Year: 2008

With Christmas over, our yearly contemplation of resolutions now vies for time with our recognition of day-to-day economic struggles that seem to gather and multiply.

No doubt that there is much to preoccupy and worry our fellow citizens; the Wall Street meltdown, the near collapse of the housing, financial and automotive sectors. Rising unemployment, huge government bailouts, bigger federal deficits, a seemingly endless spiral.

But the drumbeat of negativity – with its ever widening circle of media outlets perpetually blaring in all directions – can also act as de facto blinders, focusing us only on the bad without the benefit of other considerations – or balance. We seem to have entered a phase where reporting the news affects the news we report, creating a self-perpetuating downward cycle.

Without shortchanging those who are suffering in today’s economic times, I offer a few facts to place our world in context.

Consider first that amid grim unemployment reports, that 93% of our 154 million strong work-force is actually on the job. Even with this financial uncertainty, unemployment in the US is not historically high. Ronald Reagan won a landslide re-election in 1984 when unemployment was a full point higher.

People who compare today to the Great Depression are comic economic fantasizers.  68 years ago, more than 30% of the American workforce was unemployed. And even by today’s standards, the US is holding its own. Unemployment in the European Union was running a composite of 8.5% before the economic crisis.

And the job that American workers do continues to place the United States near the head of the line. US productivity – the efficiency of the worker per business hour – has risen consistently for a decade. Since 2000, only workers in Korea, Taiwan and Sweden have more productive than American workers.1

While the housing crisis is real and serious, we must also remember that 92.7% of housing stock is owned or paying its debt on time.2

Despite our economic maladies, the US remains the #1 destination for foreign investment because our country is safe, transparent, efficient and flexible with capital investment. These very characteristics will help in the eventual recovery of the US economy faster than other economies impacted by the crisis.  As companies review budgets for 2009, seven of the top ten companies are American, with a market capitalization in excess of $1.7 trillion.

While we worry about the health of the Dwindling Three, consider Google. Ten years ago the company began in a garage in California with an idea. Today, it has a market cap of $94 billion. After nearly three months of market chaos, Google closed on Friday at $314 per share. Some consider it quaint, but the dream of building success in America is still alive and well.3

As industries decline, new industries rise and expand, creating new jobs and opportunities. President-elect Obama promises thousands of “green jobs”.  How you see this evolution can be captured by your view of whether it would have been better to bail out the buggy whip business or invest in cars.

As we cope with talk of a stiff recession it is still worth noting what we as a nation produce. Waiting on the 4th quarter numbers, the US economy has thus far produced $145 billion more than it did at this point in 2007. That increase is a figure larger than the national economies of Morocco, New Zealand, Slovakia or Bulgaria.4

Beyond the day to day economic facts, there is good news if you’re willing to look for it.

As we hope to compete in the global marketplace of tomorrow, there are some promising signs that our education system is slowly improving to meet that challenge. The average math scores for 4th graders are 11% higher today than they were in 1995. They are 16% higher for 8th graders.5

As a nation, we’re living longer. According to the CDC, National Center for Health Statistics, life expectancy at birth is now 78.1 years, an all time high. At the same time, chronic illnesses that result in death have declined; stroke by 6.4%, heart disease by 5.5% and diabetes by 5.3%.  Infant mortality has declined 2.3%.

And, particularly amid our economic woes, it is significant that we continue to be a generous nation. Charitable giving by Americans topped $300 billion according to the most recent statistics.  74% of all those donations were by individuals. It only becomes more amazing when you consider that this is an amount of money larger than the national economies of the Philippines, Ireland, Denmark or Finland.

Charitable giving internationally was also up 16% from the year before to nearly $14 billion. The entire US international affairs budget is $36 billion for FY 08. Thus American private giving internationally is equal to 38% of the official American aid commitment overseas.

With globalization weaving its way through the Western Hemisphere to South Asia, the opportunity for foreign assistance, charitable giving and corporate social responsibility to local communities to form a new paradigm to help raise people out of poverty and generate genuine economic growth is at hand.

In sum, the hard economic road we face looking forward is not the sum of our moment.

During the 2008 political campaign, former Senator Phil Gramm ended up in hot water by calling American voters “whiners”.  The point may be debatable, but there is no doubt that amid the anxiety of our time a little grit, persistence, skepticism and even – yes – optimism – can be the stuff of greatness.

There is nothing more overvalued than conventional wisdom and consensus opinions, yet it is this consensus that drives us…until it doesn’t.  Consider:

“Everything that can be invented has been invented.”
Charles H. Duell, Commission of US Office of Patents, 1899

I think there is a world market for maybe five computers.”
Thomas Watson, Chairman of IBM, 1943

“But what is it good for?”
IBM Engineer – 1968 – commenting on the microchip

“There is no reason anyone would want a computer in their home.”
Ken Olson, Chairman of Digital Equipment Corporation – 1977

“The concept is interesting and well-formed, but in order to earn better than a ‘C’ this idea must be feasible.”
A Yale Professor in response to Fred Smith’s paper proposing a reliable overnight delivery service that Smith later founded as Federal Express.

The sum of our maladies does not represent the universe of our opportunities. Facing harsh facts does not exclude the prospect of hope or constructive action. So as we approach 2009, balance the news and look for the good. Skip sensationalism and weed through doom-mongering.  Trade up from superficial and trust what you know.

Humans are differentiated from the animal kingdom as the only species that can imagine the future. America is one of the few places adaptable enough as a society to make those futures real. That combination is a recipe for unparalleled dynamism.  It is a source of our strength and a pillar of our greatness as a nation, which has served us time and time again in moments of national doubt.

It is useful to remember that it can serve us again, now.

Still the Doubting Thomas and have faith.