An Open Letter to the Next U.S. President

Dear Mr. President:

It has been my view for quite some time that the U.S. is in pretty bad shape. From the deteriorating economy to the questionable integrity of our financial institutions, from the faulty regulatory frameworks to the dumbing down of American culture, from our bankrupt policy towards the U.S. dollar to a deepening malaise from Wall Street to Main Street, things are looking quite bleak. But all is not lost; we are Americans. We are innovative and entrepreneurial. We can be tough (if pushed). We can come together (if compelled). And now is the time for us to be tough and to come together in order to rebuild our country, a country whose promise is far greater than the one I see today.

I think the most important thing you can do as President is to help us feel better about ourselves, and to help the world feel better about us. And I believe these two goals are pretty closely related.

What is hurting us now? Fear of inflation, stagnant economic output and joblessness. Nobody wants a replay of the 1970s. Or the 1930s, for the matter. One area that has gotten little press that threatens the future of our country and its prosperity is our crumbling infrastructure. A recent story in the Economist provided some startling and scary statistics: “In 2005 the American Society of Civil Engineers estimated that $1.6
trillion was needed over five years to bring just the existing
infrastructure into good repair. This does not account for future
needs. By 2020 freight volumes are projected to be 70% greater than in
1998. By 2050 America’s population is expected to reach 420m, 50% more
than in 2000. Much of this growth will take place in metropolitan
areas, where the infrastructure is already run down.” And the picture just gets worse over time. This is kind of like Social Security, in which our leaders have chosen to defer pain to future generations, without thought of how it might effect our children and grandchildren. The issue with investing in infrastructure is that it is an investment in the future, yet with benefits that can and will be enjoyed today. A massive program to rebuild roads, bridges and subway systems, to upgrade and expand airports, ports and waterways, would provide hundreds of thousands of good-paying jobs and drive local economies across the country. Such a program would have massive ripple effects on the retail sector, putting money in people’s pockets that is not driven by home equity loans but real, productive jobs. Further, such a program would lay a solid foundation for future growth, growth that if it were to happen in the absence of these infrastructure investments would put us on track to have conditions akin to a third-world country. These jobs would be a mix of manufacturing and service jobs, supporting our still-significant heavy industries with real work. Needed work.

Now all this investment takes money, and as you know, we are already burdened with a staggering external debt. This debt is particularly unpleasant because of the sharply falling dollar, which makes our creditors less likely to continue extending credit. But you know what - I bet that you could raise the money to do these investments without even batting an eye. Why? Because all of these investments make the U.S. a better - not a worse - credit risk, as it immediately stokes the engines of growth and further lays the foundation for continued healthy growth in the future. Invest today, get a lot more back tomorrow. But for this to fly, you need to keep your wits about you and keep taxes low, encourage capital investment. resist any protectionist tendencies and to foster good relationships with our trading partners. Any backsliding in this area and the whole thing will backfire on you. You can easily sell this to both Congress and the American people. And selling the bonds to finance such an endeavor won’t be much more difficult to our well-heeled, cash flush trading partners. Well, maybe a little more difficult, unless…

We do need to make some cuts to help finance this historic rebuilding initiative, to show our creditors that we can make tough decisions when necessary. What we don’t need is to cut spending on education, science and math programs, early-child support and core programs in the arts that help keep us rounded as human beings. We also need a cogent policy on supporting intelligent investment in alternative energy. What we do need is to cut military spending - dramatically. Not because we don’t need a strong military, but because we don’t need to be and shouldn’t attempt to be the moral compass for the entire planet. The previous administration drove a stake through the heart of our military, leaving an overextended, demoralized, undermanned, disorganized and fractured institution in its wake. Our massive overseas troop deployments and ongoing presence in Iraq is costing us hundreds of billions of dollars a year, dollars much better spent at home supporting the programs I outlined above. Are we really better off because of such policies, especially in a newly multi-lateral world?  I think you’d be well advised to consider a different mission for our military, one that puts it in the role of protector of U.S. interests, narrowly defined. We can’t turn back the clock on China - they have a role to play as a global force and will not be denied. Then you have Russia, India, the Middle Eastern economic powers and others wanting their seat at the table. We need to become a leader of, but also a true part of the global community. This requires a level of humility, poise and perspective we haven’t seen in a long, long time. This means sharply scaling back legacy military involvements that have their roots in World War II, and bringing lots of our fine men and women in uniform home. It also means rebuilding the command structure and morale of our troops, who have spent too much time fighting questionable battles that have left our proud nation poorer, weaker and more isolated than it has in generations. Our nation and our military deserves better.

I believe these policies will play well with the rest of the world, Mr. President. Not because it shows us in a position of weakness, but because it shows that we can take care of business at home, business that is key for the economic and political functioning of the world. We’ve been off the rails, and our enemies and allies alike have been acutely aware of this. It is time to reverse this perception, because the status quo is simply not sustainable. I do not wish to live through a slow, grinding decline of the U.S. as a superpower, both economically and militarily. You alone are in a position to stop this from happening.

I know this will be hard to pull off, Mr. President. Let’s face it; no matter what, you are leaving office with a trillion-dollar deficit and a global stage still in flux. The real question is how you are preparing our nation for the future. You will either be remembered as someone who had an historic opportunity in a rapidly changing world but chose to do nothing with it, or to make the hard decisions, stare fear and uncertainty in the eye and say “I am embracing the future. Not everybody will be happy today but subsequent generations will benefit from my bold actions.” I sincerely hope you choose the latter, Mr. President.

Best regards,

A Proud but Concerned American

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COMMENT:

AUTHOR: Anonymous Non-American

EMAIL: nihalf@gmail.com

URL: 

DATE: 07/09/2008 07:42:47 AM

Roger,

I have been a follower of your blog for a long time, and this is the first time I’m commenting - this is a great post, and one I’m truly glad to have read. I thought everyone in the world of finance were supporters of the Chicago School of Economics model that insists on the hollowing out of governments, as practiced so thoroughly by the current neo-con administration. The current state of world affairs makes it amply clear that Friedmanite economics have not only failed us, but bought us to the brink of a vast abyss (if we’re not already hurtling into it, that is) of economic, financial, political and ultimately social chaos. The world needs a return to Keynesianism, and if America leads the way on this, there is still hope.

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COMMENT:

AUTHOR: Steve

EMAIL: stevewhite00@gmail.com

URL: 

DATE: 07/09/2008 10:14:34 AM

This too is the first time I’ve ever posted, but my comment is not about this nice blog entry, instead it’s about the above comment which is laughable in its stupidity, hyperbole, and ambiguity.  Good grief.

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COMMENT:

AUTHOR: Dave Bacon

EMAIL: dabacon@gmail.com

URL: http://scienceblogs.com/pontiff

DATE: 07/09/2008 10:33:13 AM

Nicely said.

An interesting thought: your point about return on investment into infrastructure is a good one, and I wonder if one could try to quantify this in comparison to a second portion of your letter concerning military spending.  I mean, military spending does share a few of the same characteristics: it provides a good solid job, stimulates parts of the economy, etc.  But, unless one really buys into the notion that with our current military actions the U.S./world would be in grave danger, then it really doesn’t have the same sort of long term benefit (and I’d probably argue that current policy even exacerbates our economic woes by for example create instability in oil producing regions.  Probably also the fact that we have acted unilaterally is not wise economic policy: even if the action is necessary, the fact that Europe would benefit from this action without paying for it certainly doesn’t seem to be a wise economic move.)  

Of course really trying to quantify this would be hard, but it would be interesting to get a handle on order of magnitude projected outcomes, I think.

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COMMENT:

AUTHOR: Ross

EMAIL: ross.saldarini@mountainkhakis.com

URL: http://www.mountainkhakis.com

DATE: 07/11/2008 05:59:23 AM

Very well put.

It’s nice to see that someone who has developed and earned a reputation online for a (dare i say) ‘fair and balanced’ blog on various topics cultural and financial can also make a reasonable political statement… sad that it’s somehow today a daring move, but nevertheless, thanks for doing it and you put it very well.

John/Barack… take the sentiment to heart please.

-rjs

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COMMENT:

AUTHOR: dave

EMAIL: doleary@epiphanyresearch.com

URL: 

DATE: 07/17/2008 08:32:54 PM

Roger,

Sorry to hear the news re M110, looking forward to your postmortem.

Excellent insights in the post, well said.

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