I have a great deal of respect for Steve Pearlstein. Not only have I read his column for a long time, but I have had the opportunity to spend some time with him one-on-one when he prepared his article about the Qorvis business model versus the outdated model of most communications firms. He and Ben Bradley have launched a very important blog called “On Leadership” based largely on the premise that the current turmoil of our economic system is a failure of leadership. I applaud the effort, but I also believe there is a basic flaw in its premise, as articulated below (which is a more complete statement of comments I submitted to the Leadership blog)

The Effort To Identify Any “Blame” For The Economic Situation Is A Futile Passion And Directs Attention Away From A More Accurate Diagnosis.

Any effort that tries to point a finger of blame is flawed from the start because a finger has a point that is too sharp. Its focus is too narrow.

I understand the desire to try to identify one thing to blame. There is a sense of security and closure when you can say: “Yes! That’s it! That’s the reason! Let’s blame THAT!” But when you blame something on a single “that” (be it lax regulation or not enough leadership), by implication you are dismissing that and that and that and ….” And that, I think, is a big mistake.

When I try to look at the economic situation broadly instead of narrowly, I find that the economic situation is the consequence of a very broad and deep cultural issue, not a single reason.

Start With An Analogy … And A Keen Sense Of The Obvious.

I’ll start with an analogy. A few weeks ago I was listening to the news in my car and heard the report that a recent survey showed that teenagers who had been subjected to more messages about sex had sex sooner than those who didn’t receive those messages as much. That was not shocking to anyone with a keen sense of the obvious. When someone is hit with a message constantly, from all directions, presented in a compelling way, guess what? The person very often is influenced by that message.

Everybody to whom I’ve mentioned that survey responded virtually always with some version of “of course.” Now let’s consider the messages that have been aimed at all Americans since the Post WW II expansion began. Basically, they have been “buy this” messages. Buy bigger. Buy newer. Buy better. Buy more expensive versions of what you already have. Buy what you can’t afford. So, if it is a restatement of the obvious to say that teenagers who hear more about sex are more likely to have sex, isn’t it just as obvious that people who have been inundated their entire lives with “buy this” messages have become consumers-to-the-extreme?

In The Process, The American Dream Has Been Redefined.
And So Has The American Culture.

How is the American Dream defined today?

The family story of how my father’s father came to the United States has been distorted, I am certain, by him and those who elevated him to a pedestal. But I think the story, regardless of the embellishment, was basically right. He may or may not have come to Ellis Island with nothing more than “a satchel” and a piece of paper with someone’s name. He may have come with a pocketful of coins and a network of people who would help him. But one thing is sure: he came (about 100 years ago) to pursue a dream based on certain human principles. Here, he could observe his religion without persecution. He had the freedom to find his own work or even start his own business (which he in fact did). He could say what he wanted. He could bring up kids with the strong prospect that they would live a better life than his own. He could become “comfortable” in many ways, directly related to his own standards and initiative and willingness to take a bigger risk whenever he sought a bigger reward. He could enter into a lifetime deal of any size with a handshake.

Shortly after the war, aided by veteran’s loans, the American Dream started to became symbolized by ownership of a house. At first there was “cookie cutter” Levittowns. But the ante was upped. Success, status, social network, all became tied to the size and location and looks of a person’s home. As that phenomenon grew, the homebuilding market began to be segmentized into various tiers. So we saw the move-up buyer further segmented into the first-time move-up buyer, the second-time move-up buyer, the dream home buyer, etc. The American Dream became measurable by a home’s location, style, and square feet.

However, as important a component of the American Dream as the home became, it was joined with other defining factors: the car, flat screen TVs, clothes, vacations, bragging rights for how well you “played” the market. As this environment gained momentum, the power and frequency of “buy this” messages aimed at the consumer produced an increasingly voracious appetite for buying things, and placing importance on having things.

Now … look around: What is the American Dream? How far is it from my grandfather’s dream? One is based on standards and ideals and personal initiative and responsibility; the other is based on consuming.

The Culture of The Voracious Consumer And The Inevitability Of An Economic Collapse.

We became a culture where REALTORS encouraged their customers to step-up to a bigger sale, even if they couldn’t afford it this year because real estate values always go up (don’t they?). And once that sale was made, there was someone to help the consumer get a mortgage with a teaser rate (don’t worry about whether the mortgage won’t be affordable after the first rate adjustment). We became a culture where the home buyer rejected the real estate basic law of “location location location” in favor of “product product product.”

We became a culture where individual pieces of questionable debt could be bundled into packages whose value was determined more by activity in the secondary market than by the basic value of each part. A culture where if someone was told: “It’s hot; it’s going to increase in value,” the response was “buy it” rather than “what is it?” We became a culture where people who packaged those loans and sold them were paid millions of dollars for … for … for doing what again? How did they actually earn that big paycheck? By being lucky enough to sell something with a higher price tag than refrigerators to customers who actually congratulated them for making so much money for calling them to say “buy this.”

We became a culture that knowingly elected a President that was anti-science. A culture that allowed its healthcare and public school systems to sink in quality from the world’s role model to among the lowest ranked in the world. Where not only the very rich were entitled to ride in a chauffeured stretch limo, but so were teenagers who were going to a high school prom. We became a society where some pairs of sneakers assumed such status that some people would kill to own them. A culture where for years and years leaders of a union (UAW) and executives of an industry (automobiles) knew that they were burning a big candle at both ends and the flames were bound to meet, but they clearly preferred living in denial to living in reality.

We became a culture where real leadership became too rare. But lack of leadership wasn’t the only problem. It wasn’t the single thing that we can blame for today’s economic situation. It won’t be the only solution.

The Coming Cultural Changes.

The current economic situation will ultimately be remedied. We’ll even get to another period of growth and wealth creation. And another period of correction after that. The questions are: How? When? With what pain (and opportunities)?

If I am right that the true cause of the economic situation was no single thing but the total impact of a culture, then the remedy will be largely cultural in nature. Indeed, I believe that we are just beginning to see the first signs of a cultural change. I am in the process of writing an analysis of the Obama election as evidence of an important cultural shift where the political passion moved from the extremes to the Middle. I have also posted previous articles, including one entitled “The Emerging Shift in the Focus of Messages Aimed at the American Public,” in which I discuss another indication of cultural change associated with the political environment.

We’ll see more indications of culture changes as we live through this economic situation. However, it will be difficult to identify the nuances and patterns of this process because it will occur in a world in the process of making a fundamental move from a manufacturing to a knowledge economy; where vital commodities including oil and food have volatile prices and availability; where individual economies are intermeshed into a truly global economy; and where people interact on a real time basis where geography, time and (often) language are irrelevant. This is a different world in which fundamental change is happening; we can’t look at it (exclusively) in the same way that we have traditionally viewed the world.

In this emerging world, people can (and, I think, will) coalesce on line into new communities where members share vested interests not unlike the vested interests that in centuries past gave rise to new nations. How will these new communities take shape and grow in a world disrupted by economic turmoil, heaving from the failure of a culture, tied together by the Internet?

I think the Washington Post’s online “Leadership” forum is important and I applaud it. I think that it should be expanded to “Leadership & Culture.” Because if we do not accurately define the cultural changes that are about to sweep this nation, and probably the world, we may find ourselves overwhelmed with a new cultural environment that could be very dangerous. That would be awful under any situation, but especially now when we can use the new tools of communication to help shape a world that stands for some great standards, maybe even standards that are ethical in nature, and that encourage and nurture individual and collective responsibility as well as individual and collective hope. Just like the American Dream that attracted my grandfather and so many others to this nation.