As we watch the nightly news or read the daily newspapers, we often define reality based on these sources of information.  However, these sources are rarely as objective as we assume or even as we would wish.  So, there are times when it is imperative that we step back, take a deep breath and rethink what reality actually is.  In this perspective, I hope to add information that I trust will enable you to have a more accurate understanding of reality.  The two topics, totally disconnected, are the growing threat of China and the assumed goodness of the American Association of Retired Persons (AARP). 

• First is China.  What we hear in the media is that China is a growing threat to the United States in almost every area—militarily, economically and politically within Asia.  There is no doubt that China is now challenging the US in all of these areas.  But it is quite important for us to reexamine this threat.  The US has officially changed its policy toward China from one of containment to now one of engagement.  The American economy is inextricably linked to China’s economy.  China still seeks trade, technology, expertise and investment from the US to help create the kind of modern and prosperous society it desires.  The new leader of China, Hu Jintao, met last weekend with President Bush in China.  Among many other things, he wanted to assure the President that China is not really trying to take over the world.  He said recently in South Korea, “Facts have proved that China’s development will not stand in the way of anyone, nor will it pose any threat to anyone.  Instead, it will only do good to peace, stability and prosperity in the world.”  China, in a very real sense, argues Jim Yardley, has two economies:  “It is a manufacturing goliath, a major engine for worldwide economic growth that has doubled its foreign trade in just three years.  But roughly 500 million of China’s 1.3 billion people still live on less than $2 a day and the overall population is aging rapidly, in a country where the social security net is almost nonexistent.”  The articulated goal of China is by 2020 for a “well-off society.”  The US is absolutely critical to them achieving this goal.  More than at any time in world history, the economies of China and the US are now connected.  The development of its economy is still the centerpiece of China’s foreign policy.  Hu Jintao has made economic development tours in recent years, visiting Africa, Europe and South America and proposing military exchanges, lucrative trade deals and promising that trade with China will be a win-win proposition.  Further, China needs oil and natural gas to fuel its economic engine.  Therefore, the US remains very concerned (1) about China’s growing military budget—will it use its growing power for military escapades?;  (2)  about the absence of individual rights within China, especially religious freedom (indeed, President Bush made a strong point about religious freedom in his visit last weekend); and (3)  the belief  that China’s economic growth is costing American jobs.  Overall, this last concern is difficult to defend.  China, for example, recently signed an enormous contract with Boeing for a whole new fleet of consumer jets.  Further, Americans continue to demand the cheaper goods flooding in from China.  Those cheaper goods are keeping the inflationary pressures low—just visit any Wal-Mart or Hobby Lobby to see what I mean.  In short, China is a growing challenge, but this analysis must be kept in balance, for the economies of China and America are now so interdependent that America needs China as much as China needs America.  See Yardley’s helpful article in the New York Times (20 November 2005).  

• Second is the AARP.  Rarely does a month go by where I do not receive an invitation in the mail to join the AARP.  It is the foremost lobbying organization in the US for the retired population of America.  It also offers its 36 million members discounts on car rentals, hotel rooms and airline tickets.  But economist Robert Samuelson offers a sobering analysis of the truth about AARP.  He writes, “if unchecked, its [AARP] agenda will plunder our children and grandchildren.”  What does he mean by this audacious statement?  “Anyone who has watched the steel and auto industries can visualize AARP’s America.  In those industries, companies and unions unrealistically agreed to overly generous pensions and retiree health benefits that, as the number of retirees multiplied, overburdened the companies.  Now past promises collide with present economic realities.  Workers and retirees suffer.  Wages and jobs are cut; so are pensions and retirement health benefits.  On a much larger scale, that may be America’s future.”  AARP today is so powerful that, next to the President, it can set the terms of debate for federal retirement programs—Social Security, Medicare and long-term care through Medicaid.  Here is Samuelson’s primary concern:  Given the baby boom, longer life expectancies and rising health care costs, Social Security, Medicare and Medicaid are projected to grow by about two-thirds or more during the next 25 years.  To cover these costs, the nation will need to raise all federal taxes by 50%, eliminate defense spending and 30% of other federal spending, excluding interest payments, and run budget deficits three times present levels.  AARP is in total denial about these realities.  It spent, for example, $25 million to defeat President Bush’s Social Security reform package, suggesting that the system does not need such radical changes.  As Samuelson argues, in all these critical areas, “delay is AARP’s program.”  It clearly expects younger taxpayers to bear most of the burden of these accelerating costs.  Listen to his conclusion:  “AARP’s America is an illusion.  Sooner or later, it will be overtaken by demographic and economic realities.  The reluctance to begin refashioning benefits—focusing on the neediest and oldest Americans—will compel wrenching benefit cuts later.  By their abruptness, these will be unfair.  But even these cuts won’t spare younger workers from higher taxes or cuts in other programs.  Like auto workers and steelworkers, we will learn that we could ignore the future but not avoid it.”  For what it is worth, I will not be joining the AARP.  I have concluded that it is one of the most dangerous organizations in the US today.  It is selling a lie to the baby boomers, but by the time the boomers realize the lie, it will be too late for most of them.  See Samuelson’s editorial in the Washington Post (16 November 2005). 

This is Thanksgiving weekend and it is appropriate in this edition of Issues in Perspective to focus on Thanksgiving.  To that end, I want to concentrate on the Thanksgiving hymn, “We Gather Together.”  Melanie Kirkpatrick of the Wall Street Journal offers an instructive history about this traditional hymn. 

On 10 November 2005, Peter F. Drucker died.  Unless you are involved in business, leadership or some form of management, you may not recognize the name of Peter Drucker.  But he was a giant!  His 35 books, his countless articles and his profound insights caused the significant management and leadership revolution of the late 20th century.  He would have been 96 years old in mid-November.  His life was significant in every measure of that word.