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Hope, Doubt, Fiction & Fact

The DOW exceeded 26,000 for the first time on the morning of January 16, signaling for many the promise of a financially strong 2018. The market ebbed to 25,792 by the end of the day then plummeted 1,175 points on February 5 and another 1,033 points on February 8, finally moving back up to 24,601 by the close on 2/12 and has since ebbed and flowed until coming to roost at 25,029 today (2/28). This general correction was predicted and, while nerve-wracking, the market is up over 280% since 2009 and business is thriving, so the level of faith, hope and enthusiasm for further bounty should remain reasonably high.

Among the cheers, however, there are those who remain skeptical that this New Year will be much different than a tumultuous, unique and generally unstable 2017. Human beings tend to seek stability, certainty and the known. While there are those few souls who enjoy chaos, unrest, bickering and outright conflict, most prefer steady personal, family and career progress in an atmosphere characterized by harmony, good will, trust, and courtesy. From a national perspective, it would appear that various aspects of the past year will carry into 2018…and many of those carry-forwards will remain caustic, disruptive and deeply troubling.

That is not to say that all hope is lost for this year. On the contrary, a lot will be settled this year, bringing greater clarity, more faith and a measure of optimism. For all practical purposes, new tax reform legislation, while doing the middle class few favors, brings new options for business—whether repatriating overseas capital, building new facilities or adding employees. And, there is even hope that higher wages will be an added benefit to much lower corporate tax rates. Of course, tax and fiscal accountability experts are suggesting that, while we ride this new wave of prosperity and cash flow, the darker side of revenue depletion quickly leads to exceptional deficits and the federal government’s inability to retire debt without significantly reducing Social Security and Medicare.

During the fourth quarter of 2017, dozens of polled economists from America’s top universities were virtually all concerned about the proposed (now real) tax cuts due to the short- and longer-term effects of reducing operating revenues at a time when population growth, social needs, deteriorating infrastructure, security and other needs are escalating. Additionally, support for education, environmental protection, public health, basic and applied science, national parks, and many other programs have already been or are being seriously reduced. Their deep concern is the lack of thoughtful planning, careful analysis and multilateral collaboration. Whim and fantasy do not foster prudent reform, especially in the U.S. where the level of complexity is enormous. This is not to say reform isn’t good or warranted; what I am saying here is that there is a difference between scalpel and ax, and certainly between uninformed hacking and wise, calculated curtailment.

As a nation, we have entered a new era. But it is not an era with a positive seminal force, like the end of a world war, space travel, civil rights, or a new, shining vision of what America could be. The past eighteen months have introduced more divisive and accusatory language, more ethnic and social disunity, greater financial inequity, and more international disharmony than at any point in the past century. Historians, such as Douglas Brinkley, Doris Kearns Goodwin, David McCullough, Ken Burns, William Chafe, Joseph Ellis, David Blight, H.W. Brands, Edna Medford, and dozens of others have spoken eloquently about the devolution of the Office of the President since November 2016. As of this writing, hundreds of historians and economists from both major political parties have signed petitions warning that continued abuse of power will erode America’s ability to thrive, not just economically, but as a beacon of unity, hope and global leadership.

Embracing reality as we enter this year, it might be difficult to not let the clutter of 2017 contaminate an otherwise optimistic vision. In my view, a combination of balance and careful analysis is the most important ingredient of success. Financial markets are embracing opportunities for expansion, consumer confidence and motivation is high, automobile and housing markets are strong, trade remains decent, and America is still attractive to foreign investors. The number of small businesses is escalating, innovation is rampant (think SpaceX, Tesla, and a host of rapidly growing industries- solar, electronics, telecommunications, healthcare, human services, security, etc.), and humans continue to pursue greater connectivity. Certainly, it is important to retain a calm, informed perspective, understanding that, where there is conflict and uncertainty, there are also opportunities and benefits for those who are willing and prepared.

Clearly, the pace is accelerating far beyond many citizens’ ability to cope, understand or keep pace. The result is often backlash…and a tendency to retreat or remain static. Many are going backward, unable to accept rampant change or the importance of continuous improvement. Regardless of personal decisions, the nation is strong and, even though society is being challenged, it will ultimately endure. Intuition and data indicate that there are some intense challenges ahead. However, there will also be many opportunities to understand, grow, improve, and evolve. As we face forward, the best advice is to seek truth, verify fact, and commit to kindness, goodwill and acceptance. This is our nation. If it is to write a new chapter in its history, let’s make sure it is one that future sons and daughters embrace while celebrating our courage to stand for the fundamental values that have always made America great.

With over four decades working in and with federal, state and local government, John Luthy understands public agencies. Known for his real world, straight talking style, he is a leading futurist specializing in city, county, state, and federal long-range thinking and planning. John is the author of Operations Planning: A Guide for Public Officials and Managers in Troubled Times, and The Strategic Planning Guide, both published by the International City/ County Management Association (ICMA). Reprints of his book, Planning the Future – A Guide to Strategic Thinking and Planning for Elected Officials, Public Administrators and Community Leaders (2010) has sold out several times. An innovative and dynamic presenter, John is frequently asked to speak and consult on how to prepare public organizations and communities for emerging challenges (public futures at http://www.futurescorp.com).

 

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