We're Headed for Hard Times -- Let's Use Them Well

My week started with an elegant lunch at our faculty club, at which our university president detailed practical consequences of the current financial crunch. I'm not revealing a confidence to say that we'll feel some pain. Across the country, university endowments are down. The credit crunch creates countless logistical problems. Students have greater need for loans which are suddenly harder to get. Inside our hospital, more patients are losing health coverage or shifting from nice private insurance to Medicaid. That hurts our bottom line.

Of course our university will be fine. We are in an incredibly stable industry. We have a multi-billion-dollar endowment. Many have it worse. Our students doing field work around Chicago tell of more renters facing eviction, for the usual reasons, but also because a notable number of landlords have financially imploded. On the personal front, I hear that giant sucking sound of my 401(k) losing years of hard saving in just a few weeks. Several friends are having trouble selling their homes. I'm suddenly very, very grateful that I have a tenured job.

As a nation, and as individuals, we are headed for hard times. Our next president will take office facing an economic crisis, having to preside over two wars, fighting to reverse a historic decline in our nation's global standing.

In so many ways, we face a reckoning for having squandered the times when we had it good. We enter this recession with a large overhang of public debt accrued through irresponsible and unbalanced tax cuts. We enter an era of high fuel prices having failed over a generation and more to address this obvious environmental and national security problem. We face decades of poorly-designed, poorly-maintained physical infrastructure exemplified by levees that broke in Katrina. Rattled into unwise policies by the 9/11 attacks, we face new threats having squandered a period of unprecedented supremacy. We have spent huge sums on the military. Yet we so badly mismanaged our planning and force structures that we compel overtaxed servicemen and servicewomen to serve multiple repeated tours. We might have created strong friendships and strong international institutions, to help us in a financial crisis, but we did not. Instead, our next president must build these relationships after our humiliating financial mismanagement has brought large losses across the globe.

The times are daunting. Yet they also pose a historic opportunity. The polls and betting markets suggest that Barack Obama will probably be our next president. We can't let up, but Senator McCain is being overwhelmed by an economy and party record too bad to defend, and by a Democratic nominee too good to defeat by the usual Republican means.

Senator Obama has run an astonishingly strong race. He brings charisma, but he brings a lot more. He brings an energized and disciplined organization that stayed on an even keel through the Rev. Wright crisis, that didn't get rattled by the bubble of Governor Palin, that remained steady through the string of late Hillary Clinton victories this Spring. He made some missteps, but stayed away from gas tax holidays and other gimmickry. The contrast with Senator McCain's erratic campaign could hardly be greater.

My first defining moment of the campaign occurred last Fall, though I wouldn't know it until later. I was at a small fundraiser headlined by David Plouffe. People asked how the campaign could possibly overcome Hillary Clinton's 25-point national polling lead. Plouffe calmly reported that he didn't care about any national poll, all of which would change anyway after Iowa. He outlined pretty much everything that subsequently occurred. At the time, I wondered what he was smoking.

My second defining moment took place watching the second Presidential debate. Senator Obama said simply, without euphemism or grandstanding, what needed to be said about American healthcare. Joe Klein, who has been great this year, summarized it best.

If Barack Obama is elected president of the United States on Nov. 4 -- a prospect that is beginning to seem likely now -- it may turn out that he closed the deal with a simple answer to a not-so-simple question posed by Tom Brokaw in the second presidential debate: "Is health care in America a privilege, a right or a responsibility?" ....

Obama began his response with a simple declarative sentence: "I believe that health care is a right for every American." The rest of his answer could be used as a template for how to deal with a complex issue in a town-hall debate. He began with a personal story: his mother, dying of cancer at age 53, having to fight her insurance company, trying to prove that her disease had not been a pre-existing condition. He broadened that into a general proposition about the proper role of government: "It is absolutely true that I think it is important for government to crack down on insurance companies that are cheating their customers." And finally, he transformed the issue into a metaphor for the entire campaign: "That is a fundamental difference that I have with Senator McCain. He believes in deregulation in every circumstance. That's what we've been going through for the last eight years. It hasn't worked, and we need fundamental change."

In these anxious times, that's a compelling message.

We have a huge opportunity over the next 24 days, not only to win, but to win this thing right, and to build a positive mandate for activist government. Tens of millions of Americans--forced to confront an upside-down mortgage, precarious job security, uncertain or lacking health coverage--are looking anew at the virtues of social insurance, whereby we use instruments of government to address risks that few of us as individuals, and no private market, can reliably tackle alone. I suspect some Chicago stock brokers are looking differently upon the struggles of the Pennsylvania steelworker or the woman with diabetes who lack insurance coverage, for whom economic crisis is no less painful but comes as less of a shock.

Some say that we must temper our aspirations because of the economic crisis. I disagree. Recession will drive millions of Americans into the ranks of the uninsured or onto Medicaid. Public hospitals and safety-net providers will be stressed at precisely the moment that states and localities are forced to enact new budget cuts. The necessity and the opportunity for a major breakthrough could hardly be greater. This goes beyond healthcare. We have huge social needs. We must repeal regressive Bush-era tax cuts to the wealthy, because we need the funds.

We must also use this time to address misplaced priorities in our personal lives and in our unwise and unsustainable consumer culture. We've been riding a consumption treadmill on which we put too many $5 lattes and costly toys on our VISA cards. We have borrowed too much for $45,000 weddings and granite-appointed kitchens while claiming we can't help 45 million uninsured fellow citizens. Our children marinate in a dumb media environment that perpetuates all this.

We also need a stronger call to service, overseas through the military, Peace Corps, and other public service, and here at home. I spend a lot of time at social service agencies, public health departments, schools, and hospitals that serve people who need help. Outside academic medical centers, I see conspicuously few graduates of the elite universities pitching in to help. For too long, we have denigrated and under-paid the people who teach our children, nurse us when we are sick, keep our schizophrenic loved one from becoming homeless. Far too many of our most privileged young people migrate to law firms and Wall Street. We all know this. Lawyers and investment bankers certainly do. That's one reason the attacks on Barack Obama as a community organizer fail to gather traction.

The New Yorker magazine captured what I believe in their elegant endorsement this week:

At a moment of economic calamity, international perplexity, political failure, and battered morale, America needs both uplift and realism, both change and steadiness. It needs a leader temperamentally, intellectually, and emotionally attuned to the complexities of our troubled globe. That leader's name is Barack Obama.

I've never been as proud to support a Presidential candidate as I am this year. We need to work hard over the next 24 days. I think we'll run through the tape as winners. We'll need that running start. We have much work to do.

Comments

[bakingmom]

Eloquently written. Thank you for articulating what I have been trying to say.

As someone who works in the mental health arena, I truly believe that hope resides in Hillary's allusion to the myth of the phoenix ~ something good rising from the ashes of the Bushes. I believe, though it will be painful and hard and heart-breaking, there is a confluence of forces that will shift our "consumer treadmill" culture to one that is potentially more compassionate and caring. If we could just shift our focus from caring about STUFF to caring about each other, I think (idealistically) the world could be infused with hope.

I felt a shiver of anticipation when O said that health care is a "right" ~ he clarity and his intellectual heft will be true leadership for a new day that dawns ahead.

[larry278]

I'd rather not use the melt-down to build my character & practice being serene in the face of adversity if it means watching more banks fold or seeing more people lose their jobs. What Prof Pollack sees as an opportunity, I see as a painful, needless sacrifice for Americans, the Americans who didn't wax rich by speculating on derivatives & other exotic financial instruments. The melt-down is a PIA, not Pakistani Int'l Airlines or Please inform Allah.

[Herders4Me]

>> I've never been as proud to support a Presidential candidate as I am this year.

[Wantowin]

There are times when you have to wonder why anyone in their right mind would want to be president of the US. Pollack ticks off a few of the problems that will confront the next president but doesn't begin to enumerate the many componenets of the disaster that awaits. I won't, either, but will remind evryone that yet again, the Republicans have accomplished pretty much of what their agenda has been all along, namely to bankrupt the federal treasury so the federal government won't have the financial resources to do any significant governing. This time, hovwever, they have underestimated the intelligence and resolve of the next Democratic president. and if there is any silver lining in this story it is that the nation is blessed that someone of the intellectual strength and political sophistication of Barack Obama is prepared to take on this very difficult job. He has the leadership qualities that will help to hold this nation together through what will indeed be very painful times. So leave your computers, get off your duffs and whever you are, go out and help register Democratic voters and make sure they get to the polls. And don't stop there. Volunteer, especially those of you with law degrees, to help on election day to make sure that those people actually get a chance to cast their ballots and that those ballots actually get counted.

[QualityCounts]

My moment of truth came in 2004. In 2000, I wrote a sad obituary for my rather promising Illinois State Senator's chances of ever achieving higher political office. He had just been crushed in a quixotic , poorly executed attempt to unseat a popular Congressman in a Democratic primary. Happily, I was proven wrong when, four years later, Barack Obama ran a text-book perfect campaign to capture the Democratic nomination for U.S. Senator with 52% of the vote in a seven candidate field.
So when Obama announced that he was running for President with every intention of winning, I took him at his word. Anyone who could learn as quickly and as well as Obama had to be taken seriously. During the dog days of August 2007, I remained convinced that Obama would win because he knew how to pick advisors and direct a movement better than any politician I have seen in more than four decades as a careful observer of local and national politics. I don't know how current problems will unfold or what new problems will arise for our nation in the next eight years, but I'll feel a whole lot more secure when I know that the person at the helm is looking ten steps ahead rather than two steps behind.

[Dynamohum]

I believe that Americans are in a collective denial about the state of their personal economic health. American families average $25,000.00 credit card debt alone. That doesn't include the mortgage, car loans and other expenses. People have been living way beyond their means for quite some time now. I watched from the sidelines, admittedly partially due to living on disability income. Because of my personal situation I have had to "Pay as you go" and I have ended up infintely more content and happier overall. It is even positively affecting my health. Imagine that, no credit, no self indulgence, no frills, fiscal discipline, community service, volunteerism and I am at least coping with my health issues.

What I have learned these past few years is community organizing and community service should be a compulsory civic duty. If there has to be incentives, then it should be basic things like work for college, work for whatever social benefit that one might need..

Every age and generation needs to be inspired by a leader like Barack Obama who has the vision necessary to direct us into the most beneficial changes that we desperately need. I have news for most of you, service to your neighborhood, your jurisdiction, your state, your country in all its opportunities and forms is what will breathe new life back into this country with the greatest potential. We have to stop living on past accomplishments and creat new ones.

[indygal]

I agree, Dynamohum, that we as a people have been living beyond our means for at least a generation. However, no matter how hard I've worked and tried to save to pay cash for my needs, I too have had to resort to credit cards (currently owing $18,000 and close to $20,000 in student loans). Without those credit cards, I could not have paid for my husband's dentures, two emergency room visits and doctor bills, eyeglasses, college textbooks, car repairs, or travel expenses (less than $1,000) to attend my son's wedding. In the last eight years I've had to liquidate my retirement account and deplete dividends from a life insurance policy just to pay our monthly bills. My highest gross income has been $30,000 during this time; my current is $15,000. I'm driving a 10-year-old car and buy most of my clothing in thrift stores. We are not extravagant by any stretch. Nothing has trickled down in our lives except more debt and less income to meet it. My husband and I are both hard-working, intelligent and frugal, so I know that no matter what happens, we will find a way to make do. We believe Sen. Obama understands our situation and will do everything in his power to improve the conditions we currently face. Sacrifice? It's a way of life for many of us.

[flatus]

I fell like i have a bush lodged in my throat. A raspy, prickly, irritating bush, I will be making grrraaah, grraaaah sounds until January when the damned thing will finally drop as a slimy, putrid wad onto the ground.

[HAP]

I know what you mean.

[TXfemmom]

I think many of the Universities and Colleges in the United States have been terribly irresponsible and poorly managed, and they need to cut out the fat and get back to educating our young people. Their rates usually have increased at twice the amount of inflation and it has to be scaled back.

Thick layers of administrative people need to be reduced, fancy faculty dinners and areas need to stop, and the money needs to go to education. Most have spent entirely too much on athletics and that needs to stop.

All of America is going to need to trim down to what we really need to have a future, and the Universities and Colleges cannot price our young people and the country out of a future.

[HAP]

We indeed need to reexamine how we do business. We should provide better value.

[Linda Bergthold - Huffpost Blogger]

Beautifully stated, Harold. The economic hard times are hitting everyone, but for those of us closer to retirement, it is truly painful to see those 401ks disappear like melting wax. I was thinking the other day how hard it will be for Obama to be President at this time in history, but also how much we need someone who is so calm and so unflappable. I wish he were stepping in at a time when things were better, but I can't think of a better person to be there now. I just hope that the hatred that has been stirred up will dissipate once he is elected! I know -- there is a lot to be done to make that happen -- but I am convinced he will win and I can hardly wait for November 5th to come!

[HAP]

Indeed. Tahnks for the gracious comment.

[Veryangryleft]

Thank you, Professor Pollack -- your sensible thoughts resonate with me. So glad you're on our side.

Obama/Biden '08

[HAP]

'wecome (:)

[jn123]

Amen!