A Word from London

Herbert London

      Herbert London is president of the Hudson Institute and is John M. Olin Professor of Humanities at N.Y.U. He is also the author of the recently published book Decade of Denial, Lexington Books.

The End of History or the Clash of Civilizations

      A decade ago Francis Fukuyama wrote The End of History, a Hegelian analysis that argued the end of the Cold War ushered in the triumph of liberal democracy. The dialectic that precipitated philosophical clashes in the past was at an end point. All nations, Fukuyama maintained, want free markets and some form of constitutional government.
      Islamic fundamentalism was considered as an alternative, but was rejected as a mere historical footnote. Alas, it may be too early to reject Fukuyama's contention, but September 11 made this view seem naively optimistic.
      Roughly five years ago Samuel Huntington challenged the Fukuyama contention in his book Clash of Civilizations. Huntington maintains that transcendent philosophical conceptions could lead to global conflict not unlike the present war between Western liberal democracies and radical Islam.
      Whether this conflict is to be the driving force in history remains to be seen, but for the moment at least the Huntington analysis has efficacy. Radical Islam is at war with open societies. It is an orthodoxy that cannot countenance Western latitudinarianism, what the terrorists call the manifestations of the Great Satan.
      Wherever radical Islam is in authority intolerance prevails. In the Sudan, Christians are sold into slavery. In Afghanistan missionaries are imprisoned and education is restricted to males. In Algeria political opposition is prohibited.
      As former Israeli prime minister Benjamin Netanyahu recently noted: "What is at stake today is nothing less than the survival of civilization."
      What remains undetermined is whether Islam is the enemy or whether it is only radical Islam or whether the two are indistinguishable. Are we engaged in a global clash of civilization or a clash with a substrata of one civilization?
      On one matter there isn't any controversy: A substantial portion of the world's people shares anti-Western virulence. Whether there is a real grievance or a perceived grievance or an invented grievance, Islamic hatred is probably more widespread than President Bush's speech before the Congress admits. Theocratic fundamentalists generate hatred based on centuries of supposed injustice and a basic antipathy to secular life.
      In a recent poll eighty percent of Egyptian respondents said the United States is not an enemy, but the enemy. Rejoicing on September 11 in Gaza and the West Bank confirmed this response.
      Some Arabs contend that United States' support of Israel justifies terrorist attacks. Others view the West as hopelessly decadent. Still others argue against the modernity the West embodies.
      For many militant Muslims martyrdom is the highest reward one can attain. That explains why some young men are willing to engage in kamikaze attacks.
      American youths may aspire to be baseball players or rock stars, but in a segment of the Islamic world young people are eager to be suicide bombers with a place reserved for them in paradise.
      The complexity of the clash America now confronts is embodied in the attempt to root out a belief, a hatred so deep seated that life itself is trivialized for many Islamic adherents.
      The new jihad will be opposed unambiguously while the scene of devastation at the World Trade Center and the Pentagon remains vivid in the public imagination. Yet it remains to be seen whether public unity is sustainable.
      The hate America crowd hasn't gone away; they are merely underground at the moment waiting for failure or disappointment in order to resurface. Even now the chant "an eye for an eye, leaves you blind" presages candlelight vigils in the future.       One can only hope that the magnitude of the ruthless attacks on America has sunk into the soul of the nation. One hopes as well that in order to reach the end of history, we will prevail in the clash of civilizations. And one prays that the postmodernists who preach relativism on our campuses realize that the face of evil is unyielding and definite.

Postmodernism and September 11

      It is always interesting to observe how postmodernist thinkers can engage in verbal convolutions before they find themselves in a tangle.
      On October 15 in the New York Times, Stanley Fish, noted author and dean at the University of Illinois, argues the case for postmodernism after the September 11 attacks. According to critics, postmodernists deny the possibility of objective description, thereby leaving one with no firm basis for condemnation of the terrorist attacks.

Professor Fish contends

The only thing postmodern thought argues against is the hope of justifying our response to the attacks in universal terms that would be persuasive to everyone, including our enemies.

. . . putting yourself in your adversary's shoes, not in order to wear them as your own but in order to have some understanding (far short of approval) of why someone else might want to wear them.

This, he suggests, is "simply another name for serious thought."
      There are many things one might say about the Fish analysis, but calling it serious thought is not among them.
      Let me offer a universal term that doesn't equivocate: "evil." I would argue that terrorists and freedom fighters in the cauldron of postmodern exegesis might be confused. But for those inoculated against these ravings, the distinction is simple. Freedom fighters do not internationally engage in the wanton killing of innocent people.
      When roughly five thousand people were killed in the World Trade Center for no other reason than they went to work, that is the face of evil and, yes, I'm persuaded the universal definition applies.
      Should I empathize with a crime so dastardly? Even if I understand the rage surrounding the attack, I still cannot understand the act itself. There is a distinction Fish ignores between understanding a motive and still not understanding the act emanating from it. I may hate a colleague for what I consider justifiable reasons, but the hate cannot serve as a rationalization for murder.
      The problem with Fish's relativism is that it ignores a certain reality even he at some point must recognize. If someone decides to slit his throat with a razor would Professor Fish ask why this would-be murderer is about to commit such an act? Would he attempt to understand the motives of the killer or would he strive in every way possible to prevent his death?
      The answer is obvious. It is also obvious, notwithstanding Fish's ramblings, that society has a responsibility to preserve itself against those who would choose to destroy it. That is a universal contention which I believe to be true.
      Professor Fish believes that if motives are understood and a place defined one can at least try to anticipate future assaults. But is this point accurate? Surely the motives are known: real and imagined grievances. And as surely, the places are known: Afghanistan, Syria, Iraq, Iran, Saudi Arabia, Egypt, Gaza and the West Bank. Now what?
      This argument is mere subterfuge for the central postmodernist view that we don't know what we mean when universal terms are used. In the September 11 attacks I maintain Americans were not the least bit confused about terminology. We saw the face of evil; it did not require an interpreter.
      Those who died at the World Trade Center were innocent men, women and children. In my judgement there isn't any explanation that warrants those murders. End of argument.

Openness and Security: America at the Crossroads

      The United States I love is a liberal society where strength derives from its openness. Here people are free to say what they please and do what they want, assuming they don't harm others in the process. This is the essence of liberty and it is what this exceptional nation represents.
      But in the minds of those who embrace a fundamentalist view this form of liberty is abhorrent. Since September 11 it is worth asking, as Sam Tanenhaus does in an October 19 Wall Street Journal article, whether our admirable principles are also a weakness which threaten national survival.
      Clearly an academic, as I am, weaned on the free exchange of opinion believes that all views should be considered, even those that threaten our existence. Yet in an environment where the nation is at war against a shadowy terrorist foe unrestrained by national borders and convinced of his destiny, America's openness may not be an advantage.
      The Voltairean notion that from the exchange of views truth emerges is predicated on the belief that all parties have a stake in verbal engagement. But suppose one of the parties is there only to proselytize; suppose as well that his positions are toxic and can tolerate no other point of view. In this scenario neither compromise nor neutrality is possible. Moreover, the tolerant party is likely to be the receiver of ideas and the intolerant party the deliverer.
      Similarly, this nation of immigrants has pursued an open immigration policy since 1965 that emphasizes family unification and a belief in the power of acculturation. But while this policy has produced benefits, it is now clear it has also produced thousands of Manchurian Candidates or "sleepers" who are in this country legally and illegally to create havoc. These people often hate America with a barely controlled desire for vengeance and, as the attacks on September 11 demonstrated, are willing to give their lives for a deeply held religious belief that can brook no accommodation with the United States.
      Even if one argues for the benefits of an open society with a liberal immigration policy, it must be considered against a backdrop of internal enemies intent on destruction. Recently Eric Shmitt, a reporter for the New York Times, referred to an illegal alien as "someone who arrived without valid travel documents." Now, if sneaking across a border while avoiding the border patrol-in some cases with evil intent-is merely travelling without valid documents, American sovereignty is certainly in jeopardy.
      Similarly, if the press regards "the right of the public to know" as a transcendent position which trumps all others, then national security is at risk along with our ability to prosecute a war abroad. How can one defeat an enemy when our troop movements are routinely disclosed? A free press once meant a responsible press, but since the "Pentagon Papers," disclosure is sometimes more important in the mind of media pundits than national security. Ernie Pyle meet Mike Wallace.
      Surely it is unsettling to live in a nation that assumes the right to suppress beliefs. Subversives harassed by Senator Joseph McCarthy are now part of American folklore. But what happens when those beliefs are the catalyst for violent action? And what should one do if in the suppression of toxic beliefs one saves thousands of innocent lives? It would appear that the principle may have to be modified in order to secure safety or, if not, then we must be willing to live in an environment of perpetual insecurity.
      To alter our principles may change the American landscape so many wish to preserve; to preserve our principles intact may put many lives at risk. This choice gives the freedom-security equation new urgency. Can we repudiate who we are for security or risk destruction if we preserve the nation in its present form?
      September 11 did bring the United States to a crossroad. The choices are difficult, but clear. Perhaps the greatest issue is making a choice at all. Yet doing nothing is also a choice and in the present environment a very dangerous one.

Saudi Arabian Hypocrisy and the War on Terrorism

      The White House has worked diligently to assemble a coalition (a word no one in the administration uses) to defeat terrorist activities. In fact, seventy nations have agreed to block the assets of those connected to the terror network. But there is one conspicuous omission: Saudi Arabia.
      According to Deputy Treasury Secretary Kenneth Dam the administration "made significant progress" in starving the Usama bin Laden financial support system. Yet the money spigot hasn't been shut off.
      It is known that al Qaeda receives most of its financial assistance from Islamic charities and relief organizations and much of that assistance emanates from Saudi Arabia. Yet Saudi officials either deny the allegations or reject the claims.
      Saudi Interior Minister Prince Nayif argues that the claims lack substance. Alas, that may be true since a comprehensive briefing by the U.S. government could compromise intelligence sources.
      U.S. officials note that Yassin Qadi, a Saudi businessman, funded a charity that serves as an al Qaeda front. And he is not alone; many business leaders with questionable ties to terrorist organizations are protected by the Saudi regime.
      What precisely is going on here? It appears that the Saudis want their cake and the ability to eat it at their convenience.
      On the one hand, they welcome the U.S. defensive umbrella; on the other hand, they fund radical Islamic groups as an extortion payment.
      Were it not for sixteen percent of U.S. oil imports, the U.S. might abandon Saudi Arabia. But oil is the life blood of an advanced technological society. As a consequence, we offer conditions to Saudi Arabia that would never be countenanced elsewhere in the world.
      The Saudis were almost completely uncooperative in tracking down the terrorists who slaughtered American soldiers at Khobar Towers. The Saudi royal family has given aid to Hamas, another terrorist organization whose bloodletting in Israel is well established. And the Saudis paid for Arab groups to fight with the Mujhadeen in Afghanistan.
      While President Bush Senior and Junior talk of the Saudi kingdom as an American ally, it is covertly doing whatever it can to undermine American interests.
      The curious twist in this scenario is that bin Laden is as intent on overthrowing the Saudi royal family as he is on inflicting damage on the U.S. For him, the royal family acts as infidels since it has invited U.S. troops on to holy ground (the nation with the Islamic holy cities of Medina and Mecca.)
      In that part of the world, of course, memories are short. Only a decade ago U.S. forces saved the Saudi royal family from extinction as Saddam Hussein's troops marched into Kuwait and threatened Saudi borders. The encomiums directed at the U.S. offered hope that a new relationship with the Saudis had been established. But that lasted as long as there were U.S. troops in Iraq.
      Rather than give assistance to Palestinians who live in poverty, the Saudis give aid to the terrorists attacking Israel. Even before the first subsidized bullet was fired by a terrorist, the Saudis disclaimed any knowledge of those payments. Moreover, the royal family hypocritically points to the destitution of Palestinians in the West Bank and Gaza.
      Having it both ways works for now because the U.S. is still thirsty for Saudi oil. But the day is coming when America will be oil independent. On that day the Saudi royal family-decadent beyond our imagination and self-indulgent to a disgraceful level-will have to fend for itself.
      I can shed only crocodile tears over the prospect. So much for allies that smile at our faces and stab us in the back. So much for so-called friends who undermine our interests and ignore American blood soaking their sand.
      Now when we ask the royal family to turn off the money flow to al Qaeda, it averts our gaze. There is the pretense of cooperation. But the evidence against this claim is mounting.
      It is not coincidental that most of the terrorists engaged in the September 11 attack on the United States came from Saudi Arabia. Nor is it coincidental that so many of the charities providing financial aid to terrorist groups are located in Saudi Arabia.
      As I see it, the time has arrived to talk turkey to these turkeys. Either they are with us or against us. Clearly they need us at least as much as we need oil. Perhaps that reminder should be made in unequivocal terms. It wouldn't hurt to offer the Saudi royal family a taste of reality; they have been on a carpet ride for much too long.

Universities Search for Answers to the National Threat

      For much of the twentieth century universities served a public function. Despite a liberal orientation, they cultivated patriotism, a respect for the free market and a belief in exceptional American traditions.
      It was not coincidental that college students volunteered in large number during World War II. Nor was it coincidental that the O.S.S. (the forerunner of the CIA) was composed almost entirely of Yalies.
      Needless to say, this condition changed with the Vietnam generation. In the 60s and 70s college students lost confidence in their nation. They burned flags, spelled American with a "k" and were fed a pabulum of American venality.
      Students grew soft and decadent. Although the word appeasement wasn't used, peace at any price became the standard. There weren't any conditions they noted in which reason wouldn't prevail.
      So sacrosanct was this belief that harpoons couldn't penetrate the wall of liberal illusion. Yet it was precisely this appeasement that made terror more likely. It was precisely the scent of weakness that the terrorists found irresistible.
      In the minds of the cultural relativists who came to dominate the university curriculum, American students were obliged to understand our enemies, to empathize with their condition. After all, there was no higher principle than tolerance, the emerging god of campus debate.
      The Wall Street Journal editorial page contends that this condition changed on September 11. Even the Harvard Crimson, the editorialists note, printed a poll showing sixty-nine percent of the student body is in favor of military action against those who attacked America. More telling was the Crimson's response to thirty-eight percent of undergraduates who said they were unwilling to take part in military action themselves. As the editors observed, one worries about students that favor military response "only as long as they can continue to sit comfortably in Cambridge."
      The Yale Daily News asks plaintively "Will we serve?" It answered the question by noting: "We must answer the calling of our time-for if we don't who will?"
      Is it possible that several generations trained in moral obtuseness have awakened from slumber? Is it possible that student hearts and minds were not captured by aging baby boomers still immersed in Woodstock nostalgia?
      I am not persuaded. There is considerable counter evidence that cannot be easily dismissed. A University of North Carolina lecturer said if he were president he would apologize to "the widows and orphans, the tortured and the impoverished and all the millions of other victims of American imperialism."
      Professor Paul Kennedy at Yale asked his audience to understand the reasons people have for their hatred of America-notably our military power and culture.
      University of Texas Professor Robert Jensen wrote that the attack "was no more despicable than the massive acts of terrorism . . . the U.S. government has committed during my lifetime."
      A rabbi in downtown Manhattan in the shadow of Ground Zero told her congregation of many students that we must "build bridges" to our enemies rather than "feed the dog of evil."
      A recent N.Y.U. graduate said he was unwilling to defend his country because it "has been something of a bully."
      Another N.Y.U. student that saw the Towers fall said, "this is all America's fault anyway."
      At Hunter College a student on a soapbox said the best response to terrorist attacks is "fighting American racism."
      Professor Bill Crain at C.C.N.Y. said "he wants peace not war. Our diplomacy is horrible."
      I suspect that the post-Vietnam generations have stripped the gears of public moral judgment. A flaccid form of tolerance and moral slovenliness intrudes on the unequivocal denunciation of evil. It is hard for someone raised on university banalities to accept the view espoused by Hamas leader, Sheik Hasan Josef: "We like to grow them from kindergarten through college." He was referring to Islamic martyrs.

John Maynard Keynes once wrote:

Madmen in authority who hear voices in the air are distilling their frenzy from some academic scribblers of a few decades back.

The madmen of the present take their lead from scribblers of many years back. It is the contemporary college crowd that in my judgment hasn't yet unloaded its scribblers.
      Is America's youth ready to learn something about its obligation to a free if imperfect society? Can they withstand the orthodoxy of relativism so many of their faculty members embrace? Can they overcome a history of appeasement and fight for what is right?
      History awaits the answer and history is an impatient master.

      Lessons from the New Economy

      For five years from 1995 to 2000 all I heard from colleagues and friends was that we had entered a new age, a virtual cornucopia in which the creation of wealth moves in one direction, upward. This was entitled the "new economy," predicated on information and technology that defy the old rules of Economics 101.
      Unfortunately for its enthusiastic proponents the laws of economics haven't been repealed. Markets move up and come down. Where there are rising fortunes, there is also gravity. While the tragedy of September 11 is the catalyst for pushing the U.S. and the global economy into recession, the more important questions involve the slide prior to the terrorist attack on America.
      Many dot com heroes are beginning to get the picture. The unreasonable price-earnings ratios of yesteryear are coming home to roost. Moreover, those blowing air in the bubble, by telling Americans the new economy is here, have seen the bubble burst and fortunes disappear.
      Valuations matter. The idea that a fictional account of future business earnings could lead to dramatic Wall Street underwriting was the triumph of hope over reality. Wall Street believed the lies, the trumped up dreams of the new economy, and now it has to pay handsomely for a dose of sobriety.
      It is instructive that the snake oil salesmen for the new economy are still in our midst. They rationalize the downturn in the market by arguing the Fed didn't cut interest rates soon enough or the cuts were insufficient or Alan Greenspan wasn't rationally exuberant. Yet the interest rate cuts over the last six months constitute some kind of record and Greenspan's reputation for spin has undergone severe discounting.
      What is most important to understand is that the so-called high octane economy of the late nineties was a bogus event. It was the economic equivalent of postmodernism in which laws demonstrated through empirical data are dismissed and the search for new meaning is pursued. Financial worlds were turned on their head, and for a while the view seemed very good, but that was only because conditions were seen through a kaleidoscope.
      As earnings were falling, valuations curiously often went up. This was a financial foundation built on sand. To my astonishment people paid for ideas. Every Wharton M.B.A. with a scheme discovered liquid capital. Yet this couldn't go on forever and, in fact, the death knell sounded with the beginning of the new century.
      Now investors wait for a rational recovery that includes the separation of wheat from chaff. It will take a while for a genuine market value to emerge and be recognized. After all, the hot-shot boys who fueled the new economy don't know how to manage in a downturn. After September 11 the concern is mitigating downside risks.
      It was relatively easy to manage a growth portfolio when every technology stock had an upward trajectory; it isn't so easy now. Similarly, claims of the new economy from those blowing bubbles have a hollow ring. The growth guys are attempting to cover their tracks and erase a memory of their past predictions.
      In my judgment this soul searching is healthy. It's what leads to market equilibrium. While many benefitted from a twenty-five percent annual return on invested capital in the go-go years, it was unnatural or at least a deviation from precedent. For the contemporary investor, once he reemerges from hibernation, expectations will be more modest. In fact, seven percent return is starting to sound very good indeed.
      There is still some leverage in the market, but not so much. In the area of consumables, there is over-capacity. It is hard to construct an inflationary scenario, albeit Mr. Greenspan still manages to do so. But when there are too many cars, recorders, computers, software, etc. I don't see how dollars can chase goods. The market impulse is deflationary, notwithstanding the Keynesian affect of war spending from the federal government.
      What better sign of a return to normalcy than three-button suits and skinny ties. Welcome to the fifties. Clearly this isn't history repeating itself . . . exactly.
      A pharmaceutical revolution is just over the horizon changing unalterably the landscape of health and welfare. While the Internet has taken a pounding, there are some commercial enterprises that will make it in the e-commerce world. New construction materials more durable than any on the present market will alter the construction of everything from airports to airlines. Electric cars and fuel cell engines promise great change on our highways.
      In other words, investment opportunities will reappear and the market slump will recover. On that matter I am certain. What I am not certain about is when this will occur.
      It's fun writing book with titles like Dow 36,000 but it is even more fun to determine when or if the market will reach that level. The next time a bubble emerges I hope the bulls can restrain their enthusiasm with a memory of the last couple of years. Of course that's a hope, not a realistic prediction.