The Great Risk Shift: The New Economic Insecurity and the Decline of the American Dream

Now in a newly revised and expanded edition, The Great Risk Shift: The New Economic Insecurity and the American Dream is a no-nonsense deconstruction of how current American policy has been systematically shifting economic risk from government and businesses onto the backs of individual people. Health coverage has become increasingly expensive and difficult to obtain; social security is relentlessly under attack; job security is a thing of the past; and some of the greatest risks and investments - such as years of expensive college training to prepare for a specific career - can be thoroughly upended with a shift in the labor market. The overused mantra of 'personal responsibility' is all too easily twisted into 'tough cookies for you if your child gets sick and needs expensive hospitalization.' Personal anecdotes are sprinkled throughout, yet the core of The Great Risk Shift is a big-picture analysis supported by the latest statistical trends. From the need to return insurance to its original purpose - protecting the individuals who most need it against catastrophic loss - to the pitfalls of a so-called 'ownership society', The Great Risk Shift is both a cautious analysis of the present and a red flag warning of what needs to be done in the immediate future to fight back against specific policies that are demonstrably harmful to society as a whole. Highly recommended.

This past fall I heard Jacob Hacker speak about his work in The Great Risk Shift, and I just finally got around to reading the book. What I like about Hacker is that he not only critically examines complex political and societal issues, but he beautifully transforms his conceptions into practical solutions. He doesn't just ask, "What can we do?" He shows us how it can be done. There are points I agree with in his book and other points I still have some reservations about, but his explanations and reasoning is thoroughly engaging nonetheless. For instance, he proposes a health coverage plan that reemphasizes national concerns about health care security. His proposal places more obligations on employers, which in my opinion, is a plausible expectation if the United States is not willing to adopt a universal health coverage plan. Hacker points out that a large contributor to the rise in bankruptcies is a result of healthcare costs. It's clear that health care insecurity poses great risks to countless Americans from all different placements of the socioeconomic spectrum. I did face some apprehension and concern regarding his "universal insurance" proposal. This insurance would be designed to protect families in the event of a threatening change in finances and security - for instance a drastic pay decrease. Although I can agree that current job market conditions are very unstable (I myself have faced a drastic pay decrease formerly working in the business sector), I also feel as though we generally have a highly exaggerated sense of materialism and pretentious consumption patterns in America. How will these factors be accounted for when claiming instability and who is entitled to what? Is this where federal money should go when much larger issues regarding our nation's schools, health and extreme poverty are being neglected? In the Great Risk Shift, Hacker identifies significant points of concern for Americans and the anxieties and rising inequality pressing citizens. With higher and higher concerns, these are questions we will be continually readdressing for years to come. This book proves Hacker always has amazing ideas and great things to say. We can contiunally look forward to his new approaches at examining significant social and political issues.

In his ethnography (PDF) of Grover Norquist's weekly breakfast meetings, Thomas Medved tells us how Newt Gingrich sold reluctant conservatives attending the meeting on Medicare reform. The debate up to this point functioned largely as a prologue for the day's special guest, former Speaker of the House Newt Gingrich. Here to mediate between the fiscal conservatives who disliked the bill and the free-market conservatives who saw in it the seeds of health care privatization, Gingrich spoke out in favor of the Medicare reform act. His primary message to the group was that they must start "thinking like a majority" by accepting the logic of incremental progress. That's how the welfare state was built, he said, and that is how it must be dismantled. Citing his own efforts to "stop Hillary-care" and promote the Contract With America as examples of incremental progress, Gingrich said Medicare reform is a step toward a more conservative country because it "moves you toward choice." Gingrich saw other benefits in the legislation as well. He cited in particular a major "shift in plate tectonics" now that the American Association of Retired Persons (AARP), the largest voluntary organization in America, was on the Republican side of an issue and against the Democrats. And there was yet another hidden advantage: Gingrich predicted that the bill's passage would "break up the collectivist language" of union members because when employers adopt the strategy of giving Health Savings Accounts to their non-union employees, the unions would start fighting for them. In general, Gingrich said, we can "migrate Medicare" rather than destroy it by creating choices that baby boomers will take advantage of. "Creating choices" is an interestingly ambiguous term. As discussed in Jacob Hacker's book, people who have signed up to Health Savings Accounts (which were around before the Medicare legislation) seem to be much less happy than those who have traditional coverage; they presumably wouldn't `choose' them if there were better options on the table. Nonetheless, the number of Health Savings Accounts is growing. Over a quarter of large employers said that they would offer them in 2006, and larger employers such as Walmart are increasingly trying to move away from traditional plans to HSAs, which discourage workers with health problems from staying with the firm, and hence save them money. The choice offered here is to accept a worse deal from your employer, or quit and hope that you'll somehow find something better somewhere else. Not much of a choice. Yet nonetheless, when the mantra of `choice' is invoked by the right, it often refers exactly to choices of this kind. There's something weird going on. Jacob Hacker wants to unravel this weirdness. He's a political scientist - his major empirical contribution in the last few years has been to describe the mechanisms through which Gingrich and others have deliberately sought to undermine welfare state institutions, inch by i

This is an important book, because it brings to light a very important sociologic/economic trend. I found the section on job volatility very pertinent (I'm a programmer). My only caveat is that many collectivist/socialist countries have problems equal to or worse than ours. Some of them are even trying to emulate us and add more capitalistic elements into their societies. (I grew up in England and am familiar with the problems in France and Germany). I guess that's why economics is called the "Dismal Science".

This book is an extraordinarily lucid, thoroughly researched, practical work that synthesizes the important elements of a longstanding and unprecedented campaign that has to one degree or another already buffeted the lives of almost every American. As the title suggests, the author closely examines a profound and pervasive policy shift away from collectivist (and functional) notions of the value and need for a social insurance safety net (founded on a variety of institutions, concepts and programs including Social Security, Medicare/Medicaid, Unemployment Insurance, Defined Benefit Pensions, Employer Provided Health Care, Stable Long-Term Employment, and Responsible Enterprises) that the post-war American worker (and economy) thrived in, to the extremely individualist (and dysfunctional) "Personal Responsibility Crusade" that is bent on destroying any form of collective risk pooling, along with any form of individual (and therefore ultimately collective) economic security. He also does a fine job of pointing out the contradictions inherent in the Personal Responsibility Crusade's lip service to a fantasy of economic empowerment and individual choice that purports to support families, increase opportunity, and promote freedom. Sadly, the well documented results so far are increasing numbers of Americans of all demographic profiles being crushed in a vise of flat or declining real incomes, enormous income volatility, greatly expanded risks impacting all aspects of their existence (most specifically around the primary concerns of Employment, Families, Health Care and Retirement that he addresses), and inadequate personal resources to actually take advantage of a largely illusory, inadequate hodgepodge of new "choices". Though tracing in detail an extremely destructive arc to the brave new world of an "ownership society" in which the average "personally responsible" American is now free to choose (and lose) everything, the author also develops well reasoned, practical solutions that provide an optimistic path for moving back to a reasonable framework of societal risk management. This vision addresses what's needed to improve outcomes for the broadest cross section of Americans, while also strengthening the foundations of the free enterprise system. From the extensive footnotes and incisive use of data one would think the author has absorbed just about everything there is to consider on these topics. His analysis successfully pulls together theory and observations from a multiplicity of disciplines (including political science, sociology, economics, law, psychology, history, policy analysis and business theory) to provide a full, yet also readily accessible and easily digested, picture of what has happened, how it happened, and what can be done about it. A complementary work that focuses on the political shift from acknowledging "We're In This Together" to trumpeting the fact that "You're On Your Own" (and without adequate resources at tha