Extensions of Remarks 4381 Extensions of Remarks

March 14, 1990 EXTENSIONS OF REMARKS 4381 EXTENSIONS OF REMARKS THE END OF THE FEAST Others of my fellow Americans are also We were more confident than ever, more getting rich, yet I remain pessimistic about economically <and educationally) democrat the economy and its future. I should be ic than ever, thanks to the war, the New HON. BYRON L. DORGAN more specific: not the economy as a near Deal, and the GI Bill. Our richness was so OF NORTH DAKOTA term game that one can play and manipu great, a richness caused by historical forces IN THE HOUSE OF REPRESENTATIVES late-I suspect it remains a wonderful free largely outside our doing, that it was like a Wednesday, March 14, 1990 fire zone-but the economy as part of the giant tide lifting everyone in our society. Ev long-range social contract of the nation; as a eryone was both worker and consumer, Mr. DORGAN of North Dakota. Mr. Speaker, next-century successor to the dynamic econ living in a society where, with the powerful David Halberstam has written an article in the omy I knew growing up, and which, when I new commercial television networks, there Business Quarterly entitled, "The End of the was a young man, generated a kind of was the most ferocious pressure to consume Feast." broadly based wealth never seen before in ever known to man. Perhaps the most mi It is a masterful description of the financial the world. raculous thing of all came in the mid-1950s: excess of the 1980's and is an appropriate I realize that the past decade is one in we were a nation so rich that even our chil which a great many people have made as dren became a formidable part of the con antidote to the "What, Me Worry?" Charlie tonishing amounts of money <I suspect suming economy. By the end of the '50s we Brown syndrome that has gripped so many more wealth has been taken out of the econ had not one or two cars in our suburban ga here in Washington, DC. The article by Mr. omy in a shorter time in stock deals and put rages, but often three. Halberstam is printed below: aside for personal use by men who are es There were two things that came out of THE END OF THE FEAST sentially speculators, not investors, than at that great moment: first, an abiding belief I have a friend who has done very well off any other moment in history). that whatever it was that was going to be the economy in the last 10 years. He is an But when I hear the official optimism manufactured, America would set the stand arbitrageur with a nice touch, a good sense about the economy, I feel oddily as I did ard and would do it first and do it best; and of humor, and an inherent belief that in the some 27 years ago when I was a young re second, because the period last so long, a end, arbitrage, is just a game that by chance porter in Saigon, being bombarded every belief that our hegemony would go on for he plays well. He has consistently been a day by the American military headquarters ever-a belief that God takes care of Amer winner in the decade of the Great Casino, with statistics proving that we were winning ica. We as a nation did not see that remark and if I were venturing estimates of his the war. Everything I knew and sensed told able period as the result of a confluence of wealth, I would begin at around $400 mil me that we were losing it, indeed were historical forces far outside our own control; lion. barely fighting it; everyone whom I person we saw it as our due, something we had I have always thought, based on some of ally respected told me, when we were talk earned by dint of being Americans. As such, my friend's own description of his work ing off the record, that the war was a disas we thought that which was a historical habits, that essentially he has been a skilled ter. I have the same sense today about the fluke-America's great affluence and un and nimble predator working over the tired economy. matched economic growth after the war carcass of an ailing economy. "I got here at Certainly a great many people are making should be a permanent condition. a moment when the place was filled with re excessive amounts of money off the econo That explains a good deal about our cur markable bargains," he once said. "It was my, amounts that dazzle the mind. But un rent inability to adjust to changing circum luck." A healthier economy would have pro derneath the surface, almost everything I stances in a changing world. Forty years of vided fewer easy targets and much slimmer sense is negative. Many of those who benefit immunity to all the normal crises and vul pickings. The bargain hunting would never from this unparalleled windfall talk private nerabilities· creates a kind of arrogance of have taken place. In better days the ruling ly of the darkness just around the corner, of entitlement. The pre-World War II wariness class of America's financial houses might the vulnerability of a nation that has made of our grandparents and parents, raised as not have tolerated a stock market designed itself so dependent upon the support of for they were in harder times and touched by more for the pleasure of arbitrageurs than eign investment. Sometimes they are ex the Depression, have lapsed from family for manufacturers. tremely critical of the very things that memory. Our parents hated to owe any A few weeks ago my friend and I had enrich them. While true productivity and thing; our children get credit cards in their dinner, and he, to my surprise, seemed even performance lag even more behind, there is teens. Now, facing an uncertain future, we more pessimistic about the American econo more pressure than ever on companies for intend to live as we always have; it is noth my than I. He did not like any of the cur paper performance. · ing less than our due. Ours has become an rent trends; they seemed, more than ever, That means that the premium action still economy governed not so much by need as aimed at short-range exploitation of compa lies from power and the price of oil nearly by expectation. nies' assets. In recent years it had simply quadrupled. By the end of the war we were We took that period of remarkable afflu been the arbitrageurs and the bigger compa the new superpower, fueled by cheap oil, ence for granted. Because of our wealth, we nies who had fed the takeovers. Now, he protected by two oceans in an age when became a nation that felt it never had to added, it was even worse. In the last year or weaponry could not cross an ocean. We make choices or sacrifices. Most notably, so, the ailment had gotten into the manage ended the war far more powerful, far richer, when Lyndon Johnson gave us both the ment of the companies. and far more confident than when we began Vietnam War and the Great Society during He cited the RJR Nabisco fiasco, where it. the '60s, we were confident that we could the greed of the management team had The rest of the world was in ashes. Our pay for both. opened the door to a hostile takeover. The allies and adversaries alike had been rav Since the end of World War II, we have fever is in the bloodstream of management aged in some way or another by the war. been like a nation racing through our inher now, he said; management wants in on a Britain emerged a victor but still bore the itance. What is troubling is not so much good thing. In his phrase, the greed today burden of its losses in World War I upon that we went through it so quickly, but that was like a genie that had escaped from the those it suffered in World War II, and it was we cannot discipline ourselves now that it is bottle; there was now an institutionalized about to shed its colonies. France was a over. Our economy today-with the leverag vested interest in the country in continuing victor, albeit a humiliated one; it too was ing of money and unfriendly mergers-is the way we are going, destructive or not. He about to lose its colonies. Germany was a based not on productivity, but on exploiting said this entirely without irony, and per loser, devastated and divided, with millions a moment when the society is declining, or haps there is no irony to it; it was inevita dead. The Soviet Union was a ravaged at the very best, stagnant. ble, I suppose, that managers with limited victor, losing five times as many people as What is even more chilling about our con loyalty to their product and to their em Germany, and burdened by an economic dition is our political paralysis in the face of ployees, and with greater loyalty to them system that demonstrably did not work. For these changed circumstances. There were selves than to their stockholders, had Japan the defeat in the war was as much a signs 20 years ago that we were facing fierce looked around, had seen what was happen psychic loss, a loss of faith, as it was one of competition in a number of critical areas ing, and ):lad gotten in line for their share.

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