A New American Bumper Sticker: 'Pence In 2017'

Most of our trips back to the United States involve long discussions with friends and family about activities of one’s children and grandchildren, what one does – or does not do – during retirement, travel plans and the amazing places – Siberia, New Zealand mountains, Antarctica, etc. – where they have been. “If we don’t do this now, when in God’s name will we do it?” seems to be a common refrain among the 70-year-olds. This time was different. It didn’t take 30 seconds for the conversation to turn to the one topic riveting America – the incredible spectacle of Donald Trump in the White House.

Granted, our travels were through the Bluest of Blue areas of New York and New England. But every conversation quickly became a series of “Have you heard the latest?” tales of stupefying behaviour by Trump and his close circle. Even perfect strangers get into the act. As our bus rattled down 5^th Avenue in New York past the Trump Towers the elderly couple sitting behind us started muttering about the ‘embarrassment’ in the White House. “Can you believe that clown,” they exclaimed in loud tones to no one in particular. “Whatever happened to the dignity of the Office of the President?”

 

Does he have a clue what he is doing?

One old friend who has been active in fund raising for senior Republicans at the national and state level could only shake his head in dismay. “Wanting a change from the Big Government trend of Democratic administrations is one thing. But the sheer incompetence and nonsense coming out of the White House are quite another. These guys have no idea what they are doing.” He took another healthy slug of wine before reiterating the familiar litany of juvenile behaviour – daily Tweets replacing policy making, indefensible claims of illegal voters or Obama wiretapping, fixation with inauguration crowds, the travel ban fiasco, and many others. “His school yard antics are destroying whatever legislative agenda he may have had,” he said.

Another said there were two possible approaches. “Look,” he said, “the guy is the president of the United States. And we have to help him succeed for all our sakes. Just hold our noses and try to help.”

But, he hastened to add, no one in the Trump circle seems open to such help. “The better option,” he admitted, “is to have Trump realize he is in way over his head and leave office as soon as possible for a return to television and real estate. To this end, I have prepared a lot of Pence in ’17 bumper stickers.”

Politics aside, what struck us the most about the entire Northeast region was the sheer vitality, the obvious prosperity, the focus on the future. Tradition is what you had for breakfast.

New York and Boston have had their ups-and-downs, and I have lived through some pretty depressing economic times in both cities. At one time, I remember that a taxi medallion cost more than a seat on the New York Stock Exchange. The head of the Off Track Betting operation took out large billboards claiming investors had better odds at the race track than on the stock exchange. He wasn’t wrong. Now, signs of an economic boom – from construction activity, crowded museums and restaurants, bursting show rooms – are everywhere. Despite the general frustration and sheer embarrassment with Trump, the people we met were generally optimistic about the economy.

I grew up in northern New England and spent several years in and around cities like Boston and Providence at a time when traditional industries like textiles, shoe manufacturing, or small highly skilled machine shops were leaving for cheaper labour in southern states. We used to call it the Revenge of the Confederacy. All that remained were the massive, empty shells of factories and warehouses. To add insult to injury even the Navy pulled out of several locations.

 

An empty mill from 1960s New England

Now, I scarcely recognize places. Construction programs throughout the region underpin an economy already buoyed by high value-added elements like education, health care, finance, and high tech. A once run-down section of Cambridge has been turned into a global research center feeding on the talent from universities like Harvard and the Massachusetts Institute of Technology. A short walk along any of the streets in Cambridge or Boston reveals the utter foolishness of Trump’s fear of immigration. We couldn’t count the number of languages we heard just ambling among the buildings and laboratories. He may not like it, but cutting down on immigration would be like cutting off the blood flow to America’s brain.

Despite the hustle-and-bustle of big cities, visitors can still find charming traditional New England towns desperately trying to slow down the remorseless clock of progress by rebelling against certain aspects of modern life. For example, cell phone reception in these towns is spotty at best because locals don’t like the intrusion of cell towers. In Woodstock, Vermont, visitors from the U.K. will feel right at home in a wonderful B&B run by a British couple who offer a breakfast designed for homesick guests – complete with Marmite, the ‘full Monty’, or a bacon ‘butty’.  

 

U.K. visitors will feel right at home in Woodstock, Vt.

Another unforgettable ‘charm’ of New England is rapid variation in weather. Mark Twain had it right when he said, “If you don’t like the weather in New England wait a few minutes.” Within the space of 24 hours the temperature dropped from a relatively balmy +15˚C to -15˚C – which was actually much colder with a roaring northerly wind. Nice to be reminded that nature pays absolutely no attention to ephemeral things like politics.

We Have Seen This Bad Film Before

Financial markets were crumbling. A seat on the Stock Exchange costs less than a taxi license. There was a sense that the centre could not hold against:

·                    Uncontrolled expenses

·                    Declining revenues

·                    No access to debt markets

·                    Powerful vested interests blocking any changes

·                    Fraudulent accounting

·                    Soaring deficits

·                    Near bankruptcy

Athens in 2012? No, New York City in 1975. After wrestling with these conditions for years the city faced the very real prospect of default on its bonds and bankruptcy in 1975.

Rating agencies had downgraded the city’s debt. The banks were unable to find any buyers for the debt required to roll over New York’s obligations. On top of this the state and federal governments had turned down any additional assistance on the grounds that the city first had to get its own financial affairs in order. Essentially the city was threatening the state and federal governments with the potential chaos of a huge municipal bankruptcy unless it got the required aid. The state and federal governments, for their part, were using the lever of potential aid to force the city to make hard choices.

New York On A Chilly Day

This stand-off culminated in the refusal of President Gerald Ford to give federal aid in October 1975 and the classic New York Daily News headline the following day. Ford to City: Drop Dead.

Change the names and you have the current stand-off between Greece and the European Union. But there is one major difference. In 1975 New York was fortunate to have several brilliant financiers and a strong governor who were given the scope to devise a bold, imaginative program involving compromise, increased state control of the city’s finances, additional state aid, and, ultimately, federal assistance. There are undoubtedly equally brilliant financiers inside and outside Greece willing to help. But, for now, they are on the sidelines while official Greece and the European Union offer only a collection of midgets who confuse self-defeating micro-measures with the bold reform required to pull Greece and the rest of the EU out of a downward spiral.

On the night of the Daily News Headline, financier Felix Rohayton was having dinner with Governor Hugh Carey at the restaurant Elaine’s in the city. When he heard of the federal rejection Rohayton recalls “I thought it was the end of us. But he (Carey) thought it was the beginning of winning. He was right.” Rohayton was to lead the Municipal Assistance Corporation set up by the state to raise money for the city. The Emergency Financial Control Board was established to bring order to the city’s chaotic financial management. The unions saw the light of day, and finally compromised on job cuts and salary adjustments.  The rest, as they say, is history. New York regained its fiscal balance and went from strength to strength – even overcoming 9/11.

What is so troubling about the Greek situation is the how rhetoric is getting further and further away from reality. The electoral fortunes of the Greek political party Syriza have risen sharply as it attacked the ‘barbarous’ conditions of the memorandum accompanying more than €100 billion in aid. The conditions are indeed tough, but then the hole that the Greek state dug for itself is very, very deep. The party makes no mention that this assistance, however tough, is keeping Greece afloat right now.

Syriza has cleverly and successfully changed the terms of the debate from overdue reform of the Greek state to the supposed evils of the Troika (European Commission, IMF, and the European Central BNK). Just listen to one Euclid Tsakalotos who calls himself an economics professor at Athens University.

“That isn’t the Europe that the original inspirators (?) of Europe imagined. We’re demanding a more democratic, a more social and a more just Europe.” Forget the fact that Greece is not in a position to demand anything, this whining and pugnacious attitude is not going to help Greece very much even if it finds some support in Europe.

Not a word here about the desperate need for structural changes in Greece. He simply wants the northern Europeans to hand over billions more in assistance without any annoying conditions. He completely ignores the inconvenient truth that without those painful changes Greece cannot possibly recover whether in stays in the Euro or not.

The pity is that many of these structural changes do not involve vast amounts of money. But they do involve taking on very strong vested interests like the bloated civil service, professional organizations, and even academia that have stifled growth and change in Greece for so long. It is these changes, far more than the abused and hated ‘austerity’ that will help Greece get on its feet.

Sadly, the rhetoric on all sides dances around this point. Syriza clearly doesn’t think they are important. The Germans prefer to force Greece into an ‘austerity’ program before focusing on the deeper structural changes. Only IMF Director Christine Lagarde recognizes the importance of reversing the order of austerity and structural change. But she was overruled by Chancellor Angela Merkel who faces an electorate furious at giving another of their precious pfennigs to Greece.

It would be nice if Greece and the EU could take a page out of New York’s book and come up with some bold decisions that actually address the whole issue of the viability of the Euro itself. Otherwise we may well see a Greek headline: Merkel to Greece: Drop Dead.