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Drucker continues the symposia on the topic of election campaigns and populism, arguing how the Reverend Jesse Jackson is the only competent politician in the 1984 campaign for president. Drucker states that the U.S. is in the midst of a major social, and perhaps economic, transformation in which statistics has been largely completed, and psychology has barely begun. He argues that American populism has always been an attempt to say that the U.S. ought to go back to what is natural and normal, whether that connotes the time of Andrew Jackson, or populism in the 1890s, etc. Drucker then predicts that, within a few years, the U.S. will have ceased to be different in its basic economics from the rest of the major economic countries. It used to be that countries were integrated into the world economy through food and raw material exports, and countries were integrated into the world economy through the industrial/advanced economies. The U.S. and Canada were exceptions to this trend because, particularly in the case of the U.S., they were manufacturing economies in which farming and raw materials progressively became less important. Internationally, the U.S. was integrated primarily as a raw material and food exporter. Domestically, the food and raw materials sector became relatively less important around 1975, and the trade deficit is primarily the result of the collapse of the food and raw materials exports, and especially prices. Drucker states that there is no possibility of such things returning to the way they were--and the only food importers left are the Soviet Union and Japan. Nonetheless, the switch from raw materials into a knowledge-intensive economy is rapidly underway. As a result, there is no market for what was an American international economic strength. Internationally, the economy is shifting to one that is integrated through goods and services of all kinds, rather than food and raw materials, and the current record of the American labor force violates all modern economic theory. The populist backlash, Drucker argues, must be because of the American success in terms of the shortage of labor and low unemployment in certain sectors coupled with the laying off of significant numbers of manufacturing and other blue-collared workers. Education, if it is an independent value, as it is for educated people, is one thing, while education remains an economic value for others. Drucker further contends that the populist upsurge is an early warning sign that the issues Drucker raises will continue to be key problems moving forward, and the large financial institution will, increasingly, come under close scrutiny and attack. He states that the current financial structure is immoral and violates basic values because it inputs abstract symbols as the only reality, and puts wealth-produced production nowhere. Therefore, the large financial structure and financial institution will be the next major political issue, no matter what Party wins the presidency, and a related problem for most organizations will be the alienation of middle managers. In terms of government deficit and debt, the U.S. is not particularly bad--it is in the middle. The U.S. is the only major developed country that has a very large portion of its government debt in the hands of foreigners, and is the only country in history in which virtually all of this debt is owed in its own currency. Drucker then predicts that people will eventually revolt against foreigners buying American properties, and that severe restrictions will consequently be put in place on foreign purchases in the U.S. The problem, Drucker states, will become acute when the populist malaise becomes politically effective, and he hopes that the movement will be able to treat the symptoms emerging in capitalist America, but not try to regress to a previous time. Drucker concludes by returning to a previous audience question concerning whether he is an optimist or pessimist, and he reveals that he is an optimist because the issues America faces are real issues, and when real issues are tackled, there is a chance of success. However, he does not believe America’s way will be easy or pleasant.
Drucker, Peter F. (Peter Ferdinand), 1909-2005 New York University New York University. Graduate School of Business Administration Elections Jackson, Jesse, 1941- Populism Populism--United States Populism--United States--History Jackson, Andrew, 1767-1845 United States Canada Manufacturing industries Manufacturing processes Agriculture Soviet Union Japan Knowledge workers Raw materials International economic integration International economic relations International finance Labor Unemployment Blue collar workers Education Financial institutions Production (Economic theory) Middle managers Debt Deficit financing Protectionism Optimism Symposia Election campaigns World economy Knowledge-based economy
Original recording, April 22, 1982; Drucker Archives; Box 68