This post is not about real prophets. Real prophets, the kind you hear speak at General Conference twice a year, are optimists and preach about the “good news,” the Gospel. This post is about the guy who speaks out in Gospel Doctrine class saying, “these are the worst times ever.” Or the, ahem, Mormon talk radio host Glenn Beck, whose shows these days could be summarized as, “the sky is falling, we’re all going to die.” Or the apocalyptic global warming fanatic who tells you to soon expect tropical weather in Winnipeg.
My message to these “prophets” is, to paraphrase Dickens, “it is the worst of times, but it’s also the best of times.” It all depends on what you want to spend your time thinking about.
Yes, we are in bad economic times. Compared to the last few decades, really bad economic times. And there are clouds on the horizon. But can I point out that the U.S. economy has always been about boom and bust cycles? That is the reality of capitalism.
Please check out this article:
http://en.wikipedia.org/wiki/List_of_recessions_in_the_United_States
There have been dozens of recessions since the founding of the Republic. During the 19th century, these recessions were much worse than what we have been facing the last two decades. Entire populations of millions of people were displaced and out of work. These recessions were really ugly.
But good things come from recessions. Failing, weak businesses are replaced by stronger, growing, competitive businesses. The unemployed are forced to find new jobs and new skills. And the vast majority of people, when they look back at the difficult times, say, “wow, I really learned something from those times.” Most importantly, the U.S. economy continued to grow — strongly — overall during the 19th century, despite tough recessions that seemed to come regularly.
I am not discounting the human cost of recessions. I certainly don’t want to lose my job — it would be devastating to me personally and my family. But sometimes things happen that are out of your control, and you simply have to make the best of your situation.
So, when we look at what we are facing now, and we start considering the history of the United States, would it be the worst thing in the long run to let the Big Three automakers fail and let the market sort it out? Interestingly, 61 percent of Americans in a recent poll said they are against a bailout for the domestic auto industry. I agree with them. In the long run, letting these sclerotic companies fail would be the best thing you could do for them. They would be reorganized into leaner, more competitive enterprises. Some workers would be let go, others would stay and be part of the new organizations. The vast majority of the displaced workers will find other work or will undergo re-training.
The point is that recessions, even bad ones like we are suffering, are not the end of the world. They are bad times, but good times follow.
Which brings me to our most famous prophet of doom, Glenn Beck. For an example of what Master Glenn has been preaching, take a look at this interview with Saxby Chambliss in which he says we’re either headed for hyperinflation or civil disorder and wars.
http://www.glennbeck.com/content/articles/article/196/18839/
All I can say is, “wow, he has been reading way to much Parley Pratt.” If you listen to his show at all, you will hear that the world is going to end next Tuesday and that before then there will be revolutions, the United States will break into pieces and all of us will lose our jobs. And those will be the good times.
In fairness, Glenn Beck has a lot of good messages too about the importance of family and sticking to traditional values. But I don’t think it’s productive to concentrate on such gloom and doom. Global economies function in part on confidence, and gloomy prognostications can become self-fulfilling prophecies. If we all think things are never going to get any better, then they probably won’t.
It is the Adversary who wants us to descend into despair and gloom. He wants us to think that times won’t get better, that these are the worst times ever, that we’re heading for chaos, more hurricanes, 10-foot rises in the oceans, etc, etc. Real prophets, instead, preach the gospel of “being prepared, but being optimistic because good times are coming.”
Can I leave you with the words of a real prophet?
Listen to this story from President Eyring about the late President Hinckley:
“In the last few days, I have remembered his voice. I heard that voice so many times when a difficult problem facing the Church was brought to him. He would listen carefully, perhaps asking a question or two, to be sure that he understood the magnitude of the difficulty facing us and that those who brought the problem to him knew he understood. Time after time, he would quietly say something like this, with a pleasant smile, ‘Oh, things will work out.’ He was an optimist.”
Sorry about the long post, everybody. We’re trying to fix it.
I must say that, while the doom and gloom can become tiresome, it’s necessary. Unfortunately, the information producing agents out there: news, gov’t reports and all that, are not exactly painting the whole picture. Glenn is mostly right in saying that hyperinflation can be a very viable outcome, if the monetary system gets too lax at the printing presses.
I think a lot of the good that comes from doom and gloom is that people can prepare themselves for (maybe) coming events like hyperinflation. Get your food supply. Purchase means to protect yourself should the worse happen (that means guns).
Why do people buy insurance? To cover themselves in case the worse does happen.
“In fairness, Glenn Beck has a lot of good messages too about the importance of family and sticking to traditional values.”
Yeah, but that’s only made worse by all the doom and gloom talk. Beck’s message seems to be, “These are the very worst of times because we haven’t protected the family, etc.” Whenever someone sees the farce of his doom and gloom, they are tempted to view all of his ideas in the same light; i.e., all this “family is important” talk is silly too.
Random Economist, I would be interested in any studies you have seen on doom and gloom becoming self-fulfilling prophecies. A capitalist economy works best when people take risks (opening a new business, spending time on a new invention, etc). If everybody is expecting the worst, they are less likely to take take risks, and this could hurt the economy in the long run.
“Destruction, to the eye of the spiritual beholder, seems to be written by the finger of an invisible hand, in large capitals, upon almost every thing we behold.” –Teachings of the Prophet Joseph Smith, pg. 15
Glenn Beck reminds a big of Jack Anderson, another Mormon journalist who had a lot of negative things to say. (Although I’m not sure that Glenn Beck deserves to be called a “journalist.”
In the 1970s, things always looked brighter when I skipped Jack Anderson’s column. Today will be a brighter day if I avoid Glenn Beck. And that goes double for that fathead on CNN and Keith Olbermann on MSNBC.
I’ll admit I’m a Beck fan, and when I first listened to him about what he calls, “The Perfect Storm,” it is depressing. He is not, however, all about “the sky is falling, we’re all going to die.” He is about preparing yourself mentally, emotionally, and physically for some hard times. We could all use a little expectations management when we consider that we haven’t had serious economic malaise in 30 years. We have adapted to the corrolary of “the all is well in Zion.”
Yes, we are in a recession–what makes this one different. Number one, if follows on the heels of four bubbles that all went sidways into other bubble. The early nineties recession was a collapse of the manufacturing/s&l bubble of the 80’s-investors moved into tech, creating the Internet bubble that collapsed after 9-11, which has taked us to the housing bubble. All of these bubbles were fueled by Bretton-Woods when we went on the debt standard in the seventies. We just went through a mini-commodities bubble that burst. Where can you invest right now–nowhere. Treasuries are downgrading their insurance rating–never been done before. The volatility in the Dow Jones hasn’t happened since 1930. We have 10 Trillion in debt with another 7 trillion promised. You see no warning bells? Just because President Monson didn’t talk about it in conference. He that has ears will hear. There was a lot of talk about adapting to change, dealing with difficulty, etc. It may have been generic to individual circumstances, which is the beauty of prophetic truth, but President Hinckly warnes us in 2001 about this boom coming to an end.
We don’t know whether its just another cycle, but as an amateur economist, we are in 1930’s style trouble. Citi-bank, the auto workers, Peter Schiff, and others in the business all admit the same thing. We are either headed for major deflation-depression or hyperinflation-depression. I still believe it can be headed off, but lets prepare as if we’re at the bottom of the pride cycle for a change.
Also, its obvious that you are a capitalist. Its also obvious that you don’t understand that nothing that’s been done to create this problem or to correct it has any capitalism in it. Businesses are not being allowed to fail or they’re too big to fail. They all go for bailouts. If we would just let the dog die and nurture the new puppy, we would be okay, but they are not letting it happen. You cannot bailout businesses, DOUBLE our national debt, and not cause hyperinflation. Read about the Weimer republic.
I’m an optimist because I know things will get better. Like president Hinckley, things will “work out” but does that mean we will all have two cars and a $500,000 home in Draper–no. We may be in the most miserable time economically, personally or collectively, but that may also cause us to have stronger families, better temple attendance, better Scouts, and be more self-reliant–just like our ancestors. Eventually at the end, we go to New Jerusalem, so things will work out for us because Zion is at the end of troubles.
If you don’t need Beck’s dour medicine, that’s okay. I need him to keep me from thinking “All is Well in Zion” when I see Mormons in droves acting that way when they buy their black friday LCD’s and have no food storage.
Hi Geoff,
Unfortunately, my fields of expertise are outside of macroeconomics, so I am not up to date on the current literature.
Surprisingly, it isn’t true that the risk takers are what drives a capitalist economy. An underlying assumption we hold in economics is that people are risk averse, in that they won’t engage in an activity unless the expected return is higher than the cost. A capitalist economy works best when capital is free to flow to where ever activity is most productive.
While it is true that when general expectations about the economy are low, things slow down, talking heads on TV have very little impact on actual economic activity. Think of all the talking heads back in 2005-2006 who said that the economy was going great. Peter Schiff was the lone voice of reason who saw that people cannot grow an economy in a sustainable fashion through consumption alone, but people largely ignored him.
I think that if you live by the motto, hope for the best but prepare for the worst, you can insulate yourself from major downturns in the economy.
Three or four years ago I was visiting my father during conference weekend and had to leave and drive home during the last session. I remember President Packer giving a somewhat apocalyptic address and the president Hinckley concluding the session with something markedly more optimistic.
In any event the Brethren have been teaching us for years to make our lives resistant to recession. They harp constantly on preparedness, education, debt avoidance and most of all on spiritual preparation.
But we mere mortals want temporal salvation even more than spiritual salvation so we demand bailouts, government sponsored health care, government pensions etc. We would rather be slaves than free if freedom means that our lifestyle could be affected.
I think being realistic is appropriate. Being prepared is valuable and often how things “work out”. But it seems to me the gloom and doom you’re talking about is the loss of hope. Without hope I think people become self fulfilling prophets. The loss of hope spirals into depression.
MoTab finally made a cool music video: http://www.youtube.com/watch?v=ZQ7HDIDEFV4
Hi Geoff. Your post caught my eye today. I’m with you on being optimistic and looking at the glass “half full”. I think our perspective needs to be this way if only because we are likely to attract and gather light within ourselves and are better able to assist and serve others (Good Vibrations).
On the other hand, I completely agree with Peter and the Random Economist’s comments. Given recent events, I see a greater need to prepare myself and my family for those things which are ahead. Not because Glenn Beck says so, but simply because I see the growing fulfillment of prophecy (see for example Lay Up Grain for Seven Years).
We no longer have a primarily capitalist economy. In 1913 the Federal Reserve Act passed through Congress during the Christmas recess. And although its stated purpose is to create “a safer, more flexible, and more stable monetary and financial system”, it has done just the opposite (Who Owns the Federal Reserve).
Later, Keynesian economics was introduced in the 1930’s in an apparent attempt to “grasp the central levers of social control” (Strachey on Keynesian Economics). During the same time period, the United States saw the most massive implementation of “social” programs our country has ever seen. It’s been downhill ever since.
Why doesn’t all this get me down? Because we were warned about this years ago and it’s the fulfillment of prophecy. We’re getting closer and closer to the events President Hinckley spoke about in the October 1992 general conference – “The kingdom of heaven and the kingdom of God on the earth will be combined together at Christ’s coming – and that time is not far distant. How I wish we could get the vision of this work, the genius of it, and realize the nearness of that great event. I am sure it would have a sobering effect upon us if we realized what is before us.”
So I’m with Peter and the Random Economist. Let’s be optimistic. Let’s be positive. And let’s help each other get prepared.
As Elder Oaks said – “What if the day of His coming were tomorrow? If we knew that we would meet the Lord tomorrow—through our premature death or through His unexpected coming—what would we do today? What confessions would we make? What practices would we discontinue? What accounts would we settle? What forgivenesses would we extend? What testimonies would we bear? If we would do those things then, why not now? Why not seek peace while peace can be obtained? If our lamps of preparation are drawn down, let us start immediately to replenish them. We need to make both temporal and spiritual preparation for the events prophesied at the time of the Second Coming. And the preparation most likely to be neglected is the one less visible and more difficult—the spiritual. A 72-hour kit of temporal supplies may prove valuable for earthly challenges, but, as the foolish virgins learned to their sorrow, a 24-hour kit of spiritual preparation is of greater and more enduring value.”
Whenever that day comes, if we remain optimistic and if we are prepared, we will not be fearful of entering into his presence.
Mark B.,
For the record, Beck doesn’t call himself a journalist. He calls himself a recovering alcoholic, former DJ rodeo clown. When he filled in for Larry King recently, he began the show by disclosing his conservative bias. You’re quite mistaken in claiming that he calls himself a journalist (Olbermann, on the other hand, does call himself a journalist and doesn’t ever disclose his bias).
Greg,
I wish I shared your optimism. I feel a little like Nephi (3rd Nephi, I believe), who prayed to God lamenting that he wasn’t born in another time. I feel no excitement whatsoever about being a part of this generation. In fact, I kinda feel a little ripped off that I must spend the prime of my life and raise my kids in the worst of times.
Geoff,
I get what you’re trying to say. It’s like the fire that burnt Yellowstone a few years ago. Forest fires are long-term blessings, as they prime the earth to produce a new, fresh forest. I get that. Yes, the forest will grow back, possibly better than ever, but the years spent waiting for that really, really suck.
Yes, there is always economic ebb and flow. But have you considered the long term damage our flirting with socialism may be doing to our potential to bounce back? The biggest government intrusions into the private sector in this country’s history can’t be helpful in getting to those “best of times.”
I think we’ve turned a corner, as all civilizations eventually do, that we won’t turn back from. I hate thinking about that, but I can find no evidence that my outlook is inaccurate.
I never got that Glenn Beck is pessimistic. I get that those who don’t believe in God, no matter the religion, are scared to death, almost to inaction. Newscasters constantly tell the bad news and scare people without reassurance. I think Beck can reassure people that this is all in God’s plan and to take hope.
I understand that smart, kind, righteous people can have varying personality traits–some by nature lean in one direction or another alone the optimism-pessimism continuum.
The Lord has given us the scriptures which teach an apocalyptic message. Whether we’re a optimist or a pessimist we’re had better be prepared when the evils of the last days are unleashed.
I pose a question to the readers of this blog–do you have adequate supplies of the necessities of life in the event that we are on the cusp of economic chaos? If so, wonderful, if not, I hope you will repent!
I don’t think it’s productive to concentrate on such gloom and doom. Global economies function in part on confidence, and gloomy prognostications can become self-fulfilling prophecies. If we all think things are never going to get any better, then they probably won’t.
Geoff-
But it was OK for the talking heads to concentrate on the vroom and boom economy on the way up, right? Sorry you can’t have speculative excess (i.e. the biggest housing bubble in American history) and then expect there to be no downside (although most Americans seemed to have believed that, i.e. housing prices never go down). What’s happening now is simply mirroring the excesses on the way up. I’ll gladly trade away irrational pessimism for a bit less irrational exuberance on the way up.
Regarding Beck: Embarrassingly, he was one of the few in the conservative punditry who didn’t have his head in the sand about the housing/credit bubble. He should be commended. The conservatism I believe in emphasizes hard work versus the speculate-and-then-get-bailed-out mentality that seems to pervade society today.