by Gary Alexander
June 10, 2025
“There Is a Great Deal of Ruin in a Nation.” – Adam Smith, 1777
In rehearsing the 250th anniversary of this great nation, I have been reciting passages from some of five great works penned in 1776, finding clues for our long survival – and portents for our positive future.
- “Common Sense,” by Thomas Paine (published January 10, 1776)
- “The Decline and Fall of the Roman Empire” (Vol. 1), by Edward Gibbon (February 17, 1776)
- “An Inquiry into The Wealth of Nations,” by Adam Smith (March 9, 1776)
- “The Declaration of Independence,” by Thomas Jefferson (July 4, 1776)
- “The American Crisis,” by Thomas Paine (December 19, 1776)
In addition, Adam Smith had a follow-up quote in 1777, cited above. After British General Burgoyne’s loss to the colonials at the battle of Saratoga that year, with the French entering on the side of the rebels, a British Member of Parliament, John Sinclair, wrote a letter to Smith fearing that the war was going so badly that it could be the ruin of Britain if they lost the colonies. “If we go on at this rate,” Sinclair wrote, “the nation must be ruined” (emphasis in the original). Smith’s response reflected the wisdom of a historian, or a long-term perma-bear, ignoring daily headlines: “Be assured, my young friend, that there is a great deal of ruin in a nation.” Translated from British understatement, he’s saying, “We’ll be just fine.”
Sure enough, Britain lost that war and the 13-colonies, but they went on to launch an industrial revolution, while creating a larger commonwealth and a global trading empire – all while abolishing the slave trade.
Edward Gibbon, the other British writer cited above, is often quoted by the bears to prove that America is “going the way of Rome,” but we need to remind those bears that from the time of Rome’s worst despots, Caligula (reigning 37-41 AD) and Nero (64-68 AD), it took over 400-years for Rome to fall – in 476 AD.
Instead, Rome enjoyed a series of four long-serving “Good Emperors,” who led the second century of Pax Romana: Trajan (serving 98-117 AD), Hadrian (117-138), Antonius Pius (138-161) and Marcus Aurelius (161-180), more noted as a stoic philosopher than an emperor. In fact, Gibbon, in his “Decline and Fall” magnum opus summed up this competing wave of good and bad leaders by writing: “Instead of inquiring why the Roman empire was destroyed, we should rather be surprised that it had subsisted so long.”
This is a long way of saying I was almost seduced by reading Ray Dalio’s new book, “How Countries Go Broke” (released last Tuesday), especially when he was backed by an Amen Chorus of other Wall Street giants, JPMorgan CEO Jamie Dimon, hedge fund manager Paul Tudor Jones and Lazard CEO Peter Orszag, quoted in a June 4 Wall Street Journal survey, “Wall Street Sounds the Alarm on U.S. Debt.”
That article opens by quoting the cover story of TIME Magazine, “Is the U.S. Going Broke?” But the date on that scary story was March 1972, when the federal debt level had just passed $400-billion, barely 1% of its current $37-trillion. Since then, several books emerged each year, saying America is going broke:
I Plead Guilty of the Same Gloom-and-Doom Writing – Long Ago
I am also guilty – from 1970 to 1989 – of writing the same scary stories, starting with: “The Great Depression: Can it Happen Again?” (December 1970) and “America Faces the Dollar Crisis” (October 1971), both published in a magazine of two million readers. In the 1980s, I tripled down on the debt crisis as America crossed the $1-trillion debt level, and we became a “debtor nation” for the first time in history.
At the time, I was editing three publications for The National Committee for Monetary Reform (NCMR) in New Orleans – the monthly Gold Newsletter and Investor’s Notebook, plus a quarterly glossy Wealth Magazine, along with my daily one-page summary of economic and market events and analysis (similar to a blog) for our staff, called Alexander’s Morning Economic Newsletter (AMEN). I had a full rolodex of great economists and market advisors, and a stable of columnists and advisors for all these publications.
In looking over my mid-1985 editions of Wealth Magazine to refresh my memories, I noticed a review of the Grace Commission (similar to today’s DOGE cost-cutters) – a much more thorough study of federal waste, fraud and abuse than DOGE, which we published early in 1985, and the backlash we got from readers who didn’t want their benefits cut, much like today – and the reticence of Congress to make cuts.
In that issue, I transcribed an interview I conducted with former Secretary of the Treasury (under Nixon and Ford), William E. Simon, author of a pair of books, “Time for Truth” (1978) and “Time for Action” (1980). He began our interview by saying, “The budget is totally out of control…. We’re going to have $200-billion budget deficits for as far as the eye can see, and that’s a prescription for economic and financial disaster. That includes increased inflation.” Well, to put it charitably, that didn’t happen. High GDP growth in the next 15-years reduced inflation and led to four straight budget surpluses, 1997-2001.
Here’s how that rocket ship took off, during Reagan’s second term, 1984, during my New Orleans years:
The net gain in GDP from the end of 1982 to the end of 1988 was +30.4%. The net gain in tax revenues per year was +51.4%, despite a major decline in the top tax rates from 70% in 1981 to 28% in 1987, and federal deficits dropped from a record $220-billion in 1986 to $150-billion in each of the next two-years.
While we’re not likely to see this dramatic of a recovery in 2025 to 2028 – with $37-trillion in debt rather than $1-trillion – stranger things have happened in history. After all, there is a lot of ruin in a great nation.
By the end of the 1980s, when boatloads of books predicted the end of the Western world, the death of the dollar, the coming crash and a Greater Depression, killer quakes and tsunamis, global famines and billions dying from AIDS, nuclear winters (or boiling global warming), and trade wars ending in hot wars, I finally realized I had been played for the fool, and I turned into a perma-bull just in time to profit from the tech boom and peace dividend of the 1990s mega-bull market. It took some grit to survive the lost decade of 2000-09, but the patience of a perma-bull was rewarded with the market’s powerful growth since 1990.
In recent weeks, I have been storming the Bastille over the “big, beautiful bill,” which contains few real spending cuts, but I was a bit myopic in ignoring the fact that its main purpose is to extend the 2017 tax cuts, not create or implement the DOGE spending cuts. That will (hopefully) come later, but the main goal of this bill is to get tax relief passed, and that barely happened (by one vote, 215-214 in the House), and it will likely scrape by in the Senate, but only if it treads lightly on cutting pork. One battle at a time.
All content above represents the opinion of Gary Alexander of Navellier & Associates, Inc.
Also In This Issue
A Look Ahead by Louis Navellier
A German Leader Enters a DC Hornet’s Nest
Income Mail by Bryan Perry
The Market is Shrugging Off Risks, as Fears of Recession Recede
Growth Mail by Gary Alexander
History Tells Us That America Will Likely Thrive After Crises
Global Mail by Ivan Martchev
Elon Musk May Have Ulterior Motives
Sector Spotlight by Jason Bodner
The Road to Wealth is Often Rocky
View Full Archive
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About The Author
Gary Alexander
SENIOR EDITOR
Gary Alexander has been Senior Writer at Navellier since 2009. He edits Navellier’s weekly Marketmail and writes a weekly Growth Mail column, in which he uses market history to support the case for growth stocks. For the previous 20 years before joining Navellier, he was Senior Executive Editor at InvestorPlace Media (formerly Phillips Publishing), where he worked with several leading investment analysts, including Louis Navellier (since 1997), helping launch Louis Navellier’s Blue Chip Growth and Global Growth newsletters.
Prior to that, Gary edited Wealth Magazine and Gold Newsletter and wrote various investment research reports for Jefferson Financial in New Orleans in the 1980s. He began his financial newsletter career with KCI Communications in 1980, where he served as consulting editor for Personal Finance newsletter while serving as general manager of KCI’s Alexandria House book division. Before that, he covered the economics beat for news magazines. All content of “Growth Mail” represents the opinion of Gary Alexander
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