Book Review: Stockman’s “The Great Deformation” and Our Rigged Economy

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biggerpieforum.org | Book Review: Stockman’s “The Great Deformation” and Our Rigged Economy | Administrator
Guest Commentary
By Shadrack White
The two most dynamic candidates in the 2016 presidential election, Donald Trump and Bernie Sanders, had one thing in common: they knew Main Street Americans were sick of the economy being rigged against them. But understanding how the economy was rigged was never a topic that could be fully explained in the middle of a campaign.
Enter David Stockman, a former Reagan advisor and the author of The Great Deformation. Stockman’s book is an opus about the mechanisms by which Washington tilted America’s economy in favor of the rich. The tilting happened when Washington decided to print excess money whenever it liked. That original sin then triggered growth among big banks at the expense of middle class jobs.
The story goes something like this: more than forty years ago, the Federal Reserve decided the way to avoid future recessions was to inject more money into the economy at any sign of trouble. Their fear was that, if they didn’t fire up the printing presses, prices would drop (deflation) and the economy would tank. They also knew that Congress could not control its spending, which required the Fed to print cash to pay for Congress’s deficits.
The newly printed money benefitted big banks and corporations, not working Americans. The excess money in our economy meant interest rates were nearly zero, giving bankers the incentive to make risky bets instead of investing in the slow, stable growth of employers in Middle America.
Think of this as big banks being given the chance to play with house money. The casino (the Fed) provided the chips, and banks were not going to put them in a safe piggy bank. They were going to start rolling the dice.
“Rolling the dice” for banks meant

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