Mes Dépêches

In early 2019, Wall Street Journal columnist Holman Jenkins Jr. penned one of history’s worst-timed praise reports.

Between excoriating some socialist European spirit that led to development of the Airbus A380 – a commercial failure even if incredible ride – Mr. Jenkins painstakingly painted Boeing in glowing stars and stripes, grateful that one company still “treats its business like a business.”

Barely two weeks later, the sparkling new iteration of Boeing’s bestselling model suffered its second fatal crash, and the entire fleet was politely asked to park. Nearly 350 deaths and tens of billions of dollars in legal costs were widely attributed to the “business” treatment that had moved Mr. Jenkins to write.

But while most would take such an experience as some divine suggestion for humility, Mr. Jenkins instead doubled down in a recent column, responding to yet another Boeing crisis by again extolling the company’s capitalist smarts, particularly relative to those silly European socialists.

This isn’t to say Mr. Jenkins is completely off point: Airbus’ A380 was a vanity project and ultimately one of aviation’s great flops, and Boeing was correct to not reinvent its aging 747 in reply. But the decision to prioritize $40-plus billion in share repurchases over properly competing against Airbus’ A320 was catastrophic, both for the company and its home country.

Five years later, Boeing’s tenuous cash position and importance to national security appear to necessitate some level of public support. Mr. Jenkins’ purist capitalism at work – like Citigroup or Chrysler, a mindset reducing a once-proud warrior to a crippled ward of the state.

Across the aisle, Sen. Elizabeth Warren is still screaming at big banks. I’m reminded of the Japanese officer Hiroo Onoda, who, stuck on a remote island without knowledge of Japan’s surrender, continued to fight his own little World War II for 30 years after Potsdam. Ms. Warren similarly seems locked in the great war of 2008, a time before banks were knee-capped by capital rules and hostile regulators. Using Onoda as our guide, she’s got another 15 years to go.

Principled consistency is a hallmark of character. But too often, principles get stuck in mud and aren’t refined through lifelong learning, creating rabid myopia – or, better, the act of sticking fingers in one’s ears to avoid the mental challenge of broader perspective. And here is where the ideological puritans fail.

With hindsight, would Boeing shareholders not prefer to go back in time and add in a competent regulator, capable of challenging the 737 MAX training protocol?

And what will Ms. Warren think when, one day, companies and individuals struggle to access credit from a banking system progressively weakened by politically charged regulation?

The truth, the ideal outcome, is never in some puritanical, binary extreme, but rather somewhere among the greys, and across two debates rarely within the same shade.

Thankfully, over time the ideology seen in political histrionics generally gives way to pragmatism and compromise in practice, precluding too many Boeings and propelling American capitalism to a dominant global position for at least 75 years. The risks to that streak, however, are ever-present, and, contrary to talk radio, are far more internal than Chinese.

Beyond Mr. Jenkins’ insistent, if tone deaf, defense of Boeing, the topic is timely as questions on the country’s debt begin to boil. The President struggles to find a check he won’t sign, and the Republicans’ Maga wing feasts on ritualistic Speaker sacrifice, while the country’s debt spirals in relative peacetime to levels only seen during the worst of wars.

America’s ability to dominate global markets – and, in turn, influence world affairs and spread democracy – depends fully on the supremacy of the dollar. Globally, companies and countries are forced to buy and hold dollars to facilitate trade and everyday transactions, as no other asset is believed to be as safe. Despite the rise (and fall and rise and fall) of bitcoin and various attempts at dollar alternatives, the fact remains that if one wants to buy oil with anything other than a dollar, well, good luck.

But if foreign countries or multinational companies believe the risk of the dollar to be too high, they will barter in euros, or in gold bars or apple pies. This is all about trust in America’s management of its economy and balance sheet. The “economy” side of that equation is strong, thriving under record government stimulus. But that stimulus comes at the expense of the “balance sheet” side.

From former President Trump’s ineffective tax cuts to current President Biden’s indiscriminate spending, even the under-rock dwellers know our debt has soared from fiscal largesse. And, truthfully, at near-zero interest rates the higher levels were not especially threatening, as most American debt is held by Americans, and thus we effectively borrowed from ourselves for a modest amount. But as interest rates climbed to combat inflation, so has the burden on the taxpayer to pay interest on that debt – an amount expected to approach $1 trillion next year. An amount that, already, has spooked the markets whose trust the system depends on.

Is the answer to raise a wealth tax? To eliminate spending on social programs? Maybe another tax cut to spur economic growth?

The real answer will require actual decisions, not talking points, anathema to the talking heads of the “common sense solutions” ilk and certainly to demanding voters. And those solutions will likely involve some combination of tax increases, spending cuts and learning to manage at higher deficit levels unless and until rates come down.

Should Mr. Jenkins or Ms. Warren be tasked with solving the issue, be assured that decisions will be deflected, ducked, punted, and half-assed (see: former British Prime Minister Boris Johnson executing on his Brexit promises). Such is life as an ideological puritan holding on to dogmatic fantasies in the real world.

Or, we can chill on the ideology and be the pragmatic capitalists the world expects.

Recently we’ve seen hope in this regard, as Maga attempts to overthrow their own House Speaker for the second time in six months were thwarted by cooperative Democrats. Perhaps a coalition of functioning brains is forming, at least reducing the ability of ideological puritans to hijack the most basic functioning of our system.

But as the risk is ever present, it’s worth remembering that puritans did not give us the successes of capitalism and have not fueled her steady hold on global commerce. Rather, the willingness to learn and grow within shades of grey – evidenced by our labyrinth of public-private conflict and cooperation – has given us our wholly imperfect system, one which flexibly finds new ways to dominate.