Last week, I wrote about my new hero, Ben Bernanke, Chairman of the Fed. A quietly brilliant economics professor, Bernanke's research focused on the history of the Great Depression. Following a crash precipitated by wild speculation, Bernanke came to believe that the business people and government of the time (the 1930s) did almost everything wrong.
What should have happened, he believed, was that more money needed to be pushed into the system, keeping people employed and products flowing. Instead, banks tightened up, the Federal Reserve of the time kept interest rates high (to avoid the non-existent problem of inflation), and the result was a decade of joblessness and abject poverty.
What are the odds that a scholar of that period should happen to preside over the Fed when history's dice rolled up precisely the same numbers? And have the courage to meet the challenge?
We got lucky.
So Bernanke applied what he'd learned. Interest rates dropped to almost zero. What is now called "the great bail-out" kept afloat a financial system whose collapse would almost certainly have led to Depression.
Since then, I've talked to a lot of people who still resent the bail-out. It didn't help when businesses offered multi-million dollar bonuses to the same people who got us into the mess. But let's be clear: the alternative was Depression.
Bernanke now warns us that one of the big problems we face is businesses too large to fail. Their sheer size, the interconnectedness of commerce across the globe, means that one collapse triggers others. That's sage advice. Fixing it will be complicated.
Now all of this leads me to my second point. It came up when I was talking over lunch about Tom Brokaw's profiles of, first, the "Greatest Generation," and second, the Baby Boomers.
After a lot of consideration, Brokaw labeled the Boomers "Unrealized." Their big dreams didn't come true.
Speaking as a Boomer myself, I would have used a different label. I would call us the Self-Centered Generation. And it speaks directly to the whole issue of today's profoundly anti-government rhetoric, now so common that it passes for truth.
The Greatest Generation, revered because they are mostly gone, were institution builders. They presided over the military, government, and big business. They applied collaborative intelligence to solve big problems.
The Boomers, by contrast, were and are institution destroyers. We can't collaborate to save our souls -- indeed, saving souls is just another example of how we tear institutions down (see the decline of mainstream churches, and the rise and likely fall of mega churches).
I sometimes believe that the anger of Tea Party activists comes down to precisely this. Just as Boomers were back in the 60s, we're by God angry at the Establishment. The problem is, now it's our establishment.
We're the ones running everything. With all the power in the world over the past decade, we proved incapable of maintaining either peace or prosperity. That starts to look like incompetence. It's enough to make you angry.
And the inhumanly ugly faces and voices of adults shouting at each other resembles nothing so much as the tantrum of a 2 year old who wants what he wants right now, even if it isn't possible. Especially then.
The enemy is not business, not government. The enemy is our startling inability, both as a generation, and as humans, to build and sustain institutions, either business or government, whose work we can respect.
But just as we need business to ensure quality of life, and the joy of productivity, we also need government to build the infrastructure -- physical, intellectual, and regulatory -- in which business can thrive.
We need long term thinking and it's in short supply.
So here's my big point: Institutions are necessary, both public and private. They are also interdependent. Let's hope that by and by a "greater" generation comes along again to show us how to run them.
Meanwhile, thank God for Ben Bernanke, a man who understood the value of his institution, and did the job it was made to do.
---
LaRue's Views are his own.
No comments:
Post a Comment