Every Country Deserves a Mulligan


The United States government might be about to default on its debt, but nobody’s perfect.  Sure, this could be a mess of a magnitude that makes 2008’s black swan look like the lovechild of Mother Goose and Alicia Silverstone.  At least in 2008 a frightened world could rush to the impregnable redoubt of T-bills—investments backed by the one nation presumed to be the last man standing in even the worst of scenarios.  We are, of course, not so sure about that nowadays.  But we’ve made mistakes before and people have forgiven us.

Consider the 1850s in general, and particularly the long winter of 1860-1.  The country was coming apart at the seams, the political system had broken down, and undoubtedly bond traders were nervous about the future stability of the United States.  A big misunderstanding ensued, but ultimately we came out of it stronger and people continued to rely on US treasuries—to this very day, in fact.

We’ve made some other missteps in the past, from the Smoot Hawley Tariff down to Japanese internment camps and the disastrous deregulation of Lehman Brothers, Bear Stearns and the like, but in spite of it all we’ve remained a good bet for investors around the world.

So lawmakers in Washington might push us to the point of defaulting on our national debt.  How do we know this will be so bad?  You can’t really fault lawmakers for not hastily jumping to the conclusion that this would be terrible for the country, because we simply have no evidence on which to base such a conclusion.  We don’t know yet, because we haven’t tried.  We were all young once, and no doubt we can all agree that you just don’t know what the outcome will be when you eat a lot of Adderall and drink a fifth of Jack Daniels in the matter of an hour, until you’ve found out.  The noise in your head is something that everyone needs to experience for themselves.

Even if the outcome of a default turns out to be negative, you can’t deny that we’ll have learned a lesson, and people appreciate that.  Look at Germany.  We pretty much let them get over the whole Nazi-genocide thing, and we don’t rub it in their faces all the time.  We actually admire their fiscal probity in a time of profligacy and crisis in the European Union.

The Japanese did some bad stuff in the 1930s and 1940s too, and we still love them.

China had its Great Leap Forward—also known as “the Great Leap Backward”—which killed millions and left countless others picking through the garbage for particles of edible nutrition.  We don’t hold it against them when we update our Tiny Tower on a phone swiftly and efficiently made in a Foxconn factory in Shenzhen, do we?

Look at us.  We’re the only country to ever use nuclear weapons on civilians, and yet people still like us.  The bottom line is that the United States will weather this latest crisis, because we always have in the past and the fundamentals of our economy are strong.

In America, anything is possible; even if we default, we can pick ourselves back up again and go from riches to rags to riches again because the possibilities are limitless in a land of opportunity.  Americans love a comeback story, and we might be about to have one.

If you think about it, the rest of the world should really be more like us.