To lead the debate on the economy, the Treasury Secretary needs to speak to the common sense logic guiding how Americans are thinking about the crisis.
When Warren Buffet told CNBC that the economy had "fallen off a cliff," everybody in the world understood exactly what he meant: our problems our really big, we dropped into them really fast, and we are in them really, really deep. Whether are not all three of those statements are factually accurate, Buffet's comment defined the economic recovery debate in a way that enabled everyone to talk about it in simple, straightforward terms. In other words: Buffet gave the debate a new common sense frame.
If we backpedal for a moment, we might wonder what the common sense frame was for the economic recovery debate prior to Buffet's comment. In theory, there was: a three-legged stool.
Since the Obama administration took office, and set themselves upon the never-before-attempted task of preventing an economic depression, they have been trying to frame the economic crisis using the image of a three-legged stool. The economy will stand on its own again, they tell us, if three basic components are stood up again: Jobs, Housing, and Banking. That image of a three-legged stool has been used to explain the logic behind passing three large bills laying out a big sums of public finds: The Recovery and Reinvestment Act, The Federal Fair Housing Act and "The Save The Banks Act" (actually name TBD). The economic crisis is linked to three collapsed economic factors, Tim Geithner has been telling us. We need to set up all three again to make sure that the economy has a solid foundation on which to rest.
The problem with Geithner's 'stool' metaphor is that it may be accurate, but it has not been particularly effective at defining the terms of the debate. With the exception of the occasional columnist's quip about the Geithner plan being 'wobbly,' after months of Geithner pushing the 'stool' idea, there are very few Americans talking about the economic recovery using 'three legs.' It just has not taken hold. By contrast, Buffet says 'fallen off a cliff' one time--and everybody grabs onto it instantly.
The fact is, some metaphors help the public understand what government is doing and some do not. While the three-legged stool may be a good description to use in back-room meetings, briefing books, and closed-door updates to Congress, it is not a good metaphor for defining a national debate. 'Falling off a cliff,' by contrast, does seem like a strong metaphor.
Just the other day, I felt the metaphor of 'falling off the cliff' working in my brain. Here is how it happened:
I had spent the afternoon reading articles on the banking crisis to get myself up to speed on the nature of the situation, focusing in particular on the problem that 'toxic assets' posed to the balance sheets of big banks. After all that reading, I finally understood that a huge percentage of world cash and capital is tied up in few massive banks with worthless mortgage-backed assets sitting on their balance sheets. While the assets are worthless, they are still listed as being very valuable. Soon--maybe next week, maybe next month--all those worthless bank assets are going to be converted to their real value. When that happens, the world is going to experience a sudden drop in market capital about a million times worse than the Freefall roller coaster at Six Flags. Markets will go down even further. Unemployment will rise. Even the safest of savings will lose value. That night, after reading about this, I had a fitful sleep. Despite my effort to get the banking crisis out of my mind, I kept waking up with a panicky feeling, as if I had just--fallen off a cliff.
Now, I have fallen of the occasional stool as much as the next guy, but neither the image or the feeling of stools--three-legged or otherwise--seemed to be present in my conscious and unconscious thoughts about the economy. When it came right down to it and the staggering magnitude of the economic crisis hit me in my gut, Geithner's three-legged stool was neither in or on my mind.
Like it or not, Geithner needs to acknowledge, as Warren Buffet has, that the dominant metaphor guiding the economic crisis debate is that of a giant cliff. And so the solution Geithner talks about needs to work within the logic that is already dictating the feelings and thinking of the American people.
If Geithner realizes how wide this 'cliff' logic has already spread, he will also understand that it places average Americans and big business executives in a slightly different place in the big story.
For example, when Warren Buffet says that the economy has 'fallen off the cliff,' he is talking about a massive crisis that has already happened for business owners in terms of dried-up credit and consumer spending. Big business is already over the cliff.
For most average Americans, however, our lives have changed because of lost jobs and foreclosed homes, but we have not yet seen our savings evaporate. The fact that the banks have not yet been forced to deal with the toxic assets on their balance sheets means that average Americans are looking at the steep ledge and are worried that they soon might be pushed over, but have not yet fallen off the cliff. Average Americans are having nightmares about falling of the cliff soon, whereas business owners are feeling what it is like to land at the bottom.
What this means for Geithner's choice of language becomes clear once we accept the 'cliff' is the guiding metaphor for the debate.
First, Geithner needs to explain how his plan will get business owners back up to the surface. This means talking about 'climbing out' of their 'deep' problems. If Geithner wants to talk about infrastructure investment, green jobs, and foreclosure relief that is fine, but he needs to talk about them in terms of helping business owners 'climb out' of deep ravine they landed in when they fell off the cliff.
Second, Geithner needs to explain how his plan will get average Americans over the gulch without falling off the cliff. In other words, he needs to explain how the investment act, the housing act, and the banking act will build a 'bridge' strong enough and big enough to carry every American over the horrifying depths of the economic chasm. 'Three-legged' stools may be good metaphor for 'economic foundation,' but what worries Americans is how they are going to get past the cliff without 'falling in.' And that means talking about building a bridge.
Now, under normal circumstances, it would be unfair to saddle the Treasury Secretary with the task of framing the economic debate, above and beyond the task of solving the economic crisis. But these are not normal circumstances. Hence, for Geithner to succeed he absolutely must take a more active role in communicating his message, and that means putting together a crack team of people in the Treasury Department tasked solely with helping him frame the debate. This is not to suggest in any way that framing the debate take precedence over solving the banking crisis. But with so many Americans waking with nightmares of falling off a cliff, Geithner needs to play a much more proactive role at communicating his policies in a way that leads Americans past their fears and anxieties.