As the second decade of the 21st century begins, I have been reflecting on the last ten years. Ten years I have come to call the Decade of Debacle. I know there are many reasons to be thankful, but as I look back I can’t help but to see ten years that history will not view kindly.
New Years Eve 1999 was Y2K transition night when we all collectively held our breath waiting for the end of the world, or worse, for the economy to come to a screeching halt because the software we relied upon was not prepared for a double zero year. In fact I was on call that night for some software I had developed to help a client through the Y2K transition (I never got a call). I started thinking about the many hundreds of millions (maybe billions) of dollars spent in the 90′s preparing for the Y2K transition. How businesses were born just to provide programming talent to meet the deadline. I remembered how we were issuing work visas to more than 150k developers per year and still averaged 100k vacancies at any given time. All of that came to an abrupt halt in 1999 as projects got completed and the cash generated from the tech frenzy started to dry up and the dot-com bubble burst.
Ah yes, the dot-com bubble. Remember when all you needed to get a few million dollars of seed capital was to be a student at a respected University with a half-baked idea about how to make money on the Internet scribbled on a bar napkin? Businesses were born and funded and taken public in just a few weeks. There was no product, no market, no plan – just the promise that by adding the letter ‘e’ in front of the word ‘business’ we could somehow re-invent economic fundamentals and everyone would get rich fast. The money fed into these businesses fueled an over-heated consumption-based economy that warped our sense of commercial value. We hit the wall in 1999. We came to the stark realization that a publically traded company that had no product, no customers, no revenue and no market was not really a company at all.
Then there was the Presidential election between George Bush and Al Gore featuring a great challenge over the accuracy of voting. A challenge that went all the way to the Supreme Court. The irony of the controversy is still poignant. While the country was enamored with everything tech, the credibility of our political institutions and our democracy was based on a hole punch machine and paper ballots. The hanging chads in West Palm Beach stood in great contrast to the tech culture of Silicon Valley. In the end we survived the challenge, but the wounds were deep and still are not healed.
So the year 2000 ushered in the new millennium. We realized that the sky was not falling and that business spelled any other way was still business and that our democracy was strong enough withstand a great challenge. I remember being hopeful. I remember feeling that maybe we had been through the worst of it. That we had made some adjustments for the excess of the 90′s and that we would get ourselves back on track.
Then came September 11, 2001. Like December 7, 1941, it will be remembered as an infamous day that changed the lives of Americans forever. We all know exactly where we were that morning. So many people were touched personally and so deeply affected that the rest of the decade seems like a slow adjustment to a new way of life. A life already known by other people around the world in Israel, Ireland, Turkey, Philippines, Iraq, Iran, Pakistan, Spain, Argentina, Brazil, and the list goes on. A life in a world where you no longer felt safe in your own home. A world that was not secure. A world at war. A war with an enemy that does not want our land or our resources or our trade or our allegiance. A war with an enemy that simply wants us dead. We found ourselves in battle in Afghanistan and invading Iraq. Right or wrong, the wartime culture that evolved preoccupied us and became the focus of our attention.
That preoccupation had serious consequences. On the heals of the 9-11 attack came the collapse of Enron and WorldCom. Companies that had used accounting tricks to lie about the financial integrity and performance of their companies. Enron employees had lost their entire retirement which was invested in Enron stock. The realization that greed was so pervasive and so deeply rooted in our corporate culture led to the Sarbanes-Oxley Act making CEOs criminally liable for financial reporting integrity.
Unfortunately, our preoccupation with the war left us blind to the real enemy of our economy. An enemy that would unleash another surprise attack on July 16, 2007. On that day Bear Stearns announced that two of its major hedge funds had lost all of their value due to the collapse of the subprime mortgage market. This started the complete unraveling of our financial institutions. Banks and investment firms faced illiquidity and the credit markets seized. The cash needed to keep our economy flowing disappeared and the auto industry hemorrhaged. People stopped buying homes, cars, appliances and more. The housing market crashed and people found themselves in the same position as the banks, their mortgages exceeded their property values and now they had no job; no way to service their debt; no market to sell their homes; and no way to cover the loss in equity. In an effort to prevent another Depression the Federal government provided trillions of dollars of loans and bail out funds to the banks and auto industry, but the average American was left to fend for themselves. Then in December 2008 the enemy was given a name and a face. The ponzi scheme perpetrated by Bernie Madoff wiped out the savings of thousands of people. Retired people were left penniless. Investment funds wiped out. Bernie Madoff was the monster within.
In the middle of all of this turmoil and uncertainty we were reminded of how small and fragile we are. In August 2005 Katrina slammed into the Gulf coast and wiped out New Orleans. The devastation was unimaginable. The city was left virtually uninhabitable and we were powerless to prevent it. Even more pathetic was our lack of ability to respond and recover. Suddenly we were faced with the stark reality of our mortality. Residents of the city remain homeless even today.
In the Decade of Debacle we elected George Bush to a second term and then in 2008, we elected Barack Obama. The historical significance of Obama’s election is self-evident. Now comes the real business of rebuilding a country that has lost its moxie. Irrespective of the politics, strategies, policies, programs, etc., we face massive debt, an over extended military and an underperforming economy. We are need of great leadership. And we are right to question whether or not that leadership is in Washington today.
Still , once more I find myself hopeful that the worst is behind us. That the recovery, no matter how long or how hard, is lasting. I am hopeful that my children will inherit a world that is more peaceful, more stable, more ethical. I am hopeful that my great-grandchildren will read about the Decade of Debacle in their history books, never to forget the lessons learned about the consequences of unbridled greed and religious intolerance. I am hopeful that ten years from today I am writing about the dawn of a 21st century renaissance. A new age of enlightenment. One in which I can watch a football game without having to explain erectile dysfunction to a ten-year old.
