My Two Cents - "Good Housekeeping? An Op-Ed"

10/14/2011

I am writing this article not as an economic or financial analyst, which is my normal mode of operation. This article has nothing to do with economic, financial markets, or any related topics. What it has to do with is the undeniable reality that we as a nation are failing miserably in one of the most basic precepts of civilization and that is to leave things better than we found them. When you think about it that is how true advancement takes place. If every civilization had done as we have, it is more than likely that 99% of you would never be able to read this article. Sure the technology might be there, but you wouldn't be able to afford it. Or be literate enough to read the piece. So I am writing this week as just a regular old vanilla American – one that is very concerned about the future - and how we leave things. In my opinion, there are two major areas where we are failing that are well beyond the auspices of economics in their origins, but certainly have economic implications.

Technology – A Knife that Cuts Both Ways

One of the biggest misdirections we have witnessed in the past 20 years or so, and the last decade in particular, is that because we can come up with new and better technologies that somehow we are advancing society and/or civilization. It has been quite remarkable to watch the development of computers that fit in the palm of your hand. They can make phone calls, take pictures, play music and do a raft of other useful functions. But have they truly advanced society? I would argue that they have actually caused society to regress. People have become more compartmentalized. Despite the 'social media', people are less sociable, preferring to send computerized messages into the ether, rather than shaking hands, sitting down over a cup of coffee and actually having a real discussion. There is certainly a fine line between advancement and decay, and it is truly in the eye of the beholder.

From a purely economic perspective, such developments have made us more 'productive' in our work – at least that is the assertion. But have they? Not a month goes by where there isn't some study performed that shows people are wasting more and more time at work on the Internet, social media sites, and texting with their cell phones. The losses to firms are estimated in the billions if not hundreds of billions of dollars a year. Companies are spending more resources than ever trying to combat this decay on productivity, so to call technology a drag on productivity is likely an understatement of epic proportions. Technology has truly demonstrated itself to be a knife that cuts both ways.

From the standpoint of pure innovation, this generation has certainly made more breakthroughs than the last. This process goes almost uninterrupted back to the Dark Ages. However, we must now address the aggregate effects of this technology on society as a whole. And the quantifying of these effects is going to be very subjective in nature. Permit me a brief example. When I was a kid growing up in the mid 1970s, we didn't have many of the developments we have today (obviously). The first Ataris were still several years away and most homes still had the old style rotary phones. Microwave ovens were a 'new' development. I spent a lot of time outdoors, and as an only child, my imagination bloomed as I discovered new and improved ways to occupy myself. When other kids were around, it was all about interaction, conversation, and normal, healthy development. Contrast that with today. Many kids stay inside most of the time, either on their computers or playing video games. They don't talk, they text. There is a massive obesity problem among children in this country. There are many reasons for this, but one of this for sure is the sedentary lifestyle most of us lead – enabled by technology. Understand I am not bashing innovation, but merely pointing out that it doesn't always make the contributions to the advancement of society that we might think.

And as a society, are we better off merely because we've seen an era of unprecedented technological innovation? Have we left things better than we found them simply because we've innovated? I'd argue not necessarily. The dystopian novel '1984' also featured a clearly superior technological landscape surrounding a societal fabric that was in a state of ruin. Sure, '1984' was a work of fiction, but many fictions parallel reality in one way or another and certainly '1984' is no exception. On the continuum between the unattainable 'perfect' society, and that portrayed in '1984', I would contend we are much closer to the latter than the former.

A Loss of National Identity

This is the obvious second pillar of where we are failing and I will warn you up front, this is going to be a very hard pill to swallow for some. It is going to challenge your way of thinking and leave you with the distinct sense that you've been played like a two-dollar fiddle. Why? Because you have. Let me start by asking you how you'd define 'America'. Most people would probably cite a quote from one of the founders or perhaps a refrain from one of our 'patriotic' songs. Many folks really struggled with the concept as well.

In recent years, there have been many 'movements' in this country. The stated intention of nearly all of them has been to restore America to her proper position. Perhaps to 'restore freedom', or some other nebulous concept. The outside impression given is that these movements are spontaneous and organic, meaning they originated much in the way a vacuum is filled. There was a perceived need or void, and the movement came into existence to fill that void. However, most of these movements have not been organic, but rather have served to act as lightning rods for growing outrage and discontent. We clearly have a void of leadership and have had one for decades now. I would not even try to determine when we last had effective leadership across the board, but it has been a LONG time.

We have had the current structure of leadership – the two party system – for nearly as long as we have had a nation. Opposing forces, battling over how the country should be run. Interestingly, all 50 states ratified a Constitution that was supposed to do exactly that. What we have today is two groups fighting for the most part about how best to go about subverting that Constitution. That document is our national identity. It says who we are, what we are about, and how we are to do things. It is for our country, what the Bible is for the Christian. It is the instruction manual for how to run a country. Surely it was not perfect, and the framers recognized that, providing a process for changing it. The process itself was designed so that change couldn't happen reflexively, but would take time. Clearly the intent here was that during that time, reflection and contemplation would take place.

The identity of America has been lost. School kids don't know their Constitution, most adults couldn't even tell you when the first state (Delaware) ratified it (1787), and our leaders pay lip service to it out of one side of their mouth while supporting legislation that mocks or debases it out of the other.

The two political parties, working towards the common good of the banking elite around the world have turned our political process into a WWF production. The election has become like the Super Bowl. Better be on the side of the winning team. The left condemns the right and vice versa, yet the problems continue to worsen – for generations. Getting back to my original thesis, have we left things better than we've found them in this regard? Most of you will likely agree with me on that one, but when some pollster puts you up against the wall, you'll sigh, and pick one of the establishment candidates as your 'choice' to lead us. Perhaps you'll quietly utter the phrase that he/she is the 'lesser of two evils'. Insanity is defined as repeating the same thing over and over while expecting a different result. Enough said.

The media is more than willing to help you maintain your sense of learned helplessness too. The media is perhaps the biggest reason why the people of this country haven't thrown off the shackles of convoluted political ideologies, dependence on government, and moral equivalence. And think of these 'organic' movements referenced earlier. Each of them have in some way been initiated by members of the media, then immediately co-opted by one side or the other of the establishment. The paradigm must continue at all costs. All protest must be quickly controlled and the fury directed in the establishment's preferred direction, but never at the establishment itself. Get people outside on a Saturday afternoon, they wave their signs and yell slogans for a couple of hours, then get on a bus, go home and go right back to what they were doing before. Their anger is spent, their desire to be a dissident quenched. Then the next election comes and the media plays up one candidate or another as the one who can save us from the evils of the other half of the establishment – and the charade goes on. Think that won't happen next year? I certainly hope not, but based on our history and our lack of awareness, it would seem a near certainty.

We have clearly lost our national identity. It has resulted in a great deal of economic, political, and moral dissonance. Perhaps the only thing worse than 15 trillion in debt have been the nearly 50 million voices snuffed out in a country where life, liberty, and the pursuit of happiness are supposedly the cornerstones of who we are as a nation.

Graham Mehl is a pseudonym. He is not an ‘insider’. He is required to use a pseudonym by the policies of his firm when releasing written work for public consumption. Although not an insider, he is astonishingly bright, having received an MBA with highest honors from the Wharton Business School at the University of Pennsylvania. He has also worked as an analyst for hedge funds and one G7 level central bank.

Andy Sutton is a research and freelance Economist. He received international honors for his work in economics at the graduate level and currently teaches high school business. Among his current research work is identifying the line in the sand where economies crumble due to extraneous debt through the use of economic modelling. His focus is also educating young people about the science of Economics using an evidence-based approach.