We had the opportunity to interview Mr. Volcker for I.O.U.S.A. We met the economic bigwig, who is most famous for fighting the inflation of the 1970’s and 1980’s in his office overlooking Rockefeller Center this past winter.
We asked him the obvious question: Does he see a similarity to today’s economic climate to that of when he was at the helm of the Federal Reserve? And do we need the same sort of forceful hand that he lent to the economy during that time period?
“Well, there are all kinds of consequences and uncertainty in the future if we don’t deal with these problems. But when I look at back on my lifetime, it was obvious that letting inflation get a little bit out of control and not dealing with economic problems effectively in the ’70s led to the kind of crisis in the late ’70s and the early ’80s, and it was very uncomfortable. We don’t want to have to go through big recessions to teach lessons. We’d like to anticipate what needs to be done while maintaining the growth of the economy. And the threat always is an unstable economy, an unstable currency; and that it’s destructive not just to economic life, but it can be destructive of America’s position in the world, which is a concern to me more generally.
“But the great challenge, I think, for democracy, is being able to cope effectively with problems that are pretty clearly out in the future, but require action that require some discipline, some restraint today,” he continued.
“And that’s the test we’re going through, and that’s a question of education and understanding, I think. So I think as people get better understanding of some basic economic issues, the democracy will be better able to cope with those challenges out there in the future.”
This idea of educating America comes up again and again as we promote the documentary. The other night, at a Q&A following a screening at the Philadelphia Film Festival, one audience member suggested that I.O.U.S.A. be shown at every high school. We couldn’t agree more. After all, the generation that will have to deal with these debts and deficits should be educated on the subject.
The Daily Reckoning Australia