Missing ingredient for a debt ceiling deal
Solving the debt crises in both Europe and the United States isn’t really about money or ideology. In both societies, leaders are struggling to simply trust each other.
Trust is a virtue that has slowly seeped out of many relationships in most Western democracies in the past half century. The debt crisis is just one measure of that trend.
Restoring trust requires that leaders redefine the bonds that tie a people together – not an easy task given the media glare and the stress from markets.
Europe is more fortunate than the US in that its two main leaders, German Chancellor Angela Merkel and French President Nicolas Sarkozy, have shown they can trust each other to cut grand bargains, as they did Thursday in announcing a debt-relief package for Greece.
France and Germany have long had a shared stake in unifying Europe, given the continent’s centuries of deadly discord. Amid all the details of the latest rescue package for Greece lies a shared financial sacrifice, a commitment to improve governance in the less-well-run countries, and a higher concern not to burden future generations.
Trust – a type of moral capital – was the glue for the European deal. The compromises were seen as fair and the promises as solid.
In Washington, trust is still wanting, even as President Obama and Republican leaders seem closer to an agreement before an Aug. 2 deadline to raise the debt ceiling. Are both sides merely jockeying for advantage in the 2012 elections? Are they playing to campaign donors?
And if there is a deal, how can either side know the other will live up to agreements, such as promised cuts in spending or the closing of tax loopholes? Individual politicians barely listen to the political fears of their partisan counterparts. Sound bites rule.
The trust of Americans in lawmakers is at its lowest since 1989, according to a Washington Post-ABC News poll. Only 30 percent said they would vote to reelect their legislator. A large majority rejects the way that both Democrats and Republicans are handling the debt crisis, according to a CBS News poll.
Countries with a high level of trust tend to have better economies and governance, according to many scholars. Working relationships are based on a cultural norm that requires each person to take into account the interests of others. If those norms break down, society is left with only raw political battles.
Political scientist Robert Putnam finds communities that see themselves as highly diverse tend not to have high levels of trust. Crime rises. Litigation and regulation replace dialogue and teamwork.
But that does not mean leaders should focus only on a community’s differences. They need to find bonds, such as shared values and universal hopes, that can reverse fears of diversity and create trust. That can be difficult in a country of 310 million people and 535 lawmakers facing trillions in debt. Playing one game of golf together will hardly establish trust.
A grand political bargain on reducing the US debt should really be a bargain that starts to reweave the ripped social fabric of America.
Trust, like money, is both spent and created. It requires leaders to have transparency, responsiveness, and accountability. Unlike money, such virtues are infinite. Washington needs to start drawing on that bottomless source.
