Praise for WINNER-TAKE-ALL POLITICS “Important.… The collapse of the American middle class and the huge transfer of wealth to the already wealthy is the biggest domestic story of our time.… The good news reported by Hacker and Pierson is that American wealth disparities— almost exactly as wide as in 1928—are not the residue of globalization or technology or anything else beyond our control. There’s nothing inevitable about them. They’re the result of politics and policies, which tilted toward the rich beginning in the 1970s and can, with enough effort, be tilted back over time (emphasis added for impatient liberals).” —Jonathan Alter, The New York Times Book Review “Hacker and Pierson argue strongly that the concentration of income at the top is not just the work of deep economic forces. It is aided and abetted by politicians who favor the very rich or allow policies that once favored the rest of us to erode. Hacker and Pierson look closely, sharply, and entertainingly at the way that interest-group politics and the political power of money have allowed this travesty of democracy to happen. This book is a wake-up call. Read it and wake up.” —Robert Solow, winner of the Nobel Memorial Prize for Economics in 1987 “The clearest explanation yet of the forces that converged over the past three decades or so to undermine the economic well-being of ordinary Americans is contained in Winner-Take-All Politics. Jacob Hacker and Paul Pierson argue persuasively that the economic struggles of the middle and working classes in the U.S. since the late 1970s were not primarily the result of globalization and technological changes but rather a long series of policy changes in government that overwhelmingly favored the very rich.… Nothing better illustrates the enormous power that has accrued to this tiny sliver of the population than its continued ability to thrive and prosper despite the Great Recession that was largely the result of their winner-take-all policies, and that has had such a disastrous effect on so many other Americans.” —Bob Herbert, The New York Times “Engrossing.… Hacker and Pierson . . . deliver the goods.… Their description of the organizational dynamics that have tilted economic policymaking in favor of the wealthy is convincing.” —Justin Fox, Harvard Business Review “‘How can hedge-fund managers who are pulling down billions sometimes pay a lower tax rate than do their secretaries?’ ask the political scientists Jacob S. Hacker (of Yale) and Paul Pierson (University of California, Berkeley) in their deservedly lauded new book, Winner-Take-All Politics. If you want to cry real tears about the American dream—as opposed to the self-canonizing tears of John Boehner—read this book and weep. The authors’ answer to that question and others amounts to a devastating indictment of both parties. . . . The book deflates much of the conventional wisdom.” —Frank Rich, The New York Times “Over the past generation, the middle class has been repeatedly battered, and its once-solid foundations have begun to tremble. Uncovering the hidden political story behind this great economic challenge, Jacob Hacker and Paul Pierson shed light on what has gone wrong— and why. Their book is must-reading for anyone who wants to understand how Washington stopped working for the middle class.” —Elizabeth Warren, Assistant to the President and Special Advisor to the Secretary of the Treasury on the Consumer Financial Protection Bureau “How the U.S. economic system has also moved ‘off center’ toward an extreme concentration of wealth, and how progressive efforts to reverse that trend have run aground. . . . A very valuable book.” —Ed Kilgore, Washington Monthly “Hacker and Pierson make a compelling case. If Marie Antoinette were alive, she might aver of today’s great economically challenged masses, ‘Let them nibble on passbook-savings-account interest’—if they can manage to save anything, that is.” —David Holahan, The Christian Science Monitor “A must-read book. . . . It broke down what was at stake in 2010 and will be at stake in 2012 better than anything I’ve read. . . . Hacker and Pierson show how politics has become ‘organized combat.’” —Joan Walsh, Salon “Two top political scientists tell us when America turned terribly wrong—and how the rich and powerful organized to do the turning.… Fascinating.” —Sam Pizzigagi, “Too Much,” an online newsletter of the Institute for Policy Studies “Must buy this book.” —Beezernotes.com “This is a transformative book. It’s the best book on American politics that I’ve read since Before the Storm.… If it has the impact it deserves, it will transform American public arguments about politics and policymaking.” —Henry Farrell, Crookedtimber.org “Winner-Take-All Politics is a marvelous connect-the-dots book. It makes not just one point, but a series of points that fit together like train-cars.” — The Weekly Sift “A swiftly written political history that shows why we’re where we are and what crippled our government’s ability to deal with it.” — The American Prospect “Hacker and Pierson remind us that there are no such things as ‘pure’ markets, and that markets everywhere are shaped by laws and regulations, cultures and the institutional arrangements that themselves are shaped by the political process.” —Steven Pearlstein, The Washington Post “I really recommend it.” —Chris Hayes, Washington editor of The Nation magazine, on MSNBC’s Countdown with Keith Olbermann “Read Winner-Take-All Politics. This excellent work is all about how Washington has made the rich richer—and turned its back on the middle class.” —Liz Smith, WOWOWOW.com “It’s a great review of the state-of-the-art thinking on the scope of the inequality explosion and . . . correctly frames this as a non-inevitable consequence of policy decisions. . . . Recommended.” —Matt Yglesias, thinkprogress.org “This is an important book for raising some of the key questions of our time. I would recommend that people read it and give it serious thought.” —Tyler Cowen, Marginalrevolution.com Also by Jacob S. Hacker and Paul Pierson Off Center: The Republican Revolution and the Erosion of American Democracy Also by Jacob S. Hacker The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream The Divided Welfare State: The Battle over Public and Private Social Benefits in the United States The Road to Nowhere: The Genesis of President Clinton’s Plan for Health Security Also by Paul Pierson Politics in Time: History, Institutions and Social Analysis Dismantling the Welfare State? Reagan, Thatcher, and the Politics of Retrenchment Simon & Schuster Paperbacks A Division of Simon & Schuster, Inc. 1230 Avenue of the Americas New York, NY 10020 www.SimonandSchuster.com Copyright © 2010 by Jacob S. Hacker and Paul Pierson All rights reserved, including the right to reproduce this book or portions thereof in any form whatsoever. For information address Simon & Schuster Subsidiary Rights Department, 1230 Avenue of the Americas, New York, NY 10020. First Simon & Schuster trade paperback edition March 2011 SIMON & SCHUSTER PAPERBACKS and colophon are registered trademarks of Simon & Schuster, Inc. The Simon & Schuster Speakers Bureau can bring authors to your live event. For more information or to book an event, contact the Simon & Schuster Speakers Bureau at 1-866-248-3049 or visit our website at www.simonspeakers.com. Designed by Joy O’Meara Manufactured in the United States of America 10 9 8 7 6 5 4 3 2 1 The Library of Congress has cataloged the hardcover edition as follows: Hacker, Jacob S. Winner-take-all politics : how Washington made the rich richer-and turned its back on the middle class / Jacob S. Hacker and Paul Pierson. p. cm. Includes bibliographical references and index. 1. Equality—United States. 2. Capitalism—United States. 3. United States—Economic policy. 4. United States—Politics and Government—1945–1989. 5. United States—Politics and government—1989–. I. Pierson, Paul. II. Title. HN89.S6H33 2010 306.3'42097309045—dc22 2010014515 ISBN 978-1-4165-8869-6 ISBN 978-1-4165-8870-2 (pbk) ISBN 978-1-4165-9384-3 (ebook) To our children—Ava and Owen, Sidra and Seth— inheritors of a hopefully stronger America