The new decade of greed

Rich Lowry

6/27/2003 12:00:00 AM - Rich Lowry

Attention liberal historians and Democratic presidential candidates: There is a "Decade of Greed" to be condemned and blamed on the nation's top political leadership. It's called the 1990s.

New figures released by the Internal Revenue Service show that the share of the country's income held by the 400 richest Americans more than doubled from 0.5 percent in 1992 to 1.1 percent in 2000.

Their income increased at a rate 15 times the rate of the bottom 90 percent of Americans.

These numbers would make the 1990s a decade synonymous in the liberal imagination with heedless acquisition, tarring the occupants of the White House as contemptible agents of greed, if it weren't for one inconvenient fact -- those occupants were Democrats.

That is the crucial condition that didn't apply in the 1980s, so Op-Ed writers, movie directors and -- most importantly -- Democratic presidential candidates gleefully gave it the sobriquet the Decade of Greed, and blamed it on Ronald Reagan.

A campaign memo urged Bill Clinton in 1992: "Look for an opportunity to pivot into a denunciation of the Decade of Greed. You know the riff -- the worst legacy of the Reagan-Bush years is the greed, the get-it-while-you-can attitude, the to-hell-with-my-neighbor, quick-buck mentality that created the ransacking of our great companies."

Clinton hit the theme in his speech accepting the Democratic nomination: "I have news for the forces of greed and the defenders of the status quo: Your time has come and gone." Judging by the latest income figures, the top 400 representatives of "the forces of greed" never got the message -- nor did anyone else.

The Decade of Greed critique had several permutations. There had been an unseemly celebration of wealth: "The 1980s were about acquiring -- acquiring wealth, power, privilege," Hillary Clinton complained. There had been an emphasis on easy money, fading into criminality: "Together, we must bring an end to the something-for-nothing ethic of the 1980s," Bill Clinton exhorted. There had been rank business speculation and self-enrichment: "American business must NOT ... (a) speculate as they did in the 1980s, (b) pad their executives' salaries," Clinton Labor Secretary Robert Reich wrote in a memo.

Well, now. If the 1980s were allegedly too intensely focused on wealth, they were nothing compared to the 1990s. The excess that stoked the Clintons' ire in the 1980s was that executive salaries had tripled over the decade. Over the 1990s, executive pay increased sixfold, and by the end of the decade, the average executive made 500 times more than the average worker.

If the 1980s were supposedly a time of speculative waste, they were just a warm-up for the 1990s. The Dow dropped 23 percent on one day in October 1987, but it gained back all of its losses within two years. How sober and boring compared with the frenzy over technology and Internet stocks in the 1990s.

If the 1980s featured "the ransacking of our great companies," the 1990s brought their pillaging and burning. Most of the "leveraged buyouts" of the 1980s, parodied as pointless greed at the time, made corporations more competitive. If there were excesses, none of it compared with the widespread cheating that infected the corporate world in the 1990s.

If the 1980s "left the poor behind," so did much of the 1990s. As Reich writes, "Earnings inequality among full-time adult workers was greater by the end of the first (term of the) Clinton administration than it had been at the start."

So, should Clinton be condemned for presiding over a new "Decade of Greed"? No.

A free-market economy is an enormous, roiling affair subject to governmental control -- and especially control by the president -- only at the margins. People get rich (even very rich), and there will always be opportunities for folly and novel forms of criminality. The greed and excess of the 1990s were byproducts of a rollicking economic boom, the same as in the booming 1980s.

Now, where does Reagan go to get his apology?