Sunday, May 25, 2008

Why Confucius Can't Live in America

2007: for a political science class

(On the democratizing effects of the French Revolution): “It’s too soon to tell.”
Chou En-Lai

It’s amazing how many of these (Indian) kids know more about the United States than Americans do. They watch us closely because our futures are intimately linked, and they know it even if we don’t.
Prestowitz 99

The best part is that because individual Americans are not borrowing the money, they get to believe they are actually earning their high standard of living.”
Prestowitz 167

It is said that America is the world’s melting pot. Here, the Statue of Liberty for generations proudly stood watch on Ellis Island overlooking the East and New York Harbor with the words “give me your tired, your poor.” One of the country’s mottoes is “e pluribus unum” – out of many, one. The problem with America has not been her ability to incorporate the best of other cultures. She does that fairly well. The problem with America, in the third age of globalization, is that she cannot put a single-minded, Confucian-like devotion to improving herself while competing with nations that can. And that will be the defining difference in the next several generations. This inability to harness the strength of a Confucian philosophy as applied to economic strength, the general malaise and lack of discipline that grips America as a whole, and the colossal mistake of equating the views of Adam Smith with divine truth will all contribute to the fall of America to a position other than #1 in the next 2 generations, while China and India battle for that place.

Confucian philosophy is all-encompassing. It isn’t just about money and economics, it’s about an entire lifestyle. Asians are concerned about not making trouble for “the other”. For them, ideas like meiwaku (a shame upon a family, social group, or even society as a whole) and wa (harmony) have consequences. Meiwaku is precisely what cuts down on crime, illegitimate children, and rude behavior. In his book, Confucius Lives Next Door, author T.R. Reid relates being first confronted with meiwaku by a neighbor who (rightly) thought that Reid’s child was playing a musical instrument too loudly (68). This sort of confrontation, polite and hedged in the artifice of Japanese custom when correcting someone, would be unthinkable in the United States. The retort to any such confrontation would usually start with “No one’s going to tell me…” In the land of the Constitution, “the good of the many” doesn’t really matter if it interferes with my personal freedom and enjoyment. The Asians, on the other hand, are precisely able to limit their personal freedom and enjoyment so that the society may advance as a whole. The West might laud the stubborn individualism and ego of WWII generals like Patton and Montgomery. The East would quietly reply that Patton and Montgomery would not have traversed Europe and Africa alone and without their armies. Indeed, just as the notion of “many is more important than the one” is prevalent in China, the converse, “I’m more important than everyone else” is the watchword of this American generation. But, horrifying as it may be to admit, their watchword is lifted from the pages of the Constitution, which guarantees the pursuit of happiness to all – and what is the pursuit of happiness if it is not “doing what I want”.

The argument may be made, and with some merit, that creativity is stifled in an environment with near militaristic conformity. However, the work of creativity and artists who mold within its dazzling shell is funded by cultures and nations that have money. And money is gained through solid economic process. What is the good of having an entire army of “creatives” if there is no money to pay them with? Money is another problem.

The problem of money goes hand in hand with lack of discipline. Lack of discipline is different from the previous idea of ignoring the good of the many. Lack of discipline is not being inconsiderate of your neighbor in your pursuit of happiness, it is not realizing that you may not have enough money to pay for your pursuit of happiness. The recent rocking of the world financial markets (and the subsequent golden parachuting of numerous banking CEOs) was based precisely on Americans’ utter lack of context in their pursuit of happiness. Because they treated their home equity as cash, not as debt, they ran up an unprecedented amount of mortgage debt. There was so much mortgage debt, in fact, that a new kind of financial instrument was created, a so-called “mortgage-backed security” whereby whole groups of mortgages could be bundled together and then sliced up and sold, almost like stock. This was good until the money dried up, i.e. Americans ran out of homes to mortgage. This sort of societal problem is not just America’s fault, however. Financial markets as far away as Europe and Asia were rocked by this “American” crisis also, thus demonstrating the utter interconnectedness of the world’s current economies.

If Americans are taking out lines against their home, and no one is telling them not to, and other non-American countries encourage this behavior by backing their mortgages with cash assets, the problem is not solely “American”. It is endemic and systematic. It is the problem of capitalism.

Joseph A. Schumpeter once wrote:

Can capitalism survive? No, I do not think it can. The thesis I shall endeavor to establish is that the actual and prospective performance of the capitalist system is such as to negate the idea of its breaking down under the weight of economic failure, but that its very success undermines the social institutions which protect it, and inevitably creates conditions in which it will not be able to live and which strongly point to socialism as the heir apparent.

If Schumpeter is right, then America is not the only one to blame for the fact that Confucius would be denied a visa to come spread his philosophy in America (or perhaps, even were he granted a visa thanks to the help of the ACLU, no one would hear his message). It is the system that is at fault.

Adam Smith’s invisible hand attempts to objectify that which is fundamentally human. Economics may be a “dismal science” but it is at core powered by human beings. Human beings, for better or for worse, must operate within realms of morality, be it common sense dictums like “thou shalt not kill” to modern nostrums like “don’t drive drunk”. Yet Adam Smith pretended (and all have similarly followed) that economics is completely absent of morality. If an “invisible hand” guides the markets, how can it hope to be moral? So what if small mom-and-pop stores are crushed by Wal-Mart’s lobbying of local governments? So what if US-based corporations have no sense of corporate citizenship? These sentiments are best exemplified in the absolute ignorance and arrogance of these words: “Look, I’m a loyal citizen but what happens to the United States is not my job. I have a fiduciary responsibility to my investors. The guys in Washington are supposed to be worrying about the United States” (Prestowitz 148). “The guys in Washington”, my dear sir? They are elected by you, and the last time I checked, this was supposed to be a representative democracy, so you can take all your protestations of “loyal citizenship” with you to our collective grave as a country. Just remember that your “ficuciary responsibility” to your investors isn’t going to be fulfilled through a crashing, non-existent dollar.

In addition to buying into the lie of the “invisible hand” which, like a clumsy child, routinely brushes economies into boom and bust, as well as allowing the preposterous idea that economics has nothing to do with morality pervade our society, we compound the problem by allowing the dollar to be pegged to – a printing press. Ever since President Nixon removed our country from the gold standard, the US Dollar has been worth whatever we have said it was. Just like saying that a home equity line was “savings” instead of “debt” we decided to make our dollar a “credit card” and call it “cash”. This might be a feasible situation in the hands of a responsible government well in the hands of the people, but in a country with military presences on all 5 continents, with over 700 disclosed bases worldwide, the situation is beyond unfeasible, it is unbelievable – and more importantly, unsustainable, unless we believe that in making everyone love McDonald’s we have also bequeathed our poor math skills, and robbed other countries of the ability to do simple arithmetic and see we don’t have money to pay our bills to them.

In the final analysis, the question is not really whether Confucius could live in America, it is, would he want to? With our lack of discipline, our blind trust in an economic system that has taken us up and down (predictably, even!) like a roller coaster for centuries, and our lack of vision that prevents us from an all-encompassing, unifying step forward, it seems almost unsalvageable.

Yet, perhaps the words of Ken Elliott, a manager of a Hebron plant featured in The Toyota Way, can shed some light on a path: “We are not building a warehouse; we are building a culture…we have one shot at this to get the culture right” (Liker 186-187). The hour is late, but if Americans can understand the vision, the path will be clear. Otherwise, the path will lead down a freeway, to Ikea, to buy more furniture on credit.

Works Cited

Liker, Jeffrey A. The Toyota Way. New York: McGraw-Hill, 2004.

Prestowitz, Clyde. Three Billion New Capitalists. New York: Basic books, 2005.

Reid, T.R. Confucius Lives Next Door. New York: Random House, 2000.

Schumpeter, Joseph A. Capitalism, Socialism, and Democracy. New York: Harper & Row, 1962.

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