On Governance

Those who aspire to “right speech” often measure their words with four questions: Is it true? Is it kind? Is it necessary? Is it the right time? Right speech should not escalate conflict, but it doesn’t retreat from necessary truth, and criticisms don’t always seem kind. The question of right speech is the question of how one might best serve others. Criticism with the intent to offend is not constructive, but silence is equally detrimental when it quietly endorses a pattern of offense, or encourages the silence of others.

Those of you who have followed my work over the decades know that I look at the world holistically in terms of the interconnection and responsibility we have toward others, and I’ve never been much for separating “business” from those larger values. After all, most of my income regularly goes to charity, and nearly everything that remains follows our own investment discipline. Whether my comments on matters like peace, civility, economic policy or governance are well-received or not (and I'm grateful that they have been over the years), there are moments when one has the responsibility to speak if one has a voice.

Our country faces many legitimate political disagreements. There are segments of America that view government as too bureaucratic, see foreign trade as a source of job insecurity, value national security as a priority, believe that each country has the right to a national identity, and feel that even a nation of immigrants has limits on the pace at which it can assimilate new citizens. They feel that their interests have been subordinated to an elitist philosophy that presumes that regulation is always beneficial, and that government always knows best. We can engage honestly and in good faith about those concerns, even where we disagree. Political issues like that are best settled not by insulting each other, but by openly expressing and listening to the values and concerns of each, and constructing solutions where each side might concede or trade various lower priorities, so that both can achieve their higher ones.

From my perspective, the problem isn’t politics. A civil society can work out those differences. The immediate problem, and the danger, is the mode of leadership itself. A leader can call forth either the “better angels of our nature” or the worst ones. I am troubled for our nation and for the world because of the example of coarse incivility, mean-spirited treatment of others, disingenuous speech, thin temperament, self-aggrandizing vanity, puerile character, overbearing arrogance, habitual provocation, and broad disrespect toward other nations, races, and religions that is now on display as our country’s model of leadership. I am equally troubled by emerging risk, discussed below, to the Constitutional separation of powers.

My intent is not to insult, but rather to name the elements of this pattern. Even in the face of our differences, it’s important that we refuse to resign ourselves to passively accepting or normalizing this model. A dismissive regard for truth, civility, transparency, ethics, and process is dangerous because it lays groundwork and creates potential for unaccountable, corrupt and arbitrary government. I believe that the people of our nation are both decent and vigilant enough to openly and loudly reject this behavior even where they might agree with various policy directions.

There is no changing the outcome of what was already a dismal choice for many Americans, but we can insist on rejecting a model of uncivil behavior. It is unworthy of emulating for ourselves, much less for our children. To minimize detestable behavior is essentially to condone it. It is the refuge of cowards to defend obvious offenses by deconstructing them (“He wasn’t belittling a disabled person. See? He’s waving his hands while belittling this person too”), or to condone predatory behavior toward women by diffusing responsibility (“Yeah, but that other guy was also a predator”). Our intolerance for such a tireless pattern of offense shouldn’t depend on our race, or gender, or ability, or political views, even among those who view the man as a means to achieve political ends.

With regard to international relations, the intentional provocation of both allies and trading partners is of deep concern. One might allow a generous interpretation that these provocations are intended to create new bargaining chips for use in trade negotiations (e.g. insulting Mexico, taunting China about Taiwan and the South China Sea). Yet even setting offenses aside, the associated protectionism is misguided economics, particularly at this point in the economic cycle. Given U.S. labor demographics, even a 4% unemployment rate in 2024 would bring average annual civilian employment growth to just 0.4% annually in the coming 8 years, while a 6% unemployment rate would place intervening job growth at just 0.2% annually. All other economic growth will rely on productivity growth (output per worker). The primary determinant on that front will be growth in U.S. gross domestic investment (GDI). Because of savings-investment dynamics, steep reductions in the trade deficit have always been associated with a collapse in U.S. GDI growth. Put simply, this new trade strategy courts recession or worse. That’s particularly true given a speculative financial bubble resulting from Federal Reserve’s misguided dogma that zero interest rates would bring prosperity without consequence. We now face the third financial collapse since 2000 (more data on that below).