Once a man holds public office he is absolutely no good for honest work. – Will Rogers

At the recent meeting of the BRICS, the presence of the President of the Union of South Africa signified the inclusivity of the BRICS. They deem themselves a platform for dialogue and cooperation, reflecting principles of openness, cooperation and mutual assistance. Meanwhile, China internationalizes the remnimbi and appreciates it against the dollar. It will contain inflation and asset bubbles, foster domestic consumption and reduce the costs of its exports, many of which are imports re exported after value is added in China. A stronger remnimbi reduces the costs of its foreign investments in sources of supply – and sources of demand for its products. A stronger remnimbi will enhance China’s competitiveness as it climbs the ladders of technology and capital intensity while shedding dollars. The U.S. ran a trade surplus with a strong dollar.

China buys time, but no successor to the dollar as reserve currency for this world is in sight. Work has been going on for many years to develop an East Asian regional monetary regime, currency unit and fund which might be incorporated in a global monetary fund and currency. Progress has been slow. But now the BRICS are discussing a new international currency regime. They imply national currencies pegged to a basket which might include gold as well as the remnimbi and other currencies. A global currency is a possibility.

The fundamental issue is one of leadership for a new world. The BRICS recognize this issue and begin to discuss governance in the post America world across a broad front. The WTO is in peril. The UN Security Council is unrepresentative. And the west is seemingly powerless. But the BRICS may be ready to exercise responsibility commensurate with their control of some 70% of the world’s foreign exchange reserves and organize a process which includes all nations. All would benefit from stabilization of exchange rates, transactional efficiencies, rules for capital adequacy and transparency – resources for lender of last resort financing – perhaps a single currency. All countries would benefit from a sound and stable monetary system. Judging from the scene in Washington, the U.S. might have need for a global monetary fund’s resources – and disciplines. The BRICS could help usher in generations of unprecedented prosperity – and peace – for this new world.

This remarkable conference, organized in large measure by students from BRICS, portends change in the making. A new generation is coming of age. These young are reason for hope. The University of Chicago is to be commended for hosting this extraordinary conference.

I have recorded my family’s experience in politics and the world over five generations in The Black Book. It starts with Lincoln and ends in China with an epilogue on the life cycle of nations and empires. It aims to recall the values which created America and contrast them with the values which undermine it. Its lessons from the past are for the future and BRICS, as well as Americans.

With the U.S. perceived as propagating financial crises and wars of uncertain purpose and high cost, practicing the approximate reverse of the neo liberal economic policies it joined with the IMF to impose on others, the world begins to distance itself from the U.S. government. But not from the American people or that liberal world order the old U.S. helped establish. The BRICS mean to salvage it.

The five BRICS, Union of South Africa included, with 45% of the world’s population recognized the failings of this governance at their recent meeting in Hainan. Discretely, they took note of the west’s precipitation of financial crises and wars and expressed support for the UN and the peaceful resolution of disputes, commended the African union for its efforts to resolve the conflict in Libya peacefully. The BRICS called for an inclusive, accountable world order – not a new world order – the old world order reformed and managed in accordance with its founding principles.

They support the Westphalian doctrine of non-interference. They increasingly invest in one another and trade with one another in their own currencies. China’s trade with BRICS increased 40% in 2010. They accelerate trade and investment with other nations outside the shrinking west. According to the Asia society, China’s foreign direct investment over the next decade may be between $1 and $2 billion- with the U.S. government forfeiting much of it to countries with prudent governments.

The five BRICS account for about 20% of the world’s output – and 45% of the world’s growth in output. China alone commands over 25% of world growth. It won’t be long before the BRICS have a larger share of global output than the G7. The IMF predicts China’s economy will be larger than the U.S. by 2016. Meanwhile Standard and Poors puts U.S. debt on its warning list.

With U.S. debt and unfunded long term obligations at unsustainable levels, the U.S. depends on China for finance, but China is concerned about the safety of its dollar holdings – the more so as the federal reserve prints more dollars, many of which flee the U.S. for refuge in emerging markets which defend their currencies with capital controls, taxes and higher bank reserve requirements. As the Fed pushes on the string, China diversifies its investments. It denominates international transactions, including share offerings, in remnimbi and other non-dollar currencies.

The world is left without a reserve currency – a reliable store of value. Europe is struggling to contain fallout from the fiscal profligacy of some members. The resources of its Financial Stability Facility may soon be exhausted. The euro is not a reserve currency candidate. Japan’s debt exceeds its GDP by more than 200%. The yen is not a candidate. The remnimbi is not ready. The SDR is not a reserve currency.

The world’s monetary system still reflects arrangements at Bretton Woods in 1944, including U.S. rejection of Maynard Keynes’ proposal for a global currency. Today, the money is in the east, increasingly in the south – and control remains in the west. The IMF’s resources and powers are unequal to the requirements of a monetary system for this world – a world it does not represent though it’s staff is becoming realistic.

Combined with political instabilities and costly wars (Afghanistan has already cost the U.S. $1 trillion), these conditions could exacerbate imbalances in the global economy, even lead to financial meltdown. To say the least, they undermine potentials for economic growth and political stability. But where is the leadership of a post America world?

After World War II, the victorious west led creation of a liberal world order which included the UN and its constituent agencies, the GATT which became the WTO, the World Bank and international monetary fund. It was founded on a universal declaration of human rights, commitments to the rule of international law, the peaceful resolution of disputes, assistance for the lesser developed, free trade and a stable global monetary system.

The Soviet Union was a party to this order. But much of the world was still colonized or vanquished. The Indian subcontinent was ruled by a British viceroy and awaited its bloody partition. China and Brazil were not represented at the founding – some of which I observed in the war torn London of 1945 where great men gathered to right the failures which followed world war I, but little of the world was represented at the birth of this new world order.

The U.S. was the world’s hegemon. It commanded about half the world’s out put of goods and services. The U.S. dollar was the world’s reserve currency – convertible to gold at $35 to the ounce. Other currencies were pegged to the dollar.

Since then the world has changed but not the governance of this world order. The dollar, unlinked from gold in 1971, trades in the market at about $1,400 to the ounce. The dollar has fallen by many measures like a barometer of confidence in U.S. fiscal, monetary and political governance and the viability of the U.S. economy in a newly competitive world.

Europe’s union evolved from the early years after World War II. Today it is threatened with dissolution by the fiscal profligacy of certain members and differences over foreign policy.

China’s opening up and reforms began little more than 30 years ago. In 1975, I was a running dog of capitalism. Now I am an honorary professor of Renmin University – and the University of Chicago has a platform in China located at my university. What would Mao think? The great creditor and producer to the world, the U.S., became debtor and consumer to the world. China’s foreign exchange reserves amount to some $3 trillion, a large part invested in U.S. treasury obligations. China finances U.S. debt and keeps the dollar afloat.

The fault lines of cold war came down – and trade barriers (though Russia and China remain outside the WTO). Technology extended the reach of traders and producers in all parts of the world to all others. Money in the trillions shoots about this world with the speed of electricity, destabilizing currencies and markets. Communications ignore boundaries and energize the streets.

Globalization is a reality. Within this global economy the tides shifted from west to east and north to south. But these tectonic shifts in economic resources and activity and political authority have not been reflected in the governance of this world order. The WTO and IMF are still largely controlled by the U.S. and Europe. China with the world’s largest foreign exchange reserves does not have a seat on the IMF board – or a stake in the SDR. India does not have a permanent seat on the UN Security Council – nor Brazil and so it goes.

President Obama challenged Americans to compete in a new world. He sketched an agenda which included support for education, technology innovation, exports, free trade agreements and clean tech. He supported tax reform, deficit reduction and a spending “freeze.” In doing so, he left Republicans with little to rationally differ with. It was a tactical success. But for me, it left much unsaid and contrasted another time and politics.

In the early 70′s Democrats and Republicans in Congress joined forces to establish programs for technology innovation and exports, responding to the industrial challenge from Japan. We went on to enact programs for Environmental Protection, Occupational Health and Safety, Consumer Product Safety, Mine Safety and pension reform. We responded to the Arab oil embargo with large projects for energy efficiency, fuel standards and development of “alternative” energy sources. We worked with Republican Presidents Nixon and Gerald Ford, liberal activists by today’s Republican standards. Nixon even imposed wage and price controls. De regulation began under Democrat Jimmy Carter with transportation and banking.

President Reagan followed, curtailing many of these bi partisan efforts, shifting resources to the military and missile defense. Taxes were cut, and the budget plunged into deficit under Reagan, the Republican. President Clinton, the Democrat, triangulated. The wall between government insured commercial banking and investment banking was repealed under Clinton, the Democrat. The era of big government was over, he said. Clinton, the Democrat, bequeathed a budget surplus to his successor. The budget plunged back into deficit under Bush Jr., the Republican, who bequeathed costly wars in Iraq and Afghanistan to President Obama. In other words, Democrats were fiscally responsible. Republicans created the deficits and debt which they now deplore. Jimmy Carter, the Democrat, started economic de regulation. What happened to cause such reversals of role and the gridlock which now reduces Congress to enacting the lowest common denominators of tax policy, bank regulation and health care, everyone paid off except the American people who are left holding the debt? They also suffer the largest income inequalities since 1928 – and by far the largest in the western world – another subject unmentioned by the President.

In the conventional wisdom, Reagan was the transformational president. Cheerfully optimistic and likeable, he preached a supply side trickle down economics. Cut taxes, increase expenditures and balance the budget. Leave it to the “magic of the market place”. Vice President Dick Cheney would later reassure Americans by reminding them that Reagan said “deficits did not matter.” Call it what you will. Supply side economics is another label for a familiar social darwinian economics which has no empirical evidence to support it. The evidence supports an opposite result. But Reason no longer prevails. Ideology plays a part. Regan may have moved the center to the right; or, more accurately, hollowed out the center while moving Republicans to an extreme right, polarizing politics. But I experienced in Illinois and in Washington, systemic changes in our politics of which Reagan was little more than a symptom. He was a celluloid eccentricity from the outer fringes as late as 1976, even in his own party. But party organization and responsibility broke down, except as money machines. The media became electronic and visual. It trivialized the democratic dialogue even as the issues became more complex and increased the cost of campaigns. Media ownership was increasingly centralized. Murdoch rules the waves. As campaign costs were increasing, we reformers opened up the legislative process  to let in the sunshine and let in the lobbyists and interests groups which proliferated to take advantage of the new access to the political process. Primary elections spread as party organization broke down and lengthened campaigns, increasing costs more. Nowadays politicians never stop raising money, and the money never stops pouring into lobbying and campaigns from the corporate interests. The center did not move; it disappeared, submerged beneath the waves of money often camouflaged by ideology. Corporate interests invested in both sides and at all levels of government. Partisanship raised its ugly head in a contest for money and power, and Reason died. President Obama is left to cope with a dysfunctional politics of which he is a product. He raised and spent over $800 million over two years to win the presidency. His next campaign will cost more. The President of the United States has become a fund raiser.

It is in the nature of President Obama to seek the path of least resistance, the middle ground. He avoided complex and contentious issues in his address – and neglected a President’s  unique opportunity to inform the American people about the State of the Union. A waiting world was left waiting, too, as if the State of our Union was severable from the state of the world.

Gun control was left unmentioned. We have the Western world’s highest levels of gun ownership and gun related violence and, not so coincidentally, the lowest levels of regulation.  Debt levels are unsustainable, but the president’s freeze will cut education, the FBI, foreign aid, just about everything he was supporting – but not the military where most of the waste resides. He mentioned free trade but not the WTO Doha round which could produce free trade. His bi lateral “free trade” agreements are discriminatory, trade diversionary. He mentioned the wars in Afghanistan and Iraq but not peace – and how to achieve it through diplomacy. War is easy. Peace is hard, as The Black Book explains. The instabilities spread to peoples demanding popular governments – and by inference an end to accommodations with the perceived US – Israeli alliance. Diplomacy as an alternative to war was unmentioned. The President of France leads an effort to reform the international monetary system and head off currency wars precipitated by the fall of the dollar and US monetary policy. He seeks partnership with China.

The address left Republicans in some disarray. What do they stand for other than slogans about small government and debt reduction? They give President Obama a chance to lead, to mount the bully pulpit and reassure a skeptical world, but the State of the Union address implies that this brilliant, eloquent man will continue to seek compromises with the uncompromiseable, more paths of least resistance. Harry Truman would fight. The American people might again rise up to support their President though it is more difficult now, given the money in politics, the break down of political party responsibility and the trivialization, even politicalization, of the mass media, the internet – and the mounting complexity of issues. It was a brilliant speech by the standards of our disjointed times. President Obama is honest and decent, but he is also a product of the new politics. The American people deserve to hear what he stands for. Partisan politics may be polarized, but not the American people – yet. Trust them with the truth, said Adlai II.

Intelligence failures are to blame, so we are told, for the tragedy of 9/11 and the unfolding tragedy in Iraq. If the Bush Administration had heeded its intelligence agencies, it could have prevented the 9/11 attacks and avoided its mishaps in Iraq. Administration spokesmen blame these agencies for failures to produce actionable intelligence. This finger pointing reflects misconceptions about intelligence.

I trailed Israel’s troops into the West Bank and Golan Heights in 1967 shortly after the six day war, visited a Palestinian refugee camp and returned nine years later. After the Likud came to power in 1977 and announced Israel’s plans to settle Judea and Samaria, defying the US, anyone with experience in the region could foresee the dangers ahead. I launched the first Congressional study of terrorism. It concluded in 1979 with predictions of  “spectacular acts of disruption and destruction” in the US and proposals for preventing them. They required no intelligence. The chaos in Iraq comes as no surprise to anyone with knowledge of Iraq.

Foreign intelligence supports foreign policy. Its collection priorities are determined by policy makers. Sometimes the products of foreign intelligence are tailored to fit the preconceptions of policy makers. Intelligence is often flawed. The intelligence agencies have conflicting and overlapping missions, lack “central” responsibility and are overwhelmed with masses of information, much of it technical and susceptible to “disinformation.” It requires “production” often without the necessary regional specialists and linguists. Investigating the Iran intelligence failure in the late ‘70′s, I found the CIA had no farsi speaking analyst. The agencies rely on foreign intelligence services which support the policies of their own governments. The Bush Administration received  faulty intelligence on Iraq from Mossad, Israel’s service. Or was it faulty? It may have achieved its purpose: drawing the US into a quasi state of tribes, religions and sects, ethnicities and foreign interests carved from the carcass of the Ottoman Empire.

Foreign policy of the Bush Administration reflects a lack of experience in the real world away from Washington and its arm chair polemicists and think tank ideologues many with no experience at all in the military where one learns to expect the unexpected.

Terrorism is not a phenomenon of recent origin. Gavril Princip, the Serb nationalist who assassinated the Austro Hungarian Arch Duke in 1918 did not expect to bring down the Empire. Politically motivated terrorists are fanatics, not fools. He and his conspirators expected a reaction. The Empire obliged with an ultimatum to Serbia which triggered World War I and its own demise.

Nineteen men armed with box cutters did not expect to bring all America down. Only America can do that. One preemptive war against a third rate dictator in a desert quasi state crippled and demoralized by sanctions and war, a pariah in its neighborhood, has stretched the American military thin. The US is widely perceived  waging war against Islam in Iraq and by proxy in Palestine while occupying Islamic states in the Persian Gulf and Central Asia, enlarging and undermining its “war” against terrorism while blaming its intelligence community.

The Federal budget has plunged from surplus to deficit at the fastest rate in history. Civil liberties are undermined. The dollar has sunk against other currencies as a barometer of confidence in the American economy and polity. Innocents are dying. In Spain, Argentina, Germany, South Korea and provinces in Pakistan candidates win public office by distancing themselves from the Bush Administration. The US increases its dependence on oil from the Mideast while destabilizing it.

It took the Bush Administration little more than three years to discredit its neo conservative pretensions to Empire and pax Americana, leaving the US increasingly alone and vulnerable, even dependent on foreign central banks led by Japan and China to keep its debt ridden economy afloat. According to reports in Arab media, AlQaeda followed the Madrid bombing with a statement expressing hope for the re election of President Bush, “because he acts with force rather than wisdom or shrewdness ** and will rouse our (Islamic) nation as has been shown.”

Studies have recommended reforms of the intelligence community. But reform does not change the limited nature and function of intelligence. There is no substitute for the pragmatic, cerebral intelligence of policy makers acquired from history and experience in the real world – and the courage to act on it. Condoleeza Rice, Vice President Cheney and their fellow neo conservatives inhabited a world of contending great powers in which force and technology were transcendent. Nineteen men armed with box cutters and Iraqis resisting the occupation have exploded their fantasy. The failures are of a cerebral sort of intelligence.

Economics in America  has roots in the social Darwinism of Herbert Spencer and laissez faire of Adam Smith though Smith qualified his expectations with  assumptions of ethical and rational behavior in markets – assumptions undermined today by esoteric and opaque financial instruments employed to drive markets in any direction, regardless of fundamentals. In social darwinian economics, the fittest would survive, the others did not matter. Entrepreneurs would spur production and employment if sufficiently incentive to invest. The benefits of an unregulated market economy would trickle down. Robber barons of the first Gilded Age, like slave owners in the South, seized on this economics to justify their predatory practices, great wealth and the incidental poverty and oppression of the laboring classes. In this economics there was little social ethic or role for the government as a dispenser of justice and opportunity for the masses. But those robber barons built great industries. Some, like Andrew Carnegie, gave their wealth back, believing it sinful to die wealthy.

Today robber barons  manage money. The U.S. economy was “financialized” – a symptom and a cause of decline. The financial services sector became the largest. The creation of real wealth, new industries, technologies, tradable goods and services was increasingly outsourced to pragmatic nations at an earlier stage in the life cycle of nations and empires. Today robber barons buy, leverage and sell companies as if they were commodities, rewarding themselves with high levels of under taxed short term compensation, hedging risk with esoteric financial products for the unwary.

For  Whigs like Lincoln and Federalists like Hamilton, America  required a strong central government. They won against the Jeffersonians with support from Justice John Marshall and the U.S. Supreme Court. The Constitution was a living document – not, to quote Justice Oliver Wendell Holmes, a “suicide pact”. The U.S. government  engineered a central banking system, developed infrastructure – a “system of internal improvements” – and pioneered universal education through the university. For Lincoln, Union  required hope and opportunity for all who worked and saved. Government was “for” as well as of and by all the people. Muckrackers, progressives and populist  exposed the abuses of social Darwinian economics in its various guises and appealed to Reason and conscience. Democrats during the post Jacksonian era of The Black Book  responded with bursts of political energy and economic realism.  Post Keynesian realists of Adlai II’s era like John Kenneth Galbraith made qualitative judgments about the economic value of taxes and public expenditures. In neo liberal macroeconomics today a dollar spent for another missile and a dollar spent for civil research or education weigh equally.

During the 70′s, I don’t remember many Senate Republicans buying into social Darwinian economics. Reason still  reigned. In the Moral Consequences of Economic Growth, Benjamin M. Friedman documents the absence of any empirical evidence to support the ideology of decreased taxes, primarily taxes on unearned wealth, to produce savings and growth. The rich do not invest in  infrastructure, basic research, public education and health care. Business benefits from public investment. As Friedman demonstrates from the historical record, high marginal tax rates are associated with savings, investment and high economic growth rates. In the 1950′s and 60′s, years of rapid growth and high levels of employment, the highest income tax rate was 91% and under Eisenhower, the Republican.

Economic growth requires  public investment which increases all factor productivity and owes little to the bond market and interest rates.  Now the economy is global – it always was but is no longer divided by fault lines of cold war, high trade barriers and limits of technology which now extends the reach of producers and traders in every corner of the globe to every other – and with the speed of electricity. Robber barons can invest their tax savings in China and other emerging markets which eschew their ideology and the unsustainable levels of debt contracted by the U.S. With federal debt at close to 10% of GDP and mounting, the U.S. borrows from foreign countries to finance its military industrial complex and un winnable wars. The federal debt is only a small part of the exposure which include guarantees, unfunded long term liabilities and state debt. Debt increased at the fastest rate ever under President George W. Bush.

The dollar has declined like a barometer of global confidence in our capacity for political and economic governance. In 1971, when I chaired the Senate hearings on President Nixon’s suspension of dollar convertibility into gold, the official rate was $35 to the ounce. Now in the market that ounce costs about $1,400. The trade deficit defied conventional economic wisdom to rise as the dollar declined over the years. China’s modest trade surplus is likely to rise with its currency.  In the meantime, the world is without a reserve currency. Currency wars are beginning as investors flee the once almighty dollar, and foreign countries defend their currencies.

In the 70′s, few Senators subscribed to the social Darwinian economics of Harding, Coolidge and Hoover. The center was broad. George H. W. Bush dubbed it “voodoo economics” before he, a practical man, converted to Ronald Reagan’s wisdom. With the approach of Reagan and the torrent of money pouring into our politics, Republican  moderates began to retreat, the center to hollow out. In the new America,  politics is largely driven by money, and politics drives policy. No sector invests more money in politics than the financial sector. Investors in American politics  utilize the old social Darwinian economics to rationalize tax cuts for the rich as the debt piles up.

In 1980, Senate Democrats found ourselves resisting one Republican tax cut proposal after another, all with the old mantra newly cloaked in supply side theory and peddled by a genial movie actor with scant experience in the real world outside his celluloid life. Reagan was an eccentric at the fringes of politics, a  political impossibility as late as 1976. (Galbraith  opined that Reagan converted to the Republican party when he realized that would help him make money.) Majority Leader Robert Byrd asked me to organize a Democratic task force to develop an alternative economic agenda that was fiscally responsible and addressed the challenges facing the country, including its first energy crisis and the onslaught from Japan’s companies. Being a lame duck, I deferred the chairmanship to Lloyd Bentsen while chairing a subcommittee that addressed structural weaknesses in the economy. Our Report received little attention in the press. But it gave us a responsible  response to the social Darwinian revival. .

Aided by the Iran hostage fiasco, Reagan won the election. Social Darwinism returned. As I point out in The Black Book, ideologues arrived in Washington as ideologues were leaving Beijing. Taxes would be cut for the wealthy, expenditures increased for the military and missile defense, cut for infrastructure, including civil research, and services for the poor. Little changed under President Clinton. Today the top 1% of income recipients claims 20% of total income. For the middle class and poor, incomes have stagnated since the 1970′s. Unemployment has grown to an understated 10%. In terms of income disparities the U.S. is on a par with Turkmenistan and Nigeria

China rises. In the U.S. Harding, Coolidge and Hoover have returned. The new Republicans propose to cut taxes for the wealthiest and spending for education, health and infrastructure – about all discretionary spending excepting for the military industrial complex which is where most of the fat resides. The dollar sinks, leaving the world without a reserve currency. China will soon have the world’s largest economy. Its reforms began only 30 years ago. The magic of the market place is tempered by realists in China balancing the claims of market and government somewhat like those post Keynesians of Governor Stevenson’s time.

Today, Herbert Spencer might have second thoughts, too.

Where are the Democrats? Indeed, where are the Republicans? If an agenda is needed for restoring economic dynamism to America, a good beginning can be found  in the 70′s. Revenues could be raised as in other developed countries by taxing gasoline at higher levels. The U.S. could produce oil and gas from its public domain safely and for the benefit of the public.  A national oil and gas company could also bargain with the national oil and gas companies of other producing nations. Few American companies export, except as suppliers to a handful of large companies. We could develop export trading companies for one stop service to American producers; adopt the metric system. Ideas are not lacking. Political will and leadership are lacking – and the memory of America.

Mr. President,

You deserve respect for the expeditious organization of your Administration and its rapid response to the extraordinary challenges you inherited. You have restored integrity to the executive branch, for which you deserve appreciation. But the challenges are mounting.

I take issue with your claim that this Congress was the most productive in “several generations.” I remember the 1960s to which you allude; it was during this time that the programmatic foundations for the New Frontier and Great Society were laid by Governor Adlai Stevenson, presidential candidate in 1952 and 1956 and titular leader of the Democratic Party.

I also remember the ’70s, when I occupied the Senate seat you later claimed. To cite a few examples of accomplishment from that neglected era: Congress enacted the Environmental Protection Act and various acts for product safety and consumer protection, and reformed regulation of the banking and transportation systems.

Congress also adopted measures to spur the innovation that followed in bio and information technologies. We brought the intelligence community under some control, created the Department of Energy, established energy and fuel efficiency standards, and initiated projects for development of alternative energies. In the Senate, we reorganized the Senate for the first time and adopted the first code of ethics, which were enforced by the first Ethics committee. Congress adopted measures to limit and require disclosure of campaign finances. The space program was revitalized for support of space sciences, leading to the development of the space telescope and shuttle.

And Congress failed on some counts. It failed to act on my warnings of “spectacular acts of destruction and disruption” and my Comprehensive Anti Terrorism Act of 1979. We failed to end the war in Vietnam. But what Congress did in the ’70s dramatizes the inadequacies of Congress and our politics today. As the complexities of governing increased in a dynamic, interdependent world, the competencies of government declined.

Health care reform, the tax revisions and Dodd-Frank legislation reflect low common denominators, a something-for-everybody approach. Providers, insurers and drug companies carve up the fattened health care pie, already the developed world’s most inefficient. Implementation of financial reform is delegated to regulators, costs are deferred, debt is added to levels already unsustainable.

A modest START treaty to reduce nuclear arms levels was narrowly ratified by the Senate and requires another payoff: $86 billion for enhanced nuclear weapons, which will encourage countries to develop defenses against an America that maintains some 700 bases in the world, wages wars at will and spends about as much as the rest of the world on arms while subsidizing nuclear Israel’s unlawful, defiant colonization of Palestine and the Golan Heights of Syria and pours weapons into the Arabian Gulf.

Enthusiasm for the work of this Congress signifies low expectations and short memories.
You now face a Congress more intransigent than the last. By all accounts, the outcome of the last election – including the loss of 60 Democratic House seats –is the result of public concerns about the economy, but I must point out that the dysfunction of Congress affects policy across the board. It reflects systemic changes in our government and politics.

In the Congress I remember, senators rarely divided along party lines on issues (though some Republicans habitually supported the old Social Darwinian trickle-down economics, which coincidentally rewards their monied constituency. No empirical evidence supports its effectiveness as a means of promoting economic growth and employment, let alone economic justice.)

Income disparities are at their widest since the eve of the Great Depression. During the years of growth in the 1950s, the highest individual income tax rate was 91% under President Eisenhower, a Republican who warned eloquently of the human and economic costs of a then-infant military industrial complex.

Two decades later, we resisted fiscal irresponsibility while focusing on American competitiveness in an increasingly competitive world. In those days, we were challenged by Japan – and responded. I don’t remember Republicans or Democrats opposing the President for the sake of opposing, or crippling the legislative branch for partisan or ideological purposes. Senate Minority Leader O’Connell’s Senate seat was occupied by John Sherman Cooper, a statesman and a Republican. The center was broad. A filibuster would be broken if it kept senators up all night. The incivilities, partisanship and crudities that invade our politics today are unfamiliar to me.

Mr. President, I remember the 1940s when President Truman barnstormed the country by train, railing against a “do nothing” Congress. He was a fighter. The people rose up to support him. Democrats once paraded under banners of his Fair Deal – the New Freedom, New Deal, Fair Deal, New Frontier, Great Society – and the New America of Adlai Stevenson. The country experienced great bursts of political energy and idealism.

After radical Republicans took control of the House in 1995, I urged President Clinton to reorganize his staff and program and to go on the attack. Senior members of his Administration, including a Cabinet Secretary, encouraged me. But he triangulated. The wall between federally insured banks and investment banking was taken down under Clinton. He was the first Democratic president of the new era – the era of “the deal,” of money and tactics. He won in 1996 aided by the tactics of Republican radicals in Congress. But the economy was strong, and the country was not sunk in wars of uncertain purpose and duration.

You will not be so fortunate in 2012.

Congress has inherent difficulty acting comprehensively on complex issues, except with the leadership of a president who knows what he stands for and uses the bully pulpit. You face mounting challenges and uncivil, partisan politics unprecedentedly drenched in money and ideology. You need the support of all Americans. But where is your New America, Mr. President? Incantations of hope and change, expensive halfway measures, issues deferred or delegated signify dysfunction, indecision, an instinct for the path of least resistance in the guise of bipartisanship. Americans despair and vote blindly “against” because they see little to vote “for.”

By electing to Congress an assortment of intellectual misfits with little in common except negativity and nativism, the American people have given you an opportunity to get America back on track. You can shed tacticians and salesmen, and restore civil authority to the executive branch. Bring in the wise men – even if they have demonstrated the courage to be right – and go on the offensive.

Trust the people with the truth, Mr. President.

To paraphrase James Madison, a democracy with an uninformed people is “prelude to farce or tragedy or both.” They look to you for truth and a national agenda. They will support a fighter. Many challenges will not wait, including peace in the Middle East, ending the war in Afghanistan, establishing stability to the Korean peninsula, bringing the budget and unfunded long-term liabilities under control, and addressing climate control and the DOHA trade round. Monetary anarchy looms in the world with decline of the dollar. Nukes are on the loose.

I know from harsh experience that peace is hard; war is easy. Sources as diverse as Alexander Hamilton and Herman Goering have described war fevers easily stirred and exploited. It takes courage, but wage peace, Mr. President. The economy depends on it. Diplomacy remains an alternative to war. The UN needs reform and support of the America that led its creation.

Mr. President, you can give Democrats a New America – a banner and a cause. In this new year, you can give Americans the hope and change you promised. This Congress will be more dysfunctional than the last, yet the challenge is an opportunity for you. Start with the State of the Union address. Your last one never mentioned the world – but the world looks to you. Be an American president for the world. The obstructionists in the new Congress can help elect you and a Democratic Congress in 2012.

Trust in the decency and good sense of the American people.

Most Respectfully,

Adlai E. Stevenson III