03/29/2010 05:12 am ET | Updated May 25, 2011

The Real State of the Union

Friends, compatriots, the country is bankrupt. The state of the union couldn't be any worse.

We've managed, in the last twenty years, to squander prosperity, moral credibility, and the international legitimacy we won after the demise of the Soviet Union. Our lust for empire has led us to a dead-end. We can't deliver on the basics of a reasonable standard of living for most of our people. On the crucial issue of environmental catastrophe, we have ceded leadership, while we pursue terrorist demons and other illusory monsters. Our collective level of intelligence has plunged catastrophically. We have become a nation of idiots, the world's laughing stock, who'll pursue the most lunatic notions in the name of security and safety. So unhinged have we become in our pursuit of illusory profits that we have allowed the middle-class to be destroyed. There are the untouchable rich, and there are the oppressed working people--but there is little in-between, and democracy, as everyone since Aristotle has known, cannot survive under these conditions.

When I was elected, I promised change. That was mere shadows and mirrors, the kind of rhetoric I used then. Everything I pursued legislatively in my first year was an absolute continuation of the failed policies of the last several decades. Our economic power relative to the rest of the world was so great for so long that we could make terrible misallocations of resources and get away with it; but no more. The recession--it's actually a depression, since economic activity will lag for a decade or more--is a form of accountability for our past misdeeds.

You might think of me as the bearer of bad news, but actually I'm presenting the most optimistic vision for what's still possible for America. Both parties miss the point; the prism through which the establishment I represent views our problems and crises is entirely skewed, resulting in nothing more than fantastic impressions.

It's 2010, and the worst fears of those who were terrified by George W. Bush's ascendancy have been realized. America today bears little resemblance to the America before this decade, though we continue on as though we were the same nation. Every aspect of our life has been fundamentally perverted; it wouldn't be too much of a stretch to say that there exists a new American now: petulant, idiotic, irrational, therapy-seeking, victimized, unmanly, hysterical, inconsistent, terrified, obsessed, paranoid. This is not the kind of American who built this country. What happened to individualism? Why did we become such wimpy cry-babies, so that yet another pathetic loser, the underwear bomber, makes us scream to the high heavens for the institution of torture, indefinite detention, racial profiling--even if the economy grinds to a halt because of the overreaction. But we don't care, as long as we can hear a false promise that we can be kept eternally safe by our all-knowing leaders. People, this is not how a fearless democratic nation behaves--this is the behavior of gutless wimps.

To implement what I call the freedom agenda, we must end the misguided "war on terror" and all its associated errors. This means immediate withdrawal from Iraq and Afghanistan, declaration of neutrality in the Middle East, normalization of relations with Iran and other nations we've deemed hostile. Afghanistan is rightly called the "graveyard of empires." The last decade has drained us of surplus power. We have nothing to show for it, and nothing left in the tank. The current economic crisis is greatly related to uncertainty, lack of innovation, and misdirection of resources toward violence and fearmongering, instead of invention and productivity.

We have let the terrorists--whatever their actual strength might be--succeed beyond their wildest imagination. They have forced us to do precisely what we would be doing if we were bent on our fastest possible self-destruction. There is no significance to terrorists and their actual capabilities, given our overwhelming size and strength. Any successes would-be terrorists might have in causing destruction are an infinitesimal proportion of the number of daily casualties on our freeways or in our hospital emergency rooms. People, let us have some perspective. Some terrorists, sometimes, will succeed. That is no reason to abandon our commitment to liberty. We cannot run around scared all the time, suspecting our neighbors and anyone with the wrong accent or complexion.

That is a surefire way to grind economic activity to a halt. This goes for airline security checks, all the other useless measures we've implemented in our overreaction. We're checking the shoes of five-year-old girls at airports! This is the kind of overblown lunacy we expect in the former Soviet state--though I wonder if even they went that far. We're the laughing stock of the world with our exaggerated paranoia--as though no other nation ever suffered from terrorism or any other random casualties.

It's never too late to turn the page. All those who tortured in the past administration ought to be brought to justice, regardless of their position. We must admit responsibility for torture and other crimes against humanity, and make an example of those who dared to sully our name in the world with their zealotry.

We must return to innovation and productivity. Government cannot create jobs. Yes, I believe in Keynesianism, but there's a point beyond which individual enterprise has to kick in. How can the economic process get jump-started if the banks are failed, and can't lend money? The mistake was not to let a few of the big banks fail at the start of my administration. Would that necessarily have caused a global economic catastrophe? I don't see it that way now. We would have taken our lumps at the beginning, suffered a sharp downturn, and moved on. We don't need to preserve some particular banks in their particular form to have a successful economic system. What's happened now is that we've disguised the true extent of the financial problem--we've stretched it out to a decade, or perhaps longer than that. In any event, the only way to return to fruitful economic activity is to reduce unnecessary frictions, to eliminate the transaction costs for which we used to mock the former communist states; they used to make everything as hard as possible, while our virtue was the opposite.

We have turned away the best and the brightest of immigrants, made things as cumbersome for them as possible. Many of them head now to Canada, Australia, Europe--it's our great loss. We need to become totally welcoming to immigrants of every kind, from the unskilled worker to the most skilled scientist, if we are to have any hope of regaining our economic mojo. Without returning to full openness to immigration, we'll find ourselves a third-class nation in not much time.

The world is on the edge of a climate catastrophe, losing the physical basis for whatever made civilization and modernity possible. We have been the most irresponsible agents of this destruction. Our very way of life--Hummer-driving suburbanites shopping at Wal-Mart and Home Depot for unnecessary goods--is a plague on the planet, the only one we have. Among all our crimes, this exportation of an unsustainable lifestyle will be our most odious feature for future historians--if there are going to be any historians in the world we seem to be leaving to coming generations.

What is the significance of trivial policy disputes in Washington, when confronted with such a colossal threat to the very future of human civilization? Yet there is a way to be happy and to live fulfilling lives, without any of the accoutrements of what we take to be the American way of life. That way of life must end, if we are to emerge from our permanent state of grief and depression.

There is a real world, where we are the stupidest nation on earth. We fail to see what the rest of the world sees with regards to terrorism, climate change, our economic approach, whatever matters most. We have become full-blown Soviet apparatchiks in our enforcement of the norms of the new world of terror. We have taken leave of our senses. This is the real reason why we are in the economic slump--and it is likely to get much worse if we don't change our ways.

The kinds of policy details I'm being asked to confront are quite beside the point. People need to get well again, physically, spiritually, emotionally.

We don't need to force people to buy into a corrupt medical system whose only interest is to keep all of us chronically ill, to maximize their profits.

We have nothing to fear from immigrants; we are all immigrants, and those who are the most recent Americans have made the most visible contributions to carry the rest of us along. We welcome every hardworking, serious, intelligent immigrant from anywhere in the world. If you successfully go to school here, or if you have already shown academic success elsewhere in the world, you may expect immediate citizenship with full rights, without bureaucratic hassles.

We need to stop fearing globalization--we cannot go back to a world without outsourcing, without China and India knocking on our doorstep; it is our only salvation, in fact, if we are to avoid sclerosis.

We need to rethink, however, the economic challenge: it is not a matter of growing the pie, regardless of asking what's in the pie, whether it's just paper wealth going into a few pockets. We need to radically empower individuals to succeed in the world, beginning with a reallocation of resources to universal higher education.

The wealthy must be taxed at much higher rates, to equalize the distribution of wealth. Government's key function should be to equalize opportunity for all peoples, not to get in the way of those who want to get ahead.

We need to end the wars of empire, and take the lead in restoring our planet to health.

In short, we need to think like 21st century people who have put the barbaric past behind us, rather than washed-up hollow men and women, sorrowful, victimized, greedy, nostalgic, blind, egotistic, selfish. Nothing less will get us out of the mess.