Income Inequality Threatens Capitalism- Who Said That- Surprise!

You might be surprised but here is the direct quote from non other than Andrew Carnegie who was one of the first capitalists, along with John D. Rockefeller Sr, to become American billionaires.  Here is Carnegie’s exact quote from 1889. 

” The gulf between rich and poor threatened the very survival of capitalism.” 

You might not think that view was espoused by the self-made bobbin boy who came to America and worked his way into the founding of U.S.  Steel!  Carnegie and John D. Rockefeller Sr.  competed daily to see who would become the wealthiest magnate in America! Rockefeller with Standard Oil may have edged out Carnegie for the title but the great irony is that both men  became two of the world’s greatest philanthropists benefiting nearly every conceivable worthwhile socially important endeavor. However, as both biographies clearly reveal, it was not pretty along the way. Just ask Ida Tarbell!

I write this post today after reading  in the New York Times the latest government figures on the distribution of wealth in America . It ties in perfectly with my Occupy Wall Street post of earlier this week.  In that post I commended to you Gretchen Morgenson’s Reckless Endangerment and Tom Friedman’s  That Used To Be Us.

Why Carnegie and Rockefeller?  If you want a solid historical perspective on the accumulation of wealth by two of America’s richest men , Ron Chernow’s TITAN The Life of John D. Rockefeller Sr. and Peter Krass’s  CARNEGIE offer the reader tremendous insight. 

Never before in the  American capitalistic system had so much wealth been accumulated by just two industrialists.  Both books are complete in their historical perspective of the personal lives of Carnegie and Rockefeller and admirably translate their personas into their business and later their philanthropic philosophy. 

As  I have read the daily accounts of Occupy Wall Street my memory clicked upon these two most worthy biographies.  They provide a meaningful and  necessary historical backdrop to the discourse of today. Chernow’s book was published in 1998 and Krass’s work  in 2002. 

If you have the time, these are wonderful back to back reads.  By chance , I read TITAN first and having done so would recommend that order. Each is of course deserving of a stand alone read.

Occupy Wall Street? Two Insightful Books Morgenson and Rosner,Friedman and Mandelbaum

Anyone who questions the “why” in the Occupy Wall Street movement that is sweeping the nation and the world need only pick up a copy of Reckless Endangerment by Gretchen Morgenson and Joshua Rosner! ( See Gordon’s Good Reads July 16, 2011 blog post.)  The book did not predict that folks would be manning the barricades by October but I would assume the  Occupy Wall Street movement came as no surprise to these two  excellent reporters. Reckless Endangerment is a must read for all who are trying to put Occupy Wall Street in context.  The mantra ” We are the  Ninety-Nine Percent” will become abundantly clear after reading Morgenson’s and Rosner’s work.

Nor will the Occupy Wall Street movement come as any  surprise to readers of  Tom Friedman’s and Michael Mandelbaum’s That Used To Be Us, How America Fell Behind in the World We Invented and How we Can Come Back.  That Used To Be Us  places in focus the circumstances leading up to the economic and social turbulence in America.

Friedman and Mandelbaum cite four major challenges facing America: How to adapt to globalization, how to adjust to information technology, how to cope with large and soaring budget deficits and how to manage in a world of rising energy consumption and rising threats to the climate and environment.  Though That Used  To Be Us was written before Occupy Wall Street  it clearly enlightens the reader on the years of ignorance in all quarters leading up to the nations current economic straits.  Whereas Reckless Endangerment is an investigative chronology of  America’s financial meltdown, That Used To Be Us  meticulously peals back the covers of missed opportunities to right the ship by both government and business. The  How We Come Back  subtitle of the book brings forth big challenges and a hint of optimism but ironically it ties directly into the public protests of today.   Friedman and Mandelbaum call for an end to the political “gross irresponsibility” demonstrated during the budget crises. ” Anyone who proposes solutions that are not at the scale of the problem and don’t require immediate action is not serious. ” They call for  equipping the citizenry with the skills and tools essential for economic growth in a global economy, rebuilding America’s infrastructure,  and emphasize that ” cutting ”  is not the answer unless it is coupled with major tax increases to create hope for a future balanced budget. ” Anyone who says that we can restore order to our national finances today without raising taxes is not being serious.”

Global warming is a major subject in That Used to Be Us, and the twist is that the authors see global warming as a huge economic opportunity to get out in front of new technology with inventions and production that can lead America out of the Great Recession and place its future on a sound economic growth pattern. The authors  urge America to seize the green energy initiatives being undertaken in China and make them America’s own. Stop exporting our science and technology at our own expense, reference the authors.

Great books are timeless and many have been posted on Gordon’s Good Reads.  Reckless Endangerment and That Used To Be Us my not go down in the annals of literature  as timeless or iconic but in 2011 they are certainly timely and both add greatly to broadening ones understanding of this critical American crossroads.

My blog of last week on That Used To Be Us, promoted by last Sunday’s  New York Times Op-Ed by Tom Friedman was written with 100 pages of the book left to read. The finish line is an eye opener no matter what your politics.


I am 100 pages short of finishing Tom Friedman’s and Michael Mandelbaum’s new book That Used To Be Us. How America Fell Behind In The World It Invented and How We Can Come Back. However, after reading Tom’s opinion column in today’s ( October 9, 2011 New York Times) I feel compelled to get the word to you right away. 

 The column title Where Have You Gone Joe DiMaggio? poses the conundrum  that Friedman and Mandelbaum answer in their carefully crafted and researched book.  Anyone who is vested in figuring out what is wrong with America  ( aren’t we all?), and what we need to do to fix it, is encouraged to read this book now.  THAT USED TO BE US  is  about the important national dialogue being played out in print, over the air, in Washington DC  and now in the streets!  It will not go away. The book is not about philosophy but rather solutions! This quote from Friedman’s  New York Times Op-Ed  truly sets the agenda for That Used To Be Us.

“We cannot bail or tax-cut our way to prosperity. We can only, as  ( Steve) Jobs understood, invent our way there. That is why America needs to be for the world in the 21st century what Cape Canaveral was to American the 1960s: the place where everyone everywhere should want to come to start-up and make something — something that makes people’s lives more productive, healthy, comfortable, entertained, educated or secure. To do that, we need to reinvigorate our traditional formula for success — quality education and infrastructure, open immigration, the right rules to incentivize risk-taking and government-financed scientific research.”

That Used  To Be Us is worthy as a stand alone Tom Friedman read but it is even more compelling if you have read his The World is Flat (2005) and Hot Flat and Crowded. (2008)

All of Friedman’s work is a reasoned approach to identifying problems and pointing to proven and in many cases obvious solutions.  Michael Mandelbaum adds to the excellence in this new volume. Both authors  spare no individual, political party or company in bringing issues to the feet of those responsible for our problems and giving due credit  in recognition of wisdom.

When I have finished the last 100-pages I will be even more impressed  but having completed 256 and today reading Tom’s Op Ed  I am compelled to post this blog today!