Economy & Budget

To make America great, we must prioritize the small

In the early days of our nation, Alexander Hamilton and Thomas Jefferson engaged in a vigorous debate over the future of our country. Hamilton believed that the federal government had to wield considerable power to steer a successful path for the country. Jefferson, on the other hand, argued for greater power to reside with the sovereignty of the states and the self-governance of the people. Hamilton thought that the future of the country was through commerce. Jefferson argued that supporting the established, agrarian economy embodied the identity of the country. 

Hamilton and Jefferson’s competing views on the identity and future of our country led to the first American political parties: the Federalists and the Republicans (later known as the Democrat-Republicans).

This debate has been embedded within the American political dialogue since the late 18th century.

{mosads}As we mark the midway point of President Donald Trump’s first 100 days, it is clear that we are at yet another inflection point in this great American debate. Therefore, it is important to pause, reflect and make sense of our time.

 

I want to speak to those who sit atop the power structures of our country, as well as to my generation: the sons and daughters of the baby boomers.

Many are concerned about the rise of Trumpism and the growing discord among our people.

Many others are concerned about the rise of elitism and growing disunity between the classes in our county.

These concerns, and the associated rifts, have permeated our institutions, our culture, our politics. But it is bigger than elites versus the people. It is now about a nation in crisis.

Former President Clinton recently stated: “We are all having an identity crisis at once.” In my view, he has it only partly correct. The United States is a nation in crisis and is having a crisis of identity. But it goes even deeper than that.

Our country is in the midst of a moral crisis — a crisis in which we know that people are being left behind by the changing economy. But to do something truly meaningful about it, those who are the beneficiaries of the changing economy believe that their interests will be harmed.

This tension has divided our country.

The political, economic, and moral question of our time is: How do we rebuild the foundation of our country and society?

Our country is suffering from the moral crisis of a “macro-opic” worldview. It’s a worldview that values the big over the small, the macro over the micro, the global over the local.

Those hurt by the changing economy believe that all that they hold dear — their livelihoods, their communities, their towns — are being phased out. And they view any future opportunities in the “new economy” to be fanciful. This worldview has fostered suspicion, resentment, fear and anger, and it is testing our republic and its institutions.

I believe “macro-opic” politics, policies and culture have had crushing impact on the foundation of our country. Further, I believe this outcome could have been avoided. We simply have not had the leadership in our country truly committed to the small: the basic economic, political and social units in our society, our small businesses, small towns and families.

The numbers tell this story as well.

The macro aspects of our economy and society remain robust and growing. The stock market continues on an upward trajectory, including the best winning streak in 25 years. U.S. GDP has grown every quarter since 2014.

Yet, the micro features of our economy — particularly in small towns — continue to stagnate. Here, the numbers tell a different story. U.S consumer inflation has been trending upward since 2014. Median household incomes dipped into negative territory in 2017 and remain at levels similar to the 1990s. Moreover, the consumer confidence index and sales of new, one-family homes are only now reaching 2007 levels.

What’s more, the differences between urban and rural communities are stark. According to the U.S. Bureau of Economic Analysis (BEA), in 2015, personal income, on average, rose 4.7 percent in the metropolitan areas; yet it only rose 2.7 percent in non-metropolitan areas. In addition, this same BEA analysis showed that personal income growth in 2015 ranged as low as -30.3 percent.

The United States cannot move forward constructively if the foundation of our country remains at risk and the divide continues to grow.

In the 21st century, globalization and localization are inextricably linked and intrinsically integrated. A great power like the United States cannot focus on the macro and not the micro. Building greater synergies between these levels in our society will be central to our long-term social harmony, political stability, great power status and prosperity in the 21st century.

It is time to re-focus our national politics and public policy toward rebuilding the micro, the local, the small. By rebuilding our foundation, we will renew our country.

However, this approach is going to require a new generation of leadership in our country.

We, the sons and daughters of the baby boomer generation, must lead this change. We are not beholden to the political dogma of the past. We have both a stake in the future, through our children, as well as great responsibilities to the past, through our parents. We are, therefore, in the best position to bring all facets of our society together and renew our country.

We must seize this moment. We must lead and not let our country further unravel. And we must reform — for reform will be the greatest contribution of our generation.

 

Alex Gallo is senior associate at the Center for Strategic and International Studies and served as a professional staff member on the House Armed Services Committee for five years. He is a West Point graduate and combat veteran and a graduate of the Harvard Kennedy School. His work has been published by The Washington Post, National Review, The Hill and Foreign Affairs.


The views of contributors are their own and are not the views of The Hill.