Far too fat and far too spoilt: Why America has lost its way in the world

The government may be inert and paralysed, but the society itself is full of energy. What is needed is to get in place the policies and incentives to unleash and channel that energy

TO JOIN the US Army, candidates have to take a test. In it, they are asked questions such as: “If 2 plus x equals 4, what is the value of x?” In December 2010, a study revealed that nearly a quarter of applicants failed the entrance test. They couldn’t answer basic reading and maths questions. In fact, in another army study released the year before, it was reported that 75% of Americans, between the ages of 17 to 24, were ineligible to enlist because they had failed to graduate from high school, held a criminal record or were physically unfit.

This is from the country that put a man on the moon. America today is sick — its economy is wrestling with recession; it is mired in debt (over $14 trillion according to a recent tally); and it has been surpassed by China as the world’s leading manufacturer.

Thomas L Friedman, who has won a clutch of Pulitzer prizes, and his friend of over 20 years, Michael Mandelbaum, a professor of international relations at Johns Hopkins University, have had a look at the patient and come up with a prescription entitled, That Used To Be Us: What Went Wrong With America — And How It Can Come Back.

The rot set in with the demise of the Soviet Union. The Cold War had kept the United States on its toes. “It made us serious,” says Friendman. “We basically had ‘a greatest generation’ that was born into the Depression, raised in World War II and then matured in the Cold War. They were serious people. They would never think for a second to close down the US government, let alone for a week or a month. They believed in save and invest. They’ve given way to my generation, the baby boomer generation, raised in prosperity, lived in ‘the peace dividend’, that believed in borrow and spend. We have not been good stewards.”

The United States is, of course, also a nation at war. An indication of the spendthrift nature that Friedman refers to is the fact — quoted in their book — that in every major war the US fought during the 19th and 20th centuries, Americans were forced to pay greater taxes. This has not happened with the wars in Afghanistan and Iraq. The tabs for them have been astronomical, in the trillions, not to mention the pensions of disability benefits for invalided soldiers which will have to be paid out over decades.

“It’s certainly been costly,” admits Mandelbaum, “but it should not be thought that America’s fiscal problems are due mainly to military expenditures. They contribute, but there are other causes of our present and future deficits that are even larger — the Bush tax cuts; the Medicare Prescription Drug Benefit; and the recession, which has caused a huge drop off in tax receipts combined with the programmes undertaken to deal with the recession and the financial meltdown.

“And the biggest cost is a prospective one — the cost of healthcare and pensions for seniors as the baby boom generation retires, the 78 million-strong Americans born between 1946 and 1964, and that age cohort begins to retire this year. The bad news is that the biggest cause of the deficit lies ahead.”

Worryingly for Americans, their party political system is ill-equipped to deal with this massive problem. In a book brimful of ideas, one of the most interesting sections of That Used To Be Us, analyses the logjam at the heart of American politics. The polarised, point-scoring behaviour of Democrats and Republicans has crippled the country’s decision-making. A filibuster, for example, is a delaying tactic used by the opposition party to delay the passing of a bill. From 1955 to 1961, only once did a vote have to be called to end a filibuster. In 2009 and 2010, this happened 84 times.

“Our political system is now dysfunctional,” says Friedman. “My parents had a happy marriage, but I had a lot of friends whose parents were divorced and I knew what a black cloud that put over their life — to always watch their parents squabbling. Well, that black cloud is over our whole country today.

“We need a grand bargain to cut spending, to raise revenues and to invest in our economy again, not just because it’s the right way economically. Because we have lost the confidence that we can still do big, hard things together. That loss of confidence is itself holding the economy back.”

The authors, interestingly, don’t share many of their compatriots’ fixations with China. The Pennsylvanian governor Ed Rendell, for instance, exploded after the postponement of an NFL game in December last because of a severe snowstorm. Organisers were worried about fans travelling in icy conditions. “We’ve become a nation of wusses,” he fumed. “The Chinese are kicking our butt in everything. If this was China, do you think the Chinese would have called off the game? People would have been marching down to the stadium ... and they would have been doing calculus on the way.”

The Chinese, argue the authors, have fundamental flaws in their system, including a lack of freedom, rampant corruption and an education culture that impedes creativity. Instead, the United States needs to look inwards. They outline a five-point formula for revival with an emphasis on education; research and development; infrastructure; immigration and regulation.

“If you were to design a country to thrive in the global economy of the 21st century it would be the United States,” says Mandelbaum. “It has open markets. It welcomes immigrants. It fosters innovation. It has close collaboration between its universities and its private sector and it has a lot of entrepreneurial energy.

“There is enormous energy, enormous creativity and enormous drive in the country. If you want to be optimistic about America, stand on your head because when you look at the grassroots, it’s so much more vibrant than it is in Washington. The government may be inert and paralysed, but the society itself is full of energy. What is needed is to get in place the policies and incentives to unleash and channel that energy.”