Maybe it’s just a combination of human nature and the way that the media emphasize negative news. War, pandemic, inflation, this is what we hear about in the news and too many people are natural worriers. Things sound pretty bad right now. But I agree with Warren Buffett, the Oracle of Omaha, who says, “Never bet against America”.
- The Pandemic. According to the CDC, 94% of Americans ages 16 and up have Covid antibodies either through vaccination or prior infection. Now, after the Omicron surge, half of us actually have infection-induced antibodies and these prior infections are helping to blunt the effect of new variants. In other words, get vaccinated and exercise reasonable precautions. If you do catch Covid, it is likely to be mild or even asymptomatic.
- The Ukraine war. Russia invaded Ukraine in February and brave Ukrainians are willing to fight and die to preserve their freedom and independence. The U.S. and its NATO allies are providing Ukraine with the military supplies it needs to drive the Russians out. It is not only the right thing to do but also in our own best interest to defend democracy around the world as much as we reasonably can.
- The end of Roe vs Wade? If Roe vs Wade is struck down by the Supreme Court, as now appears likely, then the issue of abortion restrictions returns to the states. Especially in the red states which tend to be pro-life, this will inevitably boost voter turnout in future elections. This is good for democracy!
- Political polarization, dissension, and acrimony. Of course, we should try to disagree without being disagreeable, but democracy is inherently messy. How much better it is to work out our differences under the rule of law than to risk violent insurrections. This is one of the great virtues of our decentralized constitutional republic.
- Inflation is now running at an annual rate of 8.5% (as of March 2022). The Fed has already raised short-term interest rates by .75 % (to a total of 1%) but will have to do much more. According to Richard Clarida, former Fed vice-chairman, if inflation is still as high as 3% a year from now, the Fed will need to raise interest rates to 4% in order to bring inflation down to the Fed’s goal of 2%. Of course, to reach 3% a year from now, the inflation rate needs to level off real soon and then start dropping. Let’s be optimistic and expect something like this will happen. In the meantime, there will be the short-term pain of rising prices, but our underlying strong economy, and low unemployment rate, should carry us through the inevitable downturn.
Conclusion. There are always serious issues to confront in a democracy, but the U.S. is in good shape overall. The Pandemic is under control. Ukraine is effectively resisting Russian invasion with our support. The likely repeal of Roe vs Wade will result in a big increase in voter turnout. The Fed should be able to get inflation under control with some temporary pain for the next year or two. All-in-all, democracy is thriving at home and abroad!
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