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Blake Liddle
Author's Bio
None Provided
Bull Run
It is now 2007 and there have been major shifts and changes in the American financial world over the past two decades, driven by the aging baby boom generation, the Internet and computerized day trading, global economic crises, and the "democratization" of the stock and markets. In Bull Run: Wall Street, The Democrats, And The New Politics Of Personal Finance, Daniel Gross examines how the changes in attitudes and policies of the Democratic party under the influence of the Clinton administration has led to an "unprecedented period of sustained stability and growth in the American financial community," the rapidly increasing percentage of Americans owning stocks and mutual funds, with the result that today a majority of citizens have a personal stake in public equity and debt markets.1 Gross offers provocative opinions backed by true-life stories illustrating the new relationship and interdependence of politics and finance, Wall Street, Main Street, and Washington.
The book Bull Run: Wall Street, The Democrats, And The New Politics Of Personal Finance opens with the first chapter called The Democratization of Money. Gross examines the concepts on which our societies are based today, but not in the fields of human rights and freedom--he examines the democracy of the stock market and the economy. One of his descriptions of this democracy is the "millions of Americans who now trade stocks with abandon on the internet."2 In the 1990s the reason that the new system of money worked was because money is a tool everybody needs, but used to be managed by private banks as they decide who can make loans and start projects. Now this is the case again, democracy of money just thrown out the window. Daniel Gross stresses in the first section of this book how important it is to get more than the usual rich and "high rolling" type people involved in the economy. Gross's ideals parallel the ideals of the founding fathers of our country; they envisioned a nation that had a government of the people, by the people, and for the people. The book then moves onto the topic of Public Employee Pension Funds. "Since 1990, the percentage of Americans owning stocks and mutual funds has doubled. Factor in the millions whose pension plans are invested in the markets and you will be amazed what happens."3 For the first time in American History, a majority of citizens have a stake in the public equity and debt markets. Without debating the finer points of pension plan law, we can say that pension plans exist to provide post-retirement income to employees. A pension plan is really a promise to pay people income after retirement. In a traditional "defined benefit" pension plan, the pensions are defined according to a formula specified in the plan documents. This usually takes the form of a percentage of the "best years" of salary."5 The book then transitions to the topic of Labor and Intellectuals. The "great transformation" that began at the start of the 1970s has changed the very terms in which the question is posed. Manual labor is increasingly coming to involve procedures that could be defined as "intellectual" while the new communications technologies increasingly require subjectivities that are rich in knowledge. It is not simply that intellectual labor has become subjected to the norms of capitalist production. What has happened is that a new "mass intellectuality" has come into being, created out of a combination of the demands of capitalist production and the forms of "self-valorization" that the struggle against work has produced.6 Everything, including the Democratization of money, pension funds, and Labor And Intellectuals, have all contributed greatly to the beginning of this great work by Daniel gross.
The book moves forward to talk about Bill Clinton and his ways with the American economic system. Gross discusses the idea of Clintonomics in depth. Clintinomics is able to lower unemployment and not cause galloping inflation that 'traumatizes the workers. For example, by adopting free trade policies and allowing corporations to move plants overseas to sweat shops, workers can be traumatized when it comes time to negotiate wages by threatening to close the plant and move their jobs overseas. Similarly, union busting is also easier when an employer threatens to close shop and move to China if workers vote to join the union. Clinton himself said, "We're Eisenhower Republicans here. We stand for lower deficits, free trade, and the bond market. Isn't that great?" Clinton further conceded during this same time period that with his new policy focus, "we help the bond market and we hurt the people who voted us in."7 Gross then moves on to Arthur Levitt , chairman of the United States Security and Exchange Commision, known as the SEC, from 1993 to 2001. The SEC was established by the United States Congress in 1934 as an independent, non-partisan, quasi-judicial regulatory agency following years of depression caused by the Great Crash of 1929. The main reason for the creation of the SEC was to regulate the stock market and prevent corporate abuses relating to the offering and sale of securities and corporate reporting. The SEC was given the power to license and regulate stock exchanges. Currently, the SEC is responsible for administering six major laws that govern the securities industry. The book then moved even farther into the economic history, The New Moneycrats. Gross claimed that under Clinton, the economy was the best it could possibly be at the time. The Democrats would do whatever it will take to get the economy booming again. The rise and fall of the markets now has a powerful and direct effect on the lives of millions of Americans, as they track their investments hour by hour, day by day watching their wealth increase.
Finally the book moves the criticizing of the Republican Party and what Gross call the "Republican retreat."8 Gross talks about this being the account of the republicans' relationships with money and the markets in the 1990s. "To be sure, Republican candidates in 1996 reflexively sang from the Reagan hymnal on the importance of cutting taxes and reducing the capital gains tax."9 Daniel Gross repeatedly made fun of the Republicans as they would always resort to the Reaganomics Theory that was used during the time periods of Ronald Reagan. Reaganomics is a popular term used to refer to the economic policies of Reagan, which called for widespread tax cuts, decreased social spending, increased military spending, and the deregulation of domestic markets. Gross's analysis of the United States economy concludes with the chapter on the new politics of personal finance. In this part of the book, he talks about how the future of American economic systems lies within the heart of the people. He says that if the Republican like government will stay we will be a country in debt, and a country that will be electing millionaires not people best qualified for office. Also in this chapter Gross answers common questions about the market and what the of the United States economy will be under conservative rule. Gross has a great view on his facts and is a well informed man. The book not only states the problem irritating to the people, but he also suggests a solution for the people of the United States and presents it superbly in this book.
Gross in his book Bull has a well presented thesis at hand. His thought that the American government is headed to far to the right is valid. Though he is harsh on his criticisms of the Republican Party and their economic theories, he hits SOME of his topics right on the head. His story about the "Democratization of Money" is very important and at the same time is very valid. His description of pension plans was hit right on the head. When things start to get shaky, Clinton comes into play. The Bashing of republican economic theory starts here. The Republican reaction to Clinton's success, Gross argues, has been to go down-market. Increasingly, the Republicans represent less affluent, socially conservative voters--often from the Southern and rural parts of the United States. They are becoming indifferent or even hostile to Wall Street. By turning away from free trade and opposing administration efforts to stabilize foreign currencies, Republicans "took actions that were directly inimical to the interests of investors large and small."10 Gross concludes with a policy agenda that Democrats could use to build on the advantage they have thereby gained. Though Grosse has valid points all the way across the board, he is heavily influenced by the Democratic Party ideals. The history of Reaganomics has also swayed Gross into a position that the democrats despise greatly. Because the theories of Reaganomics were so Right the liberals thought of his theories to be extreme and just plain dumb. This controversy over the theory of Reaganomics makes his writing seem even more to the left than it really is because their theories are so opposite.
I believe that Gross did a great job addressing the critical issues in this book. He did by no means take into consideration what the other parties thought about the issues at hand. He did not make any connection to the international market, which in this time was huge considering the internet boom. Gross provides no persuasive reason for rejecting the conservative analysis of the politics of the new investor class, which is perhaps unsurprising since he does not mention that analysis. He asserts that Republicans "have lost ground among the new investors,"11 but cites no evidence for that conclusion. The little evidence we have suggests that it is untrue--democratization of the stock market has been a great boon for Republicans. The new investors may be more Democratic than the old investors were - as well as poorer, darker, younger, and more female. But what is more important politically is the change at the margin: these investors are more Republican than demographically similar noninvestors, which suggest that they are more Republican than they would be if they were not investing. Though this was a well written book from the standpoint of the topics that were covered and the points made, I do not think that there was enough consideration and time put into the other party's thoughts.
The critics that analyzed Bull Run: Wall Street, The Democrats, And The New Politics Of Personal Finance were both from the liberal and the conservative sides. The Republican, Ramesh Ponnuru was very close to my opinion on the book. Ponnuru was very true when many times he mentions, "Gross glosses over the potential conflictĄ"12 The amount of overshadowing the democratic mistakes in history is amazing. Ponnuru also states that we do not get a lot of information on state wide or even global economic situations when he says, "Nor does the reader learn that the trend in state governments has been away from defined-benefit plans and toward defined-contribution plans."13 Another part of the Book that irritated both myself and Penury was that whenever he tried to make an argument about the republicans turning against the economy, Gross pays no attention to the democrats and just focuses on the Republicans problems at hand. The point of view and review of the book by Ramesh Punnuru is one of which I agree completely.
Another critical review comes from the Publishers Weekly Journal. In this source the writer supports the opinion of Daniel Gross and takes a Democratic view of everything. Though his voice isn't as strong as Daniel Gross's and not as offensive as his, he still leans to the left and shows his democratic views. "One of the more salient features of the 1990s bull market has been the creation of enormous new wealth."14 Here the writers of Publishers weekly support the facts saying that under strong democratic rule the wealth and economy will boom. The democrats support for the economy is what attracted Publishers weekly and Daniel Gross to write about this topic.
The period of the 1990s was the period that took a small swing to the left. Though the republicans still were dominant Bill Clinton and his economic thoughts were new for the United States and were up for great debate. "It's the economy stupid,"15 was the one memorable slogan to have emerged out of Bill Clinton's successful first run at the Presidency in 1992, and it became the overarching theme of his full eight years in office. Clinton came into office pledging to end the economic stagnation that that had enveloped the last two years of the Bush-1 administration and advance a program of "Putting People First"16 through large investments in job training, education, and rebuilding the country's public infrastructure.
Overall then, the absence of inflationary pressures as unemployment fell under Clinton should be no mystery. Class conflict has always been hunting the analysis of inflation and unemployment. With the Clinton administration providing virtually no support to workers as the bargaining strength of business increased, it is not surprising that workers felt "traumatized"17 and therefore scaled back their wage claims even in a period of low unemployment. Throughout the last decade, the increasingly rapid pace of global capital mobility and the job dislocation and corporate restructuring that follows in its wake has fostered a climate of intense economic insecurity among U.S. workers. This rising sense of economic insecurity has effectively served to hold down wage demands and wage increases even during a period of economic expansion, low unemployment and tight labor market. What is to come for the United States Economy will never be known. All we can do is wait and find out.
The Historic Bull Market has and always be a subject that will be under debate. Will the "democratization of money and the economy"18 be held on to or will it be thrown out like every other presidents plans? In Daniel Gross's In Bull Run: Wall Street, The Democrats, And The New Politics Of Personal Finance the answer lies in his words. The Economic future of the United States will be decided democratically.
Endnotes
1. Gross, Daniel. In Bull Run: Wall Street, The Democrats, And The New Politics Of Personal Finance. 1. New York: PublicAffairs, 2000, 172.
2. Gross, Daniel 4.
3. Gross, Daniel Introduction.
4. Gross, Daniel 41.
5. Gross, Daniel 55.
6. Gross, Daniel 77.
7. Gross, Daniel 63.
8. Gross, Daniel 169.
9. Gross, Daniel 177.
10. Gross, Daniel 98.
11. Gross, Daniel 79.
12. Ponnuru, Ramesh. "Stock Marcket Democrats." Public Affairs 1(2000): 5.
13. Ponnuru, Ramesh 2
14. Publishers Weekly, "Bull Run." Publishers Weekly (2000): 2.
15. Gross, Daniel 65.
16. Gross, Daniel 71.
17. Gross, Daniel 73.
18. Gross, Daniel 15.
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