Voters in Suspended Animation

Is it safe yet? As Americans go to the polls in the first general election since September 11, they find themselves in the most un-American of positions: uncertain about the future, wary of the present, and unsure of the path back to the optimism and prosperity of the recent past. They hope the measures taken against terrorism and business scandals are sufficient, but they fear they're not. Americans long for the physical and economic security of the '90s, but snipers on suburban streets just outside the nation's capital and backtracking on financial reform leave them feeling vulnerable still. They waver between the optimism offered by a recovering stock market and pessimism over a looming war with Iraq. The latest measure of consumer confidence reflects American fears: Expectations about the future are dismally low. No one appears willing to bet on the future. CEOs wait to spend on new capital. Investors wait to return to the stock market. Everywhere, people hesitate.

Past elections have seen the country divide along ideological lines, with lucid issues and disputed solutions. This time there is dichotomy, but the campaigns seem oddly divorced from the issues of the day. There is no national theme addressing the deep concerns of the people. Neither political party offers a compelling argument or a clear direction. The campaigns feel empty and artificial, with candidates simply pushing hot buttons on a predictable set of tired old issues, such as Social Security or health care. Negative TV attack ads just turn us off. As a result, we have concluded that this election will not do what we want it to do--turn a corner, take a stand, introduce policies that will make our world safe, predictable, and prosperous again. It may be that one party or the other will sweep both houses of Congress, but it is just as likely that Americans will settle for the status quo because it doesn't really matter.

THE GOOD LIFE TURNED BAD. No one understands this more than the twentysomething generation. Most entered the workforce during the boom years, when their world was full of promise. Paid highly, praised fulsomely, recruited fiercely, they now feel abandoned. Since 2000, the market has crashed, the Twin Towers have fallen, anthrax has arrived in the mail, the economy has soured, raises have stopped, bonuses have disappeared, and layoff after layoff has rendered more of the young jobless. The business world twentysomethings found so glamorous and appealing in the '90s has been tainted by corruption and scandal. And the big cities they moved to in droves in search of exciting jobs are increasingly filled with homeless people and danger. For the first time since 1991, violent crime is up. Is it any wonder that the young now worry that their brief encounter with the good life was a mere blip, and the desultory days of the present are going to be the norm? It's hardly just the young who fret: Fiftysomethings watch their dreams of retirement drift away, while they see despair replace hope in their children's eyes. Their lives, and the economy, revolve around their houses--liquefying equity and investing in real estate because everything else is too risky.

We try to draw confidence from the way our nation quickly responded to the twin shocks of September 11 and the financial meltdown, with the President showing strong leadership. The military vanquished the Taliban quickly in Afghanistan, and Congress, regulators, and the markets themselves moved with dispatch to punish those responsible for accounting, business, and Wall Street scandals. The Justice Dept. destroyed Arthur Andersen for its sins with Enron Corp. Corrupt CEOs were arrested. Wall Street firms were fined. Legislation was passed. Things were done. There was momentum for change.

A MISSED OPPORTUNITY. Then, it stopped. The Homeland Security Act that was supposed to set up a huge new agency to protect America from terrorism got caught up in partisan politics and never passed. Airports were never completely secured, and little progress has been made in safeguarding trains, trucks, and ports. The Securities & Exchange Commission capitulated to political pressures, and the new accounting oversight board is in danger of being co-opted by the industry it is supposed to check. Congress mandated corporate governance reforms, then starved the SEC of funds to implement them. The initial post-September 11, post-Enron wave of punishment for evildoers and bad guys is not being followed by long-term institutional changes that protect us from future terrorist attacks or financial betrayals. America's leaders are missing a historic opportunity that we all may regret.

So we still don't know if we are safe. We are reduced to hoping against hope that terrorists won't attack America again even as we see how easy it is to kill innocents in Bali, Jordan, or Maryland suburbs. We hope, too, that the stock market will rocket again even as we see how fragile the recovery is becoming. We feel risks all around us that are difficult, if not impossible, to manage. And we--CEOs, investors, consumers, travelers, plain citizens--pull back, hoping for the best, fearing the worst.

Americans know their world has been blown apart, but they haven't yet found a way to fashion a new one. They know that the only way back to peace and prosperity is through building security and confidence. The midterm election might have offered them a way to do this if politicians had stepped up to the task. By and large, they did not. As a result, the campaigns appear divorced from the fears and needs of the people and seem irrelevant. As long as America's political and economic leaders avoid finishing the job of building new institutions for the higher-risk world we live in--be they a Homeland Security Dept. or new oversight for accounting and Wall Street--we will continue to live in a state of foreboding. In this day and age, complacency and passivity only make us more vulnerable.

    Before it's here, it's on the Bloomberg Terminal.
    LEARN MORE