“America is a bit like a company. As a start-up, it was nimble and sharp. Then it grew into a behemoth that was able to dominate and shape the world. Now America is so stuck in its habits that it gets harder and harder to change its way of doing things.”
Paul Romer, American economist
One day when we’re all least expecting it, TMR will produce a report on the ‘state of the Union’ that will put a sparkle in your smile, a spring in your step, and perhaps even provide the impetus to toss that vial of Zoloft out the window.
But until then, we’ll continue our practice of reporting on the work of talented and respected scholars, journalists, and the random pundit or retired politician, who can shed light and learning on the complexities of an inconstant, often chaotic, and kaleidoscopic world disorder.
With that in mind, we turn to a compelling new book, “Time to Start Thinking: America in the Age of Descent,” by Edward Luce, chief Washington correspondent for the Financial Times and one of the most thoughtful foreign observers of the American polity.
Like his fellow countryman, James Bryce, who served as Great Britain’s Ambassador to the United States a century ago, and before that authored the classic account, “The American Commonwealth,” a careful retracing of de Tocqueville’s travels through America, Luce finds an America more like the one Bryce described in 1888 than de Tocqueville’s more ‘democratic’ account a half-century earlier.
"Sixty years ago, there were no great fortunes in America, few large fortunes, no poverty. Now there is some poverty . . . and a greater number of gigantic fortunes than in any other country of the world.
"As respects education . . . there is an increasing class that has studied at the best universities. It appears that equality has diminished [in this regard] and will diminish further."
Then Luce, reporting on economist Robert Solow’s graduation speech to the 2011 class at Georgetown University’s McDonough School of Business:
“Approaching ninety years of age, Solow is one of the few surviving American economists to have lived through the Great Depression . . . He won his Nobel Prize for identifying and measuring the technological underpinnings of economic growth, which, during the middle decades of his lifetime created by far the largest and wealthiest middle class the world had seen. That same class has been under a grinding and, until recently, largely ignored siege for a generation or so.
“For most middle-class Americans this had meant years of flat, or declining, incomes at a time when the top one percent were reliving the Gilded Age. The causes of this skewing were complex and deeply rooted . . . But its importance, he added with an understatement beloved of economists, was ‘nontrivial.’
“’It might be that the balance of power in society is permanently shifting [toward the very wealthy],’ said Solow. ‘If so, it is not going to be easily reversible – or reversible at all. If it continues, then your guess is as good as mine as to how society will respond.’”
With that as prologue, the next 275 pages and seven chapters of Luce’s reporting take readers on a journey that, like Bryce and de Tocqueville before him, provides an unvarnished examination of the political, economic, and social conditions in America in the early years of the third millennium.
Luce’s findings are dispiriting, disquieting, and too often textbook cognitive dissonance. The cumulative effect of his reports and fact-finding on capital formation, economic development, education, governance, health care, innovation, and the once ubiquitous American propensity for risk-taking left this reader with alternating bouts of gloom, anger, disbelief, and a Pavlovian tic each time another anecdote or factoid underscored the measurable dimensions of descent.
There is a meandering stream quality to “Time to Start Thinking,” simulating Luce’s travels throughout the country, and the breadth of his conversations with experts and tyros, ‘left-coasters’ and Midwesterners, leading scientists and industrialists, bureaucrats and inventors, liberals and conservatives, political elites and his friends, the Freeman family in Minneapolis – husband, Mark, a warehouse packager at a local hospital where his wife, Connie, is an anesthesia supply technician.
If there is a bias lurking in these pages it is for looking under every rock and reporting what’s there, not what might have been or once was. Beyond that, Luce is a Brit whose understanding of American politics and culture has been acquired through years of residence, including a brief stint as a speechwriter for a leading American cabinet secretary.
He begins with some thoughts on the political quagmire:
“Americans reflexively single out Washington, D.C., as the cause of their ills. As this book will explore, however, Washington’s habits are rooted in American society. Sometimes it seems Americans are engaged in some kind of collusion in which voters pretend to elect their lawmakers and the lawmakers pretend to govern. This, in some ways, is America’s core problem: the more America postpones any coherent response to the onset of relative decline, the more difficult the politics are likely to get.”
And then he moves quickly to the startling evidence about the ‘hollowing out’ of the middle class:
“For the first time in modern history the majority of American households were poorer at the end of a business cycle than at the beginning (2002 to 2007). Since then things have gotten worse.”
“In the last full American business cycle, between 2002 and 2007, the top one in one hundred Americans captured almost two-thirds of the all growth while the top one in one thousand Americans (0.1 percent) captured more than a third of the economy’s growth.”
“The group [business executives supporting Obama’s health care initiative] included Lee Scott, then the chief executive of Walmart, who earned more in two weeks than the average Walmart employee does in her lifetime.”
And in a visit with Harvard economist Lawrence Katz, he hears this observation:
’What we [America] are on track to becoming is a place where the top tiers remain wealthy beyond imagination, and the remainder, in one way or another, are working in jobs that help make the lives of the elites more comfortable – taking care of them in old age, fixing their home Wi-Fi systems or their air-conditioning units, teaching or helping with their kids, and serving them their food’ he said.’
‘My fear is that it will create an increasingly ugly political culture in America, that will make it even harder to address these problems.’
Then comes a look at the state of education – K-12 and higher education – once the pride of the American experience:
“More than a fifth of American adults have a reading age of fifth grade (eleven years old) or below. Just over half of Americans read books to their young children. ‘There is no magic bullet that will suddenly fix our schools, the problem is too deeply embedded,’ said Hennessy [Stanford president]. ‘We took decades to get into this problem, and it is going to take decades to get out of it.’”
“In just one generation, the United States had fallen from first to ninth in the proportion of its young people with graduate degrees, and it was still falling (in fact the United States ranks twelfth among all nations.)
“America now spends twice as much per student in real terms, as it did in 1973. Yet, according too the National Association of Educational Progress, which measures knowledge as a constant, rather than grade results . . . results have hit a long plateau. The average American score on the mathematics test was 306 (out of 500), in 2010, against 304 a generation ago. The same is true in other subjects. Like the middle class wage earner, America’s schools are suffering from a prolonged bout of stagnation.”
“In 1990, the state [California] spent twice as much on its universities as its prisons. Now it spends almost twice as much on prisons . . . the yearly cost of housing a prisoner is roughly five times the annual tuition for a college degree.”
Much of Luce’s investigation focused on America’s long-time lead on innovation:
“But it is in terms of inventiveness, risk capital, research money, and quality of government that America is falling down.”
“A large part of America’s century of scientific and technological domination was spurred by necessity. It was born neither from government nor by the private sector but from a collaboration of the two. Fear and pragmatism were its parents and imagination was its currency. Amnesia seems to be its price.”
“In the late 1990s the United States had a $30 billion annual surplus in advanced manufactured goods, the high-tech products that enabled the nation to dominate the global economy. Now it has a $40 billion deficit. As recently as 2000, the United States was ranked first in the world in terms of its ability to innovate . . . By 2010 it had moved down to sixth. In the first decade of this century, the United States came last out of forty countries in improvements to its climate for innovation.”
“Everywhere Wang [Ching Hua Wang, immunologist and head of biotechnology at Cal State/Camarillo, PhD from Cornell] looked, it seems America was stagnating. ‘I don’t feel so confident about America anymore . . . It seems to have lost its vision.’ It may also be losing its fabled appetite for risk.”
“Since 2008 risk aversion seems to have paralyzed the banking sector from lending to small businesses. The rate of American business start-ups in 2010 fell to a historic low . . . having already been on the decline before the meltdown.”
Here’s also where we encounter my favorite moment in the book, one which captures a quintessential exchange between leaders in the private sector and one at the top of the political elite:
“The SIA (Semiconductor Industry Association) had also become concerned about Washington’s ignorance of semiconductors . . . At a meeting with Harry Reid, the Senate majority leader, and twenty semiconductor chief executives . . . Reid started off by asking, ‘So, what’s a semiconductor?’” After having had it politely explained, Reid kept referring to the ‘supercollider.’”
And then to put punctuation at the end of a long examination about ‘American in the Age of Descent.’ Luce adds this coda:
“America already spends more on health care per head than other wealthy countries – almost triple the level of the British and double the French. Yet Americans continue to die earlier and spend more time disabled than their peers in Europe and Japan. And that gap is getting worse. The average life expectancy of Americans has been virtually stalled at seventy-eight years for more than a decade, at a time when several wealthy countries, including Japan as well as the Scandinavian nations, have edged up to eighty-two or eighty-three years.”
“In fact, on pretty much every social indicator you check, America is off the charts. An American baby is twice as likely to die in its first year as a Scandinavian, German, or Japanese. More than twice as many Americans are obese as is average for wealthy nations. And America’s prison population is more than five times the ratio of the next highest developed country . . . For the generation leading up to the Great Contraction, most of the wrong trends had almost been steepening. Many are now metastasizing. Four years after the housing collapse, one in four American mortgages is still underwater. One in seven Americans is on food stamps. Even Americans life expectancy is starting to look wobbly. And America’s once stratospheric economic participation rate has collapsed to the European average.”
A final note about the book -- about it’s cover, actually -- which suggests that while that you can’t necessarily judge a book by its cover, you shouldn’t ignore it, either.
The American version features an American flag, whose form recalls Salvador Dali’s melting pocket watch on a table in his “Persistence of Memory,” with a man rowing a small boat on the smooth surface, doing his best to keep from edging over the precipice and down the melting, withering part of the flag.
By contrast, the cover for the British publication shows the Statue of Liberty holding a gun to her head, and a subtitle that reads, “America and the Spectre of Decline.”
Some might say that’s simply a matter of taste; others might suggest that it’s the difference between the domestic and international perspectives on America, circa 2012.
And if we hope that this year’s presidential election might lead us to a happier, more enlightened place, consider this final bit of trivia:
“In 1960, the average sound bite for a presidential candidate on the major evening networks was forty seconds. By 2008, it had fallen to nine. Studies show that the presidential address is now pitched at the English proficiency of a seventh grader. In the 1960s presidents spoke to the twelfth grade.”
Time to start thinking, indeed. And on that point, time to start reading, “Time to Start Thinking.”
R. Garrett Mitchell
The Mitchell Report
June 27, 2012