The Unwinding by George Packer

The Unwinding by George Packer is a book about the way the United States got off track, crushed its middle class, created a gilded moneyed class, and passed through what sometimes is called The Great Recession and sometimes The Bailout and sometimes a lot worse–all culminating in the hard years we have experienced since 2008.

 

The story begins long before 2008 because it is told in mosaic style, meaning it is a series of case studies or extended vignettes that naturally dip into the past of the central figure of a given chapter.  That figure could be a Washington operator, former Treasury Secretary Robert Rubin, now-Senator Elizabeth Warren, writer Raymond Carver, or the desperation of a building-boom collapse that brought down Tampa, Florida and its environs.

 

Succinctly Packer sums everything up in three lines on page 347 writing about “Prairie Populist Elizabeth Warren.”  He writes:

“The Great Depression produced three regulations:

The FDIC–your bank deposits were safe.

Glass-Steagall–banks couldn’t go crazy with your money.

The SEC–stock markets would be tightly controlled.”

 

In effect, Packer contends, the dismantling of these regulations (which is not strictly true regarding the FDIC, as far as I know) led to the downfall of our economy and, in this particular chapter, the rise of consumer advocate-politician Elizabeth Warren, senator from Massachusetts.

 

The thematic framework for this book isn’t built to withstand heavy winds.  Packer opens with a weak prologue that says we’ve always had booms and busts and we’ve just been through a terrible bust (or at least 99% of us have) and here are stories that will help us understand what happened to us.  I’ll try to summarize the elements in play.

 

We turned corporations into profit-only mechanisms; we handed political control of the country over to Wall Street; we out-sourced labor; and we watched Silicon Valley do amazing things that enable me to write this review and distribute it worldwide quite easily but aren’t really tangible, labor intensive, or financially beneficial except to wildly, wildly rich entrepreneurs and visionary engineers.

 

If you have been following the news the last six years, lost your job or your house or your retirement savings, or seen your net worth grow a thousand-fold, you already know much of what Packer writes in highly readable, character-based narrative style.  That doesn’t mean the book isn’t worth reading. There are characters here I doubt you’ve heard of–I certainly hadn’t–who are fascinating in their dreams and despair.  And there are characters you may know one way or another who come off rather differently than one would expect.

 

Going into the political area, Packer writes about a journeyman operative who attaches himself to Joe Biden for decades, raising millions for him and working on his staff.  I’ve met Biden several times and seen him in candid moments.  Initially I found him sententious and full of himself. Gradually I found him to be direct and sincere. Then I read Packer’s account of a cold, self-interested pol who wouldn’t give one of his key supporters a kind word or the time of day.  Packard sways me, I must admit.

 

In the Wall Street dimension, there is a tongue-in-cheek satirical chapter on Robert Rubin, one of the guys who broke through the restraining regulations of the Great Depression and brought us the Great Recession.  Rubin got rich; the rest of us didn’t; but Rubin has never accepted his share of the blame, always skipped away.

 

Down on the farm a fellow named Dean Price, working the North Carolina/Virginia borderlands, becomes convinced he can make a profitable contribution to society by promoting biofuels.  He gets the last chapter of the book, and he seems to have finally succeeded after many, many setbacks.

 

Youngstown, Ohio, is deindustrialized in chapters focused on Tammy Thomas. It’s a sobering tale.  Tampa, Florida, sells itself out to developers who overbuild housing stock for speculators financed by liar’s loans from creepy “bankers”.  Silicon Valley produces a character named Peter Thiel who scored big with PayPal and an investment bank and many other technology-based initiatives.  He sees himself as a philosopher of the future and is quite critical of technology.  What does it add?  Why not focus on extending human life to 150 years and raise the bar of human expectations (what are you going to do with all that extra time, in other words)?

 

This is fact-based journalism.  Walmart is portrayed as a despicable, fascistic company that succeeds because it manages to pay its employees little and sell its goods (or China’s goods) cheap…yet still make the Walton family one of the richest in America.

 

The skewed inequality between the richest and poorest of us has roots in the early ‘70s. The ability of bankers to financially “engineer” take-overs and mergers that cut costs and raised profits began to flourish back then.  Reaganism made this Americanism.  Bill Clinton couldn’t change it. George Bush loved it. Barack Obama can’t change it.  These presidents represent our downward slide and minor comebacks.  The U.S. middle class is stuck in the mud and has been for decades. The super-rich have become even more super-rich.

 

In a nutshell, that’s Packer’s lively, depressing, detail-filled story.  Going back in time, Edmund Wilson’s collected notebooks from the 1930s tell a similar story.  Hedrick Smith’s recent book, Who Stole the American Dream?, essentially overlaps with Packer’s account.

 

Now we are in a polarized situation where the two major political parties can’t work together (and one of the parties, the Republican, can’t work within itself) and money is God in Washington.  The chapter in Packer’s book on financial reform illustrates how Wall Street owned Senator Chris Dodd (and Teddy Kennedy and Hillary Clinton) so that the reform act Obama ultimately signed was a toothless tiger, much of it written by big bank lobbyists.

 

At the moment, we are not going up and down in noticeable increments.  Slowly I think we’re creeping upward, but a better description might be that we’re going around and around, telling ourselves Packer’s stories in our own way and desperately trying to figure out how to break the vicious loop we’re in as the mega-rich look on from their fantasy-land and “average” Americans wonder, as Hedrick Smith put it, who stole the American dream? 

 

For more of my comments on contemporary writing, see Tuppence Reviews (Kindle).