CHAPTER THREE

THE CASE OF THE OPTIMISTS

To be clear, not all Americans fear we’re in decline.

Nor do all Americans believe we are facing an implosion. Indeed, many Americans believe the magnitude of the challenges we face is being overstated. They argue that the “doomsday” talk by some in the media, academia, the financial sector, the pulpits, the political sphere, and around the watercooler is just a vastly overblown and dangerous overreaction. What’s more, they fiercely maintain their belief that America is poised for a historic renaissance.

These people are determined optimists. Yes, the threats Americans face from within and without are real and serious, the optimists readily concede, but this doesn’t necessarily mean our challenges are insurmountable. To the contrary, they argue, our greatest days are still ahead.

We have faced dark times before in our nation’s history. We have faced moments when it truly seemed like the American experiment was destined to fail. Yet by the grace of God and the wisdom of some extraordinary leaders in government, business, and the church, we have repeatedly made the critical course corrections that were necessary. We have gotten our country back on the right track numerous times and have subsequently soared to heights never really dreamed possible by Americans or by anyone else in the world, and these optimists are certain we can do it again.

Barack Obama has certainly sought to position himself politically as America’s “optimist in chief.” As a candidate, he inspired tens of millions of Americans with his message of hope and change. As president, he has engendered enormous criticism from the Right, Center, and even some from the Left. Many commentators have accused him of (wittingly or unwittingly) leading the U.S. to the brink of outright collapse by accelerating the fiscal bankruptcy of the country and undermining the moral authority of American foreign policy with his approach of “leading from behind,” as one of his advisors so memorably described Obama’s approach to world affairs.[56]

President Obama has steadfastly refused to be labeled a pessimist, arguing that America has a hopeful future and that one of the things that makes our country great is “an enduring faith, even in the darkest hours, that brighter days lie ahead.”[57] President Obama epitomized his views in an essay titled “Why I’m Optimistic,” published in the fortieth-anniversary issue of Smithsonian magazine:

There is, of course, no way of knowing what new challenges and new possibilities will emerge over the next forty years. There is no way of knowing how life will be different in 2050. But if we do what’s required in our own time, I am confident the future will be brighter for our people, and our country. Such confidence stems largely from the genius of America. From our earliest days, we have reimagined and remade ourselves again and again.[58]

Even many strong critics of the president and his devout ideological liberalism join him in describing themselves as fundamentally optimistic regarding the future of America, though they would hasten to add that their policy prescriptions for getting us out of the severe mess we are in differ dramatically from President Obama’s.

Bullish on America

One example is William J. Bennett, the conservative former secretary of education under President Ronald Reagan and “drug czar” for President George H. W. Bush. Bennett, who now hosts a nationally syndicated talk radio show called Morning in America, remains convinced that Americans can and will turn things around in time, despite having chronicled the enormous surges in violent crime, out-of-wedlock births, and other social pathologies rampant in the United States over the past four decades. In his 1999 book, The Index of Leading Cultural Indicators: American Society at the End of the Twentieth Century, Bennett wrote, “To those who believe our decline is inevitable because social trends are irreversible, our answer should be: no, it need not be so, and we will not allow it to happen. Restoring civilization’s social and moral order—making it more humane, civil, responsible, and just—is no simple task. But America remains what it has always been: an exceptional nation. Our capacity for self-renewal is rare, and real. We have relied on it in the past [and] we must call on it again.”[59]

Ten years later, in his book A Century Turns: New Hopes, New Fears, Bennett passionately continued to make the case that Americans have risen to the occasion of social and economic renewal before in tough times and said that he saw no reason why we could not do so again. “Today, the levels of both hope and fear are at a high point. Whether or not we can expand the former and reduce the latter, continuing to ‘have the freedoms we have known up until now,’ will depend precisely on what we do with the challenges before us today. Will people one hundred years from now say, ‘Thank God for those people in 2009’? As an American, as an optimist, as a true believer in the uniquely American capacity for self-renewal, I hope and believe the answer is ‘Yes!’”[60]

Larry Kudlow, the CNBC host and National Review columnist, is similarly bullish on America’s future, despite being a sharp critic of President Obama and his policies. “The pessimists are now talking about the end of capitalism or a permanent decline of America. I don’t believe that for one moment,” Kudlow wrote in September 2008, just as the economic meltdown was beginning. “Specific regulatory reforms can get us out of this fix. And most of all, policymakers must maintain the low-tax, low-inflation, open-trade formula that has propelled this nation’s economy and produced so much prosperity for so long. I say, never sell America short.”[61]

The upheavals of the next few years rattled many, but not Kudlow. While he wrote repeatedly about the severe challenges to the nation and its economy and spoke out strongly about the damage he believed the Obama team was doing to America’s fiscal health, he remained remarkably positive about the future. “There’s a lot of pessimism in the air right now,” he wrote in the spring of 2011. “It’s rooted in themes I’ve been discussing for weeks and weeks—namely, lower profit margins from spiking energy, food, and raw-material prices; supply-chain disruptions from the Japanese disaster that cuts into top-line sales revenue; and gasoline price hikes that are depressing the consumer. . . . This is not the end of the world. . . . I still believe in longer-term optimism.”[62]

Editorial Optimism

The contributors to the Wall Street Journal’s editorial page likewise remain fundamentally optimistic about America’s future. Like Bennett and Kudlow, they don’t fail to point out the serious challenges facing the country, nor do they hesitate to advocate specific reform proposals. Yet the Journal’s editors regularly publish essays by those who specifically push back at the notion of America in decline. In February 2011, for example, the Journal published an essay titled “The Misleading Metaphor of Decline” by Joseph Nye, distinguished professor at Harvard University’s John F. Kennedy School of Government. “Is the United States in decline? Many Americans think so, and they are not alone. A recent Pew poll showed that pluralities in thirteen of twenty-five countries believe that China will replace the U.S. as the world’s leading superpower,” Nye wrote. However, he argued, “America is likely to remain more powerful than any single state in the coming decades.” Nye also noted that even “Rome remained dominant for more than three centuries after the apogee of Roman power. . . . Rather than succumb to self-fulfilling prophecies of inevitable decline, we need a vision that combines domestic reforms with smart strategies for the international deployment of our power in an information age.”[63]

Two months later, the Journal published an essay called “The Facts about American ‘Decline,’” written by Charles Wolf Jr., a corporate fellow in international economics at the RAND Corporation and a senior research fellow at Stanford University’s Hoover Institution.

It’s fashionable among academics and pundits to proclaim that the U.S. is in decline and no longer No. 1 in the world. The declinists say they are realists. In fact, their alarm is unrealistic. . . . In absolute terms, the U.S. enjoyed an incline this past decade. Between 2000 and 2010, U.S. GDP increased 21 percent in constant dollars, despite the shattering setbacks of the Great Recession in 2008–09 and the bursting of the dot-com bubble in 2001. In 2010, U.S. military spending ($697 billion) was 55 percent higher than in 2000. And in 2010, the U.S. population was 310 million, an increase of 10 percent since 2000. . . . Some numbers show inclines, some show declines, and some numbers are mixed. . . . The overall picture is far more complex than the simple one portrayed by declinists. The real world is complicated, so a portrait in one dimension distorts rather than reflects reality.[64]

Three months after Wolf’s op-ed ran, the Journal published “The Future Still Belongs to America” by Walter Russell Mead, professor of foreign affairs and humanities at Bard College and editor-at-large of American Interest:

It is, the pundits keep telling us, a time of American decline, of a post-American world. The twenty-first century will belong to someone else. Crippled by debt at home, hammered by the aftermath of a financial crisis, bloodied by long wars in the Middle East, the American Atlas can no longer hold up the sky. Like Britain before us, America is headed into an assisted-living facility for retired global powers. This fashionable chatter could not be more wrong. . . . Every major country in the world today faces extraordinary challenges—and the twenty-first century will throw more at us. Yet looking toward the tumultuous century ahead, no country is better positioned to take advantage of the opportunities or manage the dangers than the United States.”[65]

These are but a few of many examples of the pushback from both the Left and the Right against the real and increasingly widespread notion that America is rapidly approaching—or even has passed—the point of no return.

Trials and Triumphs

What’s more, the case the optimists are making is historically valid. Americans have faced very dark times before and overcome them.

“A Long Train of Abuses and Usurpations”

The American Revolution itself was one such dark time.

As Thomas Jefferson wrote so eloquently in the Declaration of Independence, the citizens of the thirteen colonies were suffering from “a long train of abuses and usurpations” designed “to reduce them under absolute despotism” by a “tyrant” who was “unfit to be the ruler of a free people.” After many humble—and rebuffed—attempts at gaining redress for their grievances, and after much prayer and soul-searching and much discussion and debate, the people concluded it was their right and their duty “to throw off such government, and to provide new guards for their future security.” They appealed in the process to the God of the Bible, “the Supreme Judge of the world,” knowing as they did that the task of establishing a free and independent country would require them to go to war with the British Empire, the most powerful military entity on the planet. The undertaking seemed nearly impossible.[66]

To war they did go, of course, and a painful, bloody, and often gloomy war it was at that. At times, no small number within the American military forces—both officers and enlisted men—were so utterly demoralized that they were more inclined to give up than to fight on, to simply return home to their families and friends. Some soldiers didn’t have shoes to wear or blankets to keep them warm or enough rations to keep them fed and energized. They were young and homesick and convinced neither they nor those for whom they were supposedly fighting had any hope for the future.

Historian Washington Irving noted that at one point during the conflict, “half of the officers of the rank of captain were inclined to retire, and it was probable their example would influence their men,” who would not reenlist unless they saw their leaders making the same commitment.[67] At that point, an utterly depressed George Washington, commander of the American forces, wrote a letter to the president of the Congress, saying, “I am sorry to be necessitated to mention to you the egregious want of public spirit which prevails here. . . . I find we are most likely to be deserted in a most critical time.”[68] In a letter to his secretary, Washington wrote, “Could I have foreseen what I have experienced and am likely to experience, no consideration upon earth should have induced me to accept this command.”[69]

Yet George Washington did not abandon the cause or his responsibilities. Despite how dark the situation often seemed to be, the military commander chose to believe that the impossible was only impossible if they gave up and stopped trying. Thus he rallied himself and his men to commit their lives, their fortunes, and their sacred honor to the cause of liberty, as stated in the immortal words of the Declaration of Independence. He encouraged his distraught and downtrodden men to press on despite the enormous challenges and seemingly overwhelming odds against them, and they chose to follow his lead.

In the end, the cost was brutally high. More than twenty-two thousand Americans lost their lives fighting for liberty, out of a population of merely 2.5 million. Yet the enterprise was a stunning success. By God’s grace, the Revolution succeeded. Washington and his men and the Founding Fathers who had asked them to go into battle not only established a new country but also helped create a remarkable new model of freedom and democracy for the rest of the world.

A “Volcanic Upheaval”

The Civil War posed an even greater existential threat to the republic.

Henry Clay, Speaker of the House and secretary of state during the earlier years of the nineteenth century, had long warned the people of the North and the South that the dissolution of the union would lead to a war “so furious, so bloody, so implacable, and so exterminating” that few would be able to bear the results. Indeed, he feared his own heart wouldn’t be able to take such an apocalypse within the country he loved and had worked so hard to build. “If the direful and sad event of the dissolution of the union shall happen, I may not survive to behold the sad and heartrending spectacle.”[70]

Yet the war did come, though Clay did not survive to see it and witness whether the republic would stand. Americans were suddenly and viciously pitted not against a foreign empire but against one another. Their irreconcilable differences led to a willingness to use deadly force to accomplish their objectives and defend their principles. The mood of the country turned darker than at any previous point in her brief history. President Abraham Lincoln “understood that his country faced a perilous situation, perhaps the most perilous in its history,” wrote Pulitzer Prize–winning historian Doris Kearns Goodwin in her masterful biography of Lincoln, Team of Rivals.[71] And Lincoln was far from alone.

“Clouds and darkness are upon us at present,” Ohio governor Salmon Chase observed as he perceived the bitter, brutal fighting on the horizon.[72]

“The sun rises, but shines not,” poet Walt Whitman wrote.[73] Americans, he said, were witnessing a “volcanic upheaval.”[74]

“We are in the midst of the most terrible battle of the age,” General George McClellan, commander of the Union Army, observed.[75]

“The fate of the nation hung in doubt and gloom,” U.S. attorney general Edward Bates wrote.[76]

Many wondered openly whether America could survive, and pessimism was rampant. The Battle of Gettysburg was surely the turning point of the war, but it was also one of the bloodiest. At Gettysburg alone, the Union Army suffered some twenty-three thousand casualties and the Confederacy twenty-eight thousand.[77] President Lincoln was by no means understating the severity of the situation when on the afternoon of Thursday, November 19, 1863, he spoke at the dedication of the Soldiers’ National Cemetery at Gettysburg and suggested that the very fate of the American nation and the premise of her founding were at stake.

Fourscore and seven years ago our fathers brought forth on this continent a new nation, conceived in liberty and dedicated to the proposition that all men are created equal. Now we are engaged in a great civil war, testing whether that nation or any nation so conceived and so dedicated can long endure. We are met on a great battlefield of that war. We have come to dedicate a portion of that field as a final resting place for those who here gave their lives that that nation might live. It is altogether fitting and proper that we should do this. But in a larger sense, we cannot dedicate, we cannot consecrate, we cannot hallow this ground. The brave men, living and dead, who struggled here, have consecrated it far above our poor power to add or detract. The world will little note nor long remember what we say here, but it can never forget what they did here. It is for us the living rather to be dedicated here to the unfinished work which they who fought here have thus far so nobly advanced. It is rather for us to be here dedicated to the great task remaining before us—that from these honored dead we take increased devotion to that cause for which they gave the last full measure of devotion—that we here highly resolve that these dead shall not have died in vain, that this nation under God shall have a new birth of freedom, and that government of the people, by the people, for the people shall not perish from the earth.[78]

In the end, the pessimists were wrong. Lincoln and his forces won a great victory. The union was preserved. The American democracy did experience “a new birth of freedom” and soared to heights few could have foreseen during the war’s most difficult days. But the costs were catastrophic. The conflict “that no one imagined would last four years,” Goodwin observed, had “cost greater than six hundred thousand lives—more than the cumulative total of all our other wars, from the Revolution to Iraq. The devastation and sacrifice would reach into every community, into almost every family, in a nation of 31.5 million. In proportion to today’s population, the number of deaths would exceed 5 million.”[79]

Travails of the Twentieth Century

America went on to face other dark times.

In the last century alone, we endured World War I, the Great Depression, World War II, the Korean and Vietnam conflicts, the American cultural revolution of the 1960s (complete with an explosion in violent crime, a precipitous rise in the use of drugs among young people, widespread rebellion against authority and the traditional family, and a sharp turning away from God), and the national malaise that defined much of the 1970s, to name some of the worst. These violent storms posed a real and severe threat to our security, economy, and moral and spiritual well-being. During each, there were some who feared we might not survive, much less thrive. Yet time after time, Americans weathered the storms, often to the surprise (and at times the chagrin) of the rest of the world.

To keep our current troubles in context, let’s briefly consider two examples: the Great Depression during Herbert Hoover’s and Franklin Delano Roosevelt’s administrations and the malaise that occurred during Jimmy Carter’s.

From the Roaring Twenties to the Great Depression

The 1920s in America were known as the Roaring Twenties. The economy was booming. The stock market was climbing ever higher. Factories were operating at full tilt, and jobs were plentiful. In 1927, the unemployment rate in the United States was a mere 3.3 percent.[80] Then came the unprecedented crash on Wall Street in the fall of 1929, the implosion of the nation’s industrial production, a rapidly spreading global economic meltdown, and the beginning of the era known as the Great Depression.

On September 3, 1929, the Dow Jones Industrial Average reached a record high of 381. But just eight weeks later, the market collapsed. By the end of Black Tuesday, October 29, 1929, the Dow closed at a mere 230.07. This represented a collapse of nearly 40 percent. Hundreds of billions of dollars in American wealth simply vanished into thin air.[81]

Over the course of the next year, Americans witnessed the failure of more than 1,300 banks.[82]

By July 8, 1932, the Dow Jones Industrial Average had sunk to just 41.22, an apocalyptic loss of 89 percent of the market’s value from its high in 1929.[83]

By 1933, more than nine thousand American banks—half of all the banks in the country at the time—had failed.[84] That same year, nearly a third of all workers in the United States found themselves without jobs.[85]

Americans were terrified. Many saw the United States imploding and believed there was no way to turn things around. Many lost the will to go on. Between 1929 and 1933, the number of suicides in America tragically shot up by nearly 23 percent, the biggest surge in the suicide rate in the history of the country.[86]

Upon entering office, however, President Franklin Delano Roosevelt resisted the skyrocketing national pessimism and challenged Americans not to succumb to fear. He was, after all, a congenital optimist. He had valiantly faced enormous adversity in his own personal life, including physical paralysis, and he was certain America would overcome as well. He believed the nation would emerge from the most severe economic and social crisis in her history stronger than ever.

“I am certain that my fellow Americans expect that on my induction into the presidency I will address them with a candor and a decision which the present situation of our nation impels,” Roosevelt said as he began his inaugural address on Saturday, March 4, 1933. “This is preeminently the time to speak the truth, the whole truth, frankly and boldly. Nor need we shrink from honestly facing conditions in our country today. This great nation will endure as it has endured, will revive and will prosper. So, first of all, let me assert my firm belief that the only thing we have to fear is fear itself—nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance.” He readily conceded that “only a foolish optimist can deny the dark realities of the moment,” but he insisted that “compared with the perils which our forefathers conquered because they believed and were not afraid, we have still much to be thankful for. . . . In this dedication of a nation we humbly ask the blessing of God. May he protect each and every one of us. May he guide me in the days to come.”[87]

America did, of course, eventually emerge from the Great Depression. How the recovery was achieved is a matter of intense debate among historians and politicians, including whether FDR’s New Deal policies were a net positive for the country or whether they exacerbated the country’s structural problems and prolonged the depression. The point here is not to enter that debate but to focus on the obvious: we made it through one of the most difficult periods in our history when many feared we would not. By 1936, industrial production in the United States had finally regained 1929 levels and later would surge dramatically further with the outbreak of World War II and the need for enormous production to defeat the fascists in Europe and the imperialists in Asia.[88] The Dow Jones Industrial Average, on the other hand, wouldn’t reach its 1929 record high of 381 until November 1954, but recover it eventually did and went on to hit stunning new heights in the decades beyond.[89]

A National Malaise

As we turn the pages of history, we see that Americans faced another round of storms in the 1970s. Among them: widespread anger—especially among young people—over our role in Vietnam, deep disillusionment over Watergate and other scandals of the Nixon administration, rising unemployment, paltry economic growth, soaring inflation, towering interest rates, mushrooming energy prices, severe energy shortages, and ever-growing lines at gas pumps.

Few authors better captured the pessimism of the times—and particularly the gloomy views of the liberal elites who believed ordinary Americans were primarily to blame for their troubles—than Christopher Lasch, a history professor at the University of Rochester. In 1979, Lasch published what became a highly influential book titled The Culture of Narcissism: American Life in an Age of Diminishing Expectations. Describing “postwar America as a society of dangerously self-absorbed individuals, fixated on personal goals, fearful of their impulses, and easily controlled by power elites,” according to a summary in the New York Times, the book quickly became a national bestseller, spent seven weeks on the Times bestseller list, and generated much discussion around the country, including inside the White House and even in the Oval Office.[90]

“Hardly more than a quarter century after Henry Luce proclaimed ‘the American century,’ American confidence has fallen to a low ebb,” Lasch began on the first page of his preface. “Those who recently dreamed of world power now despair of governing the city of New York. Defeat in Vietnam, economic stagnation, and the impending exhaustion of natural resources have produced a mood of pessimism in higher circles, which spreads through the rest of society as people lose faith in their leaders.”[91]

Lasch went on to argue that “as the twentieth century approaches its end, the conviction grows that many other things are ending too. Storm warnings, portents, hints of catastrophe haunt our times. The ‘sense of an ending,’ which has given shape to so much of twentieth-century literature, now pervades the popular imagination, as well. . . . The question of whether the world will end in fire or in ice, with a bang or a whimper, no longer interests artists alone. Impending disaster has become an everyday concern, so commonplace and familiar that nobody any longer gives much thought to how disaster might be averted.”[92]

The book quickly caught the attention and the imagination of Pat Caddell, a young pollster for—and key advisor to—President Jimmy Carter, as Caddell was beginning to map out Carter’s reelection plan for the 1980 campaign. Caddell not only read the book and agreed with it but drew heavily upon Lasch’s gloomy end-of-the-world observations in a long memo for the president. In the memo, Caddell essentially argued that it was not Carter’s fault that the economy was in the toilet, that American prestige around the world was evaporating, and that the American people were deserting the president and the Democratic Party. Rather, Caddell claimed, the American people were a bunch of narcissists, in a funk that couldn’t be fixed, and this was simply the zeitgeist of the times.

Caddell specifically picked up two key phrases used by Lasch, suggesting the American people were suffering from a “crisis of confidence” and a national “malaise.” He recommended that the president deliver a speech to explain to the American people what their problem was and to encourage them to lower their standards and do things like wear sweaters inside when it got cold and they couldn’t afford to sufficiently heat their homes.

Caddell’s memo sparked a firestorm of controversy within Carter’s inner circle. Vice President Mondale, for one, thought the young pollster was out of his mind and under no circumstances should the president scold the country on its national malaise. Carter, however, loved the memo and Lasch’s book. Indeed, he invited Lasch to meet with him and discuss the book. When the meeting was over, Carter decided to proceed with the nationally televised address.[93]

On July 15, 1979, President Carter spoke to an estimated one hundred million Americans in a televised address from the Oval Office. Among his remarks were these words:

I want to speak to you first tonight about a subject even more serious than energy or inflation. I want to talk to you right now about a fundamental threat to American democracy. . . . The threat is nearly invisible in ordinary ways. It is a crisis of confidence. It is a crisis that strikes at the very heart and soul and spirit of our national will. We can see this crisis in the growing doubt about the meaning of our own lives and in the loss of a unity of purpose for our nation. The erosion of our confidence in the future is threatening to destroy the social and the political fabric of America. . . . The symptoms of this crisis of the American spirit are all around us. For the first time in the history of our country, a majority of our people believe that the next five years will be worse than the past five years. Two-thirds of our people do not even vote. The productivity of American workers is actually dropping, and the willingness of Americans to save for the future has fallen below that of all other people in the Western world.[94]

Later in the speech, Carter bemoaned the nation’s energy crisis and set forth several ideas to enact legislation to force Americans to use less energy in the coming years. This continued the dismal theme Carter had set forth from the beginning of his administration, when he stated bluntly in a speech on February 2, 1977, “We must face the fact that the energy shortage is permanent. There is no way we can solve it quickly. . . . We will ask private companies to sacrifice, just as private citizens must do.”[95]

Two days after the “crisis of confidence” speech, the president asked his entire cabinet to resign, hoping this would be a message to the country that he was hitting the reset button, as it were, and making a fresh start of his administration. Instead, the move was widely seen throughout the country as evidence that the president had run out of ideas for fixing the nation’s structural problems—the energy crisis, in particular—and was himself suffering from a crisis of confidence and a malaise.

While Carter didn’t actually use the word malaise in the address, his advisors used it in private discussions with reporters and columnists, and journalists recognized the language from Lasch’s bestselling book. Soon, the address was being dubbed the “malaise speech,” and Carter was pilloried for it. California governor Ronald Reagan, the front-runner in the race among Republican candidates to replace Carter, led the way, saying he deeply disagreed with Carter’s analysis and using the speech to help frame the differences between himself and the president. “Does history still have a place for America, for her people, for her great ideals?” Reagan asked. “There are some who answer no, that our energy is spent, our days of greatness at an end, that a great national malaise is upon us. . . . I find no national malaise. I find nothing wrong with the American people.”[96]

Reagan argued, in particular, that the energy shortage and sky-high energy prices and ever-longer lines at gas stations were neither permanent nor the result of Americans’ greed or narcissism. Yes, we can all do a better job of conserving energy, he agreed, but he went on to argue that shortages and high prices were the result of too much government regulation and could be easily and quickly remedied with a new approach—a conservative and free-market approach. Carter and his senior aides sneered at such talk and dismissed the Californian as a foolish B-movie actor who didn’t understand the complexities of real life.

“Morning in America”

Ronald Reagan, of course, won the 1980 election in a landslide. On the day of his inauguration, moments after being sworn in, Reagan stepped into a room in the Capitol and signed an executive order removing price controls on oil and gasoline, his first official act as president.[97] “Critics of Reagan’s action . . . warned that gas prices would rise to two dollars a gallon. Reagan predicted that oil and gas prices would fall dramatically, and he proved to be right,” noted one Reagan biographer.[98]

When Reagan took office in 1981, the average price of a gallon of leaded regular gasoline in the United States was $1.31. Rather than climb when Reagan removed price controls and began reducing regulations on the gas industry, prices dropped immediately to $1.22 in 1982 and fell to just eighty-six cents by 1986.[99]

Simultaneously, oil prices fell as well. In April 1980, oil had hit a record high of $103.76 per barrel (in 2008-inflation-adjusted dollars). But by 1985, the price of a barrel of oil had dropped to a mere $20 (in 2008 dollars).[100] Indeed, Reagan’s policies worked so well and so quickly that barely six months into his first term, the media were already talking about an “oil glut,” with too much oil on the market. On June 21, 1981, for example, the New York Times actually published this headline: “How the Oil Glut Is Changing Business.” Reporter Robert Hershey wrote, “Oil glut! . . . Suddenly, oil is so plentiful that prices are falling by amounts that impress even big-time corporate decision makers.”[101]

By 1984, the economy was humming, Americans’ confidence in the future had largely been restored, and Reagan was running for reelection. His most famous television campaign ad proclaimed, “It’s morning again in America. Today, more men and women will go to work than ever before in our country’s history. With interest rates at about half the record highs of 1980, nearly two thousand families today will buy new homes, more than at any time in the past four years. This afternoon, sixty-five hundred young men and women will be married, and with inflation at less than half of what it was just four years ago, they can look forward with confidence to the future. It’s morning again in America, and under the leadership of President Reagan, our country is prouder and stronger and better. Why would we ever want to return to where we were less than four short years ago?”[102]

Reagan defeated Walter Mondale in the biggest electoral landslide in American political history, winning forty-nine of the nation’s fifty states. By the time Reagan left office in 1989, he had racked up many remarkable accomplishments, including rebuilding America’s military, reestablishing credibility with both our allies and our enemies, helping bring down the Berlin Wall and the “evil empire” of the Soviet bloc, and helping liberate the American economy from high taxes and overregulation. Under his leadership, some 18 million new jobs were created,[103] millions of new small businesses were developed and expanded,[104] the Dow Jones Industrial Average grew to more than twice what it had been when he took office,[105] a dazzling high-tech revolution was set into motion, and Silicon Valley emerged as the computing capital of the world.

For Reagan, however, one of the accomplishments he was most proud of was liberating Americans from gas lines, energy inflation, and the prevailing sense of doom, gloom, and failure of the late 1970s. “Many of you, I’m sure, recall the howls that went up when we acted to deregulate oil prices two years ago,” Reagan said in a 1983 radio address to the nation. “Remember how you were told that deregulation would lead to skyrocketing prices for the gasoline that fuels millions of American cars or the oil that heats millions of American homes? Well, the evidence is in, and the doomsayers were dead wrong. You don’t have to go any further than the nearest filling station to see that prices have gone down, not up, since decontrol, just as we promised they would.”[106]

Bottom Line

To be sure, then, the optimists have a compelling case. When they argue that Americans have faced very dark times in our history and have made the fundamental changes and reforms needed to avert a full-fledged implosion of the country, they are absolutely right. When they say that given this encouraging track record, they feel confident that we can do so again, they say it with conviction. So who is right—the optimists or those who are more pessimistic? Before we can draw any conclusions, we first need to look at events through the “third lens.”