9/11/11 New York – 10 years to the day of the terrorist attacks on the World Trade centre in New York City and Pentagon in Washington, D.C., President Barack Obama made the stunning announcement to the General Assembly of the United Nations that the United States was filing for bankruptcy and for protection along the lines of what is provided in the Chapter 11 provisions of the United States Bankruptcy Code. As Greece had sought and received protection from the European Union, Obama said that the United States was seeking the same from the world’s financial communities.
In a sober, but calm voice Obama said: “Due to economic challenges facing our largest foreign creditors, China and Japan, as well as internally facing the Federal Reserve, and all of their demands for repayment, the U.S. Treasury had no other choice than to file for bankruptcy and follow the provisions in Chapter 11 of the United States Bankruptcy Code.”
The President explained: “Real cooperation and collaboration between the Republican and Democratic Parties hasn’t materialised, the consumer confidence needed to drive the economy didn’t come back as hoped for and sustained levels of unemployment all added to this decision.” Obama added, “Wall Street and Main Street haven’t found a way to narrow the chasm between them and have used up precious time and even more precious money which has also moved us to this decision. We are hopeful that using the same opportunity to restructure that companies that file Chapter 11 use and that following the upcoming painful period, we will return to financial health, stability and to a position of world prominence and leadership. That day will not come soon or easily and we will all need to endure this painful period pulling together instead of pulling apart. Although Congress could not come to an agreement, since this happened on my watch, the responsibility rests squarely on my shoulders and I will not rest until we are back on solid footing. I am dedicating my entire political future whether I be in office or not to getting America off its heels and back on its feet and I would like your help it making that happen.”
Other nations were not surprised by America finally realising that it had no choice. The rest of the world has been aware for several years that the valuation of America and its near term potential was overinflated and that it had become a debtor nation instead of a creditor nation a number of years ago. And with its poorly educated and poorly skilled masses and no scalable solution for reversing that widespread problem, America appeared to be even more of a risk as an investment.
This shocking, but not surprising development may have occurred even sooner had it not been that America’s two largest creditor nations, China and Japan, had remained enamoured with the United States as a vital place to invest. With time, those nations along with many others in the world realised that they were thinking of an America that existed from the 1950′s through the 1990′s and one that has not existed for more than a decade.
The lesson taken from this to all countries and peoples, “You can never be too big to fail.”
Enter Orson Welles, October 30, 1938. On that date on the eve of Halloween, Welles narrated a portion of H. G. Wells’ novel The War of the Worlds over the Columbia Broadcasting System (CBS) Radio Network. The first two thirds of the 60-minute broadcast were presented as a series of simulated “news bulletins,” which suggested to many listeners that an actual alien invasion by Martians was currently in progress. In the days following, panic and then outrage filled the minds of many of the listeners to the broadcast who had felt it was true and then realised it was a hoax.
Now that of course was science fiction and the tale of the United States declaring bankruptcy above is fiction of a different kind.
But maybe such fiction could serve as a wake up call and the chance to do something before a disaster such as America going bankrupt occurred.
My late mentor and respected psychologist Dr. Edwin Shneidman told me on numerous occasions, “The best time to do something is when you don’t need to.” By that he meant to say that you often make more informed and wiser decisions when your back is not up against the wall. For example, he once told me that the best time to buy a house is when you don’t need to, the best time to switch careers is when you don’t need to and the best time to plan for your death by getting your affairs in order is before you are diagnosed with a terminal illness.
Given that the above scenario is an act of fiction and our backs aren’t against the wall, maybe the best time to take steps to resolve our financial problems is when we don’t need to.
What for instance would our actions be if the above scenario was true?
What if the United Stated did declare bankruptcy? What steps would it take to get back on its feet? Which of those steps could we start to take now?
I have some thoughts. I believe too much of the world has fallen prey to “transactional myopia” which is about: find the deal, do the deal, next deal and also now lives as if: it’s not about how you play the game it is about whether you win or lose. And in such a game, “win win” is just a woo-woo concept that everyone ignores whilst in reality most people seem to be playing a “zero sum” game. When winning is everything and everyone does whatever they need to win and eto not lose, including lying, you have a world in which “basic trust” is lost.
Developmental psychologist and psychoanalyst, Erik Erikson (1902-1994), created a model of psychosocial development that placed “Basic Trust vs. Basic Mistrust” at the foundational stage that he labelled “Hope.” By that he meant that when you look at the world through eyes of mistrust vs. trust, the world appears completely different to you and that drives the way you interact in and with the world. When you look at the world with trust, you feel hopeful; when you look at it with mistrust, you feel hopeless and in danger.
What could we do to bring back trust? One solution would be to think way into the future to a disruptive possibility that we would all want to make happen. Since most parents love their children, one such possibility would be to imagine the world in which our grandchildren (the children of the children we love) are borne. Imagine it as a world where right out of the womb and out of the gate they have the opportunity for personal health, environmental health, success, happiness, peace on earth and peace of mind. What would that world need to look like to fulfil that possibility?
We are in a stage of looking at the world through the lens of mistrust which may explain the veil of hopelessness that so many people live with or live close to. Until that changes, the world will continue to be in a dire situation.
What would you propose to turn around a world that is teetering on the edge of bankruptcy in financial areas and beyond?
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.