That Used to Be Us_ How America Fell Behind in thted and How We Can Come Back - Friedman, Thomas L. & Mandelbaum, Michael [11]
Charles Vest, the former president of MIT, observed that back in the 1970s and 1980s, once we realized the formidable challenge posed by Japan, “we took the painful steps that were required to get back in the game. We analyzed, repositioned, persevered, and emerged stronger. We did it. In that case, the ‘we’ who achieved this was U.S. industry.” But now something much more comprehensive is required.
“This time around,” said Vest, “it requires a public awakening, establishment of political will, resetting of priorities, sacrifice for the future, and an alliance of governments, businesses, and citizens. It requires truth-telling, sensible investment, a rebirth of civility, and a cessation by both political and corporate leaders of pandering to our baser instincts. Engineering, education, science, and technology are clearly within the core of what has to be done. After all, this is the knowledge age. The United States cannot prosper based on low wages, geographic isolation, or military might. We can prosper only based on brainpower: properly prepared and properly applied brainpower.”
If globalization has put virtually every American job under pressure, the IT revolution has changed the composition of work—as computers, cell phones, the Internet, and all their social-media offshoots have spread. It has eliminated old jobs and spawned new ones—and whole new industries—faster than ever. Moreover, by making almost all work more complex and more demanding of critical-thinking skills, it requires every American to be better educated than ever to secure and keep a well-paying job. The days when you could go directly from high school to a job that supported a middle-class lifestyle, the era memorably depicted in two of the most popular of all American situation comedies—The Honeymooners of the 1950s, with Jackie Gleason as the bus driver Ralph Kramden, and All in the Family of the 1970s, starring Carroll O’Connor as Archie Bunker, the colorful denizen of Queens, New York—are long gone. The days when you could graduate from college and do the same job, with the same skills, for four decades before sliding into a comfortable retirement are disappearing as well. The IT revolution poses an educational challenge—to expand the analytical and innovative skills of Americans—that is no less profound than those created by the transition from plow horses to tractors or from sailing ships to steamships.
The third great challenge for America’s future is the rising national debt and annual deficits, which have both expanded to dangerous levels since the Cold War through our habit of not raising enough money through taxation to pay for what the federal government spends, and then borrowing to bridge the gap. The American government has been able to borrow several trillion dollars—a good chunk of it from China and other countries—because of confidence in the American economy and because of the special international role of the dollar, a role that dates from the days of American global economic supremacy.
In effect, America has its own version of oil wealth: dollar wealth. Because its currency became the world’s de facto currency after World War II, the United States can print money and issue debt to a degree that no other country can. Countries that are rich in oil tend to be fiscally undisciplined; a country that can essentially print its own dollar-denominated wealth can fall into the same trap. Sure enough, since the end of the Cold War, and particularly since 2001, America has suffered a greater loss of fiscal discipline than ever before in its history. And it has come at exactly the wrong time: just when the baby boomer generation is about to retire and draw on its promised entitlements of Social