Can We Replicate in the 21st Century What we Accomplished in the 20th? Not if We Handcuff Ourselves

Can the American republic replicate in the 21st century what its people accomplished in the 20th: widespread economic prosperity at home, the conquering of tyrannies and fascist ideologies abroad, the application of science to eradicate disease and improve life? These accomplishments took great efforts and costs, but the benefits were extraordinary. I have been optimistic my whole trend-forecasting career, but now it has become harder to be optimistic.

We come to the close of the first decade of the 21st century confronted by profound economic, social, political and international challenges. Of course we differ on what policies to pursue; that has always been the case. But now we differ on fundamental goals, purposes and world-view. We don't even agree on the positive benefits of pursuing prosperity through free-market, private-sector economic growth and development, or about conquering tyranny and fascist ideologies. And science, which used to be the objective pursuit of truth, has become politicized.

This is a very different world than that experienced by my parents. They experienced a “typically extraordinary” rags-to-riches 20th-century American story. Born around the time of the First World War to first-generation parents, they lived in meager circumstances and worked continuously and constantly from a very young age while going to school, and of course handing their earnings over to their moms to help cover expenses. (I remember my dad telling me one of his earliest memories is a paint brush in his hand and a rope tied around his waist, being lowered into a tight spot his father, a housepainter, could not reach.)

Dad worked his way through college and optometry school, attending nights and weekends to shorten the route; he wanted to be a surgeon, but this was the fastest path to being called “doctor.” They married young, started a family and moved to the suburbs. Dad started his professional practice and would work all day, come home for family dinner every night, then shoot downstairs and see patients until the rest of us were all in bed asleep. Mom was a wonderful homemaker to us four kids, and was also quite active in community and volunteer activities. When the last of her four kids was in middle school, she went back to work. At 50 years old she started commuting to New York daily, taking the bus into the Port Authority and then walking cross town to her job.

Yes, they lived the American dream.

Their legacy: putting all four of us through college (two through graduate school!), and watching all of us, all in long-time first marriages ourselves, do the same for our kids, their grandchildren. And giving us all wicked work ethics as well! Not bad, mom and dad, not bad. We could never thank you enough.

Could they do it again today? I wonder. They benefited from public education, public transportation, a military that kept us safe, and a free market economy that provided opportunity and rewarded work, thrift, and responsibility. That was a lot, but compared to today, that's limited government.

Housing
Mom and dad bought their house in 1946 for $30,000 and lived in it for nearly 50 years. They had to scratch together every dime they had to come up with the 25% down payment, and were lucky to get the loan at all (I remember my father telling me the loan officer got cold feet at the last moment). But it was a good bet for both the bank and my parents. Federal government policy promoted a stable family home market, stable house financing, a growing economy, private sector employment, etc. Local government was responsive and responsible; property taxes were reasonable. They paid off the loan early, and in what used to an American milestone, owned it outright (with no debt).

Today the housing market has been exploded, and then imploded. Government policies have promoted instability, speculation, leverage, unimaginable debt, and irresponsibility. Would I advise my daughter, at a comparable stage of life, to buy a home? Not in these circumstances.

Education
Dad graduated from City College in New York when expectations and results were of a far higher standard than what exists today. He went to the Southern School of Optometry because it was the cheapest he could find, with the shortest route to graduation. He worked his way through school when it was still possible to do such a thing; he did not go thousands of dollars into debt, let alone tens of thousands, to get an education.

Today the education industry has wildly inflated prices, and produces poorer results. Would I advise my daughter to go into thousands of dollars of debt to get a degree? Not in these circumstances.

Starting and running a business
Dad benefited from low barriers to entry and operation of private businesses. He was not inundated with laws, regulations, permits, fees, taxes and a minefield of liabilities covering every single action he could possibly take.

Today all businesses are. According to Philip Howard, chair of CommonGood.org and author of Life Without Lawyers: Restoring Responsibility in America, a flood of statutes, rules and regulations is killing the American spirit. Legal mandates have accumulated like sediment in a harbor, robbing small business entrepreneurs of the opportunity to serve us all by hiring, producing goods and services, and thriving.

Would I advise my daughter to start a business? Not in these circumstances. As Howard writes:

“Small business owners face legal challenges at every step. Municipalities requires multiple and often nonsensical forms to do business. Labor laws expose them to legal threats by any disgruntled employee. Mandates to provide costly employment benefits impose high hurdles to hiring new employees. Well-meaning but impossibly complex laws impose requirements to prevent consumer fraud, provide disability access, prevent hiring illegal immigrants, display warnings and notices and prevent scores of other potential evils. The tax code is incomprehensible.”

The very idea of progress today is slowly being strangled. In each of the examples listed above, all of which are keys to our future prosperity and well-being – housing, education, and small business – government intervention has made matters worse. Often designed, ironically, to help those who need it, government policies and programs have had a perverse effect, resulting often in the opposite of what was intended. These policies have stifled, not encouraged, self-reliance and self-sufficiency; have punished, not rewarded, thrift, responsibility and frugality; and have accentuated, not alleviated, poverty and inequality. And they have done so at a staggering cost to future generations.

And yet, on the other hand, this is still America
Despite these problems there are reasons to be optimistic about the American future. They include:

Would I advise my daughter to be optimistic, not give up, to go forward and work to better herself and her wonderful country by fighting to change harmful policies?

You bet I would.

I bid you a happy new year.

Dr. Roger Selbert is a trend analyst, researcher, writer and speaker. Growth Strategies is his newsletter on economic, social and demographic trends. Roger is economic analyst, North American representative and Principal for the US Consumer Demand Index, a monthly survey of American households’ buying intentions.

Photo: Paula Selbert was laid to rest at Riverside Cemetery in Rochelle Park, NJ on December 12, 2010, next to Harold, her beloved husband of 60 years, who passed away in 2003.