Hedrick Smith’s New Book Who Stole the American Dream? Subject of Crossroads Lecture

Hedrick Smith, journalist and author, will speak on “The Dream at Risk” at the Crossroads Lecture this Saturday.

By Margie Doyle

Hedrick Smith, author of the newly-released book, Who Stole the American Dream? is eager to tell fellow Orcas Islander the history and the future of the middle-class. “People are really hungry for someone to tell them on the level what is going on and what has gone on,” he said in a recent interview with Orcas Issues.

He will get that opportunity on Saturday, Sept. 22 at 5 p.m. when Crossroads Lecture series presents Smith, speaking on “The Dream at Risk” at the Emmanuel Episcopal Parish Hall. Following his talk, Smith will sign copies of his book at Darvill’s Bookstore.

Smith is an internationally acclaimed reporter, television producer and author. He and his wife Susan Zox Smith maintain a home on Orcas Island. He comes back to Orcas this weekend after recent booksignings and lectures in Washington D.C. and southern California.

“My book is written for real average middle class people and for the younger generation. There are a lot of people who live year round on Orcas who might not think this is a book for them — or who may not go for serious books in general — but they would be misjudging this book.  It is written about their lives, what happened to them, who did it to them and how,” says Smith.

Publication of Who Stole the American Dream? comes after two and a half years of research and writing that began with an investigation into the fall of Washington Mutual. “I realized it was a huge story and represented what happened for the middle class.”

A look at the timeline for Who Stole the American Dream? on Smith’s website (www.hedricksmith.com) gives a thorough overview of the march of Middle American workers and management since 1914, when “Henry Ford announced the $5 day—reckoning that if workers are well paid, they can afford to  buy  Ford’s  Model  T  cars, and Ford could move into mass production. Ford’s  strategy  sparks  a  trend.”  The timeline sets out the development of labor unions and their provisions for annual pay increases, health benefits and monthly pensions upon retirement into resultant growth of consumer demand and increased employment to meet that demand and ultimately, powerful  consumer movements. Those populist voices, protests, and marches demonstrated the power and effectiveness of their viewpoints in civil rights, feminist rights and consumer rights.

Smith describes the pushback that came from organized businesses resulting in power being wielded by lobbyists, politicians and corporations, and the decline in the dream of the American Middle Class. He cites the transfer of $6 trillion [that’s $6,000,000,000,000 or $6 million one million times over] in middle class wealth from home-owners to banks.”

He sets out the events and statistics that demonstrate the theft of the middle class dream:

• Between 1945 and 1973, productivity increases by 96 percent; average hourly compensation (wages and benefits) rises at the same time by 94%
• But between 1973 and 2011, productivity increases 80 percent; average hourly compensation increases by only 10 percent
• With the Reagan tax cuts, the top personal tax rate was reduced from 70 percent to 38 percent
• Until as recently as the 1990s, stock options as compensation for Chief Executive Officers (CEOs) were  looked upon unfavorably: “There was a legitimate concern that it [taking stock options] was the wrong thing to do,” says Smith. Buth then, like a dam breaking, there was a change in the mindset.
• The growth and collapse of the subprime real estate market, where even buyers who qualified for prime, fixed-rate, 30-year loans were sold the sub-prime loans with their higher fees and interest rates.
• China produces 80 percent of the goods at Wal-Mart, a giant of off-shore hiring, and a titan of contemporary business.

So what’s to be done? Is it too late?

Smith suggests that government be charged with a Marshall Plan-type movement to restore stability to the U.S. economy. “Banks need to bail out home-owners who have religiously been paying their mortgages, should force banks to refinance to three and a half percent from eight percent, so the money can get into people’s pocketbooks. The problem is with demand.”

The official corporate tax rate should be 35 percent, Smith says, not the zero-to-13 percent most corporations pay.

And for those that feel powerless to change the government, Smith draws upon history for inspiration: those movements in the 60s, 70s, and 80s of people who spoke to the powerful.  “People need to do more than vote, but get off the couch and demonstrate, as they did in the peace movement, the women’s movement, the civil rights movement.

“There’s a cynicism and powerlessness and people have been fooled into believing voting is sufficient to take care of democracy.

“We’re not going to get a smart fix for our problems until we understand the real causes. That’s what the book is about: the enormous power shift from the middle class to corporate, elite America; and wedge economics that divides workers and cuts the middle class out of their share of the gains in U.S. economic productivity.”

“Middle class prosperity goes hand in hand with middle class power,” Smith says. He gives the growth of Germany’s economy as an example of core, solid middle class, with 21 percent of the economy based in manufacturing , while U.S. manufacturing makes up just nine percent of the economy. “If Germany can do it, we can do it.”

Smith’s book, Who Stole the American Dream?” may well be the guidebook for taking back the dream of the American Middle Class, to work with dignity and security so that our families may be provided for.

Among his previous books are The Russians and The Power Game: How Washington Works. He has worked as an international reporter in Moscow, Cairo, Paris and Saigon, and won a Pulitzer Prize in 1974 for his international reporting. He was a part of the reporting team at the New York Times that won a Pulitzer for producing the “Pentagon Papers” series.

Hedrick Smith and his wife Susan Zox Smith divide their time between Washington D.C. and Orcas Island. For 20 years and his wife Susan Zox Smith have visited their children and grandchildren in Seattle. They became acquainted with the San Juan Islands and decided years ago to make Orcas Island their retreat from the pressure, heat and humidity of the nation’s capital.

At the age of 79, Smith is still going strong with research, writing, reporting and producing for the Public Broadcasting System’s “Frontline” programs.

His routine on Orcas – walking, hiking, swimming, plays its part in keeping him active and productive. “I’m like Moran,” he says, recalling the Seattle mayor and shipbuilder who retired to Orcas at the age of 48 when his doctor gave him one year to live, and in the next 38 years built the Moran mansion, a yacht and donated much of his land to the state for the public enjoyment.

Smith says that learning keeps him young:  “I’m learning enormously from writing the book, it’s rejuvenating. An engaged, active mind keeps you going. I don’t have time to get older.”

Smith recently told Jon Talton, reporter for the Seattle Times, that after over two years writing Who Stole the American Dream?  his reporter’s passion is  still very much alive: “Not a lot of people have faith in journalism now,” he said. “We’ve let them down. I tried very hard to maintain my own faith with my readers. I did what a good reporter should do: asking questions and letting the facts take me to the conclusions.

“What we do is so damned important. We can’t let them down. People have lost faith in nearly every institution in the country. We have to restore the trust.”

Hedrick Smith is the featured speaker at the next Crossroads Lecture: Who Stole the American Dream at Emmanuel Parish Hall in Eastsound on Saturday, Sept. 22. Following the lecture, he will be signing his book at Darvill’s Bookstore.

(To read the full Seattle Times article, go to:https://seattletimes.com/html/businesstechnology/2019160224_biztaltoncolsidersmithxml.html)