Robert Reich

Robert B. Reich, a co-founder of The American Prospect, is a Professor of Public Policy at the Goldman School of Public Policy at the University of California at Berkeley. His website can be found here and his blog can be found here.

Recent Articles

One Free Market System for Wall Street, Another Free Market System for Main Street.

Washington is paralyzed by snow and partisanship. Nothing is getting done -- even as the Great Recession pulls more Americans into its maw. In the midst of this paralysis, the president was asked about the giant pay packages of Jamie Dimon , CEO of JP Morgan Chase & Co. ($17 mullion for 2009) and Lloyd Blankfein , CEO of Goldman Sachs ($9 million). “First of all, I know both those guys,” Obama said. “They’re very savvy businessmen. And I, like most of the American people, don’t begrudge people success or wealth. That’s part of the free market system.” Free market system? As I remember it, American taxpayers forked out hundreds of billions to keep JPMorgan, Goldman, and other big Wall Street banks afloat through most of 2009. Had we not done so, Dimon, Blankfein, and most other top executives on Wall Street would not have earned a dime last year. In fact, some would be out on the street, rather than sitting pretty on the Street. The free market system has been unleashed instead on...

Obamanomics One Year Out.

Obamanomics suffers from a misunderstanding of what the president is trying to achieve and what he’s up against. Into the breach come Republicans, tea partiers, nay-sayers, deficit vultures, and Raging-Dog Democrats, all viewing Obamanomics as more taxes and more spending. That’s nonsense. To see the big picture, keep your eye on three big things. 1. Government spending needed to offset the continued reluctance of consumers and businesses to spend. You don’t have to be an orthodox Keynesian to understand that as long as the private sector is deleveraging, the public sector has to borrow and spend in order to keep the economy moving forward. The current stimulus will peak in a few months. Add in unemployment insurance payments and outlays for the jobs bill, and the stimulus will be about $90 billion larger. But this sum is not likely to be enough to make up for the shortfall in private spending. Consider also that state and local governments are also slashing jobs and services -- and...

Who's Killing Financial Reform?

Sen. Chris Dodd , the Senate Banking Committee chair, scolded Wall Street representatives at a hearing Thursday for sending “an army of lobbyists whose only mission is to kill the commonsense financial reforms” needed by the public. “The fact is,” Dodd said, “I am frustrated, and so are the American people.” He charged that Wall Street’s intransigence was the reason for Congress’ failure to pass any bill to regulate the Street. “The refusal of large financial firms to work constructively with Congress on this effort borders on insulting to the American people who have lost so much in this crisis.” In other words, it isn’t Congress’s fault. It isn’t the Senate Banking Committee’s fault. It certainly isn’t Dodd’s fault. The reason more than a year has passed since the biggest bailout in the history of the world and nothing has been done to prevent a repeat performance -- even as the biggest banks are doling out more than $30 billion of bonuses, even as Goldman Sachs is awarding its big...

What Happened to Democracy?

Nobody seems to be talking about the reforms needed to clean up democracy.

(White House/Pete Souza)
Which programs should be cut, which entitlements pared back, and which taxes raised in order to reduce the long-term budget deficit? Hmmm. Let's convene a commission and have it decide. At least this is what several members of Congress and the Obama White House are proposing. Commissions are a default mechanism when politicians want to hand off difficult issues to "experts." But reducing the long-term budget deficit has almost nothing to do with expertise. It's about our nations' values and priorities. These choices are supposed to be made democratically. Democracy requires at least three parts: Important decisions are made in the open. The public and its representatives have an opportunity to debate and influence them. And those who make the big decisions are accountable to voters. But these principles are in retreat. The Troubled Assets Relief Program began with a virtual blank check from Congress. Treasury officials then secretly decided which companies would receive hundreds of...

Obama Needs To Teach The Public How to Get Out Of The Mess We're In.

The president wants businesses that hire new employees this year to get $5,000 per hire, in the form of a tax credit. That will come to about $33 billion. It’s good step. He’s also supporting a cut in the capital gains tax for small businesses. That makes sense; after all, small businesses generate most jobs. But here’s the problem. Both of these measures, and many of the other tax cuts he’s proposing, give ammunition to supply-siders who think the way out of this awful economy is simply to cut taxes on businesses. If a new jobs tax credit is a good idea, why not a cut corporate in income taxes? If it’s useful to reduce capital gains taxes for small businesses, why isn’t it useful to reduce them for all businesses? The answer, of course, is that across-the-board supply-side tax cuts for businesses don’t increase the demand for the things businesses produce. They’re useful only to the extent businesses are confident consumers are out there, able and willing to buy. Carefully targeted...

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