- Historic Sites
Is America Falling Behind?
It’s never a bad thing question how well you’re doing; the problem is to find a judicious observer who is determined neither to flatter nor to condemn
September/october 1988 | Volume 39, Issue 6
I am also worried about the massive American domestic deficit and the unprecedented foreign deficit. The loss of this country’s accustomed competitive edge in manufacturing and the loss of its traditional place at the apex of world finance is a dangerous combination. The answer here is not to resort to defensive measures, such as old-fashioned protectionism, but once again to encourage the innovation, flexibility, and adaptation that seem to me the keys to success. This will certainly involve such changes as new management structures and attitudes in business; one already sees these appearing. Sooner or later I believe it will have to lead to new ways of coordinating public and private activities. These are matters about which economists and political scientists will argue. Speaking as a historian, however, I am certain that adaptability will necessitate a shift away from national consumption—the credit-card way of life as well as unproductive government spending—into formation of human and physical capital. That last may be a painful process.
Perhaps not so very painful if we consider that a great deal of that shift should result in an improvement of the quality of our lives—that is, in our inventories of skills and knowledge.
Painful even then. I recently heard of a state legislature that was considering lengthening the school year to match that of the Japanese—about 240 days instead of 185. What a furor that started! The tourist industry protested. The kids protested. Some of their parents protested. The teachers wanted more compensation. So the trade-offs for redistributing resources into the capacity for future growth and flexibility are not painless. Politicians running for office may use slogans like “Hard choices,” but they don’t spell out those choices. None of them are willing to talk about raising taxes in order to increase the growth potential of the nation. None of them are even willing to mention raising taxes to the levels that were around before Mr. Reagan gave people a lot of pocket money. What I call the “thinking classes” are already wrestling with these notions. But the American electorate in general is not, and neither party wants to be the first to mention it. What is fascinating to me is that Gorbachev faces something of the same kind of problem—indeed, a much more difficult one.
People don’t want to hear bad news. They don’t want their institutions criticized.
Does he? Gorbachev knows what has to be done: An impossibly inefficient economic apparatus must be dismantled and a new one installed. Our problem is that we do not know exactly what has to be done.
Perhaps. On the other hand, The New York Times a little while ago carried a story about Gorbachev in some village telling the townspeople about how bad Soviet medicine was, how bad their production system was, how backward their science was. An old woman spoke up, saying, “Why are you bad-mouthing the Soviet Union all the time?” I remember I thought, It’s the same problem there as here. People don’t want to hear bad news. They don’t want their cherished institutions criticized or even held up for examination. One can understand that and even sympathize with it. But however understandable, these attitudes of defensive pride get in the way of making the changes that may have to be made.
You present a very sobering picture. But isn’t it likely that the very growing awareness of our problems will lead us to overcome them? Isn’t it the challenge that generates the response?
Of course, there is such a possibility. But I wouldn’t want to count on it. To turn around the vast inertial system of a country like the United States quickly is no easy matter. I remember a newspaperman asking a British minister in the midst of some crisis in the 1970s, “Are we at the edge of a precipice?” and the minister answering, “No, but I wish we were.”
I get the point.
The danger, you see, is that of sliding gradually downhill, simply because no single dramatic event will come along to awaken Americans to the need for change and keep them awake for a decade. I am very far from composing a dirge for the United States. But it strikes me as the height of foolishness not to recognize its vulnerability—I do not mean to military attack but to a further worsening of its relative economic position in the world. That is not in itself a bad thing. It is good for Europe and the Pacific to catch up. The hope, as I see it, is for the United States to take its place among the concert of nations fortified with the knowledge that it is, and with intelligence can remain, a great power, yet no longer perceiving itself as, or even desirous of being, the great power.
Can the United States manage such a remarkable transition? Can it undertake the difficult process of pulling back its military commitments and of undertaking those changes needed to help us find a productive and contributive place in the world economy? History doesn’t give us answers to questions like that. I see my task as pointing to the lessons of the past, so that this nation—I should say all nations, not just this one—will not have to learn those lessons over again.