David Brooks predicts a future where fear reigns, causing avoidance of risk, which prevents recovery and keeps the recession/depression going.
He sloppily cites neurobiology to explain is theory. But there are huge problems with his model.
Yes there has been fear in America and through the world. That fear has been planted by neocons, fertilized with the deaths of thousands of Americans, hundreds of thousands of Iraqis, plus the forced relocations of millions of others in the middle east, Iraq, Afghanistan and Pakistan.
The fear started with Bush and Cheney. It was the fear that doused the hope and sense of world community that arose in response to 911. Those weeks after 911, the world came together, Americans came together. The possibilities seemed unlimited. But conservative leaders, looking through their blood red rosy colored glasses, saw evil and darkness, and they quickly erased those feelings of hope.
When we observe the dwindling Republican legislative group in congress and watch Boehner and McConnel and associates attack the efforts of the newly elected president to do something to not only help the economy but to build a future for America-- rather than just fighting vague, poorly defined enemy boogey men-- we see exactly the negative, risk aversive, hopeless, idealess mindset Brooks describes.
Brooks already predicts failure. He predicts that Americans will lose hope. I think he's wrong-- that hope is a central ingredient in being an American. We are all descended from immigrants and survivors who either came to America believing they would find and carve out a better life, or from indigenous survivors, who, held to their values.
Essentially, Americans had migrated from one society to another "" from a society of high trust to a society of low trust, from a society of optimism to a society of foreboding, from a society in which certain financial habits applied to a society in which they did not. In the new world, investors had no basis from which to calculate risk. Families slowly deleveraged. Bankers had no way to measure the future value of assets."
There's no doubt that Americans ARE migrating-- from a society where capitalism and the market were blindly trusted by captains of industry and their cheerleading economoronic boosters-- to a society where the light of day has shown that de-regulation and incentivation of profit by massive bonuses lead to greed, more greed and terrible business and economics. Denizens of the dark-- corrupt politicians, greedy traders and exploiters will migrate to the places left in the world that permit these deserving to be extinct practices. Americans will undoubtedly happily and enthusiastcally embrace and enjoy this new society.
And Brooks darkly bemoans bankers inability to measure the future value of assets. Well, bankers have been using techniques comparable to estimating the number of angels on the head of a pin, with their use of mystical and magical economic illusory techniques. There may be banker mystics who bemoan the loss of the old days when derivatives, etc. could be used to conjure up plenipotentiary gods and promises. But there were will be plenty of bankers and business people of integrity who welcome clear rules, regulations and laws which forbid the conjuring engaged in by the industry Brooks laments losing.
Entering into the world of neuropsychobabble, Brooks proposes,
"Cognitive scientists distinguish between normal risk-assessment decisions, which activate the reward-prediction regions of the brain, and decisions made amid extreme uncertainty, which generate activity in the amygdala. These are different mental processes using different strategies and producing different results. Americans were suddenly forced to cope with this second category, extreme uncertainty."
America and the whole global economy have a tough ride ahead. But Americans and humans have evolved with brains that see with both hope and pragmatism. Brooks' view is a right wing, Milton Friedman freemarket economic vision that may be depressing for the corporatists and academics who have seen their models and theories fail. Look at the Republicans in congress, who, in a seemingly braindead reflex response call for a stimulus entirely based on cutting taxes.
Yes there will be those who are depressed and lose hope-- the CEOs who took bonuses for losing billions, the legislators who fed at their lobbyist troughs-- but most of the people of the world look forward to cleaning up the bad economic policies, the failed theories, and replacing them with transparent, regulated approaches that are based on fairness and rationality.