Happy Days Are Here Again, Global Province Letter, November 10, 2010

It was the best of times, it was the worst of times, it was the age of wisdom, it was the age of foolishness, it was the epoch of belief, it was the epoch of incredulity, it was the season of Light, it was the season of Darkness, it was the spring of hope, it was the winter of despair, we had everything before us, we had nothing before us, we were all going direct to heaven, we were all going direct the other way - in short, the period was so far like the present period, that some of its noisiest authorities insisted on its being received, for good or for evil, in the superlative degree of comparison only.

---Charles Dickens, Tale of Two Cities

The American Century.  The Twentieth Century was America’s time in the sun, and now we have to see how the Twenty-First will play out.  As never before, we are running down our capital and frittering away resources on global and domestic adventures.  This obsessive profligacy could leave our well very dry by 2050.  Can we pull in our horns, allocate our bucks more fruitfully (n.b., we are piddling away as much in the private sector as in government), put aside willfulness in order to achieve our wishes through energetic cooperation, and make 20-year bets instead of 2-year gambles?  Ay, that is the quest! But this calls for an expansive spirit that’s not currently blowing in our winds.

The Two Rs.  As much as anything, the American Century was put together by the two Roosevelts—Teddy and Franklin.  Hailing from what was then the Empire State, they were the twentieth’s grand presidents, equipped with nimbleness, steadfast direction, and a witty loftiness of spirit that lifted America to higher plateaus.  We’re uncertain who was the bigger, because they both towered.

Happy Days. Isn’t it the cat’s meow that Franklin’s fight song from ’32 forward was “Happy Days are Here Again”?  This became the refrain of the Democratic Party, announcing that ever after things were going to get better because the Dems were in the saddle.  It took a little gall, in the middle of the Depression, for FDR and his party to crow that the storm clouds would go away.  But too, it was a sign that FDR, above all, had confidence in both himself and his society.  Just like the irrepressible Teddy.  Even now we can hear the merriment breaking out:

So long sad times, go long bad times
We are rid of you at last
Howdy gay times, cloudy gray times
You are now a thing of the past

Happy days are here again
The skies above are clear again
So, let us sing a song of cheer again
Happy days are here again.

Sweet Are the Uses of Adversity.  The value of all this reminiscing is to instruct us that all the whining of left, right, and middle in America—and in much of the world—will lead us nowhere.  America got out of the Depression because it got over its depression.  Even people of good will have gotten rather whingey lately.  To get anywhere, we need cool brains that can look more realistically at the facts of modern life while allowing our hearts to dance the light fantastic.  After all, we are not in a Great Depression. Luckily we’ve had good governance from the Obama Administration after devastatingly bad government under Presidents Clinton and Bush.   We could be in quicksand, but, thank goodness, we are just in a hole.

Bad times like these can give us enough clarity to finally bulldoze away the flotsam and jetsam that is blocking our road to the future.  We’re now producing a huge assortment of products and services we don’t need which divert us from productive actions.  As the distinguished former head of the Federal Reserve Paul Volcker has said, the only innovation worth a damn coming out of our banks over the last 30 years has been the ATM.  Both our commercial and investment bankers have ginned up all sorts of worthless products to pay their salaries. Their garbage led us into financial crisis.  Equally hollow products and services are flowing out of other sectors as well.  With some commonsense and good spirits, we might just put them all in the trashcan.  It’s time to make good things that we really need.

The Will to Believe. In 1896 William James authored “The Will to Believe.”   He was one leader in the pragmatic movement, America’s sole great contribution so far to philosophy.  James, who was beset by his own psychological demons throughout life, came to understand that we must have faith and believe in good outcomes on a host of metaphysical questions if we are to successfully truck with life and enjoy the happiness proffered by our country’s founders.

Broadly taken, his insights apply to our present circumstance.  We have the need to believe in our society, our universe, and ourselves if we are to have the fortitude to get across the potholes in our path.  Should we come to share the despair of our pundit community, we will go nowhere.  If we believe in inertia and the corruptness of society, we’ll come to a halt.

Melville, who had a trying career and who often harbored gloomy thoughts, owned up to the need for faith and belief in his last and best novel—The Confidence Man. Therein is a widely quoted passage where a traveler advises the skeptical how to get along in life:

   "You are an eaves-dropper."
   "Well. Be it so."
   "Confess yourself an eaves-dropper?"
   "I confess that when you were muttering here I, passing by, caught a word or two, and, by like chance, something previous of your chat with the Intelligence-office man; -- a rather sensible fellow, by the way; much of my style of thinking; would, for his own sake, he were of my style of dress. Grief to good minds, to see a man of superior sense forced to hide his light under the bushel of an inferior coat.
Note: [24.6] -- Well, from what little I heard, I said to myself, Here now is one with the unprofitable philosophy of disesteem for man. Which disease, in the main, I have observed -- excuse me -- to spring from a certain lowness, if not sourness, of spirits inseparable from sequestration. Trust me, one had better mix in, and do like others. Sad business, this holding out against having a good time. Life is a pic-nic en costume; one must take a part, assume a character, stand ready in a sensible way to play the fool. To come in plain clothes, with a long face, as a wiseacre, only makes one a discomfort to himself, and a blot upon the scene.
Note: [24.7] Like your jug of cold water among the wine-flasks, it leaves you unelated among the elated ones. No, no. This austerity won't do. Let me tell you too -- en confiance -- that while revelry may not always merge into ebriety, soberness, in too deep potations, may become a sort of sottishness. Which sober sottishness, in my way of thinking, is only to be cured by beginning at the other end of the horn, to tipple a little."

Darwin’s Happy Marriage.  In all of this, we may take a lesson from Charles Darwin, who gave us evolution and who is, even today, so decried by creationists who are unable to experience religious sentiment and still allow for all the contradictions in life.  We learn that he had a fulsome life and even wrote better books because he made room for at least the possibility of a god, all because of his wife’s beliefs. From a review of Deborah Heiligman’s Charles and Emma we learn that “In today’s climate of division between religion and science, it’s instructive to read about a marriage in which the two cultures improved each for exposure to the other.”   Emma’s strong religious belief and his devotion to science happily co-existed under the umbrella of their marriage.  Modern life, from the Renaissance forward, has presented us with a choice between lots of contradictory notions. The happy man must live with the ambiguity, enthusiastically giving some credence to opposed ideas. In physics, likewise, we just have to endure the notion that light may be a particle or a wave.  One-track minds, on the other hand, lead to pinched nerves and bitter moods. 

Cognitive-Behavioral Therapy. As well, we have come to realize that eclectic and even somewhat contradictory theories must go into the stew that will fill our society’s need of a digestible cure for a raft of mental and emotional afflictions.  In our current world mental depression has become epidemic and traditional Freudian analysis has been too slow and too expensive to deal with the afflicted body politic.   The rush into drugs, meanwhile, has left the nation rather comatose and stuck in 4th gear.

C-B Therapy, particularly espoused by psychologists who have to be more practical than traditional shrinks, has proven reasonably effective for dealing with a host of complaints.  Interestingly, it takes quite a different tack from traditional analysis in which the patient tries to spew out every complaint, fear, and embedded mental blockage.  Venting is shelved by the psychologist while the patient tries to slay his dragons by confronting them.  The patient, in this approach, becomes much like the happy warrior who tries to surmount difficulties by jumping over them.  Action replaces griping.  The change of heart America needs to make probably involves a similar facing up to one’s challenges.

Cheerfulness Breaks In. The delightful Angela Thirkell, a manneristic and prolific writer about small-town England throughout the first half of the 20th century, wrote one novel that speaks to the dilemma we are considering here. In Cheerfulness Breaks In her ensemble of characters deal with the coming of World War II  (“of course, it will never happen”) and the comings and goings in a village as young men are carried off to London and the fields of war.  What’s key is that everybody shoulders the burden well, goes on with life, and even has parties and sprinkles of light amidst the storm.  There are constant spots of cheer to include several engagements and marriages.  Dastardly people and no-gooders such as the Gissings eventually disappear and never really manage to soil the community.  That is, the heart of the people is in the right place. 

P.S. The economy is getting better despite the political paralysis that has seized our Congress.  Both the rate of hires and loan levels are rising, and for now at least, we look to be in recovery.  And some smart money is shifting from over-priced bond markets to under-priced stocks.  It is most encouraging that the president’s trip to Asia is regarded as an economic mission

P.P.S. Incidentally, it would seem that the much-maligned Rick Wagoner at GM had done 80% of the work involved in turning around GM, before financial engineer Rattner and the Federal Government stepped in to reconstruct its balance sheet. Read Gladwell on this. Both the reporters and politicians missed this fact. Much of the good that is occurring in our society never makes it into our media, which earns its keep by reporting on all that’s bad.  One wonders if the media is almost singularly responsible for our despondent mood: certainly Rupert Murdoch owns the worldwide franchise on toxic thoughts.

P.P.P.S.  The Giants took the World Series.  The team was made up of a bunch of castoffs, carefully selected by a general manager who knew great things could happen if his players were in the right clubhouse.  By their own description, they were “a bunch of misfits.”  But they took the Series and lighted up San Francisco, a miracle in a California that has been taking its knocks for quite a few years now. Teams, and towns, and countries turn around when a punch-drunk people gets up off the mat just one more time and stages a knockout.
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P.P.P.P.S.  In our consulting practice, we are currently focused on morale rather than tactics.  The mindset within enterprise has to shift.  For 20 years, businesses have been engaged in an orgy of cost-cutting which means that meager people have been running the railroad into the ground.  This has stopped business dead in its tracks.   Private enterprise now needs to undertake doable growth with builders, not eyeshades.  As they said in Bull Durham, it’s time to move up to “the show.” 

P.P.P.P.P.S.  A few decades ago an old friend of ours Crosby Kelly was brought back into Litton Industries to give it a shot of viagra. It had taken a nosedive, and emergency management measures had to be taken.  Litton, you will remember, was the granddaddy of all the LIDOs, a bunch of companies that went on acquisition binges and pumped up their stocks through fancy accounting.  Crosby was a sometime Ford dealer in Cuba, a pr man, and many other things---a true impresario.  He brought in a fancy whiz-bang consultant from Chase Bank who basically told people that Wall Street inevitably linked their stock price to their cash flow.  We asked Crosby whether the consultant was worth the money. “Oh, he was all right, saying the obvious.  But his patter did get our executives to stop looking at their shoelaces and start dealing with people eyeball to eyeball.  He helped get them out of the dumps.”  That says volumes about what it takes to do a turn-around.

P.P.P.P.P.P.S.  We are much too consumed by 9/11.  Rather we should focus on 11/11.  That’s Armistice Day (called Veterans Day now by some, Remembrance Day by others).  Armistice Day “commemorates the armistice signed between the Allies of World War I and Germany at Compiègne, France, for the cessation of hostilities on the Western Front, which took effect at eleven o'clock in the morning—the "eleventh hour of the eleventh day of the eleventh month" of 1918.”  It’s about the hard-won peace coming on the heels of an interminable war which seemed like it would never end.  The world had moved on, even though it seemed that it could not and would not.

P.P.P.P.P.P.P.S.  Financial services have gotten out of hand and now account for a huge percentage of our economic activity.  Finance, in other words, is squeezing out the parts of our life that put cars in our garage and chickens on the dinner table.  There’s even a term for it: financialization.  Worse yet, there is consolidation in the sector which means that our economy is increasingly at the mercy of a few big, under-regulated financial institutions.  The small banks that help small businesses and private citizens are under siege.  This is a huge example of the mis-allocation of resources in our economy.

 

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