The American Art of Renewal

Renewal — what a great word. Here is Victor Davis Hanson:

How democracies can turn on a dime.

‘Make America Great Again” is the oft-caricatured slogan of the Donald Trump presidency. When Trump was elected, he boasted of jump-starting the economy to achieve an annual economic growth rate of 4 percent.

Experts laughed him off as a naïf who did not understand that structural changes in demography and technology made such growth impossible. Many economists predicted that Trump would crash the stock and job markets.

Yet less than two years into Trump’s presidency, the economy achieved 4 percent growth in the second quarter of 2018. Unemployment rates are at near-record lows. The stock market and oil and gas production are reaching unprecedented heights.

Such radical turnarounds have been common in U.S. history. As the ancient Athenian historian Thucydides noted, large democracies are by nature volatile, they can mobilize quickly, and they can change on a dime — sometimes in the right direction.

In late 1983, Ronald Reagan was being written off as a practitioner of voodoo economics. The country was still mired in a recession caused by Reagan’s efforts to break runaway inflation.

In the 1982 midterm elections, Republicans lost 27 seats in the House and one in the Senate. The man likely to be Reagan’s Democratic rival two years later, Walter Mondale, was considered a good bet to win the presidency, given his youthful vigor, his prior service as vice president, and his incorruptibility.

Yet in the twelve months from November 1983 to the 1984 election, the economy grew at an astonishing quarterly rate of better than 7 percent. Unemployment dropped. Almost every economic indicator showed an unprecedented boom.

Mondale was defeated in one of the largest Electoral College landslides in U.S. history, largely because the economy had been reinvented almost overnight from a bust to a boom.

Read more at National Review: The American Art of Renewal.