Take Me to Your Leader

How do you define an optimist in this environment? Someone who thinks that reported unemployment will rise from 6.1% to a mere 7.5%? A pessimist? There are lots of economists, like Nigel Gault, chief domestic economist at Global Insight, who think it will be more like 8-8.5%, and a few who think worse.

The most obvious cutbacks are expected to result in a further loss of 300,000 jobs (a bit more than 10% of that number in New York City ) in financial services alone. The New York Times today observed we are about to enter phase two of massive job loss: “In just the last two weeks, the list of companies announcing their intention to cut workers has read like a Who’s Who of corporate America: Merck, Yahoo, General Electric, Xerox, Pratt & Whitney, Goldman Sachs, Whirlpool, Bank of America, Alcoa, Coca-Cola, the Detroit automakers and nearly all the airlines.”

A little “unemployment” history (from the Times): “The highest level since the Great Depression, 10.8 percent, came in November and December of 1982 as the economy was shaking off a severe recession…The unemployment rate hit 9 percent during the mid-1970s recession, and 7.8 percent in the 1990-1991 downturn. The next peak, 6.3 percent, occurred in June 2003, during a long jobless recovery in the aftermath of the 2001 recession.” By comparison, the Great Depressions generated a 25% unemployment rate. To change direction, we need a new direction. Leadership.

Funny thing about leadership. In good times, if you avert a crisis, no one will really know, because the whistles never went off. Vanilla memories. If you screw up, like this administration did, even your own party’s next set of candidates will try and distance themselves from you. Leadership seems to be defined by crisis. Washington had battled the British, Lincoln faced the Civil War, and Roosevelt tackled the Great Depression and World War II. History's memorable figures.

Another funny thing about leadership. You actually can't follow, because you're the one at the head of the line… which means to make it work, you have to cut a clear new path – in times of crisis, the old ones clearly did not work. You don't have to be 100% right, but you sure have to convince folks you have a very well-defined goal that you know how to achieve or there won't be anyone walking behind you anymore.

Henry Paulson has been a sheep – applying a European/Asian institutional solution to an American grassroots mortgage problem and most definitely not in front of any line – and George Bush has been notably absent during this crisis (repeating his empty “patience” speech without any real direction). Look over your shoulders, guys… look at the empty space. Even your party faithful have deserted you.

I don’t envy the next President and his team; these times will try and wear upon the best of the men and women at the top. But we need leadership, wisdom and a plan. After November 4, it won’t be a popularity contest anymore… at least for a couple of years. Short term popularity is expendable if you make a positive difference. We need confidence, not empty slogans and labels. Lead! No more sheepish choices!

I’m Peter Dekom, and I approve this message.