Robert Kuttner

Robert Kuttner is co-founder and co-editor of The American Prospect, a professor at Brandeis University's Heller School, and a distinguished senior fellow of the think tank Demos. He was a longtime columnist for Business Week and continues to write columns in The Boston Globe. He is the author of Obama's Challenge and other books.

Recent Articles

The Moral Equivalent of War Production

R estoration of robust growth is the paramount challenge facing the nation, the most significant issue of the 1992 election, and the first task that will face a new administration. Indeed, all other important public questions are being held hostage to a sick economy that depresses aspiration, increases unemployment, de pletes revenue, and makes public remediation seem unaffordable. Many serious commentators have lately concluded that nothing can be done to cure the depressed economy, save to depress it further via budget balance and wait for private confidence to return. The discussion bears an uncanny similarity to that of the late 1930s, when the economics journals were filled with gloomy assessments of something called "mature capitalism." After a full decade of depression, many economists concluded that 12 percent unemployment, static living standards, and 1 or 2 percent annual growth were the best a mature market economy could do. An abrupt event on nobody's economic radar screen...

Mr. Corporate Reform?

I s George Bush about to get lucky again? White House political adviser Karl Rove has positioned Bush as the champion of corporate reform, even though Bush's own history epitomized the kind of corruption that Enron and Global Crossing raised to new heights. Last week Congressional Republicans, long obstructionist on this issue, quickly reversed course, too. By the endgame the House Republican leadership -- after proposing much weaker legislation -- has embraced the reform bill proposed by Democratic Senator Paul Sarbanes of Maryland and then some. And the financial markets helped with the biggest one-week rally since 1933. So President Bush -- Mr. Education, Mr. Drug Benefit -- is now Mr. Corporate Reform. Is the latter any more believable than the former? This will depend on two factors -- the economy and the Democrats. At this writing, despite the market comeback, a lot of real damage has been done to the real economy by the same abuses that caused the market slide. And it is...

Who Gets Hurt When Stocks Fall?

H ere is a paradox to ponder. If the stock market crash stops short of an economic depression, we can partly thank government spending -- but we can also thank America's extreme concentration of private wealth. It's true, as widely reported, that about half of all Americans are now shareholders. But stock ownership is very narrowly held. The majority of shares are held by the richest 10 percent of the people. Half of us own no stock, and the typical (median) American who does own shares has less than $25,000 worth of stock. So for the vast majority of working-age Americans, stocks are simply not a factor in household budgets. Most of us live on paychecks, not dividends and capital gains. Moreover, ordinary people who do hold stocks have their holdings mostly tied up in IRAs, Keogh plans, 401(k)s, and other forms of retirement savings that can't be spent now without severe tax penalties. So a paper loss in these assets doesn't affect current consumption. All of this helps explain why...

Taking Stock:

W ill the stock market slide spread to the real economy of jobs and personal income? Federal Reserve Chairman Alan Greenspan remarkably, thinks not. His report to Congress Tuesday was surprisingly tough on corporate executives, calling for stronger regulation. But more surprising was his upbeat forecast that despite the stock meltdown, economic growth will nonetheless stay in a healthy range of 3.5 to 3.75 percent and that unemployment will actually drop. In fairness, Greenspan's first job is to restore confidence. Some of what's going on is panic selling -- the flip side of the hysterical stock buying of the giddy 1990s. But much of the selling is a belated acknowledgement of economic reality and the market was unimpressed by Greenspan's comments. Also, Greenspan needed to signal that he has no intention of lowering interest rates. The dollar is sinking against other major currencies because foreign investors are pulling back from US financial markets. Cutting interest rates would...

Can Liberals Save Capitalism (Again)?

Seven decades after the Great Depression, Democrats have their work cut out for them.

I n a few short weeks, America's political economy has been stunningly transformed. The Bush administration, the Republican Party and three decades of conservative ideology are facing a potential rout. Yesterday's conservative clichés are today's political embarrassments. Americans are getting a vivid if painful education about the limits of the marketplace and the salutary role of government. It will be a very long time before anyone can say with a straight face that markets always work better than governments. But market fundamentalism has been so ascendant for so long -- politically, culturally, financially -- that this is only the very beginning of an ideological sea change. It remains to be seen whether liberals will manage to save capitalism from itself, for the second time in the past 70 years. President Bush is suddenly in trouble. As I've observed elsewhere, his is now a Cinderella presidency. He was abruptly transformed from dubious and untested pretender into steely wartime...

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