Moreover, attractive careers seemed to await those who earned higher degrees in positive psychology. The University of Pennsylvania program claims as one of its alums a coauthor of the business self-help book How Full Is Your Bucket? and two other alums have founded a consulting group to bring positive psychology into the public schools, through workshops on such topics as “measuring and nurturing character strengths and virtues” and “learning tools for building optimism and resilience.” 54 Another alum, David J. Pollay, is a business consultant and columnist for the Happy News Web site. Mostly, the opportunities seemed to lie in applying positive psychology to organizations and businesses, through consulting and coaching. In a breakout session so packed that many attendees had to sit on the floor, a British consultant who said that he helps clients like Wells Fargo and Microsoft create “strength-based organizations” offered a PowerPoint presentation listing the terms “natural and authentic,” “energizing,” “engaging,” “learning and developing,” “high performing,” and “well-being and fulfillment.” Similar lists, maddeningly nonparallel combinations of adjectives and nouns, pass for “theory” in most pop positive-thinking books directed at business audiences, making me wonder what distinguishes an academically trained positive psychology coach from the thousands of self-appointed coaches and motivators who feed off the business world.
Yet even at this self-congratulatory “summit,” there was some anxiety about the scientific foundations of positive psychology. In her description of the “challenges” facing the master’s program in positive psychology at her London university, Ilona Boniwell had included “healthy British skepticism.” This struck me as odd: Wouldn’t a physics or sociology professor be delighted to have skeptical, questioning students? When I put this query to her during a break in the proceedings, she told me: “A lot of results [in positive psychology] are presented as stronger than they are; for example, they’re correlational, not causative. The science of positive psychology has not necessarily caught up with the promise of positive psychology.” The “promise” was lucrative careers in business coaching, and the science would apparently just have to catch up.
In fact, the publicity received by positive psychology in the preceding year had been less than 100 percent positive. The 2007 New York Times Magazine article on Happiness 101 courses had complained about “the sect-like feel of positive psychology” and suggested that “the publicity about the field has gotten ahead of the science, which may be no good anyway.” The article went on to report that “the idea that whatever science there is may not yet be first-class troubles Seligman, too. ‘I have the same worry they do. That’s what I do at 4 in the morning,’ he says.” 55
These worries finally surfaced at a late afternoon plenary session on “The Future of Positive Psychology,” featuring the patriarchs of the discipline, Martin Seligman and Ed Diener. Seligman got the audience’s attention by starting off with the statement “I’ve decided my theory of positive psychology is completely wrong.” Why? Because it’s about happiness, which is “scientifically unwieldy.” Somehow, this problem could be corrected by throwing in the notions of “success” and “accomplishment”—which I couldn’t help noting would put the positive psychologists on the same terrain as Norman Vincent Peale and any number of success gurus. With the addition of success, Seligman went on, one was talking no longer about positive psychology but about a “plural theory” embracing anthropology, political science, and economics, and this is what he would be moving on to—“positive social science.”
Seligman’s statement created understandable consternation within the audience of several hundred positive psychologists, graduate students, and coaches. It must have felt a bit like having one’s father announce that he found his current family too narrow and limiting and would be moving on to a new one. In the Q&A session, some picked up on Seligman’s admission that the scientific basis of positive psychology is all too thin, with one asking, “How do we balance the empirical side of positive psychology with the applied stuff,” like coaching? Diener responded, in part, that “people doing things that there isn’t good evidence for” are at least “meeting a need.” Seligman agreed, saying that positive psychology was under pressure to produce practical results because “people want happiness.” If that sometimes means that the applications, like coaching, get ahead of the science—well, “science follows from practice,” he said, invoking the Wright brothers, “who flew when scientists didn’t know how birds fly.”
The idea of moving on to “positive social science” provoked even more anxiety. Diener defended the phrase “positive psychology,” saying, “It’s a brand.” Besides, he said, he “hates” the idea of positive social science, since social science includes sociology and sociology is “weak” and notoriously underfunded. The subject seemed to have veered away from science to naked opportunism. When one audience member proposed renaming positive psychology “applied behavioral economics,” because “it’s popular in business schools and goes with high salaries,” nobody laughed.
SEVEN
How Positive Thinking
Destroyed the Economy
In the middle of the first decade of the twenty-first century, positive thoughts were flowing out into the universe in unprecedented volumes, escaping the solar system, rippling through vast bodies of interstellar gas, dodging black holes, messing with the tides of distant planets. If anyone—deity or alien being—possessed the means of transforming these emanations into comprehensible form, they would have been overwhelmed by images of slimmer bodies, larger homes, quick promotions, and sudden acquisitions of great wealth.
But the universe refused to play its assigned role as a “big mail order department.” In complete defiance of the “law of attraction,” long propounded by the gurus of positive thinking, things were getting worse for most Americans, not better. The poor, including those who sought spiritual leadership from prosperity preachers like Joel Osteen and Creflo Dollar, remained poor and even increased in numbers. Between 2002 and 2006, as the economy grew briskly, the number of officially “low-wage” families shot up to 25 percent of all families with children. 1 The traditional working class, which had once overlapped with the middle class, saw its wages decline and decent-paying jobs—in manufacturing, for example—disappear. For many, the operative word seemed to be “squeezed,” as illustrated by books like Jared Bernstein’s Crunch: Why Do I Feel So Squeezed? and Steven Green house’s The Big Squeeze: Tough Times for the American Worker.
The white-collar middle class—prime market for self-help books, motivational products, and coaching services—found itself subject to the same forces of compression. Companies were cutting back or eliminating employee pensions and health benefits, a trend documented by Jacob Hacker in The Great Risk Shift: The Assault on American Jobs, Families, Health Care, and Retirement. Unemployment was low in the middle of the decade, but jobs were becoming increasingly short-lived as employers downsized, reorganized, outsourced, and otherwise sought to tweak their quarterly profits. In High Wire: The Precarious Financial Lives of American Families, Peter Gosselin described how the once-secure middle class was now being tossed about by “income volatility”—sudden downturns occasioned by layoffs, leaving families without health insurance or the means to continue their home payments. I reported on this stomach-churning situation in a 2006 book, Bait and Switch: On the (Futile) Pursuit of the American Dream, finding educated and experienced white-collar workers adrift in joblessness and short-term contract jobs and likely to end up in the same low-wage service jobs occupied by the chronically poor.
Not everyone was seeing their prospects diminish and lifestyle crimped. The flip side of all this poverty and insecurity was an unimaginably huge buildup of wealth at the upper extreme of the economic spectrum. In terms of wealth and income, America became the most polarized of the First World societies and even more deeply divided than it had been in the 1920s. The share of pretax income going to the top 1 percent of American house ho
lds rose by 7 percentage points from 1979 to 2007, to 16 percent, while the share of income going to the bottom 80 percent fell by 7 percentage points. As David Leonhardt put it in the New York Times: “It’s as if every house hold in that bottom 80 percent is writing a check for $7,000 every year and sending it to the top 1 percent.” 2 How did the top 1 percent use their ballooning wealth? On high-yield investments, of course, but also on a level of consumption that might have stunned even the robber barons of old. They traveled by Lear jet, maintained multiple homes, and hired whole staffs of personal employees, including people whose job it was to advise them on the best wines and art to invest in. Looking back from 2008, a writer in the business magazine Portfolio marveled at
the $34,000-a-night hotel rooms, the $175 gold-dusted Richard Nouveau hamburger at the Wall Street Burger Shoppe, the Algonquin Hotel’s $10,000 martini on the rock (the rock in question: a jeweler-selected diamond): Conspicuous consumption didn’t even begin to describe the you’re-not-going-to-believe-this lifestyle and work habits of the rapacious übercapitalists who were replicating all over the world. 3
On the eve of the Great Depression, in the highly polarized 1920s, there had been plenty of labor organizers and radical activists around to rail about the excesses of the rich and the misery of the poor. In the twenty-first century, a very different and more numerous breed of ideologues promulgated the opposite message—that all was well with our deeply unequal society and, for those willing to make the effort, about to get much, much better. The motivators and other purveyors of positive thinking had good news for people facing economic ruin from the constant churning of the job market: embrace “change,” no matter how terrifying; grasp it as an opportunity. A 2004 business self-help book by Harvey Mackay bore the defiant title We Got Fired! . . . And It’s the Best Thing That Ever Happened to Us. As we saw in chapter 4, employers relied on positive thinking to soothe the victims of downsizings and extract ever more heroic efforts from the survivors.
Nor was economic inequality a concern to positive thinkers, since anyone, anyone at all, could be catapulted into wealth at any time simply by focusing their thoughts. In the 2008 presidential campaign, Joe Wurzelbach, an Ohio man nicknamed “Joe the Plumber,” achieved a moment of fame for challenging Barack Obama’s plan to raise taxes for people earning over $250,000 a year. He was planning to buy the plumbing business he worked for, he asserted, and would soon be in that enviable category himself. As it turned out, he was an unlicensed plumber working in a two-man residential business that was unlikely to ever be vulnerable to the proposed tax increase. But why resent the swelling overclass—the CEOs earning an average of $11 million a year, the owners of islands and yachts—when you are aiming to join their ranks? In reality, Americans are less likely to move upward from their class of origin than are Germans, Canadians, Finns, French people, Swedes, Norwegians, or Danes. 4 But the myth, fortified with bracing doses of positive thinking, persists. As two researchers at the Brookings Institution observed, a little wryly, in 2006: “[The] strong belief in opportunity and upward mobility is the explanation that is often given for Americans’ high tolerance for inequality. The majority of Americans surveyed believe that they will be above mean income in the future (even though that is a mathematical impossibility).” 5
Hardly anyone—economist or otherwise—predicted the financial meltdown. After all, the American economy had recovered handily from the traumas of the dot-com bust and 9/11 and was being carried to new heights by soaring housing and stock prices. Professional optimists dominated the world of economic commentary, with James Glassman, for example, a coauthor of the 1999 book Dow 36,000: The New Strategy for Profiting from the Coming Rise in the Stock Market, winning a job as a Washington Post columnist and showing up as a frequent news show guest. Escalating housing prices were pumping up the entire economy by encouraging people to use their homes “like ATMs,” as the commentators always put it—taking out home equity loans to finance surging consumption—and housing prices were believed to be permanently resistant to gravity. David Lereah, the chief economist of the National Association of Realtors, published a book in 2006 entitled Why the Real Estate Boom Will Not Bust and How You Can Profit from It and became “the most widely cited housing expert in major media outlets during the peak years of the housing bubble.” 6 Frank Nothaft, the chief economist at Freddie Mac, was assuring audiences that nationwide housing prices would never fall significantly. Late in 2008, one of the rare economic pessimists, New York Times columnist Paul Krugman, asked rhetorically why no one had seen that “the whole thing was, in effect, a giant Ponzi scheme” and offered, as an answer, “that nobody likes to be a party pooper.” 7
The near unanimous optimism of the experts certainly contributed to the reckless buildup of bad debt and dodgy loans, but so did the wildly upbeat outlook of many ordinary Americans. Robert Reich once observed, a bit ambivalently, that “American optimism carries over into our economy, which is one reason why we’ve always been a nation of inventors and tinkerers, of innovators and experimenters. . . . Optimism also explains why we spend so much and save so little. . . . Our willingness to go deep into debt and keep spending is intimately related to our optimism.” 8 It’s in the spirit of optimism that a person blithely builds up credit card debt on optional expenditures, takes out a second mortgage, or agrees to a mortgage with an interest rate that will escalate over time. And the ideology of positive thinking eagerly fanned this optimism and the sense of entitlement that went with it. A Los Angeles Times reporter wrote of the effect of The Secret on her sister: “When my sister arrived from New York over the holidays, she plopped a hand-tooled leather satchel on my piano bench and said, ‘See the beautiful bag I manifested for myself?’ ” The DVD of The Secret had encouraged her to believe that she deserved this object, that it was hers for the taking, so she had charged it on her Amex card. 9
While secular positive-thinking texts encouraged people to “manifest” their material desires, pastors like Osteen and Dollar were insisting that God wants you to have the all good things in life, including a beautiful home. In Your Best Life Now, Joel Osteen had written about his initial resistance to his wife’s pleadings that they upgrade to a large and “elegant” house: “Over the next several months, she kept speaking words of faith and victory, and she finally talked me into it. . . . I don’t believe it would have happened if Victoria had not talked me into enlarging my vision. God has so much more in store for you, too.” 10 A 2008 article in Time, provocatively titled “Maybe We Should Blame God for the Subprime Mortgage Mess,” cited the suspicions of several experts on American religion about the role of prosperity preachers in fomenting the financial meltdown. Jonathan Walton, a religion professor at the University of California at Riverside, argued that pastors like Osteen reassured low-income people with subprime mortgages by getting them to believe that “God caused the bank to ignore my credit score and bless me with my first house.” Anthea Butler, an expert on Pentecostalism, added: “The pastor’s not gonna say, ‘Go down to Wachovia and get a loan,’ but I have heard, ‘Even if you have a poor credit rating, God can still bless you—if you put some faith out there [that is, make a big donation to the church], you’ll get that house or that car or that apartment.’ ” 11 To Kevin Phillips, the connection between positive thinking and the subprime crisis seems obvious. In Bad Money: Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism, he indicts prosperity preachers Osteen, T. D. Jakes, and Creflo Dollar, along with The Secret author Rhonda Byrne. 12
To many people who had long been denied credit on account of their race or income, the easy mortgages of the middle of the decade must have indeed come as a miracle from God. Dean Baker, one of the few economists who foresaw the bursting of the housing bubble, reports that in 2006 the dicey subprime and Alt-A categories of mortgages had expanded to 40 percent of total mortgages—many of them requiring little or no income documentation or down payment. 13 No wonder that within a year more and more
Americans were finding themselves in over their heads. Household debt hit a record 133 percent of household income, for an absolute amount of about $14 trillion. 14 Personal bankruptcy filings jumped by 40 percent in the course of 2007 alone. 15 People who were unprepared for their adjustable mortgages’ rate increases started defaulting, often moving out in the dead of night to avoid their neighbors’ stares.
But the gullibility and optimism of ordinary individuals go only so far in explaining the financial crisis. Someone was offering tricky mortgages to people of dubious means, someone was bundling up those mortgage debts and selling them as securities to investors throughout the world—someone who was expecting to make sizable profits by doing so. As Washington Post columnist Steven Pearlstein has written: “At the heart of any economic or financial mania is an epidemic of self-delusion that infects not only large numbers of unsophisticated investors but also many of the smartest, most experienced and sophisticated executives and bankers.” 16 In fact, the recklessness of the borrowers was far exceeded by that of the lenders, with some finance companies involved in subprimes undertaking debt-to-asset ratios of 30 to 1. 17 Recall that American corporate culture had long since abandoned the dreary rationality of professional management for the emotional thrills of mysticism, charisma, and sudden intuitions. Pumped up by paid motivators and divinely inspired CEOs, American business entered the midyears of the decade at a manic peak of delusional expectations, extending to the highest levels of leadership.