Our Country, Wrong and Right

The Politics of Rich and Poor: Wealth and the American Electorate in the Reagan Aftermath, by Kevin Phillips, New York: Random House, 262 pages, $19.95

Our Country: The Shaping of America from Roosevelt to Reagan, by Michael Barone, New York: The Free Press, 805 pages, $29.95

In Eastern Europe, the hammers and sickles are coming down as fast as they can be pried loose from their bases. In the Soviet Union itself, police guards have to be stationed around statues of Lenin to prevent them from being sold for scrap.

At a time when one would be hard put to find a Marxist east of the Oder-Neisse line, a putative Republican, employing what he calls a "vaguely neo-Marxist" analysis, has caught the falling flag of class warfare and proudly hoisted it on the ramparts of the nation's capital. Kevin Phillips's The Politics of Rich and Poor is the talk of the Washington establishment, which has greeted it rapturously and helped it onto the best-seller lists. Never fear, however. Phillips's watered down Honeckerism is likely to have as much success as the stronger Eastern European variety, but not without much suffering before the truth emerges.

Phillips knocked the political world on its ear in 1970 with The Emerging Republican Majority. He argued that "hot button" cultural issues—race, law and order, militant feminism, abortion, school busing, and others—could pry alienated urban ethnics and white Southerners loose from Roosevelt's New Deal coalition.

Richard Nixon's root canal economic policies prevented him from exploiting Phillips's theory. But oddly, as Ronald Reagan won and governed in the 1980s using Phillips's blueprint with great success, the author himself became increasingly disillusioned with and alienated from the political right.

He also edged further and further away from the hard work of political analysis and closer to the less-taxing pastime of economic prophecy. In his 1982 book Post-Conservative America, he predicted the United States would soon resemble Weimar Germany. He followed up in 1984 with Post-Industrial America, a clarion call for protectionism and "managed trade," without which utter disaster would soon befall the republic.

There is absolutely nothing new, interesting, or surprising in The Politics of Rich and Poor—only the identity of its author. By their blurbs ye shall know them, and Phillips sports two real lulus on the dust jacket: Richard Nixon ("The Politics of Rich and Poor will revolutionize the way we talk about politics") and Mario Cuomo ("Every American should read this book").

The arguments are familiar. Reagan's tax cuts and deregulation caused a massive concentration of wealth in the hands of a few super-rich people. The living standards of average people scarcely improved at all in eight years, and the poor grew more numerous. Michael Milken, the mergers-and-acquisitions boom, and Donald Trump are all paraded to receive Phillips's scorn. All this "excess," he asserts, has laid the groundwork for a Democratic "populist" reaction of higher taxes on the rich and more welfare programs for the poor.

The evidence he cites for this apocalypse, however, is almost laughable. The Joint Economic Committee report that supposedly showed a massive concentration of wealth in the hands of a few was discredited years ago.

The JEC report at first showed that the share of income held by the top 1 percent of the population had soared from 25 percent to 35 percent in the Reagan years. In fact, a computing error had caused the dramatic surge. The percentage actually stayed the same.

But even after this correction, the report remains spurious. The data the JEC used to compute income distribution by class from 1922 to 1983 was not a "Federal Reserve Board study," as a Phillips footnote states. It was instead an analysis of studies using a variety of sources and methodologies, many incompatible with one another. Besides, the analysis ends in 1983, only two years after Reagan's election and at the end of a deep recession. Again and again, Phillips uses reports and studies that began in 1977 or 1978. That's like blaming Roosevelt for Hoover's policies.

Income distribution by class is one of the most difficult economic statistics to compute because income groups are extremely fast-moving targets. Forbes magazine reports that it adds about 25 new names to its "400 richest" list every year. So in the last eight years, half the names have been new or have dropped off the list and then come back on. To take just one example, Donald Trump, supposedly the apotheosis of 1980s greed, has plummeted off the list and is besieged by divorce and bankruptcy lawyers.

This freedom to fail is completely missing from Phillips's analysis. Detroit News columnist Warren Brookes took on Phillips with statistics from the U.S. Census Bureau, a far less biased source, and showed that while there had indeed been income growth at the top of the scale, more people in middle-income groups moved up one quintile than down. Even a whopping 52 percent of those in the low-income categories saw their incomes increase by 5 percent or more during the past decade. At the top of the scale, as many as 24 percent fell out of the highest income bracket after only one year.

In the end, Phillips produces no real evidence to support his contention that class politics is the key to American politics. Indeed, the absence of class envy—even in the depths of the Great Depression—has always been one of the wonders foreign observers remark upon.

Already the book has had practical effects. New Jersey Democratic Gov. Jim Florio virtually waves the Phillips book as his Bible while he embarks on wildly unpopular tax-raising schemes. The middle-class revolt Florio has ignited as a consequence might make the national Democrats wary of their newfound messiah, but then, donkeys are stubborn animals.

Absent a major economic crisis, cultural issues are often decisive in American politics, something Phillips ought to at least dimly recognize. In 1988 while Phillips was predicting a Michael Dukakis victory, George Bush made Willie Horton a national celebrity and recited the Pledge of Allegiance repeatedly. The take-no-prisoners Phillips of 1970 would have instantly recognized the appeal of those two icons. The 1988 version scarcely noticed.

Cultural issues are the specialty of Michael Barone, co-author (with Grant Ujifusa) since 1972 of the remarkable Almanac of American Politics series. Our Country, his grand-sweep history of American politics over the last 60 years, is far more worthy of the reader's time and money than Kevin Phillips's rantings. While the book has its limitations, one can be confident that Barone knows his stuff and has left any ideological axes in the closet. He gives us information—too much at times.

In Barone's analysis, the political fault line in America lies, not between rich and poor, but between what he calls the "Yankees" and the "Ellis Islanders" and between Northerners and Southerners. Historically, the people in these groups had fundamentally different views of the country. The Yankees saw politics as an avocation; the immigrants saw it as an occupation. The North was an industrial society. In most of the 19th-century South, a visitor from the Roman Empire would have felt comfortable.

Barone shows that support for far-left, class-based politics actually decreased in the United States during the Great Depression. The vast majority of citizens wanted an economy that created jobs, not one busily redistributing wealth from top to bottom. Flint, Michigan, scene of the great sit-down strikes of 1937, elected Republican members of Congress for 30 years afterward. Individualism and self-help remained popular, though the Republicans were generally unable to figure out how to turn that feeling into political success.

The chapters on the Depression and the Roosevelt era are far and away Barone's best. Curiously, as he moves closer to our own time, the book becomes less interesting. Along the way, however, a great gallery of half-forgotten political figures from the past returns: John Lewis, Joseph Nye, Robert Wagner, Arthur Vandenberg. Barone shows why each was important. He also places in context many policy decisions: Roosevelt did not support Social Security until he became convinced Louisiana's Huey Long might beat him on the issue in 1936.

Barone is the first serious historian, so far as I am aware, to note that Lyndon Johnson's reputation as a political genius is overstated. LBJ understood the South and he understood the Senate, but the ethnic politics of the North baffled him, as did the antiwar movement. Those weaknesses proved his undoing. Barone also documents what ought to be obvious but is usually not commented upon or analyzed: Richard Nixon's extremely liberal domestic social and economic policies, and how their failure probably helped transform Watergate from an embarrassment to a fatal blunder.

The weakness of Barone's book is that, if anything, it is too determinedly middle-of-the-road. Harsh or final judgments are rare. Everyone, it seems, had admirable as well as base motives. Barone never tells us whether he believes the tremendous concentration of power in the hands of the federal government that took place during the course of his story, and the transformation of the Constitution from a document designed to limit government to a license for its endless expansion, were good or bad things.

Still, Our Country is a far more convincing tour of the American landscape than The Politics of Rich and Poor. It is better documented, and it also has the advantage of being mostly true.

John A. Barnes is deputy editorial page editor of the Detroit News.