News & Views from 465 California Street

Judgment Day

Clint Reilly
Nov
4
2008

Is the cliché true – that a country is only as strong as its citizens, not its leaders?

All of us have high expectations of our leaders. But do we hold ourselves to the same lofty standard that we expect from those we elect to office?

Election Day 2008 is a good time to look into the mirror, a judgment day not just for our next president, but also for ourselves.

How do we measure up to past generations of Americans?

In 2001 I visited Normandy with my wife, children and my mother and father-in-law, Margaret and Tom Koewler of Sacramento. Tom is a World War II veteran. Together, we walked the deadly beaches where 53,000 allied troops perished. We prayed at the Normandy American Cemetery and Memorial, where 9,387 American soldiers are buried.

A pale cross rises from each grave, the name of a dead soldier carved deep into the marble. This sea of white crosses spread against the landscape is still one of the most powerful images I have ever experienced.

Television anchorman Tom Brokaw famously assessed the generation of Americans who won World War II to be “the greatest generation any society has ever produced.”

It was a generation shaped not only by war, but also by the Great Depression. As children, they faced the worst economic crisis since the end of the 19th century. They grew up when unemployment reached 25% and poverty was a way of life. But thanks to education, Brokaw wrote, “They gave the world new science, literature, art, industry and economic strength unparalleled in the long curve of history.”

Ironically, it was this exposure to death and hardship that shaped their values and inspired their accomplishments. Hard work, education, self-sacrifice and deferred gratification were virtues handed down from grandparent, to parent, to child.

This contrasts sharply against today’s culture of instant gratification. Jeff Saut of the financial firm Raymond James calls debt the “crack cocaine” of our generation.

Just look at the level of debt accumulated by the average American household. In 1960, an average American family had $3,700 in savings and $27,000 in debt. Today, the same family saves only $398, yet has taken on $117,000 in debt.

It has become our way of life. Collectively, consumers, banks, companies and the government are now on the hook for $51 trillion in debt! Our current mortgage meltdown? A borrowing binge by the world’s leading consumer society that allowed people to finance mega purchases with funny money.

This profligate attitude toward money and the financial crisis it has spawned now threatens the very foundation of modern capitalism. To save the system, we’ll need a multi-trillion dollar infusion of government funds – more borrowing against our children’s future.

I believe a telling symptom of our problems is that the best and brightest American college students are being seduced into the financial services industry by absurdly high pay packages that dwarf compensation in manufacturing, technology, engineering, architecture, academia, public service or other socially valuable professions.

Unlike the entrepreneurs forged by the Depression and war, the money manipulators on Wall Street do not create new industries, mine new fields of endeavor or grow the real economy. And yet in 2006, Wall Street’s top five firms – three of which are now defunct – dished out $36 billion in bonuses. At Goldman Sachs, average compensation per employee was $623,000.

Many of the best and brightest young Americans have succumbed to this culture of greed. Princeton University’s graduating class of 2007 saw 43% of those who obtained jobs go to work in the financial services industry. Lest you think this is an anomaly, the number was 47% in 2006.

Greatness begins not with talent but with strong values like discipline, hard work, thrift and a generous spirit. On Election Day, we will invariably ask ourselves whether Barack Obama and John McCain have these indispensable qualities.

More important, do we?

Comments (7)

  • I really enjoy reading your columns. I started when I read that you were supporting Hillary Clinton for President, a shared goal that was not to be.Your column today about the sacrifices of the WWII generation resonated for me. I found myself reflecting on my father’s service, work ethic and possible travels to Normandy. I hope you will continue to share your insights in the Times.

    Myrna

    Posted by: Myrna | November 4th, 2008 at 1:25 pm

  • Outstanding column today–First time I have seen your column in the
    Contra Costa Times and, as a lawyer, I was amused to see it placed
    due to the resolution of your good lawsuit against Hearst–Media.
    But I digress–I hope you will send Judgment Day to hopefully
    President Obama–the reality is each American, including me, needs to
    totally reassess how we live and finance our lives. Unfortunately,
    the government will not likely be bold enough to mandate savings as a
    percentage of income, cap consumer credit, balance the budget and/or
    eliminating ballot bonds, among other things, to right this debtor
    nation ship of ours. While prior generations certainly had their ugly
    blemishes, they mostly had it right about living within their means
    and saving for a rainy day.

    You may not have political aspirations of your own, but I hope
    President Obama appoints you to something worthwhile.

    Posted by: D.Simons | November 4th, 2008 at 2:41 pm

  • I just wanted to express my appreciation of your column on this date
    in the Valley Times. I always look forward towards reading both the
    columns that you and Leonard Pitts write weekly. May you both enjoy
    many years of hopefully reaching and educating readers of all ages.
    Sincerely, Ron

    Posted by: Ron | November 4th, 2008 at 2:42 pm

  • The greatest generation may well be meeting their worthy match. I see our young people coming out with passionate commitment to support the grand occasion of a Obama presidency. We have much work to do and we have much to correct. We have created a mess for our children and they know it. They will be tested just as our parents were but I have faith that with all of our help …they too will be a great generation.

    Posted by: Melinda Maginn | November 4th, 2008 at 7:39 pm

  • I have never felt so proud of my country. I read and enjoyed your column in the Oakland Tribune, I went and saw so many energetic, hopeful people at the polls, and I thought, “Maybe we are going into a time of scarcity, but my faith is restored in our people.”

    Posted by: Claudia | November 4th, 2008 at 11:06 pm

  • I too feel that the ‘greatest generation’ has met it’s match. As part of that generation, and proud to be so, I hope that we are able to maintain this engagement that has shaped this election. Let’s keep the televisions turned off and newspapers in hand. In the months and years to come we must remain accountable individually as well as collectively and never settle until we know we are heard.

    Posted by: Adam Gobble | November 5th, 2008 at 11:13 am

  • Dear Mr. Reilly,

    Do we know how these financial services (!!??**) companies made, or expected to make, such profits to be able to pay such bloated salaries, and to hire more and more people to pay them to (rather than just to a few partners, as before)?

    I have no direct knowledge of this, but it seems that who make deals (e.g., real estate agents, car salesmen, buy-out specialists, stock offering promoters) are paid a percentage of the selling price by the sellers who expect to profit from the deals.

    It seems that such compensations are limited not by any laws, but only by what the traffic will bear: If the seller’s original investment was $1,000,000 for a broken-down ranch that he can threaten to make into into a $ 10,000,000 development and golf courses, and ‘settle’ for $5,000,000 from aroused environmental organizations, he should be delighted to pay $1,500,000 to the real estate firm that made the sale possible.

    Similarly, if the profits from deal-making are unlimited, then the compensation for those who put together such deals is bound to be excessive. And the temptations to choose such an easy-path life are similarly unlimited for those who lack any consuming interests or talents.
    With best regards,
    Rich Persoff

    Posted by: Rich Persoff | November 11th, 2008 at 9:21 am

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