I was rummaging around in the depths of my file system today and found this old video of Elizabeth Warren’s presentation to the UC Berkeley Graduate Council explaining changes in the economy leading up to the collapse of the Industrial Economy in 2008.
At about the same time that she gave this lecture she she was interviewed on “Conversations with History”, an interview series presented by University of California Television (UCTV). In it, she talks about her childhood on a Nebraska farm and her unlikely journey to the upper crust of American business elite.
She tells the story of what life in a typically modest rural family living frugally, until Dad suffers a heart attack. Suddenly everything turns upside down and mom goes to work at the age of fifty to keep the house out of foreclosure. Years later, during the run up to the Great Recession, Warren has an epiphany: the experience of her family is the same as the families she is helping Wall Street bankers to foreclose upon.
There are lessons in both videos.
One of the most powerful is that Warren was still an academic when sharing her research on consumer spending. There are no strident indictments against republicans, or emotionally laden rhetoric about the evils of business. She just explains her findings in a casual and interesting way.
Looking back over the last three-decade or so, Warren shows us where increases in the cost of consumer goods are concentrated. It’s not that we are buying designer clothes, or suffering through inflated food prices or paying exorbitant prices for huge SUVs. Those are not what has become more expensive. Home prices, taxes, health insurance — none of which we can control simply by cutting back on routine expenses — are what has made us poor.
The point Warren is really driving home, however, is how these expenses have gone up so suddenly that the two-income households come precariously close to bankruptcy if one of those incomes is lost or delayed.
She does an excellent job explaining how our consumer economy is an unsustainable house of cards. At the time she gives this talk in 2007, the economy was in the beginning stages of a slow motion train wreck. The consumer economy of the last third of the 20th century created very wealthy industries in education, housing, mortgage lending and health insurance.
These industries enjoyed great wealth but suffered greatly during the Great Recession.
Now are now working hard to attach themselves like barnacles to our new emerging economy.
But there is another issue.
Contrast Warren’s demeanor in that 2007 lecture her 2016 reaction to Donald Trump’s election in a presentation to the AFL-CIO. She no longer explains how she calculated the statistics she presents. In fact she presents few objective facts at all, and gives an emotional speech on the unfairness of our public polices a greed of bankers and others.
Not that I disagree with her. If I were to lose control of myself and surrender to the strident 13 year old we all hold subdued in our inner psyche I’s probably sound the same. But, that is not how reasoned and articulate intellectual presentation are created.
Think about this for a minute and it leads to some sobering insights.
Why would Elizabeth Warren — probably our most informed politician on matters of economics and finance – make such a dramatic change in her delivery? One would think that if she wanted to inform us about complex issues she would do it in the most effective time tested way – like a scholarly lecturer.
But she doesn’t.
I think it is because she is no longer focusing on helping others in an objective search for truth. Now she is in the political arena, where money and power intertwine to provide a pulpit and a price, and demands a price for the privilege of speaking from it. As much as one might resist “selling out” the temptation to do so is very great. You either go along with everyone else and are trusted with the keys to a national podium or go back to a lecture hall talking to a few hundred people.
Lindsay Mark Lewis pulls the covers off how politics corrupts good people in his excellent book Political Mercenaries: The Inside Story of How Fundraisers Allowed Billionaires to Take Over Politics
Lewis was a fundraiser for the Democratic Party, raising millions from incredibly wealthy donors running some of the biggest corporations and social welfare conglomerates that have ever existed. He also worked with the machinery that distributes those funds – the Republican and Democratic National Committees. He tells us how party fund raising machinery coerces our representatives into supporting their party caucuses to the tune of tens of thousands per month.
It’s not pretty and there is nothing to be proud of in his story. Like Warren, Lewis had an epiphany also, but his led him to turn away from a lucrative gig as an industrial/political bagman and live a more respectable life.
Check it out and tell me what you think:
Elizabeth Warren: UC Berkeley Graduate Council Lecture
Elizabeth Warren: Conversations with History Interview
The Two-Income Trap: Why Middle-Class Parents Are (Still) Going Broke, Elizabeth Warren