Reflections on deindustrialization and the legacy of the New Deal

There are a few things that I'd like to talk about.

First, most of my senior friends come from my college years. They all could read and write English very well back then. One of them told me, it's quite a challenge reading your daily post.

I don't think it's because I use too many fancy words, but rather because they stopped using the language after retirement and their skills have simply become rusty. Another asked me, why I write in English? So that my children can read them.

I hope my senior friends could keep using English. It's supposed to be good for their memory and cognitive health, helping to keep their minds sharp and engaged. Regularly using and practicing a second language can also delay the onset of dementia, improve multitasking skills, and enhance problem-solving abilities. Moreover, maintaining their language proficiency allows them to stay connected with a broader community, access diverse information, and enjoy a wider range of media.

Second, there's another book recording the heart-breaking impacts of deindustrialization 产业空心化 (chǎn yè kōng xīn huà). Exit Zero: Family and Class in Postindustrial Chicago by Christine J. Walley. The steel mill in Southeast Chicago where her father worked abruptly closed and then more of the same happened, followed by the decline of steel industry, which prompted her to research on this from an anthropological approach. The book delves deep into themes of class, labor, economic decline, and the transformation of American society.

Both Packer’s The Unwinding and Walley's Exit Zero use personal stories to demonstrate broader societal and historical changes. Both explore the dire consequences of deindustrialization. Packer portrays a much broader and more panoramic view of the economic and social changes in America from the late 1970s to the early 2010s. If you want to get some idea of how America has come to this point, read Packer's and Walley's nonfictions, not the personal memoir of JD Vance.

Third, yesterday a friend of mine mentioned one New Deal program, the Civilian Conservation Corps (CCC) projects in Washington State. This makes me reflect on the legacy of FDR's New Deal, especially how it impacts the nature of American society that once boasted of having a capitalist system.

Before the New Deal, it was accepted without question the belief in a laissez-faire capitalist system with minimal government intervention. The New Deal forever changed it all. It established the precedent for significant government intervention in the economy.

Before the New Deal, it was considered socialist to provide welfare and social safety nets to the vulnerable. The poor and unemployed were individual responsibilities, not systemic issues. The New Deal introduced social safety net programs like Social Security. These programs have become core elements of the American welfare state.

Before the New Deal, the stock market and financial institutions were under minimal government supervision, leading to financial disaster. The 1933 Securities Act and 1934 SEA imposed regulations on them to reduce fraud.

In conclusion, the country has witnessed the dynamic adaptation and transformation of its social system since FDR's New Deal. The question remains: how will the system evolve to deal with the impacts of deindustrialization and the collapse of the vast middle class and the elegy of the white working class, the most pessimistic group of all? Do we have the same wisdom as FDR to deal with today's challenges? Time will reveal the answers.

The evolution of America's social system: from founding ideals to modern realities

A friend of mine argues that the greatness of the United States lies in its social system. But what system are we talking about—the one envisioned by its Founding Fathers or the one we have today?

The American system has evolved, but its inherent strength remains. If America is still as great as some claim, then Trump’s MAGA (Make America Great Again) slogan seems redundant.

However, with the decline described by Packer's The Unwinding being true, burying our heads in the sand won’t get the country out of the woods. I’m reminded of a Chinese saying, 办法总比困难多 (bàn fǎ zǒng bǐ kùn nán duō), meaning "There are always more solutions than problems." This optimistic outlook suggests that no matter the challenges, there are always ways to overcome them.

Throughout its history, the U.S. has faced many significant challenges and often emerged stronger. Like the Civil War, the Great Depression, Civil Rights Movement, 2008 Financial Crisis, and Jan 6 Capitol Riot.

During the 1929 Great Depression, a severe worldwide economic downturn led to widespread unemployment and poverty. The country pulled through with FDR's New Deal, which included numerous public work projects, financial reforms, and regulations. For example, New Deal programs like the Civilian Conservation Corps (CCC) provided jobs for young men in environmental conservation projects. The Public Works Administration created jobs through large-scale public works projects, such as building roads, bridges, and schools.

More recently, the 2008 Financial Crisis led to widespread foreclosures, unemployment, and financial instability. The government intervened with measures like the Troubled Asset Relief Program (TARP) and the American Recovery and Reinvestment Act to stabilize the financial system, stimulate the economy, and promote recovery.

Throughout its history, the key to turn things around in times of crisis is always government intervention, which brought in social order, provided hope through a more socialist approach to economic problems. These programs, offering many public services, challenged the essence of out-of-control laissez-faire capitalism that preceded the Depression.

Today, many developed countries, including the United States, have mixed economies. They combine capitalist market systems with heavy government intervention and elements of socialist welfare, such as healthcare and social safety nets, regulatory frameworks, and public services like free education. In fact, the high welfare state is part of the attractions for millions of people attempting to come here.

The New Deal's heavy government intervention not only had features reminiscent of socialist policies but also set a precedent for a more active government role in economic and social affairs. This influence continues in U.S. policy today.

The American social system has evolved over time, becoming a hybrid of capitalist and socialist origins. It is no longer the one created by its Founding Fathers.

In conclusion, the American system has transformed significantly from its inception, becoming something the Founding Fathers might not recognize. This dynamic adaptation, driven by historical challenges and government intervention, has ensured the country's progress in the face of crises. 

The question remains: How will this system continue to evolve to meet today's challenges? Just as the Chinese saying suggests, "There are always more solutions than problems," so too must America continue to find innovative solutions if it hopes to make America great again.

From prosperity to its opposite: unveiling the transformation of the American Dream

Recently, there has been many discussions about the book that catapulted J.D. Vance to fame—The Hillbilly Elegy.

In fact, there are several books exploring similar themes, particularly the decline of the American Dream since the 1970s, largely attributed to the offshoring of manufacturing jobs and deindustrialization. These works often focus on the struggles of working-class and middle-class Americans in the Rust Belt.

One good book is The Unwinding: An Inner History of the New America by George Packer (2013), which I highly recommend. It’s a must read for anyone who wants to understand America today. The title of the book The Unwinding implies that before the 1960s, American society was stable and rigid, with everyone seemingly tightly bound together by a coil. However, in the subsequent decades, this coil suddenly loosened and began unwinding, leading to the sense today that things are falling apart.

While Vance offers a personal memoir of his experiences growing up in a poor white family, Packer's book presents the stories of five diverse characters—some fortunate and super successful, others disheartened and unfortunate—woven into a broader and more somber narrative of American life. Both books feature poignant stories reflecting the harsh realities of American society.

Packer uses these personal narratives to illustrate seismic changes, revealing the dramatic transformation of American society from 1978 to 2012. This period saw a shift from economic prosperity and robust institutions to economic decline, social fragmentation, polarization, and political dysfunction—conditions that are prevalent today.

The three subjects—Jeff Connaughton, Dean Price, and Tammy Thomas—once held the deeply ingrained American Dream. But over three decades, all three were left with nothing but the sadness of shattered dreams. Why did this happen? Was it because they were not hardworking enough? Packer does not directly answer these questions. However, he portrays a collective image of several newly successful figures in American society, allowing readers to deduce the answers through the stark contrast.

Packer's book effectively contrasts the nation’s glorious past with its miserable present. Through a blend of investigative journalism and narrative non-fiction, Packer crafts a compelling account that, though rooted in reality, feels almost fictional in its dire gravity. Technically, he often lets his characters do the talking, which makes it more realistic.

The book evokes a profound sense of both sadness and anger, prompting readers wondering how and why.

By placing individual stories within a larger historical context, Packer helps readers understand the forces driving the transformation over four decades, making the changes more comprehensible through the lens of personal experiences.

The Chinese saying: "积重难返" (jī zhòng nán fǎn), meaning: "deeply entrenched problems are hard to change" or "deep-rooted issues are difficult to overcome." It implies that problems that have accumulated over time are challenging to rectify.

The Unwinding is not merely a historical account but a stark mirror reflecting the tumultuous journey of American society. Though I generally maintain an optimistic outlook, the book delivers a jarring reality check, truly challenging any overly hopeful view of the nation’s trajectory.

The Guiding Light: JD Vance's Faith and Ambition in Politics

A friend of mine asked me a question about JD Vance last Saturday, but an event that day delayed my answer. Here it is.

The question was: Vance's faith in God pulled him through in the past, but will it continue to guide him now and in the future when he is in power? Honestly, this is not an easy question to answer, as there is much more to consider.

The question brought to mind Rui Xu, the first Chinese American state representative in Kansas, whom we interviewed in 2023. When we asked him how he made decisions, he said, "My guiding light is to make a decision that my daughter will be proud of, that I'm not going to regret. I would regret it if I didn't fight for what I believe. If I lose, I don't care, but I will always sleep better." I am not sure if Rui Xu believes in God, but he certainly has a belief system, an anchor in his life, which serves him well. Unfortunately, I can't say the same for JD Vance. We don't know what truly motivated him to enter public service.

We also don't know if JD Vance has a guiding light in life like Rui Xu. If Vance's faith were truly the center of his life as he might profess, it would guide him in critical decision-making and throughout his career.

Even if he started with some noble purpose, he might change later on. When Vance holds a position of high power, he is exposed to pressure from interest groups, the risk of corruption, and the lure of more power. Does he have a strong value system to stick to his original goal? Does his belief help him address the conflicts of interest between serving his country and his political ambitions?

We know he is a smart and ambitious man, having taken on roles at law firms or investment jobs after graduating from Yale in 2013. In 2016, he decided to move back to Ohio, where he was considering a nonprofit endeavor. In 2018, he planned to run for the US Senate, a race he won in 2022. Some have suggested that his nonprofit work ostensibly served a good cause, but in reality, its purpose was to advance his political ambitions. "A 2021 report by Business Insider revealed that Our Ohio Renewal's tax filings showed that in its first year, it spent more on 'management services' provided by its executive director Jai Chabria, who also served as Vance's top political adviser, than it did on programs to fight opioid abuse."

There is a Chinese saying, 大权在握, 心中无德 (Dàquán zài wò, xīn zhōng wú dé), meaning, "With great power in hand but no virtue in his heart." It captures the potential dangers and moral pitfalls of holding power without a strong moral and ethical foundation. The unhinged people with power are more likely to become super destructive. It's worth noting that many of former President Trump's associates didn't end up well: Steven Bannon, Roger Stone, Allen Weisselberg, Peter Navarro, Paul Manafort, Michael Cohen, Michael Flynn, Rick Gates, and many others.

Throughout all this, I smell his burning passion for political power. However, I don't see any evidence of a guiding light like Rui Xu's or any faith in God. It is perfectly understandable that people are drawn to power, but the question remains: for what higher purpose?

This brings us to a crucial question: in the pursuit of power, does JD Vance have a guiding light or a steadfast moral compass or a clear set of values? As we watch JD Vance's journey unfold, we should remember that true greatness is not just about achieving power but about serving the country and the people with integrity, wisdom, and a commitment to the greater good, transcending his personal gain. 

Only time will tell if Vance's faith is strong enough to guide him through his political life or if his ambitions will overshadow his professed beliefs. 

As civilization moves forward, it is the guiding lights and the value within our leaders that often shape the course of history.

As I am writing this, I remind myself of my guiding light. I hope you too.

A shift in focus: from JD Vance to Milton Friedman

I planned to continue discussing the JD Vance saga today. However, an incident yesterday morning shifted my focus.

A friend connected me to someone from the Midwest. I'm unsure what prompted her outreach. She introduced me to Capitalism and Freedom by Milton Friedman and praised the MAGA movement. But she abruptly ended the conversation and cut off connection upon learning that I wasn't thrilled about either, without hearing my perspective. Now that I mentioned Friedman's book, I'm gong to say something about it.

Milton Friedman follows the tradition of laissez-faire economics and minimal government intervention. Similar to Adam Smith's "invisible hand" theory—where individuals driven by self-interest inadvertently contribute to society's overall welfare through free markets—Friedman believed that voluntary exchanges in a competitive market lead to a better society.

Both Friedman and Smith argued that markets are more efficient at resource allocation than government intervention. They posited that free market prices reflect the true value of goods and services, thus guiding resources to their most productive uses.

Both also advocated for a limited government role in central planning and providing public goods, emphasizing Enlightenment ideals of liberty, individualism, and autonomy.

Regarding charity, Friedman argued that it should be handled by private organizations and local communities rather than relying solely on government assistance. However, this raises the question: what happens when local communities and private help are unavailable?

Modern civilization is also built on the ideals of liberty, equity, and fraternity. Friedman's focus on individual responsibility, free markets, and a limited government role bears some resemblance to social Darwinism, which emphasizes "survival of the fittest."

Despite my reservations, I recommend Capitalism and Freedom. Milton Friedman, though passionate about his ideas, exemplified a true gentleman's approach to debate, ironically so different from the person who recommended his book to me yesterday. In sharp contrast to today's often mean-spirited political discourse, filled with rants and ravings, Friedman engaged with opposing views respectfully, civilly and thoughtfully. He treated those disagreed with him as rational individuals with different perspectives, fostering a spirit of constructive dialogue.

By the way, there's a Chinese saying, “和而不同” (hé ér bù tóng) meaning: "harmony in diversity" or "seeking harmony without uniformity" or we disagree with each other harmoniously. It is the essence of engaging in civic and respectful discourse and understanding differing viewpoints.

In an era where polarized opinions often lead to hostility, Friedman's respectful manner reminds us of the importance of civil discourse. Only through open, earnest and respectful dialogue can we hope to bridge divides and work towards a more inclusive and equitable society. After all, civilization moves on, regardless of which social system or party triumphs.