There’s a new world being built. These are exciting times.
So, have you clocked how much the world has changed in the last few months?
I know it’s hard to keep track of. 2020 was such a roller coaster that most of us came out of it with no idea which was up.
(Just follow house prices. They’re definitely heading up.)
Anyway, one of the things that the pandemic has done is totally overturn the global economic order of things.
I know that probably sounds dramatic, but it’s actually hard to over-state how massive the change has been.
And I think the key signpost for the new world order is this quote from the most powerful woman in the world.
No, not Beyonce. I’m talking about Janet Yellen.
Until recently she was the chair of the Federal Reserve. Now, she’s Biden’s new Treasury Secretary.
(It’s fair to say she’s the most powerful woman in the world, right? I can’t think of anyone else that even comes close.)
Anyway, she’s laying out a pretty ambitious agenda. It’s active, it’s progressive and it’s green.
In just one paragraph in a recent speech she lays out the mission that she and the Biden administration are on:
… over the years, new problems developed that were not properly addressed. In the push to grow our economies, we neglected our environment. As we embraced new technologies, we didn’t do enough to prepare our workers and our education systems for the changes underway. While we embraced trade as an engine for growth, we neglected those who did not benefit. And in the most recent period, when we might have adopted policies at home to face these issues and joined with our allies to address issues abroad, we isolated ourselves and retreated from the international order that we created.
Over the last four years, we have seen firsthand what happens when America steps back from the global stage. America first must never mean America alone.
It is true that this is a political speech by a person in a political role. So there’s no surprises there that’s she’s sticking the boot into Trump’s “America First” version of isolationism.
So the last bit there is squarely aimed at Trump and his legacy within the Republican party.
But the rest of it is much broader, and is a criticism that could just as easily been levelled at Obama.
In fact, the anger that Trump rode into the White House precisely came from those that had been left behind by the rush to globalised trade.
Remember, in rust belt America, if you’re working class, your life expectancy has actually been falling in recent years.
The so-called “deaths of despair” – drug and alcohol abuse, opioid abuse, and suicide – were on the rise, as “off-shoring” hollowed out working class communities.
And as I said, working class life expectancy (those without a BA degree) has actually been falling:
That’s a terrible result in ‘the greatest nation on earth’. That’s a dismal failure.
But if working America was in pain, no one seemed to be listening. Democrats seemed to be off fighting for the rights of gay pandas in Tibet.
But then came Trump, and Trump seemed to get it. He wanted to make America great again, where great just meant that working class men weren’t dying lonely, broken deaths.
(It was a radical vision.)
But this totally blindsided the Democrats. They didn’t get that people were angry. They just thought that Trump’s supporters were neanderthal racists pining for the good ‘ol days of the KKK and lynch mobs.
They weren’t. They just didn’t want to see their loved ones cut down in the prime of life. They didn’t want to see their communities destroyed.
And they didn’t want to be called “deplorable” for wanting something so basic.
No wonder they were angry.
So Trump spoke to these people, and he channelled that anger and rode it straight into the White House.
But as George Bush famously said, “Fool me once, shame on you. Fool me twice and shame on… well you won’t do that again.”
The Democrats, at least on the face of it, have learnt the lesson. They’re listening now too.
Yellen’s statement here is that we now see the pain that was caused by neglecting America’s workers and neglecting those left behind by new trade orders.
And it’s time to do something about it.
Now, politicians’ promises normally aren’t worth the paper they’re written on, but when it comes to Janet Yellen, they’re actually written on about $5 trillion worth of new paper.
Fiscal spending is literally off the charts. It makes the response to the GFC look like a drop in the bucket.
Covid has given them the excuse they needed to open up the wallets and spend, but now they’re saying that it’s no longer good enough to just get the economy ‘back on track’ and back to ‘normal’.
There’s a new world to be build.
There’s a new world that that doesn’t destroy the environment. One that doesn’t leave working people behind. One that doesn’t see America retreating into isolationism.
There’s a new world to be built, and it’s going to cost a lot of money.
But Yellen’s got the money.
And she’s not afraid to use it.
This is nation-building stuff. Suddenly, and ironically, it’s the 1950s again, when the entire world had to be rebuilt out of the rubble of World War II.
And what followed then was a generational economic boom.
This is history repeating. This is America saying that we found the money to remake the economy in 1950. We can find it again now.
Let the generational boom begin.
If this doesn’t get you excited, you’re missing the point.