By Alan Murray and David Meyer
May 17, 2018

Good morning.

Take time to read the cover story in this week’s issue of TIME magazine, written by Steven Brill and available online here, which begins with this question:

How did the world’s greatest democracy become a land of crumbling roads, galloping income inequality, bitter polarization and dysfunctional government?

It’s a good question, and one that Brill has boldly attempted to answer in his new book, Tailspin, from which the TIME piece was adapted. I read an advance copy of the book, as well as the adaptation, and can attest Brill tells a compelling tale about how the meritocratic class that grew up successfully after World War II, and to which Brill and most readers of this newsletter belong, has used its power to create a new protected elite. “In a way unprecedented in history,” he argues, the new elite was able to “consolidate their winnings, outsmart and co-opt the forces that might have reined them in, and pull up the ladder so more could not share in their success or challenge their primacy.”

The Atlantic has a somewhat different take on the same subject in the cover story of its new issue, with the title: “The Birth of a New American Aristocracy.” Brill is a lawyer by training, and an astute observer of government, and his tale tends to focus on the legal and political causes of the problem. The Atlantic piece takes a more sociological approach, looking at assortative mating, geographical self-sorting, and educational legacy and privilege. Neither of them, in my view, pays sufficient attention to the economic causes of the great American divide—how globalization and digitization are driving winner-take-most dynamics. But I’d recommend reading both articles, when you have the time. They are serious attempts to deal with the most important issue facing American society—which has not only endangered the American dream, but is driving the resentment that has become a major threat to our economic system.

By the way, you’ll note Brill begins his treatise with a reference to crumbling infrastructure. This morning, Business Roundtable Chair Jamie Dimon and Bechtel CEO Brendan Bechtel are hosting an event to push for bipartisan action on infrastructure—to address the need for more funding and less red tape. That’s an issue that bridges the great divide, because it creates hard hat jobs even as it makes U.S. business more competitive. With mid-term elections approaching, there is little to no chance anything substantial will happen on that front this year. But the BRT has made it one of its big three issues in hopes of paving the way for action soon after the election.

I’m in Washington myself this morning, for meetings with business leaders, and will have more results from our CEO poll tomorrow. In the meantime, news below.

Alan Murray


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