January 2011

John Steele Gordon’s “The Federal Debt” is for the most part written with the erudition and power readers of American Heritage have come to expect of Gordon. It is all the more regrettable that the last page and a half has been replaced (due, no doubt, to a computer error) by a puff piece from the Republican National Committee. Besides the obiter dictum that the Reagan arms buildup “finally helped bring victory in the Cold War” (how President Mondale would have shored up the old Soviet Union is not explained), nothing is said about the effect on the deficit and debt by the advent of supplyside economics and monetarism as the new economic orthodoxy (at least in the Executive Branch). In light of the article’s excoriation of Keynesianism, the fact that the deficit expanded to record-breaking proportions under a President trained in economics (to my knowledge, the only Chief Executive to possess an economics degree) who explicitly rejected Keynesianism ought at least to have been mentioned.

I am eager to receive each issue of American Heritage , as the articles are invariably well presented and informative. But I was especially impressed with “The Federal Debt.” It should be required reading for all economics classes.

In “The Federal Debt” (November 1995), John Steele Gordon obscures a major point by not examining the data with a bit more precision. He acknowledges, for example, that when Andrew Jackson virtually eliminated the national debt by the mid-1830s, the country “plunged into depression.” He notes that cutting the debt in half during the 1850s was followed by another depression and that debt reductions were followed by “severe depression” in the 1890s.

In fact, every major depression in U.S. history has been immediately pre-.j ceded by a multiyear spasm of budget cutting and debt reduction. The depressions began in 1819, 1837, 1857, 1873, 1893, and 1929. There has beenj virtually chronic deficit spending since the Great Depression, and no new economic collapse, the longest such period in history.

Gordon also fails to note that Franklin Roosevelt was re-elected in 1936 , partly on the basis of a promise to balance the budget. He came very close to doing so in 1937, cut back the size of government, and the modest recovery of 1933–37 immediately disappeared.

When the Olympians fly into Atlanta, the first sign of the city they will see from the air is not the skyline of proud towers, shimmering in the humidity, but Stone Mountain, the immense dome of granite sixteen miles to the east. Even from a mile in the air they will be able to see clearly the three huge figures carved into the face of the rock: Jefferson Davis, Robert E. Lee, and Stonewall Jackson. Gazing out the cabin window, the athletes may not know who those carved figures are, but once they’re on the ground it won’t be long before they find out. History is definitely part of the Olympics extravaganza in Atlanta, and it is already providing a good deal of controversy.

The Debt The Debt The Debt The Debt Greeks and Gringos Democratic Jazz Democratic Jazz Left-wing Terror The Bonnie Blue Flag The Real MacArthur? Emerson and Individualism Emerson and Individualism Credit Due

Last fall, just as this issue was starting to take shape, I received an invitation to a press conference held by the European Commission, a sort of chamber of commerce of nations. In promoting a new tourism program called “Routes to the Roots,” speakers from Germany, Great Britain, Ireland, and Norway praised the success of the American experiment and the way we as a people have managed to forge a common purpose yet keep our individual ethnic identities. This struck me as an appealingly archaic, faded-sepia-postcard view of a society whose warp and woof is undoubtedly a bit frayed right now. Indeed, it was only the day before the conference that Pope John Paul II had arrived in America; from the tarmac at Newark Airport, he had implored Americans to hold open our doors to immigrants.

In the years since I have had to use the services of a baby-sitter, inflation has hit this little business. I was amazed to find that the rate per hour has more than doubled. My grandchildren are baby-sitters, and they make a lot of money. Listening to one of their conversations, I discovered that accompanying fringe benefits are important to them and are carefully considered before they accept jobs: large color televisions, for instance, and families that leave out lots of snacks.

I couldn’t resist a lecture on how tough things were when I was young and how lucky they were to be able to earn money so easily. I had a different way of earning money, and memory came flooding back as I described it.

Cautiously our driver worked the cab between trucks unloading yellow barriers on the street outside the downtown Royal, considered in 1972 to be Copenhagen’s finest hotel. A polite soldier stopped us to apologize for the inconvenience, although he volunteered no explanation for the barricades.

In that early evening the lobby was crammed with people. Suddenly, out of nowhere, came an assistant manager who pounced on our luggage and deftly ran interference for my wife and me to an empty, back elevator.

Inside our ninth-floor room he handed over the key, and, graciously refusing a tip, told us that someone would be along shortly to answer questions. I assured him we had a few.

With surprising ease I reached Potters, a friend at the U.S. Embassy, who had made our reservations. “So far,” I told him in the Russian we both spoke and enjoyed using on one another, “your influence has been incredible.”