AMERICA

By stereotype, America is a pretty optimistic place. In my personal experience, I’ve found that to be true. Even in New York, which prides itself on being tougher than the sunny heartlands, half a dozen people urge me to “Have a nice day!” by the time I get to my desk each morning.
Yet this land of Disney and emoticons seems rather downbeat at the moment, particularly about its own role in the world. The post-cold war expectation of an era of easy and benign American dominance now looks hopelessly romantic.
A few weeks ago I heard an Asian Muslim diplomat tell a group of US policy wonks that in the wake of the war in Iraq and the treatment of prisoners in Guantánamo, his country now looked not to the US but to the European Union as its human rights model. If you like to think of yourself as inhabiting the city on the hill, that kind of comment really hurts.
Yet America’s battered global reputation isn’t the biggest source of domestic gloom. Even American elites have long been ambivalent about projecting their country on the world stage, after all, and, as we foreigners love to remind our US friends, an astonishing number of Americans do not even possess passports.
There is no such uncertainty about commerce and its central role in the nation’s life. I loved being part of Thanksgiving last week (despite grave miscalculations about turkey cooking time), but I must confess that “Black Friday”, the post-Thanksgiving retail bacchanalia, and its online twin “Cyber Monday” were celebrated with equal zeal.
Still, a lot of people are getting worried that America’s great capitalist engine is breaking down: the subprime crisis has infected much of Wall Street, house prices are falling, the dollar is tumbling and even the heroic American consumer may be retreating.
One sign of the new mood is that chief executives, the heroes of the go-go economic narrative of the past few years, are being knocked from their pedestals with a thud – the cover of Fortune magazine, which has often featured super-model style shots of business bosses, this month asks “WHAT WERE THEY SMOKING?” above unflattering mug shots of four erstwhile financial titans.
Even beyond Wall Street, serious Americans are starting to warn that there is something seriously wrong with their country. Subprime and the housing bubble, on this analysis, are manifestations of a deeper national malaise – Americans are great at consuming, but have forgotten how to study, build and invest.
As billionaire philanthropist Eli Broad told me last month: “Frankly, in America we’ve become fat, dumb and happy.” In his new book Innovation Nation, John Kao echoes Broad: “We are rapidly becoming the fat, complacent Detroit of nations”.
Part of what Broad and Kao are responding to is the rebalancing of relative global wealth and power prompted by the collapse of communism and the rise of emerging markets, especially India and China. This is the great good news of our age, but I understand how it can feel uncomfortable for America to adjust to being merely first among equals.
But they also are worried that something more dangerous than this flattening of the Earth is taking place. As Kao puts it: “Just as we are beginning to slack off, others are stepping on the gas”.
On this point, foreigner though I am, I’d like to urge them, and their fellow Americans, to be a little more, well, optimistic. It’s true that the balance sheets of the nation’s households, banks and, indeed, the nation itself are looking strained at the moment. And a few decades of prosperity have created a country which, as Kao notes, “spends more on astrology than astronomy”.
But America has one great strength that inclines me to bet that it will not only work its way out of the subprime mess, but also retain a comfortable position of global economic leadership. That strength is openness.
Russia’s Vladimir Putin is this week’s most egregious example, but he is not the only leader of a rising world power who fears openness. So do many of his fellow “petrocrats”, as Thomas Friedman has dubbed them, in the oil-rich Middle East, not to mention China, where, as a reader visiting Beijing pointed out to me in an email last month, the few copies of the FT that are allowed in sometimes have pages ripped out.
Openness is valuable in and of itself – once we are safe and fed, liberty is an enduring human need. But even if that sounds to you like the abstraction of a latte-drinking liberal, I think you will agree that openness – to money, to ideas, to people – is one of the most important drivers of which economies will flourish and which ones will founder in the coming century.
By all means watch how the subprime saga unfolds but, if you want to know if America will remain great, look to whether investors from Abu Dhabi remain welcome, college kids continue to found new Facebooks, and immigrants, for all the pre-election furor, continue to make their homes here