The Decline Of The Blue Model
Look around and it is almost impossible to not realize that the Western world today is in a state of existential angst. Populists are on the rise, and to be labelled “the establishment” has become almost the kiss of death in politics. Tune into any talk show or audience debate panel and the anger and rage can almost be tasted as it simmers away in the background, only growing in heat with every passing moment. A great deal of this can be attributed to the atrocious decline in personal finances for far too large a slice of the population. People are worried about their state of employment and job prospects. Savings rates are far too low. Debt is far too high. The young fear they’ll never achieve the lifestyle and success of their elders. The old worry the life they have known will be unsustainable as they grow yet older.
This feeling of financial precariousness can be blamed to a large part on a seismic shift in economic circumstances that has come to a head in recent years; the old rules have fallen away and the new ones have proven to be far crueler. The old state of affairs, dubbed the “Blue Model” by The American Interest (who I cannot recommend strongly enough) which governed for most of the seven decades following the Second World War, were highly favourable ones for the West in general and North America in particular. Blessed with an unprecedented industrial competitive advantage which was combined with a youthful population and ever expanding markets across the world for goods and services, the economic boom times went on and on (brief hiccups here and there excepted of course). Good quality jobs were plentiful, even for those with only menial skills and education, and benefits and pensions were available to most with a social safety net there to catch those who fell through the cracks. The opening up of the wider world to trade and commerce brought on higher standards of living and greater access to consumer goods at a rapid pace, with what would be the ill effects coming much more slowly.
Inevitably, though, the good times came to an end. While fingers are pointed most often to the financial crisis of 2008, this in truth was only the crescendo of a wave that had long been building. Some of the factors to blame advanced so slowly it is understandable that they were missed until the onslaught was upon us, such as how the decline in birthrates and the advances in longevity turned the pillars of the welfare state into cement shoes of fiscal insolvency as the ratio of contributors to takers went from four-to-one to two-to-one with no sign of this trend abating. Others were more the result of willful ignorance. The opening up of ever more markets to trade brought undeniable benefits as goods and services became ever cheaper and more accessible as a result, but the uglier side was denied for the longest of times and still is today to some extent. The hollowing out of industrial manufacturing and workplace pensions and benefits due to ever increasing competition is a real trend in today’s workforce, as is the increasing rise of precarious service based positions in place of the lifelong factory jobs of old.
The problem posed by this is one that neither side of the conventional political spectrum seems able to fully wrap their heads around; what we hear instead is a great deal of willful ignorance and reheated leftover policy prescriptions from the earlier decades. The right continues to extol the magic formula of tax cuts, deregulation, and yet more trade agreements, ignoring that the problem for too many people is not that too large a slice of their paycheque goes towards income tax but rather that their paycheque is too small to begin with no signs of growing and that the availability of cheap Sony televisions and Mazda cars is of little consolation when they remain increasingly unaffordable to much of the population even at these reduced prices. The left continues to preach of the necessity of preserving government benefits and entitlements while pledging to offer even more in willful blindness to the fact that even the existing obligations of the welfare state are increasingly insolvent due to the coming demographic storm we face. Both are sadly illusions. While the reasons for our current economic malaise are complex, tax rates being too high and government regulations too stifling are not among them (and I say this as someone who has no love for either of those things). Similarly, the idea that financially insecure private sector workers living temporary contract to part time gig will ever stomach the across the board tax hikes needed to continue financing the lifelong jobs and gold-plated pensions, luxurious benefits, and bankable sick days of the public service is laughable (the mathematically impossibility of this being doable if only the rich paid a little more being equally farcical).
The reluctance of so many in the political class to address these realities is understandable. To do so would involve making some very uncomfortable admissions, not the least of which would be acknowledging some of the fundamental premises of the American Dream were just that, a dream that must now be woken up from. It would require admitting that the very brief period of tremendous prosperity and social mobility that followed the aftermath of the Second World War was an ahistorical blip and not in fact a permanent progression of society. Finally, it would result in questioning of the very basis of the model of widespread consumer consumption and indulgence that modernity rests on; a model that holds up the maximization of consumerism for every individual as the ultimate goal to civilization. Is it any wonder that the prospect of soul searching the very roots of the modern world is so daunting a prospect?
I will not pretend to know what the answers are to the present dilemma facing the Western world. Reforms to education and jobs training would doubtlessly be part of it. So to would be a reorientation of immigration policy away from the importation of millions of barely literate Mexican peasants or Muslim migrants as we’ve seen in America and Europe towards a more needs based process that prioritizes skills and capabilities. On a deeper level, though, it would also require a reflection upon values; a need to open our eyes to the reality that the system we have built of emphasizing the acquisition of stuff we do not really need or want to impress people we neither know or particularly like in search of narcissistic gratification is in fact a house built upon sand. By turning towards a more concrete and genuine set of measurements by which to access ourselves and our sense of worthiness we might prove far more fruitful in the long run than continuing to try and shore up the crumbling edifice of the post- World War Two consensus.