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There Is Another Way: Seeing Robert Reich in Portugal
By lynmiller-lachmann on 2017-07-07 19:27:16
Since 2012 my husband and I have been spending a substantial part of each year in Lisbon, Portugal, which is why I have
delayed my Waging Peace blog posts until July this year. During the past five years, we have seen Portugal endure a deep
and protracted economic crisis and a recovery brought about by an increase in exports and tourism. Indeed, things are
looking up for this small country that has become a popular tourist destination -- ranked the #1 travel destination of 2017
and the third safest country in the world. Some of those travelers to Portugal have started to put down more permanent roots,
including Madonna. [caption id="attachment_10071" align="alignleft" width="255"]
Robert Reich speaking in Portugal.[/caption] While we were in Portugal, economist
Robert Reich came to visit. He spoke at ISCTE-IUL, the graduate institute of the University of Lisbon. His talk, "How
Inequality in America Created Trump: A Warning for Europe," was sponsored by the ruling Socialist Party of Portugal (PS)
and the Portuguese branch of the strategic communications group Res Publica. The almost-filled auditorium heard Reich
speak, in English, about the forces of right-wing populism, which he defined as nationalism, scapegoating, broadly-directed
anger, and xenophobia, and how they came to take over the U.S. government with the election of Trump and a Republican
Congress. He argued that the process began in the late 1970s with deregulation of various industries under Democratic
President Jimmy Carter. With deregulation came an assault on unions that accelerated under Ronald Reagan. The decline of
unions — from a third of private sector employees in the mid-1970s to seven percent today — is one of the principal reasons
for a drastic redistribution of wealth from the middle class to the very wealthy. Until recently, according to Reich,
productivity increased in the U.S., but all the benefits went to a handful of people at the top. Their concentrated wealth led to
a further concentration in corporate ownership (with the corresponding decline in small businesses) and political power.
Reich observed that aggregate demand is now declining because of the disappearance of the middle class, and along with it
is a decline in generosity as people cling to what they have hoping they will not slide into the ranks of the impoverished. He
said that Americans are running out of coping mechanisms to hide their stagnating wages and loss of economic power.
Already, women have gone back to work, people are working longer hours, and borrowing against rising real estate values —
what caused the 2008 economic crisis and Great Recession — is no longer an option.
Speaking to a European audience, Reich compared the rise of inequality in
the U.S. to austerity economics imposed by the “troika” (European Union, European Central Bank, European Commission).
He noted that the countries that imposed austerity economics to pay off high levels of debt in fact ended up with even more
debt because their economies stagnated or contracted. Only through economic growth can debt be paid off. Reich cited
Portugal as a country that has begun to recover from austerity through economic growth. Exports have increased, and unlike
the U.S., Portugal relies more on these exports than on consumer spending. Tourism has contributed to economic growth,
with further investment in the pipeline to encourage more visitors. The new Socialist government has encouraged this
investment, and with the agreement among the parties on the left now has the political stability and will to carry out these
measures. Reich concluded with the statement: “The world is watching Portugal with hope.” Audience questions touched on
the Trump administration’s open hostility to people of color and LGBTQ persons, the ability of the a two-party presidential
(versus parliamentary) system to effect change, the “downward escalator” of education as well as economics in the U.S.,
debt restructuring in Europe, the role of social media in both Trump’s victory and the resistance against him, and the
possibility of nuclear war with his finger of the button. As far as the move to impeach or remove Trump from office, Reich
believed the chances of him leaving in the middle of his first term for any reason was one in three. Reich’s presentation at
ISCTE-IUL coincided with his one-week holiday in Portugal, which he mainly spent in Lisbon. In coming to Portugal for
vacation, he reaffirmed his hopeful vision of what the country has become over the last few years — a model for progressive
governance, democratic participation, and the successful resistance to austerity. After all, he didn’t choose to spend his time
in Russia, Turkey, or those countries of Eastern Europe where the slide into authoritarianism is testing the limits of EU
standards for freedom of expression, human rights, and the rule of law. Our friends in Portugal are starting to express similar
optimism, an optimism reinforced by the country’s leadership in a variety of areas from sports championships (such as the
Euro Cup) to accolades in the arts (winning the Berlin Film Festival and the Eurovision song contest) to the realm of politics
(the election of Antonio Guterres as Secretary General of the United Nations). The world is indeed watching with hope.
