Excerpted From Eric Peters latest Weekend Notes.
“Mate, seriously, what the hell is going on with your country?” asked my old buddy, Sunny in Sydney. Spent the week in Australia. Singapore too. And in my decades of travel, discussions, debates, never has this one question dominated all others. “America has actually become the Gong Show!” he cried, pulling up his iPhone newsfeed, replete with porn stars, trade wars, revolving doors. Bump stocks and budget deficits. Rocket men and Dennis Rodman. “It’s better than it looks, but worse than it seems,” I said, shrugging, trying to shift topic. “What kind of bollocks is that mate? Give me a real answer!” he insisted. So I tried…
Imagine an Alien arrived just ahead of World War II. From space, it watched us spin. Americans appeared reluctant to fight. But they eventually obliterated the aggressors, who had themselves destroyed the developed world. Being the only nation left standing, America rebuilt both its allies and the vanquished from their ruin. Russia sealed itself for decades. China too. And this left America to recreate in its image all that remained. The pursuit was at once selfless and selfish. Well-intended, idealistic, magnificent, flawed, human. On balance the world welcomed the model, prospered, even though America prospered more. The nation became protector of the free world. After the Soviet model collapsed in 1989, it accepted a role as global policeman; an unsustainably expensive proposition. Year by year its debts grew as economic rivals watched their peace dividend compound. America used global trade to promote its model, and accepted trade terms that allowed every ambitious nation to catch up. America’s CEOs off-shored production, jobs, and transferred technology abroad to hit quarterly profit targets. Trade partners stole the nation’s technology too, and invested enormously in education, infrastructure, research, development – all things that America let dwindle. The Alien saw billions of humans lifted out of abject poverty. The species appeared more prosperous than it could have imagined possible amidst 1945’s smoking rubble. And it was true for everyone, except a growing group of forgotten Americans, who had been told by Washington’s elites that they were perpetually better off. They felt the opposite. They lived paycheck to paycheck, indebted. They heard the Chinese stole $1trln of their intellectual property, that Germans impose 10% tariffs on Ford imports, while America imposes 2.5% tariffs on BMWs. They felt cheated, disrespected, betrayed by allies and rivals. Having rebuilt the world, the Americans quit, and headed home.
Percent: “What if I told you that Trump was our destiny?” I asked Sunny in Sydney, still trying to explain America. He laughed. “I’m serious.” First, one simple stat. Roughly 50% of Americans with high-school or less education participate in the labor force. The other 50% don’t. The opportunities for them to retrain are severely limited. The impact on their communities and families is devastating. That kind of social decay quickly becomes entrenched. The chances that the children from these communities will live the American Dream is nearly zero percent.
Percent II: “Do you think a single establishment Democrat or Republican would have done anything to improve these forgotten communities or address the conditions that contribute to their problems?” I asked Sunny. He shrugged. “Zero percent chance,” I said. Not a single President or party has earnestly attempted to help these people in decades – which is why we’re here. Bernie Sanders would have tried, but establishment Democrats denied him a fair shot. Obama did not improve their lot. And the chances that Clinton would’ve helped are zero percent.
Percent III: “You know what frightens American voters?” I asked Sunny. “NRA?” he asked. They’re scared of becoming the forgotten people Trump talks about. They see technological disruption, driverless taxis, trucks, robo advisors, global supply chains. They’ve seen others displaced, outsourced, struggling to reinvent themselves as disruption creeps inexorably up the economic ladder. And they see the globalist political/business/central banking elites conspiring to stay on course. Enriching one another. Widening inequality. One hundred percent.
Desperation: “Know how you can tell Americans were desperate for change?” I asked Sunny. He shook his head. Trump jumped off that bus and grabbed 53% of the white women vote. Just imagine the landslide if an anti-establishment candidate had come along who had not ranked as the most ‘unfavorable’ in history? Now Evangelical Christians are splicing scripture to justify Stormy Daniels. America was crying out for a Trump. But the only choice we got was The Donald. And had we not gotten him in 2016, just image who we would’ve gotten in 2020?
Creative Destruction: “Want the good news?” I asked Sunny. He nodded. We’re not going to have a full-blown trade war. Did that once, 1930s. We’re broke, we can’t afford a war. We’re just shaking things up hard. Pulling back on global supply chains. Rebuilding some barriers. Charging people for stuff. Want military protection? Pay us for it. No more free riding. And we’re going to get our workers paid more. We’re going to rebalance the way we divide the economic pie. It’ll be messy. Ugly. And you better hope we succeed. If we fail, we’ll implode.
Creative Destruction II: “Want more good news?” I asked. We’re addicted to entertainment. And we have the most entertaining President in history. Which means we’re more politically aware/energized than ever. Trump inspired a sexual assault/harassment movement. 325 women are now running for US House, 72 seek reelection. 75 are running for governorships, 4 seek reelection. He’s inspired an impassioned debate about racism. Immigration. Division. Media. Guns. Trade. Inequality. Kids are engaged. It’s remarkable. Where will it lead? A better place.
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