TCG National Conference 2003

TED HALSTEAD
TCG National Conference, June 12, 2003

TED HALSTEAD: It's a real honor for me to be here because, ever since my days in college when I was part of the repertory theatre in the summer, I've been an amateur theatre buff and I've noticed over the last couple decades this explosion that all of you have led in the regional theatre movement across the United States that is, by far, one of the most encouraging trends in our civic life in America and you have a lot, a lot to be proud of. So, for me, it is a real honor to be here with all of you.

I think that it's fair to say that the more trying times we enter as a country, the more important your work becomes, which is just another way of saying that your work is becoming ever, ever more important. And I know that you all face a profound paradox—in fact, any of us who run nonprofit organizations face that paradox—which is that there tends to be an inverse correlation between the importance of our work and the philanthropic largess out there to support it. One way or another, though, we're all going to make it through this and, even though times are tight, the importance of our work in redefining the cultural, social, political, intellectual landscape could not be more important. So, it's a real honor to be part of a group of cultural creatives instead of the usual audience I talk to, which are either business, academic or intellectual—not to say that you aren't intellectual. You are profoundly intellectual, but you are intellectual with an artistic bent, which is wonderful. I also think that for you this is a very important time because, as Ben hinted, we are at a historic turning point in our country. This is something I will get into in my remarks, but, at historic turning points, it tends to be those at the forefront of the artistic and intellectual world who help redefine our social landscape. So, part of my message in my remarks to you this morning is to encourage you to see the work that you do day to day as part of a broader tectonic shift in our society.

Before getting into my remarks, though, I'd like to start with a little experiment to get a sense of our audience and of ourselves here today. So, if we simply divide—and I think I know what the answer is, but I think it will be fun to find out anyway. If we simply divide the room into Democrats, Republicans and independents—which are the three options in our political system—with a show of hands. Let me ask first, how many Republicans do we have in the room? Bright lights, but can't see too many hands. How many self-identified Democrats do we have in the room? Yeah, one or two more. [laughter] And how many self-identified independents do we have in the room? Quite a number, though a few less than the Democrats. Let me start with one suggestion, and that is that, when Bush's new chairman of the NEA visits you tomorrow, let's hope that he does not start off asking that very same question. [laughter]

There is a serious reason why I asked that question, though. That is that I believe that the most profound political trend of our time is the de-alignment in our electorate. And what I mean by that is that, if you asked the American public the same question I just asked you, to self-identify as Democrat, Republican or independent, you find that there are now considerably more Americans who self-identify as independents than as either Democrats or as Republicans. It's a stunning statement about that state of our politics because, in a two-party system, you have a plurality of people who say neither of the above. Well, why is that? Well, my proposition to you is because the majority of American people know, in their guts, that our political system is largely broken, that neither party is responding to the true challenges and the true opportunities of our time. What I mean more specifically is that our country, in many ways, is stuck in the past. We have entered, at least in the economic sphere, we have entered the so-called Information Age, or the Post-Industrial Age, yet we remain stuck in Industrial Era institutions, ideologies and political parties. When it comes to the political spheres, in one sense you could say that we remain, our political system remains dominated by two feuding dinosaurs that have long outlived the world in which they evolved. It gets a little more subtle, though, because the two parties are at a very different stage in their own evolution. I think it's fair to say that the Republican party today has a very clear and coherent agenda, even though personally I find it a very backward-looking agenda. By contrast you have the Democratic party which, frankly, doesn't seem to have much of an agenda at all—and I'm not saying this to be funny. I'm saying this quite seriously. But as a result you have neither of the two leading parties offering a forward-looking, a bold, a visionary agenda for the future of American politics—and I believe that the American people know this. They know this. This is why so many of them are tired of conventional politics, looking for something different, self-identifying as independents.

So, the bulk of my remarks this morning I want to focus on what would make up a new political program worthy of this new era of this Information Age. And I want to start with what is so new about our age. You know all the basics. You know that technologically this is a fundamentally different time. You know that the nature has changed dramatically. Job mobility, for example, is down to just a couple years, whereas we used to have a model of lifetime employment. We know that there are fundamental changes in the realm of the family. To give you just one example, back in the 1960s, over 70 percent of American families had at least one stay-at-home parent. Nowadays, over 70 percent of American families have no stay-at-home parents, either single working parents or two working parents. There are also fundamental changes in the nature of the economy, just-in-time manufacturing, all of that. These are all the hallmarks of the so-called sped-up Information Age.

But you know all of that. What I want to suggest, though, is that there's something else that is actually more profound going on and I'm going to argue that for all of the changes going on in the Information Age, it is probably in the personal sphere—that oh-so-rich personal sphere that Judy was talking about—that the Information Age has exerted its greatest impact. I believe that what we are witnessing is a mass professionalization of society. And what I mean by that is that we are seeing the spreading of norms, values and knowledge which, in the past, were really limited to the elites, but now are spreading to all members of society. We are becoming a free agent nation and a highly sophisticated nation. Let me give you just a couple of examples. The majority of Americans, the vast majority, own credit cards. The majority own their own homes. About half of Americans have money invested in financial markets and the majority also have access to the unlimited information on the World Wide Web. My point is that today's citizens, as compared to our grandparents or our great grandparents, are far, far more sophisticated and, as a result, our more sophisticated citizens are capable of flourishing in a system that offers them a lot more choices and a lot more responsibilities. But the key point here is that the sophistication of our citizens has, in many ways, surpassed that of our dominant institutions, which still tend to be fairly paternalistic and fairly top-down. Now, in the past, this top-down, centralized system may have been necessary to promote progress and create a new citizen. Well, the system has succeeded and we do have new citizens and now it is time for that system to evolve. If there is one defining feature that I would suggest ought to be the pillar of a new politics worthy of the information age, it is that any system needs to be able to confer far, far more choices on the American people. What do I mean by that? I mean more voting choices. I mean more educational choices, more career choices, more medical choices, more lifestyle choices.

This is where the argument gets kind of interesting, though, because, on the surface, it often seems as though there's a necessary tradeoff between more choices and flexibility on the one hand, which are really the defining features of the Information Age, and fairness on the other hand, which is a perennial American value. Now, when you think of choices, clearly our choices as consumers in the Information Age have grown just exponentially. Anything you want, in any size, shape or form, you can get on the World Wide Web. This is an era of choices the likes of which the world has never seen. Yet as citizens, in the realm of politics, our choices remain exceedingly limited. In other spheres of society our choices remain very limited. My point is that the expansion of choices we've seen in the marketplace has not expanded to the civic realm, to the political realm and to other realms of our society. So, on the surface, there's this touchy tradeoff—this tradeoff between flexibility and choice on the one hand and fairness on the other, which is really our sense of equality, which is a perennial American value. Now this tradeoff leads to the sense that these two values are often mutually exclusive and our two political parties seem to go out of their way to exacerbate the situation, making us believe that, as citizens, we have to choose between choice and fairness, between equality and flexibility. Let me give you a couple of obvious examples. The Republican party today tends to be in favor of ideas like school choice or privatizing social security on the grounds that these would expand—social security, for example—on the grounds that it would expand the individual choices of all citizens. Fair enough, on those fronts. But Democrats, as you all know, tend to oppose these ideas on the grounds that they would undermine fairness, our sense of equality, social cohesion and so forth. It's dynamics of this sort that lead the average American to believe that there's a mutual tradeoff between these two, between choice and fairness. Well, I would suggest to you that whichever party is first to square the circle and to offer the American people what they really want—which is more flexibility and choice on the one hand with more equality and fairness on the other—that party, I believe, will own the future of American politics for the next several decades, but neither one has gotten there.

So, I want to walk you through a couple of examples of how we could get from here to there, how we could create a new social contract for this country based on these principles of flexibility and fairness, which need not be mutual opposites, but rather which can be joined into a dynamic new paradigm. Let me start with healthcare because that's something that a lot of Americans are concerned about today. I'm using all of these examples to point out two things: one, how we are stuck in the past and two, how we could break out of the old boxes of left and right going forth. So, let's start with healthcare. We have 41 million uninsured Americans. We are the only developed nation in the world that has such a high proportion—one in seven—uninsured. In fact, most other nations have no uninsured because they have national healthcare systems. Yet we spend more, by the way, than any other country when it comes to per capita healthcare expenditures. So why is this? It's because we are stuck in our own past. We're stuck, in fact, in an accident of history. During World War II there were wage freezes in order to keep inflation at bay. As a result, companies were somewhat desperate to attract new workers and they couldn't do so through high wages, so they started offering benefits such as healthcare benefits with tax deductions from the government. Well, this accident of history, after World War II, grew into the basis for our national healthcare system. And many of us don't think of this, but if you consider that today we get our health insurance, the majority of us—unless you're very poor, in which case you get medicaid, or rather old, in which case you get medicare—we get insurance from our employers, or we tend to not get insurance at all. Well, at the height of the second industrial revolution when the average American aspired to lifetime employment with a single firm, that type of system might have made sense, having your job provide your insurance. Nowadays, though, do you know what the average job tenure in America is? It's under five years. In California, it's under three years. For people in their twenties, it's one to two years. How much sense does it make to have to risk losing your health insurance every time you change jobs or, at a minimum, having to change your doctor and so forth? It breeds a profound, profound insecurity. The way of the future is to make insurance citizen-based instead of employer-based, meaning that your insurance ought to follow you from job to job. It ought to be your right as a citizen. It ought not to be dependent on who you happen to work for and whether your employer is generous or not generous, big or small. But that does not necessarily mean that we need to go the way of Europe. And one of my key points in that Atlantic article that Judy mentioned to you was not that creating a new social contract for the United States means that we need to become Sweden—because there is a unique American tradition believing in private enterprise, personal responsibility and so forth. So, we need to craft our own special social contract. So, I am not suggesting that the best way to reach universal health insurance is through a single-payer system of the type that they have in Europe or in Canada. Americans do not have the tolerance for the extremely high taxes that that would require. Five U.S. presidents have tried to do it. It has not worked. The most promising way to get there, by contrast, is to make health insurance mandatory for all citizens with generous subsidies for those who need them. Just like car insurance is mandatory, health insurance should be mandatory. Companies should be required to provide contributions to those benefits for all of their workers. We ran numbers—actually, we released these numbers yesterday morning on Capitol Hill with one of the leading senators in the country, Senator John Breaux. We found estimates that it would cost $75 billion to transition from our current system to a new system where every American would be covered. That may sound like a big number, but believe me, in the scheme of things, it is a very, very small number. But to get from here to there we need to change paradigms. We need to get away from the antiquated, employer-based model and adopt a new model based on citizens, which would combine the type of flexibility and fairness that I'm talking about.

Let me shift to another big national problem and that is the state of our education system. Here, again, we spend more than any other OECD country on K-12 education, but our results are quite, quite poor. On math, reading tests and so forth we tend to score considerably less than our counterparts in developed nations. Now, again, we're stuck in an accident of history. For those of you who are involved in the education debate, you may know this. For those of you who don't, this may be news to you. But we have one of the most antiquated ways of funding schools in the entire developed world. It leads to dramatic—and I mean dramatic—disparities in per pupil expenditures across the country. This is the big issue. This is the 800-pound gorilla that no politician is willing to touch. The last four U.S. presidents have claimed they want to be the education president, but not one of them has been willing to touch this issue. Because we fund schools locally and largely through property taxes, there are profound inequities. If you live in a rich neighborhood, a low property tax will generate a lot more revenue than even a much higher property tax in an adjoining poor neighborhood. That is no way to fund the education system in the world's leading democracy. It leads to this type of disparity: The average child in Mississippi gets, on average, $4,000 for his or her K-12 education. In New Jersey, by contrast, the average figure is over $12,000, even after you adjust for cost-of-living differentials. In other words, our children are, instead of studying geography, they are suffering from accidents of geography. I think the way forward here is to combine the best of the Left with the best of the Right. Conservatives, in my opinion, are correct when they say that parents ought to have more autonomy when it comes to where their children go to school and, generally speaking, I support the goal of school choice. I think it's something that would improve our school system and empower parents to have a greater say. But when you ask them, "How do we get from here to there?", the conservative proposals are nonsensical. President Bush ran on school choice and yet his policy was to give every student a tax credit or tax voucher of $1,500 to be able to buy choice. Well, when the average cost of school education across the country is $7,000, how on earth do you give a parent $1,500—less than one-fourth—and say, "Here, go head and choose"? It doesn't makes sense at all. If we're serious about broadening choice, we have to be serious about reaching national parity in school funding. So, the idea that my group has been pushing on this front is to equalize funding nationwide for every student—to give every student in America roughly the same amount of money and then to empower the parents to have a greater say in where their child goes to school, whether it's in a system of charter schools or some localities may choose to extend that to private schools as well. But we have a huge challenge to deal with here. Most other countries fund schools federally. We fund them locally. Only 7 percent of K-12 funding comes from the federal government and yet we let our politicians get away with telling us they're going to the education presidents. The bill the that Republicans, with collusion from Democrats, passed recently—the Leave No Child Behind bill—is a complete farce. It is a large, unfunded liability. All it is doing is showing the inadequacy of our education system. If we want to do something about it, we have to tackle the funding of our schools. This is yet another way that we need to a) modernize and b) combine flexibility with fairness.

Let me move you to a third example where here we're not stuck in the past century; we're rather stuck in the 18th century. Our electoral system was inherited from 18th century Britain and I will tell you that even the Brits are rethinking their electoral system, so maybe we ought to follow suit. Now this we will find zero leadership from either political party because they have a vested interest, a built-in interest, in maintaining their very comfortable two-partisan, two-party duopoly. The biggest problem out there in our political system…. Well, let me step back for a minute. There are really three theories of what's wrong with our politics. There is, first of all, what I would call the Beltway Insider Theory, which is that politicians are inherently corrupt and they become more corrupt the more time they spend in Washington. You may believe that, but that is one of the theories and the solution of choice seems to be term limits. Don't let them stay there that long. The second theory of what's wrong with our political system is what you might call the Special Interest Theory and that is that politicians are basically good people. They mean well, but they are corrupted by the power of money and the influence of special interest, hence campaign finance reform as a solution of choice. Well, there is a third and, in my opinion, more profound diagnosis of what's wrong with our politics and that is what I would call the Lack of Choice Theory. The fact that, because we are limited to a choice between two rather predictable parties, most Americans, come election day, do not have a candidate to support that actually represents their views on a wide range of issues. Let me give you an example in the last election, for instance. Senator John McCain—the last presidential election—Senator John McCain at a key time was by polls the most popular candidate in the country. Yet there was no way that John McCain could get the nomination for the Republican party. Why? Because he challenged the Religious Right and the Religious Right has a veto lock on the nomination of any presidential candidate for the Republicans. And, by the way, the exact same thing happens in the Democratic party where, again, a group of minoritarian interests have a veto effectively on who can be their candidate. So, we have a system in which these minoritarian groups, by virtue of our complicated electoral process, have a lock on the choices for us, the American people. So how can you get out of this? How can we combine my principles of flexibility and fairness with a new way of empowering citizens? Well, I would suggest that the most significant, yet simple, amendment we could make would be something I call choice voting. And what that means is, come election day, you would be able to choose—you would be able to vote not just for your first-choice candidate, but also for your second- and your third-choice candidate. You would put, "Here's my first, second and third choice." This is what's called instant runoff voting. This is used by various corporations in America. It's used by several countries throughout the world. It's very simple, but it would solve the most profound problem in our politics, in our electoral system now, which is that any vote now for a third-party candidate is not only a wasted vote, but is a vote, in effect, for the person you least like because you are, in effect, throwing away your vote. If we had this type of system, the outcome of recent elections would have been dramatically, dramatically different. Let's go back to 1992. If we had such a system in which you could say, "Here's my first choice, my second choice and my third choice"—and, by the way, what happens then is that, if your first-choice candidate does not have a majority, then your vote is simply reapportioned to your second-choice candidate and perhaps to your third-choice candidate until somebody has a majority of first, second or third choices. If we had such a system, in 1992, Bill Clinton would probably not have won because what probably—what cost George Bush the election was all the votes for Perot. So, Bush Sr. would probably have won in 1992. In the 2000 election, though, if we had such a system, there's no question that Al Gore would have won because Nader effectively stole the election—again because a vote for Nader effectively became a vote for Bush because of our very antiquated electoral system. Here's a simple way to greatly broaden the choices in our electoral system and, lest you think this is outlandish and would never happen—well, this is a bit of an outlandish example—but my former home city of San Francisco recently passed exactly this: From henceforth elections in San Francisco shall use instant runoff. The state of Alaska had this on a referendum recently. The state of Vermont is considering this in its legislature. This is not that outlandish of an idea.

Let me give you one more big idea for the future of American politics—one that I've been talking to several leading presidential candidates about and that I would hope makes it into the '04 election—and that is what do we do about creating true equal opportunity in this country? If you look at the polls, Americans don't believe in equality of outcomes, but they profoundly believe in the equality of opportunity. Yet, we don't really have an effective way to bring that about. The Left, the Democratic party, is still caught up in a paradigm of income support, meaning providing just enough to get by to those who are needy. While that is extremely necessary and useful, it is not enough because nobody has ever spent their way out of poverty. Conservatives, by contrast, tend to have this social Darwinism, which is survival of the fittest, let them fend for themselves. That, obviously, is not particularly compassionate or effective either. If we are serious about helping each next generation at having a shot at the American Dream, well, here's a radical idea for you that, again, would combine flexibility and fairness. Let's endow every American child, from birth, with financial assets. How would this work? Let's say you give every child born tomorrow, starting tomorrow, $6,000 at birth that would be invested on their behalf by their parents until the age of 18, but it's the child's money. When they reach 18, with compound interest, that would be about $20,000 in inflation adjusted terms. That $20,000 would be available to them to a) buy a high-quality college education or lifelong learning; b) put a down payment on a first home; c) start a legitimate business; or d) save for their own retirement. In other words, we would be endowing every citizen with the financial resources necessary to have a productive life. The difference between the wealthy and the not wealthy is that the wealthy have financial assets. In recent years—or at least until the stock market crashed—the trick was that it was the returns on financial assets that were far outstripping the returns on labor. The way that people were getting ahead was with returns on their assets. All Americans, in the 21st century, should have access to financial assets. And one of the most profound new ways to broaden economic opportunity in the 21st century would be to endow every child from birth. And this is an idea, by the way, that follows directly from American history. In the 19th century we had the Homestead Act to broaden the ownership of land throughout the United States. In the 20th century we had the Home Mortgage Deduction to help every American own their own home. Well, in the 21st century we should go one step further and enable every American to have financial assets in their own name.

Okay, so here are a number of big ideas that are all held together by three principles: one, the idea of making as many programs as possible citizen-based instead of employer-based, place-based, like school funding, or institution-based, like employer-based benefits; two, it would bring more, a lot more, choices to all facets of American life and confer a lot more choices to American citizens; and three, it would do it in a way that is far, far more fair. These are ideas that appeal to a broad cross section of the American public. And now is the moment when I am going to ask you to momentarily suspend your disbelief, but I'm going to give you an argument for suspending your disbelief, rather than asking you to do it on faith. This is where we get the cycles of history. If we look at sort of the broad swath of American history, we find that profound periods of political change tend not to be evolutionary—rather they tend to be revolutionary. They tend to occur roughly every 70 or 80 years, triggered by a consistent set of phenomena. What are those phenomena? Well, first, profound technological changes: the birth of the first industrial revolution, the second industrial revolution and now the third industrial revolution of the Information Age. Each of the prior transformations of the American republic—the big ones—have centered around the birth of one of these new industrial eras and I'll get back to that in a moment. The second thing that they have tended to have in common is a profound shock to the system, a destabilizing phenomena, whether a war or the Great Depression. The first time the American republic was fundamentally reinvented was during the period of reconstruction following the Civil War. The second time was during the New Deal, which, of course, followed, first, the Great Depression and, second, the Second World War. The third triggering factor in all of this tends to be demographics—profound changes in the makeup and composition of our population. A fourth profound factor tends to be great new periods of inequality, which certainly was one of the triggers for the birth of the New Deal era. And a fifth and final trigger is profound periods of partisan dealignments, when the existing political coalitions start crumbling. Well, you may have already guessed where I'm going with this—and that is, unlike the last several decades, we are now approaching a time when all of these five factors are once again, creating what I believe will be, over the next decade or so, a near-perfect political storm.

Once again I want to take you back. Look at the founding of our republic. We founded America as an agrarian republic. We then reinvented the country during the next big crisis. We had a Civil War. We had a profound technological change, meaning that we had the birth of the first industrial revolution. That brought us a very, very different country in almost all respects. The market and the civic sector and the governmental sector were radically transformed. Once again this happens at the birth of the second industrial revolution through the New Deal paradigm. The trigger is, again, the Great Depression, the birth of the second industrial revolution, profound new levels of economic inequality. Well, once again all of these factors are coming together. Let's go through them very briefly. The wars are of a very unexpected type this time: asymmetric warfare, something that at your last conference none of us would have predicted but now is very much upon us. We are in a sense of—we are, in a profound sense, not in a moment of peace in terms of our national security. Second is technological change and this is the one that we all know. The birth of the Industrial Age being replaced with the birth of the Information Age has changed so much about the nature of our lives, our commerce and, as I mentioned, brought forth a far more sophisticated citizenry. Third, demographics. Over the next 10 years, I assure you, nothing will be more destabilizing in American society than the retirement of the Baby Boom generation. I saw some numbers in the last couple of days. The debt, the not-reported debt, the unfunded liability in medicare and social security alone over the 75 years—if the programs don't change—are at the tune of $44 trillion. No, you know, nobody has any ability to assimilate a number like that, so let me put it in very concrete terms because it is such a large, large number. It would take taxing the entire wages of every working American, meaning taking your entire payroll for the next four years to cover that type of unfunded liability. These programs are going to start crowding out so many of the other sectors of what the government now spends its money on that we will be forced through very difficult periods of self-sacrifice. But again, I remind you: It is through periods of crisis that our republic is reinvented. It tends not to be in peace and prosperity, it tends to be in moments of crisis and demographically, technologically, militarily, crises will be upon us. When it comes to inequality, we are returning to levels of wealth and income inequality that we have not seen since the period preceding the New Deal. These numbers out there are really draconian and they will have a profound impact—probably not on the next election, but certainly over the next decade. And then, finally, what gives me the most hope is this dealignment underway. The fact that so many Americans—especially young Americans—are self-identifying as neither Democrat or Republican, but as wanting something different or other.

If you go back to the last reinvention of the American republic during the New Deal period, the core ideas, the intellectual capital of that reinvention were developed well in advance of the time, but the basic ideas of the New Deal by a key number of progressive thinkers lay at the margins of society. FDR did not run as a New Dealer. FDR became a New Dealer in response to the wave of history, to the crisis of history. And suddenly ideas and experiments which had been conducted at the state and local level suddenly became the model for a new national paradigm and you had, in very short order, a new political framework, one which served as a public philosophy that really brought our country together from the 1930s until the late 1960s and in which we saw the birth of the world's first mass middle class society. The consensus and coalition broke apart in the late 1960s, started breaking apart, and has yet to lead to a grand new political coalition. But sooner or later the current order is going to implode because it is not offering clear, coherent solutions to the real problems of our time. So, although my message to you is bittersweet, that change will come from crisis, the sweet part is that fundamental crisis will come. Throughout American history it has always been those, the artists and the intellectuals, who have been at the forefront of that change.

So, my message? The wave of history is coming. All of you in the arts, all of you who are intellectuals—and those of you who are in the arts are, by definition, intellectuals—will be at the forefront of this next remaking. It will be a difficult remaking, but it will be an opportunity for us to reinvent our republic because the history of our nation is one of reinvention. That is what we have done best. Every 60 to 80 years we have fundamentally reinvented our republic and, once again, we're coming to a near-perfect political storm, which means that sooner or later—not in the next year or two, but certainly in the next 10 to 15—we will see a fundamental remaking of the American republic and it will be a pleasure to be in this with all of you. So, with that, thank you very much.

[applause]

Is this something that goes with theatre people that they like clapping for a very long time? It makes the speaker feel very good, but thank you. We have just over 15 minutes for a group discussion. I believe that there are microphones in those two places, so my hope is that we make this a very interactive discussion and talk about anything that you want. If you could start by identifying yourself, please.

JOHN GALLOGLY: Hi, I'm John Gallogly, I'm from Theatre West in Los Angeles. I've got a question for you. The assumption that you're operating under seems to be that any crisis will come out with an improved republic. What is to say that this wave of history you're proposing is not going to be a tsunami of fascism? Aren't the same conditions you're talking about exactly those that were in the Weimar Republic, which was also a republic which became—which perverted into something that we all know. The question of radical difference of wealth and, in this country, something that is perhaps mitigating against what you call the sophistication of the American republic, which is the constant consolidation of media ownership and the choices that people get in terms of their information—how do you think this will become, necessarily, a solution when we hit this crisis and not a further deepening of this problem and perhaps a historical reversal of the democratic nature of this republic?

HALSTEAD: That's a very interesting question. Let me agree with one part of what you're suggesting and profoundly disagree with another. I think you are exactly correct that there is no way to know, in advance, whether the response to the next crisis will be a promising one or a not promising one. I am not a technological determinus. We will be—we are in for a next remaking and we could blow it this time or we could, as in the past, become a better nation in the process. So, I completely agree with your premise that the outcome is entirely unpredictable. Yet, what gives me great hope is that the last three times we have been through birthings of our republic, each time we have succeeded in expanding on three axes: the axis of individual freedom, the axis of community solidarity and the axis of fairness. And all three times we have moved forward and upward on that axis because of profound American values. In between those periods, we have worsened in some areas. We are worsening once again when it comes to economic inequality. But I have great faith, again, in the values—the core values—of the American people and the fact that, when tested, people come out…I believe that when Americans are truly tested, the very best in them tends to come out. We will tolerate only so much inequality. We will do our part. Americans have a tendency to come forward when circumstances require. So, what gives me optimism is our nation's own history of having passed this test several times before. If you look at the polls right now, about 24 percent of Americans consider themselves conservative. About 20 percent consider themselves liberal. The vast majority consider themselves moderates. The vast majority of Americans are pragmatists. The vast majority of Americans want a fairer society, a society that has more social trust and civic capital, a society that is more dynamic, not less. So I—though the risk you point to is real—I think that our history suggests, and certainly my optimism helps me believe, that we will pass this test once again, but that's the point. It is a test and we—those of you at the forefront of the artistic community or those who will play in the intellectual debate—these are the people who are going to be leading the charge, so the challenge is upon us. There are no foregone conclusions. In that sense, you are absolutely right.

To the latter part of your question about media consolidation, yes, I do think that is a problem. On the other hand, given the explosion of the electronic realm and the world of the Internet, never before have we had such access to so much information or been able to customize it to such a degree. I tell you, what worries me more than media consolidation is the shift from broadcasting to narrowcasting and the organizing around very small niche interest groups that tend to get their news only through very filtered mechanisms. But I think that the breadth of information out there for anybody looking or wanting, at this point in our history, is quite astonishing.

MICHAEL ROHD: Michael Rohd. First, thanks for your great speech a great deal. I'm curious, speaking from a historical perspective that you seem to have a great sense of, a great experience with, how you see the relationship between the degree of jadedness or cynicism amongst a citizenry and a voting public with the results of the type of change that you're talking about in these three other eras in American change. Although there's certainly more information out there right now, there's also probably a greater disillusionment with the system and the process. And how you see animating, in a positive way, a citizenry—where we're at with that and what your organization does to work not just with the government and intellectual circles, but within the general public. Thanks.

HALSTEAD: That's a very good question. If you look at my generation, so-called Generation X, or the successors' generation, Generation Y, you find exactly what you're talking about, which is profound cynicism about the public sector, profound alienation from the mainstream political process, far less likelihood to vote or volunteer for a political campaign or what have you. So these trends, if you look at them on their surface, are rather depressing. On the other hand, if you look back at the cycles of history, as you were suggesting, you find that the American public tends to go back and forth between periods of public interest and private interest, times of concern about the commonwealth and times of concern about the self, times when the civic impulse is very strong and times when it is very weak. So there's a cyclical element here and clearly over the last two decades we have been in a very inward-centered, alienated, me phase, if you will. But, if history is any guide, the pendulum is most likely to swing back. Now what will it take? Well, I would suggest to you that what it will take is not just big, new ideas—what my group is about delivering to a political process—but it will take a new type of political leader and, for lack of a better term, I would describe that new political leader as one who is willing to lose on principle. [applause] What I mean by that is that so many of our politicians are obsessed with doing whatever it takes to stay in power and whatever the poll, the focus groups or the polls, tell them that they are so constrained. This is even more the case for Democrats. I had the opportunity a couple weeks ago to spend the weekend with 30 Democratic senators giving them a talk about the future of healthcare and my introductory remark to them was: If you have anything to learn from Republicans, it is that boldness pays. Boldness pays. We need some politicians who have the courage to put forth big new ideas rather than trying to play it safe. John McCain, when he galvanized so many Americans in the beginning of the last election, it's because he had this willingness to speak truth to power. He was sort of the common speaker. I know you may not agree with a lot of his ideas, and I don't either, but I have a lot of respect for him because he was more daring than most candidates. It meant, of course, that he could not get the nomination for his party. Same in the Democratic party. Some leaders that would come out with bold ideas may not get the nomination. But we need the kind of politician, the type of leader, that is willing to speak truth to power, willing to lose on principle. That is what we need. So I think that, sooner or later, a new generation of political leader will come to the fore—and I know a lot of exceptionally talented young people who are planning to enter politics in the next decade, who are not shy and who have big new ideas. Now, you'll notice that strange things happen in American politics. No event has galvanized young people to vote more than the—sorry to say this—the running of Jesse Ventura in Minnesota. The reason that nobody predicted that he would win is because when they poll, they poll registered voters. Minnesota has same-day voter registration laws. And what happened was that, come election day, huge numbers of young people flooded to the polls, registered and voted for the guy and we got our first governor-wrestler. [laughter] Clearly he was somebody willing to challenge the conventional political orthodoxies. Now I would wish for a better example of the future of American politics, but, sooner or later, we will get that and I think there's a mistake in thinking that a lot of the changes have to occur from the top down. As I mentioned, electoral laws are fundamentally shaped at the state and local level. Other cities and states can follow the lead of San Francisco, redo the way they structure elections and, in so doing, make it so much more possible for new voices to come into the political process.

And I want to say one more thing about this. Although I'm a big believer in instant runoff voting, a more likely scenario for a reinvention in American politics is not the ascension of a third party. Third parties play very, very important roles in American politics. They push whole new issues onto the political sphere—but they are like bees. They tend to sting once and then die, but their lasting legacy is that they lead to the fundamental takeover of one party or the other. Because our parties—and this is the key thing to remember—our parties are really just shells. They are shells whose agendas and coalitions change radically—I mean radically—from decade to decade. Most obvious example: The South used to be the bedrock of the Democratic party. It is now the bedrock of the Republican party. The parties can be taken over. I would suggest to you that, at this particular moment in history, it is the Democratic party that is far more ripe for takeover. Sometimes parties need to implode before they get re-energized and taken over. But with all of this I think there is a lot of hope—and when you get new leaders with new ideas offering a vision that is appealing to people, a vision that evokes passion in all Americans, then people will come out and do their part.

CARIDAD SVITCH: I'm Caridad Svitch. Thanks so much for your talk today, it was really inspiring. I just had a few questions for you which had to do with, certainly during my lifetime and the generation younger than me, we've seen the erosion of the middle class in American society and the greater division between the rich and the poor. And, you know, a lot of your comments about those who invest and financial assets and so forth predisposes that these are people who own property or have property or have some knowledge of making investment, that that figures into their lives. But there is a great majority of Americans who are displaced, poor, unemployed, part of a migrant class, for lack of a better term, a nomad class, a peasant economy and they have very little political power, but their voices are part of our nation. So, I'm wondering where you see the opportunity for those voices to be heard, represented and given their place in the market economy that we have.

HALSTEAD: First of all, every American citizen has the right to vote. I actually believe that every American citizen has the responsibility to vote, which gives me the opportunity to float one more big idea—and this is one, I have to say, most of my colleagues at the New America Foundation think this is outlandish, so this is just me speaking, not my colleagues. But I think what we've seen is the erosion of citizenship and, I think, in the 21st century, we should be expecting a lot more, rather than less, of one another. Hence, I would suggest that we make voting in American mandatory. [applause] Just like several other countries have mandatory voting. And that change alone would do so much to shift those dynamics because suddenly every politician would become accountable not just to those who vote, but to all American citizens. I mean, if you look at—I'd mentioned that 50 percent of Americans have assets in the financial markets? Well, 70 percent of voters have assets in the financial markets. The investor class clearly is the dominant class in American politics. That is not necessarily a representative class, but that is because those who are at the bottom tend not to vote in high numbers and they need to start doing so, whether mandated to do so or otherwise encouraged to do so. I think that the strange phenomena in America right now is that, although inequality is growing dramatically, it hasn't really manifested itself as a big political issue, in large part because there's a lot hiding it. Most Americans own their homes. The values of homes have gone up so dramatically that people have been refinancing at incredible rates and part of what is keeping our economy going is simply that people keep taking money out of their house, using it to consume. That keeps the economy going. The most frightening statistic out there about our economy is that household debt is now at 107 percent of household income. 107 percent. This is less than a decade before the Baby Boom generation starts to retire, when we should be saving a lot more. So, sooner or later, if and when the housing bubble crashes, these issues, which are percolating below the surface, will become front and center and people, out of necessity and out of inspiration, will come out and do their part at the polls. We will have a new politics. I'd love to see it through mandatory voting.

MING CHO LEE: I also want to say—I'm Ming Cho Lee—I also want to say it was a fantastic speech and I learned a great deal. I thought that you are enormously optimistic and I hope that you're right. I have two questions. One is: What's wrong with this intellectual group that the Democrats vastly overwhelmed the independents? So, what's wrong with this group here? Democrat is more hands raised—that's almost more than half the independents. Of course, Republican doesn't count here. [laughter] So, that's question number one. Number two is: The situation that frightens me now is that I have been feeling a little bit like the Weimar Republic and Nazi Germany in the '30s. I'm afraid that change may not happen because you never mentioned the eminence of corporate in both politics and in the economic system—and in our life and approaching how we behave. The forces are so strong and, for me, the Republicans' agenda is so cynical—I think they're going to overwhelm us. For example, last night I said we don't know how to do dissent anymore. No one speaks up. And I just also want to put in: What happened to the artistic and intellectual community during Nazi Germany?

HALSTEAD: Do you want to ask your question as well?

JANE BEARD: It's a little similar. I look at—whether you agree with it or not—in the name of homeland security we are taking away civil liberties. I witnessed someone question a police officer, in Silver Springs, Md., and be hauled away and be held for 24 hours under homeland security rules, not even being told what he was being charged. I think it does make dissent more impossible. The question that was asked earlier—I look at the 18th and 19th and early 20th century as societies that, whether they were privately focused or publicly focused, were much more homogenous than what we have now. I have had teenagers graduating from high school in an upper middle class community and I have been astounded by their friends who were not registered to vote. In our house, if you're not registered 10 days after you're 18, you don't come home and you show me the little slip that says you voted that day. But these kids don't read the paper. Kids older than—they're not involved. They don't get it. And so, if we're taking away the capacity to protest under the name of making us all more secure, if we're not teaching kids, if we're not identifying with the state, with the community, with an ideology, even with a political party—how do we come together when this revolution comes to make the Right thing happen as opposed to let the people who have power make their thing happen.

HALSTEAD: I am—being the naïve optimist that I am—to be honest with you, I find these comments to be very encouraging, though what you're talking about are very cynical trends. But people have to get angry before they get activated. People have to feel that there's a crisis before they will start mobilizing. In other words, necessity is the mother of all invention and things have to get—I hate to say this—even a bit worse before people start realizing that they can't just go on with their day-to-day lives. Because we're still almost sleepwalking through the good ol' days of the 1990s, where all you had to do was put some money in your 401-K and worry about yourself and things were going to be good. It was this strange period of peace and material prosperity and even my generation—we grew up in this very ahistoric period in which there wasn't a lot of shared sacrifice. Well, sooner of later, shared sacrifice is going to be forced upon us. And I don't want to sit here and suggest that any of this is going to be easy. What I'm trying to suggest to you is that big tectonic shifts are on their way and I've heard nobody yet disagree with me on that. Secondly, that creates a profound opportunity for us to either fail or succeed in reinventing our republic once again. But it is up to all of us to play our part, whether it's forcing our children to vote or whether it's inspiring members of our community—through art, through rhetoric, through articles, through speeches, through what have you—and to collectively come up with a new vision. We need all of this. There are three components: We need an activated citizenry; we need a big new set of ideas; and we need some political leaders who have the guts to stand for those ideas.

Right now I would say that the citizenry is starting, and you can feel it in this room, to get uncomfortable over the direction of this country. There is a palpable discomfort in our country that needs to be channeled toward political activism; that's one thing. The new set of ideas—they too are coming to the fore. That's what myself and my colleagues spend a lot of time on and I can tell you even all the leading presidential candidates in the Democratic party now—we've sat down with almost every single one to pitch them on big ideas and their usual response is, "That's a great idea, but it's a bit too bold," or "You know, it might offend some constituency or what have you." I'm waiting for the day we meet with a presidential candidate who says, "That's the right thing. It may be bold, it may be risky, but, damn it, I believe in it and I'm going to go do it." Sooner or later that candidate will come. Sooner or later we will do our part. So, you're right. There are no guarantees. But the moment of history is rising upon us and it is our moment to do our part. So, with that, I hope I can end with a thought of inspiration of challenge. Thank you very, very much.