionate conservatism.”


In three of the books under review, there is a warning to Democrats, but one that may not be heeded as the millions of dollars in contributions roll in: though we may be living in a postindustrial society, for Democrats the key to winning elections still lies in serving the interests of members of the working class, providing them with government services that cannot be supplied fairly by the marketplace and restraining the excesses of unfettered capitalism.

Teixeira and Rogers describe a “forgotten majority”—it makes up 55 percent of the voting population—composed not of traditional unionized blue-collar workers, but of white technicians, mid-level office workers, and others without a four-year college education. Its median family income is $42,000 a year. The authors argue that even after decades in which white working-class voters have shifted in varying numbers to George Wallace, Richard Nixon, Ronald Reagan, and Ross Perot, Democrats can still win a substantial number of their votes by addressing their concerns: education, job training, child care, and secure retirement programs.

A major reason for the white working-class defection over the years, the authors say, has been the Democrats’ emphasis on noneconomic issues like racial equality, gay rights, and women’s issues at a time when working-class wages were declining. Because of this coincidence, it seemed logical to white men that the gains of others were coming literally at their expense:

Among those whites for whom the post-1973 economic world has generally been hard, the Democratic party has lost its appeal, while among those for whom it’s been something close to a disaster—white men—a complete meltdown in Democratic support levels has occurred…. And with the forgotten majority workers’ own incomes stagnant or declining, they became very reluctant to pay for programs that they didn’t think worked, or worked for everyone but them.

Into this breach leaped the Republican Party, preaching lower taxes, traditional morality, traditional fam-ily relationships, and smaller govern-ment. White men, particularly in the South, deserted the Democratic Party in droves. The party seemed to them more interested in awarding preferences than rewarding hard work, as well as distracted by its liberal social agenda.

But now Teixeira and Rogers point to polling data indicating that the white working class has grown far more tolerant over the years, more willing to live and work alongside blacks, more accepting of different lifestyles. To win them back, the authors say, the Democrats should adopt a strategy that reunites the social values of these voters—e.g., reward for work, a fairer system of affirmative action—with their economic experience, repairing the breach that has occurred since 1973, when their economic decline began.

Even if this means backing away from the emphasis on racial and sexual issues of recent years, Teixeira and Rogers say the Democrats must take the risk of pursuing broader-based appeals to voters: “The best approach to mobilizing the forgotten majority lies in universalist, transracial issues that should have substantial appeal to the Democratic base [i.e, racial minorities and working women] as well.” As an example, Democrats could advocate affirmative action based on class and family income, rather than on race. Poor blacks would still benefit, but so would poor whites. The offspring of upper-middle-class black parents, however, would get no preference over a white rival from a humble background.

Mounting such a campaign is easier said than done. Teixeira and Rogers describe their forgotten class purely in economic terms, and there is very little mention of issues like abortion, school prayer, and gun ownership that have also hurt Democrats among substantial numbers of white working-class voters. On the other hand, to win a national election, Democrats do not need a majority of the forgotten majority’s votes; they simply need to do somewhat better than the current 33 percent or so support that Gore enjoys among it.

Milton Esman, an emeritus professor of international studies at Cornell, plunges into this debate with an attack that is Rooseveltian in its vigor and forthrightness. His book is an eruption of outraged eloquence after what must have been years of frustration over the flaccidity of moderate progressives in the face of a conservative Republican assault on liberal achievements.

“Nothing has been as bizarre in recent political discourse as the appropriation of ‘values’ by the Republican right as they celebrate unrestrained cupidity, self-interest, and social Darwinism at the expense of ordinary citizens,” he writes in a typical sally aimed equally at conservative knavishness and liberal complaisance.

Like Teixeira and Rogers, he believes Democrats have spent energy on noneconomic issues, “such causes as multiculturalism, environmentalism, homosexual rights, and gender equality that appealed to important constituencies but failed to speak to the daily concerns of most workers, consumers, parents, and voters.” In this vacuum, Republican ideologists sold voters on the virtues of low taxes, self-reliance, and minimal government. If Democratic programs were not aimed at helping ordinary people, there was no reason for ordinary people to support Democrats.


Republicans were able to portray the entire array of Democratic governmental programs as simply the work of busybodies—Hillary Clinton is their most visible current example—who enjoy expanding government for its own sake. At the turn of a new century, few young people can imagine why there was ever a need for Social Security, Medicare, the GI Bill, federal wage and hour laws (now widely ignored), a federally underwritten welfare program, environmental protection, affirmative action, banking and securities regulation, consumer protection, and public defenders.

Esman reminds us why these programs were enacted in the first place and why they (or most of them) are still essential:

In an integrated and globalized economy such as ours, only the federal government is equipped to check abuses of concentrated economic power; to protect unorganized consumers, investors, depositors, and workers; and to safe-guard the environment and our patrimony of natural resources…. The United States has become economically and culturally “one nation, indivisible.” The abuse of concentrated economic power and of unregulated business practices are national in scope, with national consequences that can be dealt with only by regulation that is national in coverage.

Esman is a biting skeptic about the universal benefits of free trade, a position that is heresy among most academic economists. While he observes that it has reduced prices, he adds:

Free trade has, however, wreaked havoc on millions of manufacturing workers, their families and the communities they support as employers have transferred operations overseas to take advantage of much lower taxes and labor costs…. The fate of these displaced manufacturing workers and of the once-proud communities they supported has been one of the silent tragedies of the past quarter century.

And further:

Government policy cannot afford to be paralyzed by the ideology of free trade, which is vigorously promoted by neo-liberal ideologues and multinational enterprises. Organized business has taken advantage of globalization to reverse the terms of competition with labor for the distribu-tion of the economic product by undermining the welfare state, weakening labor unions and transferring operations to low-wage countries.

This is such an aggressive and unapologetically liberal agenda for the Democrats that it might serve the party well if Esman’s compact, forceful book were to be found on the seats of every one of the delegates to the convention in Los Angeles, simply as a reminder of the kind of principles the party once stood for. He advocates government support for a “living wage” (i.e., a higher minimum wage), industrial policy that promotes manufacturing, penalties for companies that ship jobs overseas with the intention of importing the products back to America tariff-free, enforcement of immigration laws, continued anti-crime measures, support for public education, continued support for equal opportunity, and, most radically, universal single-payer (Canadian-style) health insurance.

It is hard to see how Democrats could continue to raise corporate contributions to sell such a program, but Esman notes that the Internet now provides a tool that may be able to bypass the new reliance on big-money fund-raising. Single-payer health insurance may seem utopian in the current political climate, but doctors are already rebelling against the controls placed upon them by the private insurance industry, and in many places are trying to unionize themselves. Do not be surprised if national health insurance is eventually brought to us thanks to the American Medical Association.

Probably his most important precondition for a Democratic revival is that progressive spokesmen must be more energetic in defending their heritage of serving ordinary Americans. He observes that Republicans have established a highly efficient inter-connected array of think tanks and magazines

that ridicule “political correctness,” promote traditional morality and individualistic self-interest as the appropriate ethos for the current era, glorify market processes, and condemn government for corruption, incompetence, and gratuitous meddling in the affairs of individuals, families, and especially businesses. The response from left-leaning intellectuals has lacked the passion, the assurance, and the coherence of the rightist attack. Until this disparity has been overcome, until progressives find their bearings under the political conditions of the early twenty-first century and regain their intellectual self-confidence, they cannot recover politically.

Esman’s prescriptions are sure to be attacked as nostalgia for a bygone political world; but they at least provide a yardstick that Democrats can use to measure themselves. It is surely more constructive than their current fascination with whether or not they are outraising the Republicans.


John R. MacArthur’s The Selling of ‘Free Trade’ puts a human face on the victims of the NAFTA agreement, which was approved by a nominally Democratic-controlled Congress, at Clinton’s urging, in November 1993. MacArthur, the publisher of Harper’s magazine, concentrates on the fate of the Swingline stapler factory in Queens, New York, which was dismantled by its owners so that operations could be moved to Mexico. The displaced Swingline workers were not the white working-class members cited by Teixeira and Rogers; they were largely immigrants, doing tedious factory work as their first step up the ladder in their new home country.

The Swingline move highlights the fatuous premise that Clinton used to sell NAFTA. At a signing ceremony in 1993, he portrayed Mexico as a vast potential market for US goods, noting that the

average Mexican citizen is now spending $450 per year per person to buy American goods. That is more than the average Japanese, the average German, or the average Canadian buys; more than the average German, Swiss and Italian citizens put together.

You would think, listening to Clinton, that Mexicans had purchasing power comparable to the average Swiss and would buy even more American products if NAFTA were enacted. But Mexicans were not the target customers of Swingline—or of many of the other corporations that shifted production to Mexico. Swingline’s American workers could have afforded to buy the staplers they produced, and no doubt even had need of them. The pathetically poor Mexican workers at Swingline’s new Nogales plant would place staplers far down on their shopping wish list, somewhere behind electricity, plumbing, and floors for their shacks.

It is hard to describe as US-Mexican “trade” a transaction that ships an American factory to Mexico so that its products can be imported back to America and produce higher profit margins for the owners. MacArthur describes NAFTA, correctly, as not a trade agreement but an investment agreement, one designed to assure the safety of American investment in Mexico rather than to increase exchanges of indigenous Mexican and indigenous American goods. Under the Department of Commerce’s perverse statistical guidelines, if you export $1 billion worth of such factories to Mexico and fire all the workers in the shuttered American plants, each $1 billion exported is credited with creating 20,000 new American jobs.

Despite MacArthur’s sympathy for the Swingline workers of Queens, his book highlights some basic problems. The factory’s longtime union was corrupt; it was ousted by the Teamsters, which improved conditions, but even the Teamsters’ engaging agent for Swingline was subsequently indicted under the Racketeer Influenced and Corrupt Organizations Act, though his conviction was reversed on appeal.

In one brief passage, MacArthur recounts how four Brooklyn longshoremen undocked the cargo ship Hansa Commodore. “For fifteen minutes of actual physical labor, [one of the longshoremen] said, the four would be paid for a six-hour shift at a rate of about $30 an hour.” This is routine on the New York waterfront, simply a fact of life. But no wonder employers would want to flee a city where labor costs can be so out of line.

In addition, the Swingline jobs, which included, at one point, filling staple boxes by hand, were mindlessly dull and hardly attractive to the average US high school graduate. That’s why immigrants, in some cases illegal immigrants, could get them. One of the difficulties in defending American industry from foreign competition is that often, because of an underfunded US Labor Department, the industries being defended are in fact ruthless sweatshops employing and exploiting illegal immigrants. Swingline was far better than that, providing a near-middle-class lifestyle and health insurance for its workers, many of whom could afford cars to drive to work—an unthinkable luxury for the Mexicans who replaced them.

MacArthur’s sympathy for the Swingline workers is matched by his contempt for the American politicians who approved NAFTA, even for then House Majority Leader Richard Gephardt, a Missouri Democrat, who opposed it and who has been a leading skeptic of free trade. MacArthur denounces Gephardt as naive for trying in 1991 to negotiate improvements in NAFTA that made it seem more humane, and accuses him of failing to put up a stiffer fight because he was interested in running for president in 1992. Here MacArthur loses me. He has written an impassioned and righteous book with some illuminating human stories but—pace Esman’s demand for more energetic liberal rhetoric—MacArthur goes overboard in his outrage over the injustices of NAFTA, and his argument becomes less persuasive as a result. He does not give a balanced account of Gephardt’s record on many pro-labor issues, including the reform of NAFTA. If Gephardt is the enemy, the Democratic left is lost.

David S. Broder’s Democracy Derailed is a warning to the public and to politicians, both left and right, that voters can simply bypass the government if they suspect that special interests have replaced concern for the ordinary citizen and the common good. The voters’ weapon that interests him here is the direct ballot initiative, which creates law by referendum. This is lawmaking without government, which means lawmaking without hearings, without informed debate, often without adequate understanding of the consequences.

In theory, initiative campaigns are the purest kind of grassroots democracy, and arose out of disgust with politicians who seemed to be wholly owned by railroad barons, Eastern banks, and industrial monopolists. But Broder shows that today’s initiatives are often the work of moneyed interests who hire professionals to gather signatures and then sell their proposed legislation to the public by TV advertising just as any other politician does.

In 1998, Broder reports, direct initiatives were used across America to make new laws and amend state constitutions:

They ended affirmative action, raised the minimum wage, banned billboards, decriminalized a wide range of hard drugs and permitted thousands of patients to obtain prescriptions for marijuana, restricted campaign spending and contributions, expanded casino gambling, banned many forms of hunting, prohibited some abortions, and allowed adopted children to obtain the names of their biological parents.

The most famous current example is California’s Proposition 13, which was approved after politicians were slow in refunding some of the surplus property taxes that had been reaped thanks to inflation in the California housing market. Proposition 13 indeed rolled back taxes, but it has led to great inequities in the tax burdens between established homeowners, who pay the old, capped rates, and new purchasers, who are saddled with a far heavier load. In addition, the limit on property tax undermined California’s once-admired public schools. “What in the 1970s had been the nation’s model school system—from the elementary grades through a system of junior colleges, colleges and great research universities—fell into disrepair and disrepute,” Broder writes.

Broder, a Washington Post reporter and columnist who is often described as the dean of American political journalists, warns that modern technology makes the direct initiative a threat to the Constitution itself:

I do not think it will be long before the converging forces of technology and public opinion coalesce in a political movement for a national initiative—to allow the public to substitute the simplicity of majority rule by referendum for what must seem to many frustrated Americans the arcane, ineffective, out-of-date model of the Constitution.

He asks: “Do we really wish to keep this a republic? That question is coming at us with the speed of E-mail and with the explosive power of a political bombshell.”

When this moment comes, the political guru Dick Morris will be there to welcome it and explain to politicians—or anybody else with the money—how to manipulate the new system. In a previous book, Vote.com, Morris, a one-time strategic adviser and pollster for Clinton, heralded a new day in which Internet-aided direct democracy would supplant our current legislative process. Morris believes that such direct democracy will liberate voters from bureaucrats and interest-group politics, rising above the left- right divisions that have often paralyzed national debate.

In The New Prince, Morris offers a neo-Machiavellian handbook to prospective politicians on how to choose issues, conduct ad campaigns, and stage debates with their opponents. Some of this may be useful to the politically ambitious but there is such an air of cynicism throughout that Machiavelli himself would likely cringe.

Here is Morris’s advice on choosing a political position:

If a politician has any position at all on abortion, gun control, tort reform, casino gambling, or a plethora of local issues, funds await harvest…. Take whatever position you want, but do take a position, because once you do, ample money awaits you on either side.

As in Vote.com, Morris argues that modern technology has made voters better informed than ever and thus better qualified to take a more direct role in lawmaking. I doubt this. There is certainly more information available to more people, but the Internet has also removed the traditional filters that once screened a good deal of nonsense out of our national debate. On the web today, one can read all manner of conspiracy theories, baseless accusations, character assassinations, and economic quackery. Many people think, no doubt, that this stuff could not be said if it were not true, that someplace there is an authority who would keep the record straight. There is none, and if, in such a climate, lasting political decisions can be made at the click of a mouse, the country is in danger.

Morris is harsh on government bureaucrats, whom he regards as obstacles to the plans of newly elected officials: “The permanent bureaucracy of the executive branch of a democratic government is dedicated to a single mission: To change nothing. Left or right matters little. They are neither liberal nor conservative. They are in favor of things as they are.”

And a good thing, too, I say. The nation should be grateful to the bureaucrats who act as an institutional memory when a bright-eyed new administration takes office. It is the old professionals who can remind the newcomers that many seemingly original ideas have been tried and found wanting. If they are indeed intransigent, good leadership can overcome them. But this basic element in the checks and balances of our government should not be ignored or conquered as a matter of course, as Morris suggests.

Of the five books under review, Morris’s is the most unsettling because in its cynicism and its obsession with the tactics of political campaigns it is likely to be the closest to future reality. Teixeira, Rogers, MacArthur, and Esman appeal eloquently for a return to an old-fashioned populist politics that serves the most vital interests of ordinary working Americans. And it is not hard to imagine both Al Gore and George Bush, who has been reborn again as a “compassionate conservative,” mouthing many of their populist appeals about fair play and a government that responds to the average citizen.

But it is even easier to imagine both of them curling up at night with Morris’s book, looking for tips on how to raise money, how to write ads, how to do whatever it takes to win an election. For what it’s worth, Morris advises that flag-burning is passé as an issue with voters. We can be grateful to him for that.

This Issue

July 20, 2000