On average, about once a year I’ve used this journal as a way to record my thoughts and not just my experiences. Those posts are probably the most boring to read, but I like having an occasional snapshot to look back on and remember how things felt at any given moment in time. This post is another in that series, so feel free to ignore and watch the Mr. T video in the previous post if this sort of rambling isn’t your thing…
So the economy is a mess, an election is 24 days away that looks like it will massively change the make-up of government, and with so much happening it’s easy to overlook that this moment seems to be one of those pivotal times that will be recorded in history books for years to come. There haven’t been a lot of major events that I’ve lived through in my 33 years – the ones that come immediately to mind are:
- September 11. Probably the event of the greatest historical importance over the past 30 years.
- The 2000 election. At the time it seemed like a big deal, but the fact that history would have been vastly different had 300 votes gone another way in Florida makes this a much more significant event in retrospect.
- The Asian tsunami. This didn’t affect me personally, but I still remember seeing the headline on CNN the night of the earthquake (during which time they reported a couple of thousand deaths) and thinking “this will be very, very bad”.
- The end of the Cold War. After years of nuclear missle summits and scary videos of Soviet military parades, I seem to recall that this one sort of came in stages. The fall of the Berlin Wall was obviously a big deal, but it seemed like over a period of years there was another country that changed leadership every month, and then suddenly one day everyone realized that the USSR no longer existed.
- Challenger. Everyone remembers where they were when the shuttle exploded. Strangely the loss of Columbia seems to have had a much less significant impact – I guess Challenger was the accident that led people to realize that we didn’t have as much control as we thought we did, and has since made the US very risk-averse.
- Tiananmen Square. While at the time this event seemed important, today the bigger story seems to be the rise of China. In retrospect, Tiananmen Square was significant for the fact that it showed that China would do things its own way and that it had become a large enough power that the rest of the world would be unable to assert any influence.
- The First Persian Gulf War. I was in high school at the time, and no one knew how to feel about such a big conflict. Vietnam was the only relevant event most people knew of, and the protests and discussion seemed to assume the two would be the same; afterwards, with CNN showing live coverage and the Iraqi army being defeated so easily, people seemed to forget Vietnam and assume that the US military was invincible, leading to overconfidence in the current Persian Gulf conflict.
There are other stories, but I’ve either forgotten them, they seem less impactful, or strike me as being related to the stories above – Hurricane Katrina or the Iraq War are clear examples; in my mind, those stories started with the 2000 election, in which the US electorate signalled that it was more important to have a President who seemed likeable and shared religious values rather than someone who was more intellectually qualified such as McCain (the 2000 version) or Gore. I’m sure Bush is a nice guy, but just as you wouldn’t hire a CEO who didn’t have expertise, leadership ability and a sharp mind, the President should likewise be elected based on those qualities and not on his likeability or success in demonizing the competition.
In any case, what prompted this posting is a feeling that the current time is another big moment in history, and I want to remember it. With banks failing, stocks down 40%, the government pumping $700 billion into markets in addition to countless loan guarantees and bailouts, this moment will be a pivotal one. In general people don’t like big changes, but with current conditions people are willing to try just about anything, meaning the next year could see more major policy changes than in the past thirty. Obama has campaigned on the premise that the dominant economic policy of “trickle down” is a failure, and is instead trying to implement his own “bottom up” strategy in which it will be the strength of the middle-class, rather than the strength of markets, by which the economy is measured. I expect higher taxes on the rich, massive government investments in infrastructure to create jobs, and at least in the short-term some large and scary deficits that will, for the first time since World War II, mean that America is no longer the clear economic leader in the world. While I think that after the past eight years America would have lost its economic dominance no matter what happened, the transition due to Obama’s proposals will (I think) make it happen sooner, although I believe that the investments he proposes will cause the downturn to be much shorter than it would have otherwise been.
In any case, it will be interesting to see the outcome of this change – $15 billion a year for energy research, if enacted, will go a long way towards creating new industries, and if done right could completely re-make how the world produces and uses energy. Higher taxes on the rich may reduce some investing, but at the same time a stronger middle class will (in my opinion) have a stimulus effect that will more than overcome any investment losses and fundamentally shift people’s view of what a “strong economy” means. The elephant in the room is the deficit – unless that comes under control inflation will rise and nations will be less willing to loan America money. For a country that relies on the ability to have large budget deficits a lack of credit could result in very traumatic cuts to defense, entitlements, and other government spending. As an Obama supporter I trust in his vision and like where it could lead, but at the same time see this moment in history as a very pivotal one that will be interesting to look back on twenty years from now.