Crisis of Responsibility
Page 16
Chapter 2
5President Donald Trump’s affection for economic nationalism, and disdain for the impact of freer and more open trade, were by no means unique to the 2015–2016 presidential campaign. The now president was an outspoken critic of free trade and global business evolutions dating as far back as the mid-1980s. The difference: his views were not shared then by either the conservative Right or the liberal Left. Reagan Republicans and Clinton Democrats were both advocates of free trade and the growth benefits of global commerce.
Chapter 3
6Dennis Prager, “America’s Second Civil War,” Townhall, January 24, 2017, townhall.com/columnists/dennisprager/2017/01/24/americas-second-civil-war-n2275896.
7Dr. Charles Murray, Coming Apart: The State of White America, 1960–2010 (New York: Crown Forum, 2012), 154.
8Pew Research Center, Analysis of US Decennial Census (1960–2000), 2017.
9United States Census Bureau, Historical Living Arrangements of Children, 2014.
10Robert Lerman, Marriage and the Economic Well-Being of Families with Children: A Review of the Literature, Urban Institute and American University, 2002.
11J. D. Vance, Hillbilly Elegy: A Memoir and Culture in Crisis (New York: HarperCollins, 2016), 193.
Chapter 4
12This hypothetical conversation aligns with multiple accounts of sentiment Fuld expressed in this period, including what has been documented in A Colossal Failure of Common Sense: The Collapse of Lehman Brothers by Larry McDonald, pp. 229–231.
13CoreLogic (previously Baseline Analytics), annual Mortgage Fraud Report, 2010.
14Sumit Agarwal et al., “Predatory Lending and the Subprime Crisis,” Journal of Financial Economics 113, no. 1 (2014): 29–52.
15Oliver Wyman, Experian, Market Intelligence Report, June 28, 2009.
16Luigi Guiso, Paola Sapienza, and Luigi Zingales, “Moral and Social Constraints to Strategic Default on Mortgages” (working paper no. 15145, National Bureau of Economic Research, July 2009).
17Data compiled from www.realtytrac.com, accessed July, 2017.
18Office of the Comptroller of the Currency and Office of Thrift Supervision, OCC and OTS Mortgage Metrics Report, 2009.
19Ibid.
20Ben Bernanke, The Courage to Act: A Memoir of a Crisis and Its Aftermath (New York: W.W. Norton & Company: 2015), 361.
21Alt-A lending may be an obnoxious term, but it can best be understood as the sort of middle-ground category of mortgage borrower, with “subprime” primarily referring to those of severalty impaired credit, “prime” referring to those of high credit and financial capability, and “Alt-A” representing the middle ground where the loans would not be conforming to the standards of the government agencies (Fannie and Freddie), hence the term “Alt-A” (i.e., “alternative to the agencies”). These loans often possessed either high debt-to-income ratios or high loan-to-value ratios, but not with the accompanying low FICO score of the subprime category.
22Darryl E. Getter et al., “Financial Crisis? The Liquidity Crunch of August 2007,” Congressional Research Service Report for Congress, September 21, 2007, assets.opencrs.com/rpts/RL34182_20070921.pdf.
23Alan Greenspan and James Kennedy, “Sources and Uses of Equity Extracted from Homes,” Oxford Review of Economic Policy 24, no. 1 (2008): 120–144.
Chapter 5
24Scott Lincicome, “The Truth about Trade,” National Review, April 4, 2016.
25Srikant Devaraj and Dr. Michael Hicks, The Myth and the Reality of Manufacturing in America, Center for Business and Economic Research, Ball State University, 2015.
26Pablo D. Fajgelbaum and Amit K. Khandelwal, “Measuring the Unequal Gains from Trade,” Quarterly Journal of Economics 131, no. 3 (August 2016): 1113–1180.
27Matthew J. Slaughter, “The ‘Exporting Jobs’ Canard,” Wall Street Journal, June 14, 2017.
28I might add that within the conservative Right, those apologetics have hardly been necessary for most of the last one hundred years. Economic nationalism is not only a new phenomenon on the Right, but it is essentially a brand new phenomenon. The anti-trade wing of Republicanism and conservatism has been mostly limited to the ilk of Pat Buchannan in recent decades past, whereas 2016 brought an avalanche of conservatives who suddenly embraced a more nationalistic view of trade, either in mere rhetoric or in actual policy prescription. Surely the popularity and nomination of Donald Trump had a lot to do with this perspective change in many.
29U.S. Bureau of Labor Statistics, “Job Openings: Total Nonfarm (JTSJOL)” (chart), June 2017, fred.stlouisfed.org/series/JTSJOL.
30Lincicome, “Truth.”
Chapter 7
31Morgan Walsh, “In Defense of School Choice,” Enquiry IV, no. 17 (2017).
32National Education Association, Rankings & Estimates, May 2016.
33“2016 Best and Worst School Systems,” WalletHub, August 2016.
34California Department of Education, CalEd Facts, www.cde.ca.gov/re/pn/fb/.
35Troy Senik, “The Worst Union in America,” City Journal, Spring 2012, www.city-journal.org/html/worst-union-america-13470.html.
36Ibid.
37Andrew J. Coulson, “Do Vouchers and Tax Credits Increase Private School Regulation?” (working paper no. 1, Cato Institute, October 4, 2010), object.cato.org/sites/cato.org/files/pubs/pdf/WorkingPaper-1-Coulson.pdf.
Chapter 8
38Gianmarco Ottaviano and Giovanni Peri, “Re-thinking the Effect of Immigration on Wages,” Journal of the European Economic Association 10, no. 1 (2011): 152–197.
39Alex Nowrasteh, “Immigration’s Real Impact on Wages and Employment,” At Liberty (blog), September 15, 2014, www.cato.org/blog/immigrations-real-impact-wages-employment.
Chapter 9
40“Average Student Loan Debt in America: 2017 Facts & Figures,” ValuePenguin, 2017, www.valuepenguin.com/average-student-loan-debt.
41Emmie Martin, “Student Loan Debt Has Grown 250% in the Last 10 Years—Here’s Where Grads Owe the Most,” Yahoo Finance, July 19, 2017, finance.yahoo.com/news/student-loan-debt-grown-250-000000611.html.
42United States Census Bureau, “Current Population Survey,” Annual Social and Economic Supplement, 2017.
43Bureau of Labor Statistics, 2010–2016.
44Charlie Sykes, Fail U: The False Promise of Higher Education (New York: St. Martin’s Press, 2016).
45Ibid.
Chapter 10
46Yuval Levin, The Fractured Republic: Renewing America’s Social Contract in the Age of Individualism, (New York: Basic Books, 2016), 205.
Chapter 11
47David Brooks, “The Odyssey Years,” New York Times, October 9, 2007.
48Sen. Ben Sasse, The Vanishing American Adult: Our Coming of Age Crisis and How to Rebuild a Culture of Self-Reliance (New York: St. Martin’s Press, 2017).
49Jay W. Richards, Infiltrated: How to Stop the Insiders and Activists Who Are Exploiting the Financial Crisis to Control Our Lives and Our Fortunes (New York: McGraw Hill, 2013).
Chapter 12
50Thomas Sowell, Intellectuals and Society (New York: Basic Books, 2009), ch. 22.
ACKNOWLEDGMENTS
It really is a justifiable cliché to say that it is impossible to acknowledge all those who deserve acknowledgment for a book.
This book would not have been possible without the love and support of my saintly wife, Joleen, to whom this book is dedicated. And it would not have been possible without a legacy of twenty years (which was about forty years too few) of training, mentoring, parenting, and formation by my late father, Dr. Greg Bahnsen, the greatest intellect I have ever been around. He instilled in me a doctrine of responsibility well before I was ready to hear it.
I am extremely indebted to my publisher,
Anthony Ziccardi, my agent, D. J. Snell, my editor, Bill Blankschaen, my publicists, Annie Scranton and Meghan Powers, and the extraordinary team from Post Hill Press. The writing of this book started with a group of people who believed in it and were willing to work with me to bring it to fruition.
My life is filled with a plethora of people I call friends who stimulate my intellectual curiosity and moral imagination. P. Andrew Sandlin, Jeffery J. Ventrella, and Brian G. Mattson at the Center for Cultural Leadership are such men. This message itself would never have been developed in my own mind, let alone have a chance of fertilizing into our society’s soil, without the work of Father Robert Sirico and the Acton Institute, where the dream of a free and virtuous society finds foundational support. My long-time “Triple B” book club partners, Eric Balmer and Aaron Bradford, have been friends for twenty-five years and partnered with me on an incredible reading journey for over a dozen years. Paul Murphy and Brian Harrington have been my sounding boards and discussion partners over many a Manhattan meal working through so many topics. All of these men are dear friends and avenues of support.
My brothers and sisters at Pacifica Christian High School are fighting this good fight with me, teaching kids to think and live well: David and Dayna O’Neil, Keith and Amy Carlson, Michael and Angie Hill, Geoff and Lucie Moore, Scott and Wendy Baugh, Luis and Darcy Garcia, Matt and Catherine Anderson, Chris and Sarah Stratton, and Ben and Cassidy Roberson. Operating leverage in society comes from arming men and women with an appreciation for truth, beauty, and goodness.
For over sixty years there has been an organization standing athwart history yelling, “Stop!” The legacy of William F. Buckley and the continued labors of my friends, mentors, heroes, and colleagues at National Review and the National Review Institute are the reason I believe our cause will prevail. Jack Fowler has been a friend to me and a servant to the cause in ways that cannot be articulated. I am in debt to Lindsay Craig, David French, Rich Lowry, Jonah Goldberg, Charlie Cooke, and the entire organization.
I am thankful for my friends in the Lincoln Club of Orange County and all of the conversations and controversies we deal with, many of which made their way into this book. Al Frink, Bob Loewen, Mark Bucher, Michael Capaldi, Kerry Reynolds, John Warner, Wayne Lindholm, Michael Reynolds, Walter Myers, Seth Morrison, Cynthia Quimby—too many more to list. The crisis of responsibility sees its ground zero in our state.
My partners at HighTower Advisors are not only colleagues and friends, but industry visionaries and pioneers committed to a righteous cause. Elliot Weissbluth is a rare breed of leader, a friend, and a disruptor. My life and career have been enhanced by the entire HighTower organization. Thank you to Elliot, Matthias Kuhlmey, Brendan Sullivan, Amit Dogra, Sagar Kurada, Tim Woods, Cheryl Callahan, and all those fighting the fiduciary fight.
Larry Kudlow has impacted me in ways he will never understand, predating the time we even met. I thank Tom Bonds, Brian and Judy Tong, Bob Anderson, John and Michelle Somers, Jim Birchfield, and all who have invested time and love into my well-being.
I can’t acknowledge all my Viva boys here because a routine Google search might undermine the whole thesis of the book (kidding, mostly). You are my friends for life.
Thank you to the clients of the Bahnsen Group for giving me the privilege of doing what I love on their behalf. Their faith in our work and intentions comes from trust; and that trust is reciprocated by our undying trustworthiness. I wish I could name every client in this section, not just for their partnership with us, but particularly all those I feel particularly indebted to as friends. Space limitations do not allow. I do thank Mark Corigliano, Tracy Price, Merv Simchowitz, Andrea Shelly, and Stuart Nagasawa for particular levels of support, friendship, and belief.
And I thank my team at the Bahnsen Group—Brian Szytel, Kimberlee Davis, Don Saulic, Brian Tong, Deiya Pernas, Robert Graham, Trevor Cummings, Michelle Leivas, Jacqueline O’Hare, and Peter Van Voorhis—who not only represent the greatest body of client-centric fiduciary advisors I have ever been around, but who are also my partners, friends, and daily allies in the cause of becoming extraordinary.
My family: Kiddos—Mitchell, Sadie, and Graham. Brothers—Jonathan and Mike-Dogg. Extended: Brad, Vicki, Colin, and Monica. Todd, Joco, and kids. All my in-laws. Quality over Quantity. I love you all.
Finally, I thank the God who loves me, takes care of me, and did for me what I could not do for myself. It is the truth, beauty, and goodness of the creation God made that provokes me to care that a culture rooted in the same be presented to Him.
ABOUT THE AUTHOR
David L. Bahnsen is the Managing Partner of The Bahnsen Group of HighTower Advisors, managing over $1 billion of capital. He is a frequent guest on Fox Business and CNBC, and is annually recognized as one of the top advisors in the country by Barron’s, Financial Times, and others.
For weekly investment commentary and market analysis from David L. Bahnsen:
www.dividendcafe.com