The Liberals' Mistake

Charles A. Reich

[A paper presented at the Center for the Study of Democratic Institutions, followed by discussion. Reprinted from The Center Magazine, July-August 1987]

Charles A. Reich is the author of the influential book, The Greening of America (1971), and the Center Occasional Paper, "Bureaucracy and the Forests" (1962). This article is adapted from his Regents' Lecture at the University of California, Santa Barbara, and his opening statement. Dialogue Participants included: Mason Gaffney (Professor of Economics, University of California, Riverside); Giles B. Gunn (Professor of English, University of California, Santa Barbara); Donald McDonald (Acting Director, Center for the Study of Democratic Institutions); Alison Dundes Renteln (Visiting Lecturer, Law and Society, University of California, Santa Barbara); M. Stephen Weatherford (Professor of Political Science, University of California, Santa Barbara)

The country we live in is a laboratory. We have one experiment after another. Unfortunately, it is not a laboratory where no one gets hurt: some lives are enhanced, others are ruined. We have to view our society with concern and passion, and see what we can learn from each of our experiments. When we get upset and angry about politics - whether it is conservative, liberal, or whatever - we tend to think in terms of right and wrong, not what we can learn. After Watergate, we dismissed Richard Nixon from our minds and didn't ask what can be learned from Watergate. We have strong opinions about the New, Deal, but, again, we tend not to look at it as an experiment from which we can learn anything. As Reagan conservatism is becoming less popular, people are asking: Where do we go from here? We can also ask: Does the last era of liberalism provide any indications as to where we might or should go from here?

The liberalism of the nineteen-thirties emerged after the catastrophe that resulted from the conservatism of the nineteen-twenties. Conservatives had been in power for a long time, and ended by nearly wrecking the country. Liberals came along and performed a rescue operation. Ironically, they are credited with saving the establishment, which they surely did.

Liberals were high achievers. They did superlatively well in school, excelling in law and in the social sciences. They thought they were well-equipped to run the world, and never lacked self-confidence. They loved to talk and argue and tell you that you were wrong about everything. They were irreverent, funny, and impatient, but they were also people worth knowing.

I was in my twenties when I knew most of the nineteen-thirties liberals, who at that time were in their fifties. That was the best part of my overall education. The liberals were wide-ranging in their interests, ready to question the orthodoxies of the time, and looking for new horizons. It is always difficult to find people like that, but it is even more difficult today.

The liberals of the nineteen-thirties were diverse, but they had a common vision. They accepted democracy, the free market, and capitalism. However, they thought that unless the market was not corrected or ameliorated, there would be child labor, neglect of the elderly, dangerous and harmful consumer goods, monopolies squeezing people out of business and forcing down wages - in short, there would be the horror of Great Britain's Industrial Revolution before the British began passing social legislation. The liberals' vision was that something better could and would have to be made out of this economic machine. John Dewey, a leading philosopher of liberalism in the nineteen-thirties, described that vision as the "liberation of the capacities of individuals for free, self-initialed expression by the regimentation of material and mechanical forces." He argued for liberating people from the oppressive forces of economics and industry and freeing them from the insecurity caused by the market.

By 1930, the United States had solved the problem of production: it could produce enough for all its people. There was no need for privation or want. There was no need for people to work all the time, and the work that needed to be done would become ever lighter. In 1930, the task was to give people their freedom, unleash their capacities to create a better society and better selves, and relegate the economic production of goods to second place in the order of priorities. The first goal of society was to have better, happier, and more fulfilled people. Economics and production were to be only a means to that end.

How did the liberals expect to achieve their vision? They had unlimited faith in government. Their program consisted of governmental regulation, governmental aid, programs for people who needed assistance, and government ownership of services that could not be managed well in the private sector. Their idea was that government would modify the market and prevent it from grinding people up.

Liberals themselves would staff the regulatory agencies and the government in general. They believed it was possible to satisfy both the public interest and one's own ambition al the same time. Their idea was that the personal interests of each individual and the public interest coincide: When we do good for others, we do good for ourselves. The task of the government was to make policies that would balance the various interests in the American society and to produce the best plan for the general welfare and industry.

Congress and state legislatures delegated a great deal of authority to the policymakers. As a result, lawmaking moved away from Congress and into what came to be called the "fourth branch" of government. This fourth branch was under the executive branch, but also somewhat independent of it. Congress simply told the federal agencies to act in ways that would further the public interest, that is, the public good. Congress's general delegations of power masked the fact that law-making was going to be done by experts, lawyers, and professionals. That was a profound constitutional change. Prior to the nineteen-thirties, the courts would have told Congress that only it could make the laws. But in the nineteen-thirties, the courts accepted the idea that the laws would, in effect, be made by the experts and the professionals in their capacity as regulators and policymakers in our society.

For the American people, the promise and bargain in this new approach was: Do what you are supposed to do, and society will deliver what you want and need. People could work at the jobs of their choice and believe their lives would be fulfilled. Their work would contribute to this great big machine and they could trust this machine to deliver in terms of their personal well-being and the services and things they wanted and needed.

Until the nineteen-sixties, the American people accepted and believed in this bargain. We felt that ours was a good country, that it was going places, that it was fair, that there were good and wise people in Washington, and that opportunity was constantly expanding in our society. All we wanted was the chance to participate. Now we no longer say we want to do our share; we say: We want to get ours! Before the nineteen-sixties, ours was a less selfish attitude, but it was also a conformist attitude that accepted things as they were.

Why did the liberals' vision go wrong? Why didn't anybody understand that it was going wrong? The liberals were right when they insisted that we had enough food and goods for all of our people. But they did not - and we still do not - know how to distribute those goods in a rational way. We have failed to figure out how to turn this abundance into an advantage. The liberals were also right about labor-saving. If we evenly distributed the work that needs to be done, there ought to be a lot of time left over for everybody to have the leisure that people need. But we have managed to reverse that. Today, a great many people cannot find any work. People are dispossessed and cannot support themselves or their families. Many are homeless. For many others, work has become a rat race: something to be endured, not enjoyed.

Today we are witnessing an impoverishment: the apparent drying up of resources for all kinds of things that are badly needed. We seem to have no money for housing, for education, or for health and social services. And yet we have a deficit, and we are told by candidates for public office that we must cut the federal budget even more. This impoverishment is a mystery.

There is social injustice today, something that was never supposed to happen again in American society. Ours is rapidly becoming a society of a privileged class and an underprivileged class. Those in the privileged class may fall, but they are protected; those in the underprivileged class may rise, but they will never get out. The underprivileged in our society turn to crime to survive and, in turn, wind up in our prisons.

The drug-testing program today is a class program. It is an effort to compel those who are restive and dissatisfied in our society to behave. It cracks down on the underclass and the blue-collar workers, but not the managerial class, the white-collar workers. The latter are not being subjected to random drug testing or having their constitutional rights invaded. There may be drugs on the assembly line, but there are also drugs in the executive suite.

Why should a classless society become a class society? Why should one be stuck in the condition into which one was born? For far too many people, the idea of America as a society of opportunity has become only rhetoric, not reality, and this reality is a far cry from what the liberals envisioned in the nineteen-thirties. People feel they are losing their values. And by values, I mean what people want. People are not able to get what they want.

There seems to be less democracy today. People feel powerless. In the 1984 election, more than sixty percent of the eligible voters did not vote. People thought the various candidates were indistinguishable, that they did not represent anything the voters might possibly want, or that no matter how one voted, the outcome would not change the political system. And indeed, the political system does not respond.

The view today - which I think is perfectly justified - is that nobody cares what happens to anyone else. As a result, people will not get what they need if they do not aggressively pursue it. The individual cannot rely on government, on other individuals, on institutions, or on politicians.

We are told that the American people have become conservative and selfish. I don't think they have. I think America has become a place where the individual has to look out for his or her own self. That is the simple reality. However, this is an unfortunate attitude, because of the kind of society and people that will result.

What mistakes did the liberals of the nineteen-thirties make that brought us to this consequence? The first mistake was political. Liberals placed an unreasonable amount of faith in large institutions: unions, foundations, big government, large corporations, and universities. These institutions are based on principles that are antithetical to democracy. They are not democratic, they are hierarchical: Someone is at the top and everybody else is at the bottom. Their policies are not made democratically, they are made at the top. These institutions are also not egalitarian. They operate by administrative discretion and authority, not the rule of law: There is no legislature, no group lawmaking body.

The individual in the large organization does not have the kind of constitutional rights that an individual in the society at large has. There are no protections of autonomy and free speech. Employees can be fired for many reasons. We need to constitutionalize large organizations to protect the people within them, to ensure that they can be politically outspoken. We should not allow organizations to lay off an employee who has invested twenty years of his or her life in the organization. Keeping those employees on the job might cut into the organization's profits, but profits should be put on one side of the equation and democratic and human rights should be put on the other side of the equation. When people in large organizations lack protection, that undercuts our democracy, because it is not likely that those people will be active, vigorous citizens in the society at large.

Organizations have led to the concept of membership and nonmembership, and that has become a pervasive fact of American life. You are either a member or you are a nonmember. Members are given health benefits and promises of security; nonmembers are given very little of these things. In our society, to be a nonmember is to be a loser.

People in large governmental organizations made the mistake of not relying on the people themselves for the political base of the society. Liberals fostered an elitism that allowed only those who understood what was going on to run things. People outside the system did not know what was going on within the system, and eventually liberals themselves were out of the system. They lost public support because, in their governance, they had not taken the people into their confidence. Consequently, those who today are angry at "welfare cheats" and at public demands for social services do not understand that the purpose of welfare and social security is to help the victims of the market.

The second mistake of the liberals concerns what constitutes growth and well-being. Liberals did not look critically at the idea of growth. They thought that as long as the country had more goods, more sales, and more profits, it would be better off. But growth is accompanied by ever-increasing social costs: the gross national product rises, but the environment deteriorates, people lose their jobs, plants abandon towns and jobs go overseas. The GNP may rise, but people find that they are drained emotionally: they have to work longer shifts, and they have little to show for it when they get home. The balance sheet may go up, but the emotional lives of people go down.

What we need is a concept of "gross national cost." Life is a balance sheet, not simply economic growth. It is income and outgo. And until we know what the cost of growth is we will continue to operate under an illusion. As long as we consider only the growth of goods and ignore the growth of personal and community well-being, we will be impoverished by growth. That is what is happening in our society today. When we call for more growth, we are, in effect, calling for less of everything we really need, aside from material goods.

The greatest single loss from growth is traditional values. Economic growth harms the family. The more economic activity we engage in, the less time we have for our families. Communities deteriorate when local companies want to make so much money that they leave the communities and go where labor is cheaper and where tax laws are more favorable. Unemployment studies show that the loss of a job is disastrous to the family: It results in divorce, child abuse, and family violence. All of this can be traced to a system in which economics is more important than all other values. If the nonmaterial, intangible, and emotional goods of life are not considered as part of our GNP, they will certainly decline in value.

When we buy anything in the market, we, in effect, cast a vote. Price stickers on some automobiles should read: This automobile was made in an authoritarian country where people are denied their human rights, where living standards are a small fraction of American living standards, where people have no medical care or social security, and where children are exploited. We should ask ourselves whether we really want to vote for the social conditions in those countries.

Every purchase in the marketplace involves social choices. Some products are made by companies that are destroying the environment, other products are inexpensive because companies lay off fifty percent of their employees so that they can lower the price of their products. We should ask ourselves whether we really want to vote for the destruction of our environment and for having every second person lose his or her job in the factory.

We should be aware of the social consequences of our vote when we purchase anything. We should also realize that if our cherished values are disappearing, they are disappearing because we have chosen to vote for their disappearance. The market is no better than our knowledge of our society and ourselves.

We had a faulty market mechanism based on faulty self-knowledge, a faulty conception of growth that is fundamentally impoverishing, and this led to a predicament in which those who were suffering the most had the least idea of the true cause of their suffering; they were fighting among themselves rather than against the real cause of their suffering. The result was a political stalemate; there was no way one could vote for one's values. Values were at the end of an obscure path that people could not follow. Consequently, people became frustrated with politics; they felt that society was not responsive. This, in turn, began the process in the nineteen-sixties in which everybody tried to get what they wanted directly instead of going through the system.

There were various kinds of direct action in the nineteen-sixties: the Civil Rights movement, in which minorities realized that nobody would do anything for them, that they had to do things for themselves; the women's movement, in which women realized they themselves had to do something about their rights; the environmental movement; and other social movements. The point is that people could not get what they wanted through the system - they had to get it directly. It is no wonder that what began as an idealistic concern for those who were deprived of their rights led to a great deal of selfishness by those who were not deprived. And here lies the affinity between the radicalism of the nineteen-sixties and the conservatism of the nineteen-eighties. Both grew from the same soil: They are different responses to the same problem.

It is not a contradiction to say that we live in a society in which some people are left-wing radicals, some are cultural radicals, some are cultural conservatives, some are "yuppies," some are trying to turn the clock back, some are trying to turn the clock forward. All of us are responding to the fact there is no system that can keep any promises. Everybody is fighting each other under the illusion that it is the "other people" that are causing the problem. We don't realize that we are all in the same boat. We are all suffering from the absence of a system that can pull us together and assure us that the results of each person's work will come back to him and enhance his life in some way.

Neither Democrats nor Republicans today offer any vision of how we can overcome our present difficulties and build a more satisfying life. Both offer merely palliatives and, at best, a holding pattern. We have to look beyond the politicians to see a different future.

Our society today can be compared to a home in which a baby is screaming while its parents read a book on child care and say to each other: "It says here that we're supposed to let the baby cry for an hour. So, we're doing the right thing, we are ignoring what we hear, what we see, and what we feel." Just so, it is possible for Yale Law School students, as they go inside the school to study social policy, never to notice the homeless people who are huddled outside, trying to keep warm around the heating grates of the school.

We hear the screams around us, but we bury our noses in the books of the system, looking there for the answers. We have to ask ourselves, What do we need and how do we get it? rather than simply turn the wheels of the system and hope that they will grind out something that may respond to our needs. When we are working on our own needs, we are in fact working for the public good.

What is happening in our society today is the result of mistakes we made in the past. These things are neither necessary nor inevitable. Nor are they things we have to accept. They were simply bad choices. We can make better choices.

The basic vision of the liberals of the nineteen-thirties - less work, more abundance, and a higher fulfillment of human beings - was not a bad one; it simply has not worked out well. The liberals did not do too much; they did too little. They underestimated the task of living in a complicated industrial society and of regulating a complicated economy. Today, we need a different kind of liberal, one who is much more sensitive to people and to what the screaming of the baby means.


MASON GAFFNEY: At one point in your book, The Greening of America, you said we are entering a new age of man. I sense in your presentation today, however, a kind of pessimism.

REICH: The things I have criticized are not mandated by nature, or by anything in our society. The present system has been able to sustain itself despite the many failures and the criticisms. I am optimistic that we can change these things. I think we can have a better society and better individual lives.

In the nineteen-thirties, we solved the problem of production. Today there are still enough goods for everybody in our society. What we have not solved is the political problem of how to distribute these goods in sufficient quantities so that every American can have a decent life. Ours is an enormous productive success, but a political failure.

GAFFNEY: The ideas you advance in your paper have their counterparts well before the nineteen-thirties. In 1879, Henry George said that a great wedge is being driven through society and that those beneath it are being ground down, while those above are being lifted up. Karl Marx said the same thing at about the same time, although he gloried in it and saw it as inevitable. You say that individuals who pursue their own fulfillment will solve the problems of society. That sounds very much like Adam Smith.

REICH: New things are happening in the area of law today. The Critical Legal Studies movement, which emerged in the last decade, attacks the legal system for rationalizing the status quo. It demonstrates how the seemingly necessary propositions of the law are really not that necessary. It suggests that we abandon the present structure for one that is based more on individual rights. I am astonished that our law schools have produced a generation of legal scholars who are questioning the legal system at the basic level, and they are doing it quite successfully.

There is also the jurisprudential school of thought - represented by Professor Ronald Dworkin and others- that deals with rights in a much more positive way than I have ever seen done before. It has found a way to derive human rights for all of us that gives us a more independent and better-protected position vis-a-vis the state, the corporation, and large organizations in general.

The idea is that individuals have a set of human rights - including economic rights and political rights - that the law can and should recognize. I always thought that this development would be a long time coming. Yet, in many of our law schools today, people are talking about these things, and these people are becoming quite influential.

M. STEPHEN WEATHERFORD: One of the most striking things about your presentation is that it is curiously un-American: it does not lead to any action or any direct policy consequences. You are urging us to do something that is foreign to American politics and much more congenial to European political systems, and that is not to take action, but to slow down and take thought.

Your paper seems quite ideological. It strikes me that this notion of bringing things to consciousness - our actions, the organizations we are involved in, our emotional giving, the values we sacrifice to consciousness - is fundamentally a politicizing kind of admonition. The political realm is one in which we have processes set up to force us to be explicit about our arguments, to confront them honestly, and to build coalitions frankly. In a sense, you urge us to think about many other things in our lives that are outside politics - what we do in large organizations, in the economy, in the family, in our interpersonal relations - as if they were political. That is, we ought to think about these things consciously and be willing to bargain about them and be explicit about the tradeoffs we are making.

In your general perspective there seems to be the notion of balance, of equilibrium, the idea that corporations have gone too far in elevating profit maximimization above other values. You are suggesting that the way to draw corporations back toward equilibrium is to introduce the notion of property rights and tenured jobs, the notion that there are limits on the ways corporations can treat their employees. We can think about that, not as a restriction on what corporations are allowed to do, but as the imposition of an alternative set of values. This is an attempt to force corporations to come to terms with the harms they are causing, because they are not only harms in themselves but also, in a sense, violations of other things we expect social organizations to do.

This sense of balance comes out in another way when you talk about the public sector. And here it goes back to a notion that political scientists usually call legitimacy, that is, the rightful authority to make rules that will govern people's lives. You talk about the impoverishment of the public sector, the kind of pathetic exercise in which politicians, who represent the government of the most powerful country in the world, say they cannot fund education programs, welfare programs, and programs for the homeless because the nation does not have enough money. This poor-mouthing in an incredibly rich society always strikes one as being out of synch. We call on government to do a lot of new things today. We seem to have no problem at all pushing economic conflicts and personal conflicts into the public sector and asking the public to resolve them while, at the same time, withdrawing the resources that the public needs to solve them. So we do think of the government as being, in a sense, responsible for homelessness, yet we want to cut the taxes that would be needed to take care of homeless people. That, too, is moving away from a balance between the public sector and the private sector that John Kenneth Galbraith talked about in the nineteen-fifties.

REICH: The American people have little idea of how their society is structured and how it works, how wealth is distributed and what alternatives there might to the present system of distribution. The idea that we have no more money for the homeless, for education, for the elderly, for day-care services is ridiculous. We have all the money we could possibly need. But the money is being hidden from us. We need to know where our resources are being used. Without a kind of social self-knowledge, we do not know what our choices are. Corporations, for example, say they have to move their manufacturing plants overseas. Why do they have to do that? They say they do it out of necessity. But it is not a matter of necessity; it is a matter of choice - they choose to maximize profits, by employing cheap foreign labor.

GILES B. GUNN: Your analysis of some of our social problems is quite acute. I am a little surprised, however, at what you suggest are their causes and possible solutions. You say that we solved the problem of production by 1930. That is true, but only in the sense that a certain number of goods - which may have been assumed at that time to be necessary to meet all needs - was within our capacity to produce. At about the same time, however, our economy began to change from a production economy to a consumer economy. Liberal critics of liberalism would say that that transformation changed the entire system. What were deemed old needs are not now easily fulfillable, because our sense of what is enough has changed. In consumer economies, needs are generated faster than they can be met, and thus they remain insatiable. We simply cannot and never will get what we need, especially when our needs continue to be, as your paper denned them, in such disconcertingly individualistic terms.

You say that one of the things that joins the conservatism of the nineteen-eighties with the radicalism of the nineteen-sixties is the recourse to special-interest politics that seeks, if not to go out of the system, at least to play to self-interests. Yet, you say the way out of our current impasse is for people to accept the realism of self-interest, and that somehow that will serve the public interest.

Is the present system in good shape? Does it merely need some imaginative tinkering to ensure that fewer of us fall outside its benefits and that power is shared among those who are lucky enough to enjoy those benefits?

REICH: Derrick Bell, a black professor at the Harvard Law School, has written, among other things, a series of imaginative cautionary tales. In one of them, something happens to the flower of white youth of the country so that they become like black ghetto youth: They lose all motivation and the desire to learn. Then it is discovered that, for a hundred thousand dollars apiece, we can restore the white youth: they will get back their motivation and their desire to learn. Congress promptly appropriates the necessary money for the white youth, schools, for example, without an infusion of federal money from Washington. Doesn't the federal government have a responsibility to spread the wealth of the country to all those who need it?

REICH: Federal money is not coming back to the people. The Reagan Administration is running up the biggest deficits and the biggest defense expenditures of all time. People have to be selfish now. They have to think of themselves. And only after they have taken care of themselves can they think of sending their resources to Washington.

AUSON DUNDES RENTELN: I think that conservatives and liberals alike would agree on what you have identified as some of our social problems. The question is, what are the priorities? Many people might agree with you that the Reagan Administration wastes three hundred billion dollars a year by giving it to the military, but many others would not agree with you.

In your paper, you say that "values are what people want." People have quite different ideas about what are basic needs. Some say that national defense is a basic need. Others say that housing for the homeless is a basic need. We need to talk about particular values and the priorities among those values. If the American people are as materialistic as you seem to suggest, why should we believe that, by identifying alternative ways of thinking and alternative policies, we will persuade anyone to adopt them? We seem to be assuming that there are shared values.

Regarding large organizations, you said organizations are extremely undemocratic because they are not subject to the rule of law. If, as seems likely, we are stuck with large organizations, can we try to conceive of organizations that would be more oriented to helping people, such as national health institutions that would help people who don't have health care, or national day-care institutions that would help families in which both parents have to work so that the family does not suffer?

REICH: We could have a society that includes large organizations, but pay everybody in them approximately the same amount of money. Why do executives have to be paid $500,000 or $1.5 million dollars a year? Why can't we consider all work equally valid? Keep the present structure, but change the reward for those who work in it.

RENTELN: That seems to be a minor change. You would keep large organizations and simply change the rules under which they operate.

REICH: I think it is a major change. I would also provide the kind of security enjoyed by the top people to everybody in the organization. I would give job security enjoyed by tenured professors to all employees in the universities. Academic tenure, after all, is a form of social security. A person who invests his or her time in one organization should be rewarded with job security. I would also extend that kind of tenure throughout society. There is no justification for job tenure in just one small area, the university.

MCDONALD: As to the question of shared values, how can you assume there are shared values? Isn't it true that until blacks rioted in Los Angeles, Detroit, Washington, and Newark in the nineteen-sixties, the national government and the people generally were insensitive to their problems? Does something like that have to happen again before Washington becomes sensitive to the fact that great numbers of blacks are out of work?

REICH: These people are screaming, and we ought to be able to understand their screams.

GAFFNEY: You assume - and I agree with you - that we could curtail most military spending without seriously damaging the security of our country. However, Alan Wolfe points out that American politics is driven by two things: growth and imperialism. It seems to me that imperialism wins votes - at least it certainly sells newspapers, and they influence votes. Jimmy Carter once said that if we want to make the federal government a redistributor, of wealth, we need to find the moral equivalent of war. It is the warlike spirit that drives people toward sharing resources. But your remarks seem to suggest the opposite.

REICH: I am sure the problem is as you have stated it. I am not sure I like the solution of channeling everything through the federal government. That seems to have been the mistake the liberals made. There has to be a better way to keep track of the resources we send to Washington. If we send money to Washington, we won't see it again.

GAFFNEY: My point about military spending is that it does come back, in terms of a psychic satisfaction, say, to the deer hunter in northern Wisconsin who thinks in quite different terms than you or I. He votes for military spending because he enjoys seeing the U.S. flag around the world.

REICH: People who are victims of this system do not, to a large extent, understand what is happening in the system, which enables the system to continue committing tremendous injustices. The consciousness of the people has to be raised.

GUNN: I am curious as to why you didn't address in your paper the role of anti-Communism ideology in liberalism over the past fifty years. Since the nineteen-fifties, all Democrats - and I think most of them are liberals - have decided they will never be weaker on Communism than are the Republicans.

REICH: I did not address the issue of anti-Communism because I think it is more important to take care of our needs in this country and stop worrying about imaginary problems in other countries. People do a lot better when they deal with what is in front of them than they do when they fantasize about what is threatening them in the outside world. During the Kennedy era, the most lurid imagination took over reality.

GAFFNEY: John Dewey said that ideas are plans to solve problems that arise in a social context. Therefore, without a plan to solve a problem, there is no idea. It seems your plan is to localize. However, there are good reasons why we cannot localize everything.

The United States, the Federal Republic of Germany, the Canadian Federation, and other federal governments have developed fairly elaborate systems of revenue-sharing. In Canada, almost all of its oil is in Alberta. It receives enormous revenues from its oil, and finances generous public services with those revenues. The federal government in Ottawa figured out that there would be an unbalanced distribution of population if everybody moved to Alberta to share in that wealth. And the people in Alberta figured out that they would have to cut back public services and find some way to divide that oil wealth up among those who were there first. Incidentally, Alaska declared a social dividend from their oil revenues and restricted it to those who were there first. But that was declared unconstitutional, and so Alaska developed another way of wasting the money on unnecessary public works rather than on social welfare, because that would attract immigrants.

I submit that over a large geographical area and large population we have to have some system of revenue-sharing at the national level to prevent (a) the kind of inequity that results from the fact that some areas have all the rich resources, and (b) the kind of restrictive, anti-social attitudes that would result from those people who were there first pulling up the ladder behind them.

We need revenue-sharing at the federal level to accomplish the kinds of things we both want to see accomplished.

REICH: There may be room for both: Some things need to be done at the federal level and some things need to be done at the local level. However, individuals should solve their own problems first and then proceed to those in their families, among their friends, in the community, and in the region. If this process does not begin with the individual and then work outward, it gets beyond anybody's comprehension and sense of responsibility.

GAFFNEY: It is comforting to note that there is revenue-sharing at the state and local levels.

RENTELN: As to the question of a large-scale commitment, what should our human rights foreign policy be? There are peoples throughout the world who cannot meet their own needs. They cannot solve their own problems. Should we be concerned about human rights in other countries?

REICH: We should begin taking care of human rights in this country, and then take a certain amount of responsibility for human rights elsewhere. I am suspicious of those who talk about human rights violations elsewhere and yet do not talk about the terrible human rights violations in our country. They are dealing with the world upside down.

RENTELN: Why can't we be concerned about the human rights violations in both places?

REICH: Maybe it is the idea of their being equally resolvable that I reject. We should start with what is most easily in our power to change, and then move outward. We must set priorities and clean up our own act. That is what we can do something about. It is actionable to start at home, and rather inactionable to complain about what happens on the other side of the world. America is quite prone to getting righteous about the rest of the world while ignoring what is happening here.

MCDONALD: The American economy is not as robust as it was thirty years ago. The post-World War II economy was much more on the upswing. Economists, such as Lester Thurow, and political economists, such as Robert Kuttner and Robert Reich, are saying that the standard of living in the next twenty years will continue to go down, to a great extent because of the flight of productive manufacturing jobs overseas where labor is cheaper. As a result, ours is increasingly becoming a service economy, which is not a high-paying economy. More and more men and women are going into the services industry to find work. Sons of steelworkers used to look forward to going into the steel mills; they now have to go into service jobs. To what extent can we have a liberal revival and the renaissance of a caring society if the economic wherewithal continues to diminish?

REICH: There is a great deal of important nonmaterial wealth. It can make the difference between someone having a satisfying life or an unsatisfying life. We can stop at some reasonable level as far as material wealth goes. From then on, the riches and the pleasures of life can be expanded into the nonmaterial area, and that is unlimited. The change of consciousness that I talked about in The Greening of America recognizes that we need only so much in the material area and that we are going to get more rewards and satisfaction by developing ourselves in the nonmaterial area. Education may be the most valuable thing of all, beyond the few basic material things that we need.

MCDONALD: To help bring those who are left out of the system and who are leading lives of despair up to a basic standard of living, the rest of us will have to give up something of our standard of living. That gets back to the question of whether there are indeed shared values in our society. Are you saying that somebody has to provide leadership to bring our consciousness to the level where we would be willing to sacrifice some of our standard of living in order to help others less fortunate?

REICH: It would not be such a great sacrifice. Does someone really need a fifty-thousand-dollar car? At some point, other things become more rewarding, and that's true even apart from whether others are in need. It is more rewarding to go to the woods for a few days in an inexpensive car than to have an expensive car and not go to the woods. There is a point at which material things offer less than do some nonmaterial things. We ought to be able to live on a reasonable level and at the same time have others live on a reasonable level. Then we would not be afraid to work in our cities, we would not be at war with ourselves, which is characteristic of people in this country. If we were at peace with ourselves, we would be able to see other less material, but still quite rewarding, horizons. In The Greening of America, I did not mean that we would all become richer in material things, I meant that we would all become richer in the totality. I still think it is possible for that vision to become a reality.