5. Older fears and disillusionment about the tractability of public opinion (see, for example, Walter Lippman’s Public Opinion, published in 1922) have given way in recent years to a new understanding of the public’s active role in sorting, screening, and criticizing what it hears. See, for example, Wilbur Schramm, “The Nature of Communication Between Humans,” in The Process and Effects of Mass Communications, W. Schramm and D. Roberts, eds., rev. ed. (Urbana: University of Illinois, 1971), 8; Gerald M. Pomper, “From Confusion to Clarity: Issues and American Voters, 1956–1968,” in American Political Science Review, lxvi (June 1972): 415–27.
6. Annual message to Congress, December 4, 1917, in Arthur S. Link, ed., The Papers of Woodrow Wilson, vol. XLV (Princeton, N.J.: Princeton University Press, 1984), 194.
7. For a more detailed look at this theme in popular American fiction, see John G. Cawelti, Adventure, Mystery, Romance: Formula Stories as Art and Popular Culture (Chicago: University of Chicago Press, 1976); E. G. Bormann, “Fantasy Theme Analysis,” in J. L. Golden, G. F. Berquist, and W. E. Coleman, eds., The Rhetoric of Western Thought, 3rd ed. (Dubuque, Iowa: Kentall/Hunt Publishing, 1969), 433–49; Will Wright, Sixguns and Society: A Structural Study of the Western (Berkeley, Cal.: University of California Press, 1975).
8. John Kenneth Galbraith, American Capitalism (Boston: Houghton Mifflin, 1952).
9. For an account of American conspiracy theories, see Seymour Martin Lipset and Earl Raab, The Politics of Unreason: Right-Wing Extremism in America, 1790–1970 (New York: Harper and Row, 1970).
10. On the uniqueness of the American form of satire, see Leon Samson, The American Mind (New York: Jonathan Cape and Harrison Smith, 1932), 13.
11. For a cogent and thoughtful analysis of this tendency, see Samuel P. Huntington, American Politics: The Promise of Disharmony (Cambridge, Mass.: Harvard University Press, 1981).
12. See Richard Hofstadter, The Age of Reform (New York: Knopf, 1956), 228.
13. Samuel I. Rosenman, ed., The Public Papers and Addresses of Franklin D. Roosevelt, 13 vols. (New York: Random House, 1938–50), vol. 5, 8–18, 230–36.
14. Ibid. Professor Samuel Beer provides an insightful analysis of Roosevelt’s nation-building efforts, and their subsequent relevance, in “In Search of a New Public Philosophy,” in The New American Political System, Anthony King, ed. (Washington D.C.: American Enterprise Institute, 1978), 5–44.
15. State of the Union Speech, 1984. See Paul D. Erickson, Reagan Speaks: The Making of an American Myth (New York: New York University Press, 1985), 98.
2. THE PREVAILING VERSIONS
1. Polling data reveal a striking consistency in conservative or liberal views. Such basic orientations frequently do a better job of predicting a respondent’s views than does objective self-interest in the outcome of a particular political choice. See David O. Sears et al., “White’s Opposition to Busing: Self-interest or Symbolic Politics?,” in American Political Science Review 73 (June 1979): 369–84; Richard Lau et al., “Self-interest and Civilian’s Attitudes Toward the Vietnam War,” Public Opinion Quarterly 42 (Winter 1978): 464–83.
2. Public opinion polls clearly revealed a shift in political ideology. In 1977, 30 percent of Americans considered themselves “conservative”; by 1986, 40 percent had adopted that appellation, while only 18 percent called themselves “liberal” (about the same as two decades before). Moreover, while 24 percent attested that their views were “more conservative” than they had been five years before, only 16 percent said their thinking had moved in the opposite direction. (Data based on the Harris Poll of March 1986, and the New York Times–CBS Poll of January 1986.)
3. For a theory about why the public seems to waiver in this way, see Albert O. Hirschman, Shifting Involvements: Private Interest and Public Action (Princeton, N.J.: Princeton University Press, 1982).
4. See Walter Fisher, “Romantic Democracy, Ronald Reagan, and Presidential Heroes,” Western Journal of Speech Communication 46 (Summer 1982): 299–310.
5. Thus writes Professor Richard Pipes in Survival Is Not Enough (New York: Simon and Schuster, 1984), 280.
6. This from Herbert Stein, Presidential Economics (New York: Simon and Schuster, 1984), 315.
7. Ibid., 328.
8. George Gilder, The Spirit of Enterprise (New York: Simon and Schuster, 1985), 290.
9. Charles Murray, Losing Ground: American Social Policy 1950–1980 (New York: Basic Books, 1984).
10. For a discussion of this view, see Diane Ravitch, The Troubled Crusade: American Education, 1945–1980 (New York: Basic Books, 1983).
11. According to this view, America in the nineteenth and early twentieth centuries managed crime through a massive investment in “impulse control.” Self-discipline was inculcated in schools, churches, and other socializing institutions; and this investment apparently paid off, in terms of reversing the upsurge in crime that had marred the early nineteenth century. Gradually, however, this emphasis was replaced by an “ethos of self-expression” that reached its height after World War II. See James Q. Wilson and Richard Hernstein, Crime and Human Nature (New York: Simon and Schuster, 1985).
12. See Fred L. Israel, ed., The State of the Union Messages of the Presidents, 1790–1966, vol. 3 (New York: Chelsea House, 1967), 2814.
13. From Roosevelt’s first inaugural address, cited in Henry Steele Commager, ed., Documents of American History, 7th ed., vol. 2 (New York: Meredith, 1963), no. 476.
14. The appellations “liberal” and “conservative” were infrequently used during this era, and when they were used they often meant different things than they do today. In the 1928 presidential campaign, for example, when Herbert Hoover identified his cause with “liberalism,” he was referring, as do modern European liberals, to the nineteenth-century movements asserting civil and economic independence from the ancien régime. Even after the term became associated with the New Deal, the former meaning lingered on; Robert Taft called himself a “liberal” to the end. Nor was the term “conservative,” with its connotations of British paternalism and elitism, particularly welcomed by opponents of the New Deal. The first American politician to embrace the term was Barry Goldwater, in 1964.
15. Goals for Americans (Englewood Cliffs, N.J.: Prentice-Hall, 1960).
16. After a best-selling book by the social critic, Michael Harrington.
17. See The Public Papers of Lyndon Baines Johnson, vol. 1 (1963–64) (Austin, Texas: University of Texas, 1965), 283, 611.
18. Ibid., (1965) vol. 2, 636.
19. Ibid., (1965) vol. 2, 224.
20. Ibid., (1963–64) vol. 1, 597, 704.
21. See, for example, William Kornhauser, The Politics of Mass Society (Glencoe, Ill.: Free Press, 1959); Harry Eckstein, A Theory of Stable Democracy (Princeton, N.J.: Center of International Studies, Princeton University, 1961).
22. Cited in Richard Hofstadter, The Progressive Historians (New York: Vintage, 1970), 438.
23. Quotations from campaign speeches, Nashua, New Hampshire, December 8, 1975, and Cleveland, Ohio, February 7, 1976.
3. THE NEW CONTEXT
1. Data on world population growth and its relationship to economic development can be found, for example, in U.S. Policy and the Third World: Agenda 83 (Washington, D.C.: Overseas Development Council, 1983); and Ruth Leger Sivard, World Military and Social Expenditures (Washington, D.C.: World Priorities, 1985).
2. Although manufacturing’s share of America’s gross national product has remained fairly constant over the last two decades, the number of workers engaged in manufacturing has steadily declined.
3. It is necessary to be a bit cautious with these figures, in part because the definition of an “American” producer is becoming less clear as time goes by. If the output of American manufacturers operating in other nations is included, the story is more upbeat. See Irving Kravis and Robert Lipsey, “The Competitive Position of U.S. Manufacturing Firms,” National Bureau of Economic Research Reprint No. 659, September 1985.
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nbsp; 4. This stagnation has been particularly apparent in comparisons between the United States and other nations. From 1973 to 1984, for example, while American productivity improved by an average of .7 percent a year, the Japanese were producing 2.8 percent more each year. Western European nations also raised the productivity of their workers more rapidly than we did (although it must be noted that several of them accomplished this feat with a smaller portion of their work force actually at work). See United States Department of Commerce, International Economic Indicators (Washington, D.C.: United States Government Printing Office), various issues.
5. A distinction must be drawn between average family income, which declined between 1973 and 1985, and average per capita income, which, by some measures, increased over the same interval. Even if one is to focus on the more positive calculation, however, there is evidence that for any given age cohort within the population, per capita income declined. For example, a man passing from age forty to age fifty between 1953 and 1963 increased his real earnings 36 percent; one who passed from age forty to fifty in the following decade increased his real earnings 25 percent. But a forty-year-old in 1973 saw his real income drop 14 percent during the subsequent ten years. See Frank Levy and Richard Michel, The Economic Future of the Baby Boom (Washington, D.C.: Urban Institute, 1986).
6. In fact, in all of the ten years between 1970 to 1980 annual cash assistance for each nonelderly poor person in the United States rose by just $93. Few would decline a gift of $93, but this is not a sum likely to tempt crowds of Americans away from honest labor, or to lure poor teenage girls into motherhood. Adjusted for inflation, benefit levels for Aid to Families with Dependent Children, which is the largest cash-assistance program for the poor, actually declined during the decade, and they have continued to decline since 1980.
4. THE BOOMERANG PRINCIPLE
1. Quoted in Samuel Eliot Morison and Henry Steele Commager, The Growth of the American Republic (New York: Oxford University Press, 1940), 280.
2. Life, vol. 10, February 17, 1941, 63.
3. This is not to discount the moralistic strain of American policy toward the Mob at the Gates. Nineteenth-century missionaries set out to convert “heathens” toward the west and the south. Teddy Roosevelt launched a holy war on the Spanish and Mexicans. Woodrow Wilson sought a “community of nations” that would subscribe to universal laws and principles of human freedom. John F. Kennedy envisioned America as a beacon light, toward which the poorer nations of the world inevitably strove, and could reach with our help. Jimmy Carter sought to promote international human rights. Ronald Reagan echoed all these themes. But these moralistic ideas were never as significant, in practice, as either of the other two. Americans have never had the stomach for prolonged moral crusades in faraway places. At most, these sentiments provided partial justification for assertiveness in protection of our interests, or rationales for tolerance and magnanimity in the service of isolation.
4. The principle applies to any complex, evolving system in which the principal actors are dependent on one another. Examples are easily found in nature—among plants and animals that inhabit a particular watershed, among the members of one species, even among the organs or cells of a single animal. “The whole dear notion of one’s own Self—marvelous, old free-willed, free-enterprising, autonomous, independent, isolated island of a Self—is a myth: Yet, we do not have a science strong enough to discipline the myth.” Lewis Thomas, The Lives of a Cell: Notes of a Biology Watcher (New York: Bantam, 1974), 167.
5. OECD Economic Outlook (Paris: Organization for Economic Cooperation and Development, July 1984), p. 21, table 5.
6. More on this in subsequent chapters.
7. International Trade Commission, annual reports (Washington, D.C.: United States Government Printing Office, 1980–85).
8. Robert Z. Lawrence, Can America Compete? (Washington, D.C.: Brookings Institution, 1984).
9. Reported in The New York Times, December 20, 1984, sec. E, p. 4.
10. World Development Report (Washington, D.C.: International Bank for Reconstruction and Development, 1985). To take but one example, Brazil’s exports to the United States, which had increased substantially in 1983 and 1984, thereafter stopped growing; American restrictions on Brazilian steel, shoes, sugar, textiles, ethanol, and other products, had begun to take their toll.
11. See Ruth Leger Savard, World Military and Social Expenditures 1985 (Washington, D.C.: World Priorities, 1985), p. 35, table II.
12. Robert Pastor, “Our Real Interests in Central America,” Atlantic Monthly, July 1982, 36.
13. See The New York Times, January 11, 1986, sec. A, p. 1.
5. AMERICA’S TWO COMPETITORS
1. On these and other examples, see Reich, “Making Industrial Policy,” in Foreign Affairs (September 1982), 852–87; and “An Industrial Policy of the Right,” The Public Interest (Fall 1983): 3–17; Ann Markusen, “Defense Spending as Industrial Policy,” in Sharon Zuken, ed., Industrial Policy (New York: Praeger, 1985), 76–85; Thomas Egan, “The Case of Semiconductors,” in Margaret Dewar, ed., Industry Vitalization (New York: Pergamon Press, 1982), 121–44.
2. Whether publicly or privately funded, other industrialized nations spent a much higher percentage of their national products on civilian research than America did. In 1986, America’s total research and development spending topped $115 billion, of which $73 billion was financed by the U.S. government, largely for defense purposes. For an excellent summary of U.S. government sponsorship of private-sector research and development, see Harvey Brooks, “Technology as a Factor in U.S. Competitiveness” (Unpublished, Harvard Business School Division of Research, 1984).
3. In addition to these sums, some $95 billion was spent on procuring new weapons, many of which would incorporate the most sophisticated technologies. See Science Indicators (Washington, D.C.: National Science Foundation, 1986).
4. See Council on Economic Priorities, The Strategic Defense Initiative: Costs, Contractors, and Consequences (New York: Council on Economic Priorities, 1985).
5. Washington Post weekly edition, January 6, 1986, p. 21.
6. On competitiveness in the defense industry, see William W. Kaufmann, “The 1986 Defense Budget,” in Studies in Defense Policy (Washington, D.C.: Brookings Institution, 1985); Robert DeGrasse Jr., Is This National Security? (New York: Council on Economic Priorities, 1984).
7. DeGrasse Jr., op. cit.; see also, George F. Brown Jr., Defense and the Economy: An Analysis of the Reagan Administration’s Programs (Washington, D.C.: Data Resources, April 1982).
8. These data were gleaned from company reports.
9. The New York Times, February 27, 1986, sec. A, p. 1.
10. See John Shattuck, “Federal Restrictions on the Free Flow of Government Information and Ideas,” Government Information Quarterly, 3, no. 1 (1986): 5–29.
11. In a study of technological transfers from the West to the Soviet bloc during the course of fifteen years, the Congressional Office of Technology Assessment concluded that—even in technological areas where significant transfers occurred—the technological gap did not diminish. United States Congress, Office of Technology Assessment, Technology and East-West Trade (Washington, D.C.: United States Government Printing Office, 1979), 220.
6. THE RISE OF THE JAPANESE-AMERICAN CORPORATION
1. This account is based on interviews and press reports.
2. Eric Mankin and I analyzed a sample of one hundred joint ventures between American and Japanese companies and discovered the same pattern in almost every one. See Reich and Eric D. Mankin, “Joint Ventures with Japan Give Away Our Future,” Harvard Business Review (March-April 1986).
3. See Hajime Karatsu, “The Deindustrialization of America: A Tragedy for the World” (Tokyo: KKC Brief, Keizai Koho Center, October 1985).
4. With the opening of the Tokyo stock exchange, it could be expected that more of this money would drift to Japan. See Jill Andresky, “Ready or Not,” Forbes, February 10, 1986, p. 94.
5. There were some notable exceptions. Canadians, for example, have never been wholly enthusiastic about American subsidiaries in their midst.
6. Japanese computer manufacturers (like Hitashi), meanwhile, were linking up with American semiconductor makers (National Semiconductor)—not to buy chips, but to sell Japanese computers in the United States.
7. For example, a small turning machine that Bendix sold in the United States for $105,000 in 1985 could have been made in Cleveland for $85,000. But when made in Japan by Bendix’s partner, Murata Manufacturing, and then shipped to Cleveland, the machine’s total cost was just $65,000. Company report, 1986.
7. LOCKING THE GATES
1. In the spring of 1986, the U.S. Commissioner of Customs set off a diplomatic tempest when he blamed America’s drug problem on “massive drug-related corruption” in the Mexican government, including the Mexican president’s cousin and a state governor.
2. Andrew Pasztor, “Meese’s Ambitious War Against U.S. Drug Abuse Is Faltering as Cocaine Use Continues to Spread,” Wall Street Journal, January 9, 1986, p. 48.
3. Estimate of the Drug Enforcement Administration, “Report on Interdiction of Dangerous Drugs” (Washington, D.C.: United States Government Printing Office, 1986). See also Report of the National Intelligence Consumers’ Committee on Cocaine Abuse (Washington, D.C.: 1986).
4. Funding for interdiction, eradication, and surveillance was increased substantially more than that for education and treatment.
5. Stuart Auerbach, “Non-Producers Ship Steel to U.S.: Industry Sees Trend as Way of Getting Around Import Limits,” Washington Post, November 12, 1985, sec. E, p. 1.
6. In 1984, Congress strengthened the laws to allow American companies to get relief even before the “dumped” product actually injured them.
7. Estimates based upon 1980 Census. The Bureau counted 2 million illegal immigrants, and estimated that this represented roughly half of the total.
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