Getting Some Real Change from Our Stimulus Dollars

A New York Times article  (thanks to Tom Dow for pointing me to it) titled "The Big Fix" considers the current economic situation. In it we read:

In the early 1980s, an economist named Mancur Olson developed a theory that could fairly be called the academic version of Rahm’s Doctrine. Olson, a University of Maryland professor who died in 1998, is one of those academics little known to the public but famous among his peers. His seminal work, “The Rise and Decline of Nations,” published in 1982, helped explain how stable, affluent societies tend to get in trouble. The book turns out to be a surprisingly useful guide to the current crisis.

In Olson’s telling, successful countries give rise to interest groups that accumulate more and more influence over time. Eventually, the groups become powerful enough to win government favors, in the form of new laws or friendly regulators. These favors allow the groups to benefit at the expense of everyone else; not only do they end up with a larger piece of the economy’s pie, but they do so in a way that keeps the pie from growing as much as it otherwise would. Trade barriers and tariffs are the classic example. They help the domestic manufacturer of a product at the expense of millions of consumers, who must pay high prices and choose from a limited selection of goods.

Olson’s book was short but sprawling, touching on everything from the Great Depression to the caste system in India. His primary case study was Great Britain in the decades after World War II. As an economic and military giant for more than two centuries, it had accumulated one of history’s great collections of interest groups — miners, financial traders and farmers, among others. These interest groups had so shackled Great Britain’s economy by the 1970s that its high unemployment and slow growth came to be known as “British disease.”

Germany and Japan, on the other hand, were forced to rebuild their economies and political systems after the war. Their interest groups were wiped away by the defeat. “In a crisis, there is an opportunity to rearrange things, because the status quo is blown up,” Frank Levy, an M.I.T. economist and an Olson admirer, told me recently. If a country slowly glides down toward irrelevance, he said, the constituency for reform won’t take shape. Olson’s insight was that the defeated countries of World War II didn’t rise in spite of crisis. They rose because of it. 

This reminds me of something Rikkity has said - that people do not fear too much change, but rather too little change.  In every situation there is the absolute necessity of change.  Even when it appears that we are in stasis, it is because our changes and the changes of our environment are parallel and equal.  We live in an organic existence, so therefore change is central and essential to the very definition of  "being" and "reality."

We have become very adaptive to a certain level of change.  We do not normally sense the millions of skin cells which leave us every day.  The slowly shifting sands on the beach are not noticed moment by moment.

However, on a larger scale, we do notice change.  Change which we notice because the change is of such a degree (scale) or such a direction (difference) that it is not equal and parallel to our own changes is usually experienced in two ways:  loss and enhancement.  

We all know about loss: something which was in a certain way is not that way anymore.  When the path of that something began equal and parallel to us and then veered off, it feels like some component of the plane (temporal, spatial, emotional, spiritual) on which we exist is left us.  We feel like we are less than we were before because that something felt like part of us by its intimate similarity. 

The other side is enhancement: something which was not a part of us becomes intimately connected to our existence.  The path of something began separate from us, often unknown to us, but then becomes equal and parallel with our plane of existence, and it seems like it is us.  We fel like we are more than we were before.

People do not like the loss side of change.  People like the enhancement side of change. 

And too, too often, when societal systems (religion, politics, families) change they only go so far as the loss side.  Little changes.  As Frankie says in Rocky Horror Picture Show: Remove the cause, but not the symptom.

People fear that all they will know is the loss, with nothing of equal but different value to replace that loss.  You don't want to have a 12 X 24 X 6 foot hole in your backyard if that is all you have - but if you then get a swimming pool full of water in the place of the hole, that is another story.

We are ready to accept change which will move us to the enhancement side of the equation.

And this is what Olson is arguing.  We often hear people say "It is time to get this country back on track and we will do whatever it takes." 

NO!

It is time to get this country onto its new path (which may not involve tracks at all).  Don't start with the problem and stop with getting things back the way they were.  

Start with the vision of how things would feel better, enhanced, more expressive of the values which we hold as central.  Then ask which new and different paths would feel equal and parallel to those values.  Head in that direction.  

In the current challenge, we, the people, have a right to fear that government will only go as far as getting the DJIA back in the growth range and the unemployment numbers down and not really go the distance in which enough fundamentals have been changed that we all can feel like we have moved beyond what has gotten us into this crisis and that we are not "back to business as usual" but rather that we are "exploring the land of our dreams."

For every dollar we spend on stimulus, I hope we get back some big change.