The Edgy Optimist – When did America get so pessimistic? … Barely had the counting ceased in last week's presidential election when the news took a somber turn. Two of the next day's headlines read "Back to Work, Looming Fiscal Crisis Greets Obama" and my favorite, "America has Sown the Seeds of Its Own Demise." Politicians either celebrated or decried the results, but regardless of party affiliation most warned of formidable challenges and a perilous future. How did it come to pass that even the resolution of a contested election brings almost zero relief from the relentless focus on problems and threats? How did a country that for much of its history exhibited a (sometimes naive) willingness to ignore obstacles and plunge forward become a society that struggles to turn its gaze away from the dangers that loom just ahead? In short, how did the United States become so pessimistic? – Reuters
Dominant Social Theme: We need a resurgence of positive thinking.
Free-Market Analysis: So Reuters is starting a new column with Zachary Karabell, the president of River Twice Research and River Twice Capital. He is also author of How China and America Became One Economy and Why the World's Prosperity Depends on It.
This is surely a power elite dominant social theme of sorts, that what ails the West can be cured by the power of optimism. It is all a question of how you look at things.
That's why the column is called "The Edgy Optimist." It's going to be an optimistic column but one that recognizes that the current Western pessimism has its roots in reality. Here's some more from the article:
Without question, this has been a challenging time for America and much of the Western world. We can all recite the crises, disasters and failures: Y2K, the bursting of the Nasdaq stock market bubble in 2001, 9/11, Iraq, Afghanistan, Enron, WorldCom, the bursting of the housing bubble, the Wall Street implosion of 2008, the euro zone's troubles, chronically high unemployment, anemic growth, the continued emergence of China as a global economic force. I could go on.
The bleak attitudes of the past decade are in stark contrast to the giddy optimism of the 1990s, a consequence of the Internet revolution, a soaring stock market and the end of the Cold War. Yet even then, the growth model that so many Americans took for granted was showing signs of strain. Manufacturing jobs were quietly evaporating, and incomes for the middle class were stagnating. And so we have come to a point where even the conclusion of a peaceful, contested democratic election offers no pause in the drumbeat of negativity.
Few today are unaware of the problems that beset us. There is ample informed commentary, analysis and prognostication describing what is going wrong and could get worse: increasing deficits, waning economic growth, high unemployment, unstable financial systems, stock markets crashes, inflation spikes, geopolitical conflict, renewed recession, destructive gridlock, rising inequality, etc. No one could argue reasonably or rationally against the possibility that these issues will undo us or lead to worse times ahead. The problem, is that few argue consistently or cogently that our fears may, in the end, just be fears and that we will do more than muddle through.
That is the goal of "The Edgy Optimist," my new column. It will examine what might go right and how, and what is going right and why. To deny the challenges and perils of our world, particularly the changing nature of our material and economic lives in the West and how we can ensure sustainable prosperity and growth in the years to come – well, that would be foolish. But it is equally wrongheaded to dismiss arguments to the contrary as foolish, unlikely or ill-informed.
Behavioral psychologists have shown that when people feel fearful, anxious or pessimistic, warnings about the dangers that lie ahead sound smarter and wiser than alternate views that suggest more constructive outcomes. Alliance Bernstein recently sent a note to clients charting how the Dow could quietly reach 20,000 within five years. The reaction? Anger and outrage. Bernstein was flooded with complaints that they were naifs. Had they released a paper with the title "Dow 5000" they likely would have generated just as much reaction, but from clients wanting to know how to prepare for what seemed like a credible scenario.
What is interesting in this introductory column is how it is being presented. It is almost like a power elite dialogue itself, but one where the reality of fear-based memes is not recognized.
The dominant social theme might be characterized as "we have nothing to fear but fear itself." The subdominant social theme features, of course, the power of positive thinking.
The idea is to influence people's moods by positioning information in a certain way. This is the way the elites try to control people anyway, by playing on various emotional elements in order to encourage a commitment to globalism.
The rest of the article is a kind of rebuttal of the issues that The Daily Bell raises regularly. We won't take credit either for the issues or the rebuttals but the monologue is uncanny. Karabell writes about the election and then points out that the US government accounts for some US$6 trillion of "economic output" out of US$16 trillion.
As if anticipating criticism, he then writes (defensively, in our view), "Much of that $6 trillion is necessary and productive – it pays for schoolteachers, firemen, police, Federal Aviation Administration controllers. But even if you write that off as less productive spending, that leaves $10 trillion that has nothing to do with government."
After explaining the US fedgov is actually a modest beast, Karabell, is off and riding after government regulation. We learn that the emphasis is on costs rather than "uncalculated benefits."
But what is added to overall output by a judicial and legal system that enforces contracts? What boost is there to output because of rules against excessive pollution that reduce the healthcare expenses that would be required to treat those harmed? We are very good at looking at the inefficiencies and calculating the harm of over-regulation. We are less adept at weighing those against the benefits.
Finally we reach the so-called private sector itself. "Non-governmental activity remains incredibly dynamic." Of course, Karabell provides a sympathetic shoulder, explaining that the sector is full of "rapid change and disruption."
He admits that the West's labor force has been disrupted by private sector vertigo but points out that the flip side to stagnant wages and high unemployment is that billions of people in China, India and other BRIC countries are entering the middle class.
He concludes, "No one can say what the future holds, but the chances that it will see our fears realized only increase when the consensus is that they will be. We know the risks; it is time to pay attention to the possibilities."
Does Karabell really believe that people who are out of work in the West feel better that BRIC countries are doing well? Additionally, these arguments only confirm what we've pointed out previously, that the West is likely being torn down on purpose just as the largest part of the developing world is being lifted up.
The proximate cause is monopoly central banking that is capable of restructuring an entire society in only a few decades if the printing presses run hot enough and long enough. This is what took place in China and Japan and now India and Brazil. It must inevitably end in tears for it is a false prosperity that distorts society due to the great gouts of money that flow through the economy. Eventually, society cannot take anymore and the flood of money subsides. The prosperity is revealed as a kind of phantasmagoria and many industries are revealed as unstable or even unnecessary.
Economies are not in trouble because of irreversible globalist forces. The globalist forces are caused by great gouts of monopoly central banking money. What's going on in the world, in other words, is a kind of directed history. The powers that be WANT the current chaos and international leveling. This is not so much edgy as brutal. As for the optimism, it is best celebrated when one perceives that the elites' fear-based promotions are being pushed back.
Obviously, there is ongoing pushback or Reuters, a mainstream media sounding board, wouldn't be promoting "The Edgy Optimist."