Wednesday, May 9, 2012

Life in Spain vs. the U.S. ... Learned Helplessness vs. Earned Success

Although not as severe as those of Greece, Spain has huge financial problems, too.

For example, the nation has an overall unemployment rate of 24%, perhaps on its way to 30%, and an accompanying youth unemployment rate already at 50%.

On top of that, their banks are in deep trouble as well. Now that Greece is on the run from its creditors, will it soon be Spain's turn to try to keep the bond vigilantes at bay?

And what lessons does Spain have for us in the good old U.S.A. to learn, if any? Let's start with how we're different in what we believe and reward--totally different.

In contrast to the social democratic model in European nations, including Spain, American Exceptionalism is based on well established memes (ideas or behaviors that spread from person to person within a culture) like hard work and earned success. Those national norms make us fundamentally different  from most other nations, including Spain.

America and the Value of 'Earned Success' contrasts life in the U.S. and Spain.  Of course, it could have compared us with most other European countries and reached many of the same conclusions. Here goes:

"I learned to appreciate the American free enterprise system by quitting a job in Spain.

At age 19, I dropped out of school to pursue a career as a French horn player. After a few twists and turns, I wound up in the Barcelona Symphony, which was a Spanish government job.

Even as a foreigner, I had the same lifetime work status as a clerk at the water department. Nobody ever left these jobs, except with lavish disability packages. (One colleague who injured his lips moonlighting at a dance-hall gig ended up spending the next 20 years collecting a full salary to stay home.)

I loved music—but the life of a government functionary wasn't my cup of tea. And so my Spanish wife and I decided to pull up stakes and start over in America. Neither of us had a college degree, and my wife's English was limited.
To friends in Barcelona, this move was ridiculous. Quitting a job in Spain often meant permanent unemployment. As we departed, my in-laws tearfully gave us a gold bracelet which, they said, we could pawn in the coming hard times.

We were fairly poor for a few years but just fine. I taught music during the day and earned a bachelor's degree in economics at night. To her astonishment, my wife immediately landed a job teaching English to other immigrants. "America is a great country," she declared—an assertion I had never heard from a Spaniard.

In the end, I concluded, what set the United States apart from Spain was the difference between earned success and learned helplessness.

Earned success means defining your future as you see fit and achieving that success on the basis of merit and hard work. It allows you to measure your life's "profit" however you want, be it in money, making beautiful music, or helping people learn English. Earned success is at the root of American exceptionalism.

The link between earned success and life satisfaction is well established by researchers. The University of Chicago's General Social Survey, for example, reveals that people who say they feel "very successful" or "completely successful" in their work lives are twice as likely to say they are very happy than people who feel "somewhat successful." It doesn't matter if they earn more or less income; the differences persist.

The opposite of earned success is "learned helplessness," a term coined by Martin Seligman, the eminent psychologist at the University of Pennsylvania. It refers to what happens if rewards and punishments are not tied to merit: People simply give up and stop trying to succeed.
During experiments, Mr. Seligman observed that when people realized they were powerless to influence their circumstances, they would become depressed and had difficulty performing even ordinary tasks. In an interview in the New York Times, Mr. Seligman said: "We found that even when good things occurred that weren't earned, like nickels coming out of slot machines, it did not increase people's well-being. It produced helplessness. People gave up and became passive."

Learned helplessness was what my wife and I observed then, and still do today, in social-democratic Spain. The recession, rigid labor markets, and excessive welfare spending have pushed unemployment to 24.4%, with youth joblessness over 50%. Nearly half of adults under 35 live with their parents. Unable to earn their success, Spaniards fight to keep unearned government benefits.

Meanwhile, their collective happiness—already relatively low—has withered. According to the nonprofit World Values Survey, 20% of Spaniards said they were "very happy" about their lives in 1981. This fell to 14% by 2007, even before the economic downturn.

That trajectory should be a cautionary tale to Americans who are watching the U.S. government careen toward a system that is every bit as socially democratic as Spain's.

Government spending as a percentage of GDP in America is about 36%—roughly the same as in Spain. The Congressional Budget Office tells us it will reach 50% by 2038. The Tax Foundation reports that almost 70% of Americans take more out of the tax system than they pay into it.

Meanwhile, politicians foment social division on the basis of income inequality, instead of attempting to improve mobility and opportunity through education reform, pro-growth policies, and an entrepreneur-friendly economy.

These trends do not mean we are doomed to repeat Spain's unhappy fate. But our system of earned success will not defend itself.

All surveys show that most Americans still embrace our free enterprise system—today. The crucial test is whether the country is willing to support the hard work and policy reforms that will sustain it.

The cost of failing this test will be more human than financial. In our hands is the earned success—and thus the happiness—of our children and grandchildren. The stakes in the current policy battles today are not just economic. They are moral."

Summing Up

Economic freedoms and basic principles can't be separated from personal freedoms and personal responsibilities.

The blessings of liberty, including economic liberty, are indeed a moral issue.

Free individuals with equal opportunities are able to do as they choose and either reap the rewards or accept the failures accordingly.

In order to be free to succeed, we must be free to fail as well. In that regard, legendary UCLA basketball coach John Wooden observed that success was never final and failure was never fatal.

Keep playing the game of life to the best of your ability, in other words.

We can't long have both big government and a prosperous economy.

Neither can we have big government and a self reliant happy group of fellow Americans.

Security follows opportunity; not the other way around.

We can't steal second base with our foot still on first.

As a nation, the cumulative knowledge of all of us will always be tremendously greater than the combined knowledge of our political leaders.

Besides, we're all happier doing our own thing and letting the chips fall where they may.

Should you doubt any of the foregoing, just consider the plight of the ordinary Chinese, Russians, Syrians, Iranians, Venezuelans, Cubans and countless others who don't enjoy the individual freedoms and opportunities that we have as Americans, yet all too often take for granted.

For that matter, consider the Europeans, too.

Do we really want to be like them?  Not I.

Thanks. Bob.