Between 1947 and 1968, big business got bigger: the share of assets owned by the 200 largest industrial companies rose from 47 percent to 61 percent. Then came a hardening. Deregulation ended soft niches (e.g., airlines, trucking) protected by government-sponsored cartelization. The Interstate Commerce Commission, which encouraged cartelization, was abolished.
New financial instruments (e.g., junk bonds) fueled hostile takeovers. Capital gains taxes were cut, stimulating entrepreneurship. Between 1970 and 1990, the rate at which companies fell from the Fortune 500 quadrupled. The portion of the gross national product accounted for by the 100 largest industrial corporations fell from 36 percent in 1974 to 17 percent in 1998.
In 1957 the Soviet Sputnik provoked some hardening of America's schools -- with more science and advance placement courses, and consolidation of rural schools. President Kennedy's vow to reach the moon by the end of the 1960s was an inherently hard goal, with a hard deadline measuring success or failure.
But the second half of the 1960s brought the Great Softening -- in schools and welfare policies, in an emphasis on redistribution rather than production of wealth and in the criminal justice system. The number of violent crimes per 100,000 people rose from 1,126 in 1960 to 2,747 in 1970 while the prison population declined from 212,000 in 1960 to 196,000 in 1970. In 2000, after the swing toward hardening, there were 1.3 million prisoners.
Barone says racial preferences, which were born in the 1960s and '70s, fence some blacks off from Hard America, insulating them in ``a Soft America where lack of achievement will nonetheless be rewarded.''
The Detroit riot of 1967 lasted six nights before 2,700 federal troops restored order. In 1992, after the 1980s turn toward hardness, the Los Angeles riots lasted 18 hours, ending six hours after 25,000 federal troops were dispatched.
In the Soft America of 1970, the tapestry of welfare benefits had a cash value greater than a minimum wage job. In the Harder America of 1996, welfare reform repealed Aid to Families with Dependent Children, a lifetime entitlement to welfare. And in the 1990s, welfare dependency -- and crime -- were cut in half. A harder, self-disciplined America is a safer America.
What institution is consistently rated most trustworthy by Americans? The institution that ended its reliance on conscription, that has no racial preferences and has rigorous life-and-death rules and standards: the military.
Barone believes that promotion of competition and accountability -- hardness -- is the shared theme of President Bush's policies of educational standards, individual health accounts, Social Security investment accounts and lower tax rates to increase self-reliance in the marketplace. Barone's book is a guide to electoral map reading: the blue and red states have, respectively, softer and harder sensibilities.
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