The Triple Package (23 page)

U.S. public debt, which in 1980 was about 30 percent of gross domestic product (roughly the same percentage as in 1790), is today a barely graspable $17 trillion, over 100 percent of GDP.
America’s infrastructure, the physical embodiment of a nation’s capacity to invest in its future, was once the envy of the world; today, it earns a D+ from the American Society of Civil Engineers, including solid Ds for drinking water, hazardous waste, and transit. What’s most surprising is that America’s infrastructure
investment declined (as a percentage of GDP) even during the stupendous prosperity of the 1980s and ’90s.

In the 1960s, the insecurity created by the country’s rivalry with the Soviet Union drove the United States to stay ahead of the world in basic science and cutting-edge technology. Since then, American
research and development spending has dropped by over 50 percent (again, as a percentage of GDP). By 2009, Americans were
spending more on potato chips than their government spent on energy research and development.

Even as U.S. public debt skyrocketed, Americans’
personal savings rate dropped from about 12 percent in the early 1980s to 2.5 percent in 2009 (compared with a reported 38 percent in China). The drop occurred steadily and was not merely an artifact of the 2008 financial collapse.
Gambling has skyrocketed too, increasing an estimated 6,000 percent between 1962 and 2000. Drug habits that were still countercultural in the Sixties have become practically mainstream. Today, according to recent studies,
almost one in five high schoolers drink, use drugs, or smoke during the school day.

All these ailments are examples of gratifying present wants at the expense of the future. This trend is by no means limited to the poor.
Over half the students at America’s private high schools say that drugs are trafficked, kept, or used at their schools. A
study in California found drug and alcohol abuse higher among “upscale youth”;
adolescents in a suburb where the average family income was over $120,000 reported “higher rates of . . . substance abuse than any other socioeconomic group of young Americans today.”

Moreover, self-esteem parenting is much more common among wealthier Americans. As the principal of a Silicon Valley prep school put it, “
Avoiding discipline is endemic to affluent parents.” Psychologists are observing an
explosion of narcissism in America’s children, particularly among the better-off. The so-called
millennials—with their sense of entitlement, their expectation of being “CEO tomorrow,” their belief that the workplace should adjust “around our lives instead of us adjusting our lives around work”—are for the most part not lower-income or minority youth. They’re the
children of well-off white baby boomers.

As these children grow up and begin entering the workforce, they are not overwhelming employers with their attitude. “
Millennials don’t always want to work,” the consultant Eric Chester told Forbes.com, “and when they do, their terms don’t always line up with those of their employers. All too often, the young worker shows up ten minutes late wearing flip-flops, pajama bottoms, and a T-shirt that says, ‘My inner child is a nasty bastard.’ Then she fidgets through her shift until things slow down enough that she can text her friends or update her Facebook page from her smartphone.”

And the worst of it is that the demand for instant gratification has spread into our political and economic institutions.

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A
LL DEMOCRACIES RUN
the risk that politicians will focus on short-term gains, rather than long-term national interests. Politicians who want to get reelected have to satisfy their constituents now; the future is someone else’s problem. In this sense, the real question isn’t why the national debt has grown to its currently unthinkable proportions; it’s what kept it from doing so earlier. Part of the answer has to do with the surrounding culture and whether that culture promotes norms of restraint and responsibility, discipline and investment. In the 1980s and ’90s, American culture was not promoting those norms. The dangers of this development should not be underestimated. For politicians, even war can be a form of instant gratification; the grievous costs are often borne long after those who started it are out of office.

A false sense of security, no impulse control, and immediate gratification: these forces also played a part in the 2008 financial collapse. Instead of living within their means, average Americans—spurred on by
teaser rates and easy credit—
bought $500,000 houses with money they didn’t have and loans they couldn’t afford. Instead of following traditional lending practices,
banks offered mortgages to almost anyone who walked in the door, collecting fast fees and handing off the risk to someone else. Instead of exercising a disciplining function, credit-rating agencies earned hefty profits by awarding
AAA grades to high-risk mortgage-backed securities. Instead of providing long-term sound investments for their clients, Lehman Brothers, Bear Stearns, and other investment banks raked in billions by packaging these subprime securities into extremely complex instruments that masked their true risk, without bearing any of the long-term costs; as one financier would later describe these derivatives,
“
They could explode a day later and you are not impacted one single iota.”

The collapse of 2008 undoubtedly had multiple causes, including fraud, corruption, ineffective regulation, and old-fashioned greed. But to some extent it was a pure Triple Package implosion. At its heart was a bubble—the housing bubble—and as Shiller and fellow economist Nouriel Roubini have shown, every such “boom and bust” is fueled by
a contagious “excessively optimistic” conviction that the boom “will never end” and disastrous risks will never materialize. In other words, rather than being driven by
in
security, people were driven by a false sense of
security
. And because of this false sense of security, people threw impulse control out the window in pursuit of instant wealth. Those who—like Shiller and Roubini—counseled impulse control and insecurity in the years before the crisis were treated like
Cassandras.

Historians will long debate why Americans fell so headlong into the savings and loan bubble of the late 1980s, the dot-com bubble of the 1990s, and then, even after the bursting of those two, the mother of all bubbles in the 2000s. Without minimizing other causes, part of the reason is simply that America had lost the Triple Package, and this loss had infected the whole system. At every level of the economy, from borrowers to bankers to hedge-fund billionaires, people didn’t feel anywhere near enough insecurity or exercise anywhere near enough self-control. Thus America failed the marshmallow test—and paid the price.

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W
HERE DO WE GO FROM HERE?

To recover from its instant gratification disorder, America would have to recover its Triple Package. Throughout this book, however, we’ve stressed the dark underside of the Triple Package in many if its
forms. If, therefore, America is to aspire to a reinvigorated Triple Package, it has to be a Triple Package worth aspiring to. To that end, we close by addressing each element of the Triple Package in turn.

First, superiority
. This is the one Triple Package element America hasn’t lost. Americans still believe in America’s exceptionality. They still routinely and publicly call their country “the greatest nation on earth”—a phrase you’ll almost never hear Europeans (or anyone else) using.
Tony Blair once called the United Kingdom “the greatest nation on earth,” and the British press roundly lampooned him for it. By contrast, when Barack Obama said he believed in American exceptionalism “just as
I suspect that the Brits believe in British exceptionalism and the Greeks believe in Greek exceptionalism,” he was criticized for being insufficiently and inauthentically exceptionalist.

National superiority complexes can be a tremendous source of confidence, cohesion, and willingness to sacrifice. They are also among the most dangerous forces in human history. Nazi Germany had a whopping superiority complex. So did imperial Japan.

The only justifiable national superiority complex is one true to America’s constitutional ideals of equality and openness. America remains today the country most open to the talents and dreams of all. That is a superiority worth aspiring to—a superiority that includes rather than excludes, and at its best restrains rather than fosters imperialism.

This kind of superiority complex is not available to ethnic or religious groups, because they can’t open themselves equally to people of all backgrounds and beliefs. To do so would mean losing their identity. But again, America is not an ethnic or religious group. It’s a vast and diverse nation. In this respect, America has an advantage over its Triple Package groups. America can and must champion principles of equality and inclusion that ethnic and religious minorities can’t. But it’s precisely this equality and inclusion, on America’s part, that will
keep drawing Triple Package groups, with their tremendous economic energy, to America’s shores.

Second, insecurity
. Insecurity is in many respects destructive at the national level. For one thing, it too can make nations dangerous; the belief that “national security” is in danger can easily become a justification for cracking down on civil liberties or making war on the basis of unsubstantiated factual claims. Moreover, whatever it is that made the country insecure—the attacks it suffered, the economic threats it faces—will have exacted their own, sometimes dreadful price. Nevertheless, the Triple Package holds, in diametric opposition to self-esteem thinking, that adversity and self-questioning can be good things.

For most of its history America was an upstart, an underdog. Only toward the end of the Cold War did America emerge unrivaled, on top of the world. China is exploding today in part because it’s so insecure. (As China experts Orville Schell and John Delury put it, a deep sense of “
humiliation”—of being “stepped on” and outpaced by the West—has “served as a sharp goad urging Chinese to sacrifice” so that their country can recover its former grandeur.) China has the Triple Package in spades, with an outsize superiority complex, a Confucian tradition of impulse control, and above all a determination to prove itself once again to the world. What Americans needed in the 1980s and ’90s was
more
insecurity.

Thus the horror of 9/11, the unwon wars that followed, the rise of China, even the financial collapse—all this has had, paradoxically, one beneficial consequence: the return of Triple Package insecurity. But the insecurity Americans need is not one of fear or belligerence. Triple Package insecurity is the hunger to prove oneself, tempering superiority with the feeling that one is not, at least yet, good enough. Historically, the United States has risen to its greatest achievements when Americans have felt the call to prove their country’s mettle,
morality, and ability to win out over grievous challenges. Americans did just this after Pearl Harbor, when the country had not only suffered an attack on its soil but had barely emerged from the deepest depression in its history. For better or worse, America has that opportunity again today.

Finally, impulse control
. Going forward, impulse control may be the most important element of the Triple Package to focus on because it offers a path into the Triple Package for everyone, regardless of background. The Triple Package isn’t members-only. It’s not the exclusive property of Triple Package groups. The way in—not that it’s remotely easy—is through grit: by making the ability to work hard, persevere, and overcome adversity into a source of personal superiority.

This kind of superiority isn’t zero-sum; it’s not ethnically or religiously exclusive. It doesn’t come from being a member of a group at all. It’s the pride a person takes in his own strength of will and his own accomplishments. Like a national superiority complex based on equality, this too is a superiority worth aspiring to.

Born in the South Bronx to struggling Puerto Rican parents, Justice Sonia Sotomayor was not raised in a Triple Package group. Nor was she raised in a high-discipline, high-expectations Triple Package family.
Her father was an alcoholic, and her mother’s “way of coping was to avoid being at home,” Sotomayor recalls in her magnificent autobiography,
My Beloved World
. But Sotomayor—who
gave herself painful insulin shots for juvenile diabetes starting around age eight—writes that despite “the
fragile world of my childhood,” she was “blessed” with a “stubborn perseverance” and the belief that she could overcome whatever obstacles life threw at her. She wasn’t always a high achiever in school. But in fifth grade, she “did something very unusual for a child” and “
decided to approach one of the smartest girls in the class and ask her how to study.” Soon her teachers had re-seated her in the row “reserved for the top students,” and a few years
later she would be applying to Princeton—against the advice of her guidance counselor, who recommended “Catholic colleges.”

The point of this example is not, “See, it’s easy to climb out of poverty in America—Sotomayor did it.” On the contrary, Sotomayor’s story illustrates just how extraordinary a person has to be to overcome the odds and institutions she had stacked against her.

The difference between Triple Package individuals, like Sotomayor, and Triple Package groups is that members of the latter are pushed by family and culture to work hard and strive, whereas a Triple Package individual may have no resources to draw on other than his or her own. (As was true in Sotomayor’s case, a single relative or mentor
can make an enormous difference.) Sometimes Triple Package individuals may even be disparaged by members of their own group.

Many have drawn attention to an “oppositional” strand of contemporary black urban culture that disdains studiousness and “getting straight A’s” as “
acting white.” (Interestingly, however, Harvard economist Roland Fryer’s important 2006 study found that this
phenomenon did not exist at all-black schools.) But what’s rarely observed is the strangely parallel disparagement of discipline and academic striving that has emerged among America’s affluent classes.