1971: The Golden Anniversary of Democratic Decay



The democratic decay we see today was five decades in the making. The year 2021 marks the fifty-year “golden anniversary” of the beginning of our democratic descent. Because 1971 was the definitive turning point from our position as a leading democracy and ‘the land of opportunity.” Until that point, the U.S. had a burgeoning middle class that was the envy of the world; it touted unprecedented upward mobility that animated the “American Dream”; capitalism was leveraged to invest in citizens and enhance democratic ideals; and 80% of Americans expressed a fundamental trust in government institutions.


Today, America is considered a ‘flawed democracy’. And this isn’t simply a qualitative observation, but a quantitative metric. Today, the U.S. ranks below all developed countries in some pretty critical areas, and below many third world countries in too many others. And in the most recent report, America is formally characterized as a ‘flawed democracy’, and ranks an unremarkable twenty-fifth in the Democracy Index.


The deterioration we witness today had been quietly seeded in 1971. The U.S. Chamber of Commerce, a powerful business lobby, requested that corporate lawyer Lewis Powell write a position paper, known as The Powell Memo. His paper rapidly circulated among national business leaders, and became the manifesto for new business-oriented think tanks, lobbying groups, trade associations, and professional organizations committed to shaping the government to better meet their needs.


“Business must learn the lesson that political power is necessary. That such power must be assiduously cultivated; and that when necessary, it must be used aggressively and with determination — without embarrassment and without the reluctance which has been so characteristic of American business.” - The Powell Memo

The Powell Memo served as the blueprint for corporation domination. And as corporate dollars began to infiltrate American politics, it turned our government into the mutant institution we see today. Big corporations, Wall Street, and wealthy individuals could actually change laws and regulations, and purchase policies that tip the game ever in their favor. And that process was almost invisible, for decades. It happened inside administrative agencies and legislatures. But the net effect was to very subtly - but dramatically - change the rules of the game.


The American people flatlined. Until that year, American wages increased proportional to the national economic growth. And economic wealth was invested in free higher education, healthcare, and increased opportunities. But in 1971, American wages flatlined, even as economic productivity continued to skyrocket. James Frick explained, "Don't tell me where your priorities are. Show me where you spend your money, and I'll tell you what they are." And by that measure, it became painfully clear that the American people were no longer the priority. All the wealth moved almost exclusively to the top, sending us skipping down the path to a two-tiered society.


This is not about partisan debate. This is not about the government versus market. It is not about Republican or Democrat. It is about power that is misused. Allowing private money to shape public politics is a flagrant conflict of interest. And yet we are seeing the detrimental effects of public policies that turn a democracy into a plutocracy. The government becomes a pawn in corporate hands, and the bottom line continues to trump the common good that a healthy democracy is designed for.


Bad capitalism is cannibalizing democracy. Among its many vices, this abuse of power has been used to perpetuate gross economic inequality. And there is a direct correlation between economic inequality and political polarization. That’s why we see the fracturing in society that we see today. Allowing corporate elites to undermine the government’s capacity to represent and respond to citizen’s concerns is both hilarious and heinous. We are facing the Great American Resentment, with heightened economic, social, and health insecurity. And the very predictable result is that the disenfranchised become all too easy to radicalize.