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While the New Global View (NGV) that took form at Breton Woods during the closing days of World War II was very far sighted, there was a blind spot in the visionaries’ eyesight. This blind-spot led to a flaw in the foundation - a flaw that would not become obvious for a few decades.
America and the world suffered through the Great Depression of the 1930’s. It emerged from the Great Depression decade right into the Second World War. In less than five years America emerged from World War II as the major world power still standing on its feet, and a world leader.
The differences in the pre-war and post-war standard of living of the average American is staggering. A formidable middle class was born, and it prospered. For much of the rest of the war-torn world, the pre-war and post-war differences were none existent, or even negative.
That gap between the average American’s standard of living and that of much of the rest of the world grew enormous in the two or three decades following WW II.
The problem is that the planners and seers did not, could not, envision that unprecedented postwar American socioeconomic explosion, and that blindsided them. Their vision was necessarily constricted by their own experience. They based their predictions of what was possible in their post-war vision for the world on the model of their own pre-war experiences.
You can see why if you can look at the situation through their eyes. Their experience of the decade and a half preceding Breton woods was the foundation upon which they necessarily had to build their vision. The blueprint of that foundation was that of world-wide depression leading up to the most disastrous war in recorded history. It is little wonder that, despite their amazing foresight, they could not foresee what was to evolve in the post-war United States, Europe and Japan.
In the pre-war world, the socio-economic gap between the haves (America, largely rural, among them) and the have-nots in most of the rest of world wasn’t all that great. That unexpected post-war yawning gap, a gap that was much smaller in the planners’ pre-war experience, is important because the NGV was predicated on the much smaller historic pre-war gap. The laudable idea was that the whole world could be brought up to, or at least approach, the American standard of living in the post-war age.
Instead, in the decades following WW II, the “American Dream” that the rest of the world was encouraged to aspire to receded gradually into the distance for the world’s aspiring citizens as the American economy exploded. And that was the crack in the foundation of the NGV. That widening gap was to come back to haunt the NGV in about four decades.
And the leadership that inherited the plan, and the problem, was unfortunately not of the same stature as the planners.
To be continued …
Reference: The Rise and Fall of the American Middle Class: The Big Idea.
The Rise and Fall of the American Middle Class: A Faulty Foundation.
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Posted By: AZ Moderate Posted on: Jun. 19, 2006 at 8:28 PM  5 Comments
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Jun. 20, 2006 at 07:20:26 AM
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| For the record, I gave you a ten. Seems like you have many silent critics.
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Jun. 20, 2006 at 08:03:41 AM
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| Oh yeah, Breton Woods! Will one article in the series touch on the Gold Standard letting currency float against each other, and you'll of course need to get into the French Opting Out of Breton Woods (for all you average americans, thats what triggered the anti-French propaghanda in the early 60's). Income growth in the USA in 50's was phenominal, median income went from $2000/yr to 5000/yr! And all the manufacturing for the war was converted to peacetime uses, like new cars, and new stuff like plastic frisbees, and hula hoops. Also, if you could hit on the cartel system the USA imposed on all of our satellites, regulating commodity production, and how after Clinton killed those quotas what happened to farmers in Brazil, Venezuela and Central America. The coffee cartel, the cotton and sugar cartels all had to go to free markets. And this all ties into the World Trade Organization and the World Bank... and NAFTA and the Federal Banking System, and the Bank of England... |
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Jun. 20, 2006 at 10:22:45 AM
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| Yes, MoronInCharge, I have noticed the drive-by “silent critics”. I laugh at them. Hah! The subject stands on its own merits, and if it appeals to enough intellects here at VofA, the silent critics will be buried. But it would be nice to know what they disagree with in these History category articles. I have to wonder whose toes such articles step on. The articles are not political – not yet, that is. Perhaps the shadow people know where this is going … “Intelligent business models like this, enabled by the internet to make a reality, show the possible positives of outsourcing (although I should say that currently by law, all nighthawk services overseas reading for U.S. hospitals must be staffed by U.S. licensed radiologists).” Absolutely. But this is a minor positive for the American middle class. This doesn’t replace American radiologists, thanks to a law. Most “offshoring” supported by the internet does put members of the American middle class, and those who aspire to it, out of work. In the 1960’s I taught “computerism” in the Wisconsin Vocational/Technical/Adult education system (since renamed Community College for marketing reasons and snob appeal – but that’s another issue: see ‘From Vocational track to Baccalaureate Degree? That is the Question’ at http://www.voiceofarizona.com/content/p/5031/catid/12/artid/2250). I enjoyed prognosticating with my classes about where the industry was going. One of the things we foresaw was the possibility of using computer technology over phone lines (no internet yet at that time) to allow expert cardiologists in large medical centers to analyze the “country doctor’s” patient’s cardiogram. Such usage has indeed become common, but we never envisioned such work being done half a globe away. A major point with my theory is that the “level playing field” that was originally predicted to be at level comparable to America’s is in fact being degraded to a subterranean third (or perhaps second) world level. And that means the American middle class will become a shadow of its former self as “the middle class is expanding in other countries where there is a large, well trained, eager, and relatively inexpensive work force. It is rapidly shrinking at home.” Emphasis on "relatively inexpensive work force"! I say that the rapid shrinkage of the American middle class is planned by the power elite. Lack of investment in its workforce by Corporate America has been endemic since around 1980. And a lot of the knowledge and experience can only be obtained in the labs of the likes of Intel and Microsoft – not in the universities. Things simply change too fast. With apoplogies to Intel and others that still do invest in their American work forces, it’s simply cheaper to hire an H-1b professional from India (Google Tata Institute), or move the research to Ireland, and turn the American out on the curb. I’ve witnessed this trend up close and personal for 25 years as part of the computer industry. And Congress just keeps raising the H-1b quotas for their corporate masters. Americans are falling behind in the education race for a reason. … Read my articles for that reason. But don’t get me started... |
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Jun. 20, 2006 at 10:33:08 AM
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| Phaedrus, good topics all. There should be an Economics category here at VofA. That meta-topic could be explored at great length. It looks like you have put some thought and study into the topics that you suggest. Why don’t you expand on them? I will be embedding links to my ‘Confidence Game’ series in subsequent articles in this ‘Rise and Fall of the American Middle Class’ series. Some of what you suggest is addressed in this series for anyone that wishes to drill down on those links. The "Secret Memos" link at http://www.voiceofarizona.com/content/p/5031/catid/36/artid/2670 embedded in the first article does also touch on some of these topics in a tangential way. A congruent topic that I would like to spend more time on in the future is this: There were two embryonic elements that got this NGV off the ground; the Marshall Plan to help Germany, and indeed Europe, rise from the ashes of war that so completely buried it; the occupation, rejuvenation and return of Japan to her people. Lead by America, both of those defeated foes became beacons of democracy and economic powerhouses: Germany as a sparkplug to a war crushed Europe; Japan as a particularly close Asian ally and partner to the United States. The leaders of that day had vision far far superior to what passes for American “leadership” today. The baton has been dropped – and lost in the tall weeds of zealous agendas spawned of errant ideologies. But don’t get me started… |
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However, in my own experience, I can tell you that there are radiology "Nighthawks" that reside in Australia and Europe, who perform preliminary reads on emergent radiology cases using teleradiology, for U.S. hospitals after-hours. They let the U.S. radiologists get a full night sleep and come into work the next day fully alert and less apt to make mistakes. The Nighthawk radiologists are fully Board Certified, and licensed in the States that they cover by telerad. They perform their interpretations during their daytime, and are also wide awake and less apt to make errors. Such an outsourcing operation is considered a win-win situation for the U.S. radiology practice, the hospital, the nighthawk service, and the patient.
Intelligent business models like this, enabled by the internet to make a reality, show the possible positives of outsourcing (although I should say that currently by law, all nighthawk services overseas reading for U.S. hospitals must be staffed by U.S. licensed radiologists). The broader premise of "The World Is Flat" is that because of technology, with the world on a more level playing field, there is a massively expanding middle class. The catch is, the middle class is expanding in other countries where there is a large, well trained, eager, and relatively inexpensive work force. It is rapidly shrinking at home.
We are less able to compete in this new environment because we have priced ourselves out of the ballpark to provide reciprocal services; and sadly, our workforce is poorly trained relative to many other countries in Europe and Asia, and increasingly, the third world. The average student in any age group in Bangalore, India far exceeds his U.S. counterpart in math, science, and . . . English skills. This should stand as a striking denouncement of our dumbed-down society and failing public education.
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