With his characteristic humor, humanity, and candor, one of the nation's mostdistinguished public leaders and thinkers delivers a fresh vision of politicsby returning to basic American values: workers should share in the success oftheir companies.

Robert B. Reich, professor at Brandeis University and founder and national editor of The American Prospect, is author of eight books, including Locked in the Cabinet and The Future of Success. His radio commentary can be heard biweekly on public radio's Marketplace, and his writing has appeared in The New Yorker, Los Angeles Times, The New York Times, The Washington Post, The Boston Globe, and many other publications. He lives in Cambridge, Massachusetts.

CONTENTS

Preface

1. Whatever Happened to the Social Contract?

2. Corporate Citizenship

3. Work That Pays, Insurance if It Doesn’t

4. Lifelong Learning: Education for the Twenty-first Century

5. The Day I Became a Feminist: Real Family Values

6. The Long View: A Decent Working Society

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Whatever Happened to the Social Contract?Not since World War II have Americans felt so unified. We're fighting a war against terrorism and we're fighting to get the economy moving again. And we're all in this together. Except when it comes to paying the bill. Add the cost of fighting the war to the biggest military buildup in two decades and extra security at home, and you're talking real money-hundreds of billions of dollars over the next few years. The Bush administration has also enacted a mammoth tax cut-$1.35 trillion over the next ten years. At this writing, the president is proposing almost $600 billion in additional cuts in income taxes and capital-gains taxes. The bulk of these cuts-those already enacted and those proposed-benefit large corporations and people who are already wealthy. So who's going to pay? Take a guess. Middle- and lower-income Americans. Most Americans now pay more in payroll taxes than they do in income taxes. Payroll taxes include Social Security and Medicare payments. You pay these taxes on the first $80,000 or so of your income (the ceiling rises slightly every year). After that you're home free. Bill Gates stops paying payroll taxes at a few minutes past midnight on January 1 every year. None of the enacted or proposed tax cuts affect payroll taxes, even temporarily. To the contrary, they increase the odds that payroll taxes will have to be hiked. That's because the tax cuts, combined with the military buildup, will drain so much money out of the Treasury that there won't be enough money to pay for Social Security and Medicare by the time the early baby boomers begin retiring, about a decade from now. So payroll taxes probably will have to rise in order to fill the gap. Get it? Income and capital-gains tax cuts for the rich now, payroll tax hikes on middle- and lower-income Americans to come. Americans like to think we're all in this together, but the fact is that the economic fallout from terrorism is hitting some Americans much harder than others. When the slowdown began, layoffs and pay cuts hit hardest at manufacturing workers, white-collar managers, and professionals. Since the terrorist attacks, a different group is experiencing the heaviest job losses: the low-paid. Many are service workers in retail stores, restaurants, hotels, or other tourist-industry businesses that have been hard hit. Others are caregivers-social workers, hospital workers, elder-care workers-whose jobs and wages are on the line as public budgets are trimmed. The economy may be rebounding, but these people aren't. Government is less helpful this time around. Safety nets are in tatters. Welfare-to-work programs made sense when work was plentiful, but without work, those no longer eligible for welfare have nowhere else to turn. Even job losers who still qualify find that welfare payments in most states are worth less than before. Unemployment insurance is also harder for them to get. Since part-time workers, temps, the self-employed, and people who have moved in and out of employment often don't qualify, a large portion of the lower-wage workforce is excluded. Many who don't qualify are women with young children. Meanwhile, federal programs for job training and low-income housing have been shrunk by budget cuts. State and local governments are in no position to step in. They're already strapped by rapidly declining tax revenues. Rather than beefing up social services, they're cutting them. Rather than improving our schools by reducing class size and offering all-day kindergartens and after-school programs, they're paring back. Instead of m