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In the first years following the aftermath of World War II, a young and relatively unknown American diplomat named George Kennan wrote a series of memos that changed the post-war world. Assigned to the U.S. Embassy in Moscow, Kennan observed the expansionist interests of the then-Soviet Union and, seeing cause for concern, wrote to his superiors detailing ways to address the threat he saw emanating from Joseph Stalin and his Communist lieutenants. The approach that Kennan outlined became known as the “containment strategy” that was utilized by the United States throughout the Cold War era.
Every president from Harry S. Truman to George H.W. Bush based their national security strategies on the cornerstone of Kennan’s memos, the most famous of which was published under the pseudonym “X” in Foreign Affairs in July 1947.
The power of Kennan’s memos inspired NCF to ask its Scholars and new class of Fellows as well as a select group of guest contributors to each write a memo to the future detailing their insights in ten select areas. Detailed on the ensuing pages are “memos to the future” from these notable individuals who share their insights on where we need to go in the years ahead to be successful.
Throughout a long and contentious election season, fractious campaign messaging has focused on highlighting the “differences” between the political parties and their candidates. Amid the partisan fray, however, the party platforms reveal refreshing accord on a top national priority: improving the global competitiveness of the American economy. National consensus on this objective is an encouraging first step. Now comes the more difficult part—achieving our aim.
There’s no better time than a presidential inauguration and the start of a new Congress to launch a future-defining national project, provided that after the oaths of office are sworn the parties elect to unite for action, rather than retreat to their political corners to regroup for the next electoral scrum. A mission of such magnitude is best commenced with a presidential declaration of commitment that inspires public enthusiasm and marshals our national energies, akin to President Kennedy’s pledge to land an American on the moon.
The United States is mired in the slowest economic recovery since the Great Depression. Worse, we are told by many economists and policymakers that things are not going to get much better. We are experiencing, they say, the “New Normal,” a permanent downward departure from America’s historic 3% growth rate. New Normal projections are an understandable response to the trauma of the financial panic, the European debt crisis, deleveraging, and downtrending demographics, summing to a suggestion of slower growth—maybe 2% per year–as far as the eye can see.
Indeed, with existing policy and leaders telling us to prepare for slower growth ahead, the New Normal is probably an accurate prediction. The New Normal, however, assumes we are powerless to do anything about it. Its fatalism runs counter to the American ethos. The great leadership challenge of our time is to show the future is still possible and to chart a path of economic resurgence.
We’ve seen this play before. Forty years ago, things also looked bleak. Inflation was starting to break out. Vietnam had dragged on for nearly a decade. Watergate was burbling. Oil prices were beginning a dramatic climb. We had entered what the Club of Rome asserted in its famous 1972 “Limits to Growth” report was a long state of decline. It was time to downgrade expectations, rein in ambitions, and hunker down for the lean decades ahead.
The United States is on an unsustainable fiscal course. This year marks the fourth in a row that the U.S. federal deficit will exceed $1.1 trillion. Since the end of 2007, the federal debt, now $11 trillion, has doubled as a share of annual GDP—from 36% to 73%. The long-term outlook is even worse.
The deficit is likely to improve in the next few years, but it will then turn upward again due to the projected rise in federal spending on Medicare and Social Security. According to the Congressional Budget Office (CBO), spending on those two programs will rise from 8.7% to 12.2% of GDP by 2037.
The good news is that U.S. lawmakers and policy experts from across the political spectrum have begun in earnest to outline possible strategies for tackling this looming debt crisis. Unsurprisingly, many suggestions—from the Left and the Right—are misguided or not particularly constructive. For example, a number of left-leaning think tanks have recently supported a “financial transactions” tax that would cause huge distortions, raise far less revenue than projected, and push more of the industry offshore. Similarly unhelpful, some conservative groups have advocated abolishing various small spending programs on the grounds that such cuts will improve the fiscal outlook, even though their elimination would have only a trivial impact on the overall federal budget.