Yesterday I observed here how the 2016 race reflects American conditions in the late 1970s — also stagnant — and how the political elites are echoing President Jimmy Carter’s feckless reaction in his notorious July 15, 1979 address to the nation in which he said, in part:
The threat is nearly invisible in ordinary ways. It is a crisis of confidence. It is a crisis that strikes at the very heart and soul and spirit of our national will. We can see this crisis in the growing doubt about the meaning of our own lives and in the loss of a unity of purpose for our nation.
The erosion of our confidence in the future is threatening to destroy the social and the political fabric of America.
What’s really going on? The destruction of our social and political fabric derives from stagnation, not vice versa.
My Letter to the Left: the Gold Standard Will Restore Upward Mobility was an analysis of an important piece by Stan Sorscher in The Huffington Post, itself headlined “Inequality — “X” Marks the Spot — Dig Here.” Sorscher perceptively wrote:
The second message is the very abrupt transition from the post-war historic period to the current one. Something happened in the mid-70’s to de-couple wages from productivity gains.
The third message is that workers’ wages – accounting for inflation and all the lower prices from cheap imported goods – would be double what they are now, if workers still took their share of gains in productivity.
Carter, confronting this, floundered.
Reagan, in an ad hoc way, fixed it.
That fix has unwound.
Malaise, “threatening to destroy the social and political fabric of America,” returns.
Either or both candidates can confront the source of the stagnation: Bad Money. Confronting it with authenticity and savvy can propel either into the White House.
One can well imagine how much better the political climate would be if workers’ wages — including yours and mine — were double what they are now. The Pursuit of Happiness would be going much better. We’d be a cheerful, not surly, nation.
Sorscher attributes the onset of stagnation to how our “moral, social, political and economic values changed in the mid-70’s.” This claim recalls the Japanese Imperial Navy submarine captain’s declaration that “the floggings will continue until the morale improves.”
The “values change” hypothesis is strangely reminiscent of, and just as wrong as, Jimmy Carter’s great “moral equivalent of war” MEOW. Let’s peek at the data.
Ralph Benko, internationally published weekly columnist, co-author of The 21st Century Gold Standard, lead co-editor of the Gerald Malsbary translation from Latin to English of Copernicus’s Essay on Money, is American Principles Project’s Senior Advisor, Economics.