Saturday, March 5, 2011

Has America Lost Its Swagger?

In the new Time Magazine Fareed Zakaria offers an alarmist vision of America‘s decline. Link here.

Zakaria is an intellectual celebrity, supposedly a deep thinker, but here his analysis and his nostrums are almost too conventional.

He is quite correct to say that: “America's success has made it sclerotic. We have sat on top of the world for almost a century, and our repeated economic, political and military victories have made us quite sure that we are destined to be No. 1 forever. We have some advantages. Size matters: when crises come, they do not overwhelm a country as big as the U.S. When the financial crisis hit nations such as Greece and Ireland, it dwarfed them. In the U.S., the problems occurred within the context of a $15 trillion economy and in a country that still has the trust of the world.”

We would all agree that too much success produces overconfidence and complacency.

Yet, Zakaria's conclusion is less than inspiring: “For most of our history, we have become rich while remaining restless. Rather than resting on our laurels, we have feared getting fat and lazy. And that has been our greatest strength. In the past, worrying about decline has helped us avert that very condition. Let's hope it does so today.”

It doesn’t feel quite right to say that we can solve the problem by worrying about it. It sounds like recycled consciousness raising. No one gains strength or motivation by being afraid of getting fat and lazy. In and of itself, worry can become defeatism, and defeatism, a basic pessimism about the present and the future, does not motivate anyone to do anything.

Nor am I convinced that America’s future will be greatly enhanced when we accept Zakaria’s bizarre notion that those who respect and defend the American constitution are mired in “ancestor worship.” That sounds like saying that we should change the rules in the middle of the game.

Of course, the constitution can be adapted by the process of amendment. Surely, respecting the constitution, that is, the rule of law, will serve us better than dismissing it as an eighteenth century relic.

Then, Zakaria declares that we need to learn from other nations, especially those great laboratories ofr social democracy... Sandinavian countries. Of course, Zakaria is not the first to recommend that America emulate Scandinavia or Ireland or Iceland, for that matter.

But there is not reason to believe that what seems to work in Sweden is going to work in America. There is a question of scale, but there is also the simple fact that Scandinavia is an American military protectorate.

Recall that Spain was once the great Western hope for clean energy. The government was throwing money-- as they call it, investing-- in wind and solar technology. Now, Spain is verging on bankruptcy and it threatens to sink the European monetary system.

Scandinavian countries are not the home of technological innovation or industrial power. Nor are any of them financial hubs. To take one example, Norway prospers because it has a lot of land, very few people (5,000,000), and a lot of North Sea oil.

Ultimately, Zakaria wants to rationalize American governance. In itself, this is not a bad idea. And yet, his vision of a brave new world where Republicans and Democrats compromise away their differences and will live in harmony in a new Republic of Worry doesn't seem quite as feasible as he thinks.

I am not going to ask anyone to spend too much time pondering Zakaria’s article. It presents itself as a big thought piece, an engagement with big ideas, but, as such, it largely falls flat.

Its redeeming virtue is that it includes a quotation by Harvard historian and favorite of mine, Niall Ferguson. Call it a diamond in the rough.

Ferguson has written a new book, called Civilization, to be published next week, about what made the West great. I would humbly recommend that getting in touch with the sources of our greatness will serve us better than worrying about our decline.

Ferguson wrote: “For 500 years the West patented six killer applications that set it apart. The first to download them was Japan. Over the last century, one Asian country after another has downloaded these killer apps — competition, modern science, the rule of law and private property rights, modern medicine, the consumer society and the work ethic. Those six things are the secret sauce of Western civilization.”

I consider it metaphorically infelicitous to go from killer apps to secret sauce, but Ferguson is otherwise correct.

So much so that if you start thinking about these apps and ask yourself whether we still believe them or practice them, you will quickly conclude that significant portions of the American electorate do not, and that an unholy alliance of government bureaucrats and lawyers has done everything in its power to constrain industrialization, free trade, free competition, property rights, and the work ethic.

If I may conceptualize Ferguson’s list, the West became great because of the Industrial Revolution and the value system that made it function.

The Industrial Revolution turned science into economic growth and prosperity. From railways to skyscrapers to medical technology to sanitation systems the Industrial Revolution built the West. It also built the massive logistical systems that distribute goods to consumers.

It did so because it valued free enterprise, open competition, and a work ethic. It built first and worried later.

In today's America we worry first and build later. As a for instance, how much time will it take to rebuild the World Trade Center?

The sanctity of private property allowed individuals to keep most of what they earned. It was based on the principle that what you earn is yours to enjoy before it belongs to the community at large.

Government refereed the competition and ensured that everyone was playing by the same rules.
It also assumed the important function of ensuring the value of the currency. If your earnings are your private property, a federal government that debauches and devalues the currency is taking your money away from you. That is, reducing the purchasing power of your savings.

I do not know what Ferguson is going to say in his book-- it isn’t out yet-- but clearly many people in America no longer believe in the killer apps that made the West.

People pay lip service to industrialization, but we have allowed industrial development and energy exploration to be hobbled with red tape and lawsuits.

Most of us believe that environmental purity is a transcendent virtue. We have allowed an unholy alliance of lawyers and bureaucrats to make it nearly impossible to establish and maintain energy independence. Serious thinkers think that the problem can be solved, not with more drilling and exploration, or with more nuclear power plants, but with higher energy taxes.

Energy production is a dirty business. Those who imagine it to be clean and pure are living in a pastoral idyll that has nothing to do with reality.

Keep in mind, industrial agriculture in California’s Central Valley has been shut down because a court decided that we need to save a smelt. With precious few exceptions, no one really cares what happens to the farmers of the California’s Central Valley, to their families, or to the price of agricultural commodities.

And we haven’t even mentioned the consummate stupidity that has led the nation, in a time of food shortages, to burn a large portion of its corn supply for fuel.

As for the value of free and open competition, there again, much of America voted in 2008 for a candidate who believes that social justice should trump free competitive enterprise.

Social justice means that the government, not the free market, should determine winners and losers. Social justice advocates believe that if the market does not produce the outcomes they desire, then the market must be rigged.

A culture that values competition ensures that everyone compete fairly, but it knows that what matters in business is production and profit, not the percentage of woman sitting on corporate boards.

And forget about the work ethic. America seems more committed to a fun ethic, where you do not have to work as hard, but where spend you time honing your skills at vacation.

If you want to measure how much we have lost, just examine the furor that erupted over the now famous, or infamous, Tiger Mom.

Tiger Mom’s children learned a work ethic. They learned to compete fiercely and effectively. They were supposed to be their best not their most complacent. They were taught the value of achievement, not empty self-esteem.

And the American people, in massive numbers, looked at Prof. Amy Chua and declared her to be an abusive mother. How could she visit such indignities on her innocent daughters?

That tells us what America thinks of the much vaunted work ethic. While the East Asian countries are happy to educate their children according to the Confucian principles practiced by the Tiger Mom, we are worrying that our little darlings might be traumatized by too much homework.

Too often, we coddle our children. We want them to be creative free spirits, future artists and designers. We want them to avoid the arduous task of engaging in free and open competition.

Are there exceptions to these rules? Are there Americans who still hold to the work ethic, and who believe that you should work to earn what you have, not rig the political system to provide you with more than you have earned? Indeed, there are.

Unfortunately, they are probably a minority by now. And the majority that is leading the American decline, and that actually believes that America should decline, is not going to go down without a fight.


David Foster said...

"Learning from other nations" business, one can often observe weak and uncreative executives whose idea of a strategy is to copy whatever the competition is doing. But it is rare for what works for company A to be the optimum strategy for company B...companies have unique assets, cultures, and histories which have a great influence on their optimum strategies.

This doesn't mean, of course, that a company or a nation shouldn't learn from others: of course it should. But it is rarely a good idea to do this from a position of "We're so awful and they're so wonderful, we'd better do just what they're doing"

Anonymous said...

David -

I've heard this idea of "'the other'(europe,socialism,asia,etc) as the ideal", described as "comparing the worst of one's own culture,to the (percieved) best of some far-off
'other culture'"'s an updated version of "the grass is greener on the other side of the fence."

perhaps stuart could elborate how the complainer(critic) feels somehow superior by arrogating a position of judgement to themselves,without having to effect any constructive change.

- shoe

Stuart Schneiderman said...

As David suggests, the problem with saying that one's own country or business is so bad that we need to emulate someone else's lies in the fact that this form of self-criticism suggests that one's country or company has no psychological resources of its own.

If we are that bad, whatever makes anyone think that we have the competence to enact what works somewhere else.

As for Shoe's question about holding up some other country as the ideal, I think that this is really a ploy by idealists to couch their utopian and impractical visions in an appearance of realism.

They are saying that their policies will work here because they worked there. It feels like a rhetorical ploy, an effort to persuade people to adopt bad policies.

And then when we try it here and it doesn't work, we say that we are defective. If it worked there and doesn't work here, then there must be something wrong with us.

Unfortunately, people who do nothing but criticize and complain never end up admitting that they were wrong.

They deprecate our culture, as you suggest, and therefore demoralize the people who are supposed to implement the new policies.

The other angle concerns identity, whether it is national identity or corporate identity. Making yourself into someone or something else will necessarily undermine your ability to build on your own successes and to gain confidence from your own victories.

Therapy Culture said...

I've heard this idea of "'the other'(europe,socialism,asia,etc) as the ideal", described as "comparing the worst of one's own culture,to the (percieved) best of some far-off
'other culture'"'s an updated version of "the grass is greener on the other side of the fence."

Another form of the "grass is always greener" is comparing today's generation with the generations of the "good 'ol days".

Face it.

If things suck now. They sucked back then too.