Neil Howe: It’s going to get worse; more financial crises coming

[Dan '82]

[pbrower2a]

Themes:

1. Crisis not over yet financially or politically
2. Generational inequality: America rescued borrowers and lenders, but stuck younger people with zero return on investment (ROI) and very high prices for housing.
3. Likelihood of more aggressive use of government
4. Boom fanaticism, X doing badly in economics, Millennial generation going nowhere
5. Likely more authoritarian government (Trump/Sanders)
6. Market-driven libertarians have lost.
7. Expect more volatility in markets.
8. Look to Millennial trends in business, housing, personal spending -- good growth areas

[radind]

(05-25-2016, 04:27 PM)pbrower2a Wrote: Themes:

1. Crisis not over yet financially or politically
2. Generational inequality: America rescued borrowers and lenders, but stuck younger people with zero return on investment (ROI) and very high prices for housing.
3. Likelihood of more aggressive use of government
4. Boom fanaticism, X doing badly in economics, Millennial generation going nowhere
5. Likely more authoritarian government (Trump/Sanders)
6. Market-driven libertarians have lost.
7. Expect more volatility in markets.
8. Look to Millennial trends in business, housing, personal spending -- good growth areas

Also seems that the USA on verge of crisis turning point.

[pbrower2a]

(05-25-2016, 04:30 PM)radind Wrote:

(05-25-2016, 04:27 PM)pbrower2a Wrote: Themes:

1. Crisis not over yet financially or politically
2. Generational inequality: America rescued borrowers and lenders, but stuck younger people with zero return on investment (ROI) and very high prices for housing.
3. Likelihood of more aggressive use of government
4. Boom fanaticism, X doing badly in economics, Millennial generation going nowhere
5. Likely more authoritarian government (Trump/Sanders)
6. Market-driven libertarians have lost.
7. Expect more volatility in markets.
8. Look to Millennial trends in business, housing, personal spending -- good growth areas

Also seems that the USA on verge of crisis turning point.

I see questions of the sustainability of some of the deals that America has made in the recent past. Most significantly we have soft rules for the rich-and-powerful but harsh rules for the not-so-rich-and-powerful.

[Bob Butler 54]

(05-25-2016, 04:27 PM)pbrower2a Wrote: Themes:

1. Crisis not over yet financially or politically
2. Generational inequality: America rescued borrowers and lenders, but stuck younger people with zero return on investment (ROI) and very high prices for housing.
3. Likelihood of more aggressive use of government
4. Boom fanaticism, X doing badly in economics, Millennial generation going nowhere
5. Likely more authoritarian government (Trump/Sanders)
6. Market-driven libertarians have lost.
7. Expect more volatility in markets.
8. Look to Millennial trends in business, housing, personal spending -- good growth areas

I'd like to think there will be a push back if the trend goes much further towards aggressive / authoritarian.  The question might be how to break government of, for and by the wealthy without some sort of forceful push?  The problem is getting the focus and thrust of the crisis targeting the capitalists rather than aiding and abetting them.

Otherwise, can't argue too much.

[Mikebert]

Looks like Neil and I are on the same page. The template I have been working with is the combination of the secular cycle (SC), and the saeculum. THe SC is more or less a cycle in inequality. It predicts that inequality will peak and start heading down during the SC down phase which began in 2006 and which should end when the 4T ends.

For this to happen will require Neil's points 3, 5, and 6. As I see it, these points cannot happen without points 1 and 7, and these must happen before the other points. Points 2 and 5 are merely present observations and point 8 is extraneous.

The scenario that comes from these assumptions something like this.

2006 capital productivity shorts down because of high inequality, beginning downgrade.
2016-18 Dow begins a 10000+ point decline from its prior peak
2017-18 recession begins
2017-18 Financial crisis occurs. Wall St panics
2017-18 Ted Cruz rallies the House Leadership caucus to pressure Speaker Ryan to not act on any government rescue or stimulus plan.
2017-18 The president either defeats Ted Cruz or persuades Ryan to fold or the Second Great Depression begins here.
2020 Election becomes a referendum on the handling for the economy. In the (more likely) case that policy was ineffective (country is in depression) how the end of the 4T will play out will depend on whether Ted Cruz is ruled as a winner or a loser.
2024 4T will be already over or drawing to a close. If inequality has been effectively addressed then the SC will be ending. If not then the SC will continue until the next 4Tand resolution of inequality will have to wait until then.

[Eric the Green]

In the Awakening, criticism of "institutions" was directly largely at corporations as well as government policies such as constant war. So the Reagan counter-revolution was not so much a continuation of that, as the use of slogans to deceive people to support authority (corporations). "Individualism" consisted of letting big corporations do whatever they want to us. Taxes were reduced mainly for rich people. This has created the unequal economy that we have now. Gen X grew up deceived by the slogans, as well as left to fend for themselves by preoccupied parents in childhood. So this false "individualism" continues to run our government, through Republican obstruction.

I'm not worried about rich "individuals" having to pay more, and do not consider this "authoritarian."

[Eric the Green]

It still seems likely to me that Hillary will survive her email troubles, and neither Trump nor Sanders will be elected. Trump will turn people off more and more as the campaign proceeds. So why does Howe talk about Trump and Sanders? Presumably their campaigns and supporters will influence Hillary and the congress to some extent. I don't see more than continued gradual adjustment, and if Hillary can get some policies changed, inequality will diminish somewhat. I see nothing more than a mild recession in 2019, offset by a green energy boom. Howe mentions housing interests among millennials, and certainly affordable housing will be a big priority in blue states where housing prices are high. As millennials come into greater influence in the 2020s, more drastic reforms will likely be implemented, and many male members of Generation X and some boomers will resist them, trying to hang on to their wealth and their ideology. This is the outline of the most-likely conflict during the remaining 4T years.

[Bob Butler 54]

(05-26-2016, 12:12 PM)Eric the Green Wrote: I'm not worried about rich "individuals" having to pay more, and do not consider this "authoritarian."

Not so many years ago, it was standard partisan (expletive deleted) to call any Democrat a Communist, any Republican a Nazi.  I tried to suppress this false argument as ridiculous abuse of words which ought to have real meaning.  While I won't claim significant credit, the free use of Communist / Nazi descriptors seems to be far less fashionable these days.  If nothing else, it has just been over done.  If somebody uses these inappropriate descriptions, it reflects poorly on the person using the description more than the person allegedly being described.

These days, instead of 'Communist' or 'Nazi' people are using 'authoritarian'.  Same thing.  The word has been changed to protect the propagandists.  

Who is the word being used to attack?  What is the new meaning of the word?  It seems like an 'authoritarian' is anyone who dislikes the corrupt politics as usual that favors the wealthy few.

Now, I'm not authoritarian.  I'll express dislike of Stalin, Hitler and Saddam equally and vehemently.  I'm the modern Whig.  I'm in favor of democracy, human rights, equality and freedom.  At the same time, I see an element in all of the crises in modern Anglo-American history of a wealthy elite establishment having too much power.  There is generally a new elite who acquired wealth using a new technology allying with the People to weaken the hold of the old elite in the name of the Whig virtues.

From my neo-whig perspective, the authoritarian is generally the establishment rather than the People and the new elite.  The authoritarians using force and coercion to subdue and subjugate the People are the kings, nobility, slave owners and robber barons.  This generalization might not apply so cleanly this time around.  Still, applying it to the anti-establishment side doesn't feel right to me.

Anyway, when you see the word 'authoritarian' thrown around, compare it to the recent use of 'Communist' or 'Nazi'.

[MillsT_98]

(05-27-2016, 11:42 PM)Bob Butler 54 Wrote:

(05-26-2016, 12:12 PM)Eric the Green Wrote: I'm not worried about rich "individuals" having to pay more, and do not consider this "authoritarian."

Not so many years ago, it was standard partisan (expletive deleted) to call any Democrat a Communist, any Republican a Nazi.  I tried to suppress this false argument as ridiculous abuse of words which ought to have real meaning.  While I won't claim significant credit, the free use of Communist / Nazi descriptors seems to be far less fashionable these days.  If nothing else, it has just been over done.  If somebody uses these inappropriate descriptions, it reflects poorly on the person using the description more than the person allegedly being described.

These days, instead of 'Communist' or 'Nazi' people are using 'authoritarian'.  Same thing.  The word has been changed to protect the propagandists.  

Who is the word being used to attack?  What is the new meaning of the word?  It seems like an 'authoritarian' is anyone who dislikes the corrupt politics as usual that favors the wealthy few.

Now, I'm not authoritarian.  I'll express dislike of Stalin, Hitler and Saddam equally and vehemently.  I'm the modern Whig.  I'm in favor of democracy, human rights, equality and freedom.  At the same time, I see an element in all of the crises in modern Anglo-American history of a wealthy elite establishment having too much power.  There is generally a new elite who acquired wealth using a new technology allying with the People to weaken the hold of the old elite in the name of the Whig virtues.

From my neo-whig perspective, the authoritarian is generally the establishment rather than the People and the new elite.  The authoritarians using force and coercion to subdue and subjugate the People are the kings, nobility, slave owners and robber barons.  This generalization might not apply so cleanly this time around.  Still, applying it to the anti-establishment side doesn't feel right to me.

Anyway, when you see the word 'authoritarian' thrown around, compare it to the recent use of 'Communist' or 'Nazi'.

Speaking of which, when did the "new elite" become the "old elite"? I know right now the Boomer elite is now the old elite but I know back in the 2T they were the new elite, but when was the turning point?

[Bob Butler 54]

(05-30-2016, 10:34 PM)MillsT_98 Wrote: Speaking of which, when did the "new elite" become the "old elite"? I know right now the Boomer elite is now the old elite but I know back in the 2T they were the new elite, but when was the turning point?

Good question.

Looking at older cycles and crises, it is fairly clear who is the new guys and the old guys.  When the king is opposing the parliament, the King is representing the older power structure.  When southern plantation owners and robber barons ended up supporting different parts of the country in war, you knew which way the tide was flowing.

Not so clear today.  Yes we have new technology and new ways of making money.  Still, the tools of the old industries are working fine for the new guys.  It isn't that the rust belt industries such as oil, steel and cars are run using a different method than the computer or genetic engineering companies.  For the most part they are trading on the same stock markets, making campaign donations to the same politicians, and partying in the same exclusive clubs.  The techniques and traditions that allowed the old robber barons to maintain control are working just fine for the new robber barons.

Thus, there are no new elites that in order to size power over the old elites must make promises of change to the People.

I also see the Boomers as divided.  Some people are trying to make the crisis into a generational thing, with older people in conflict with younger people.  I see it as a red - blue thing, a rural - urban thing, perhaps to some extent a religious - secular thing.  There are folks on either side of all these divides in all generations, though there is a trend that the younger generations are leaning more blue.

I am more or less a Blue Boomer, but don't try to pin the Red Boomer memes on me, and don't try to say all Boomers are alike, that there is no difference.

I see the turning point as the National Malaise as declared by President Carter.  Before that time America perceived of itself as having an intense energy that could be applied to solve any problem.  The US had never lost a war.  It was presumed that we never would.  Americans would bear any burden, pay any price, support any friend, oppose any foe, and basically do anything necessary to make the world a better place and get the job done.  This was replaced by the Reagan memes.  The government is the problem, not the solution.  The default way to approach any problem with society is to cut taxes, trim regulations and privatize.  The GI's tax and spend liberalism had been taken to excess.  It was discovered that we couldn't solve any problem by throwing money at it.  The response to this discovery was to not throw any money at any problems anymore, to let the problems fester and rot.  The National Malaise was the turning point between the great energy and optimism of the New Deal through Great Society eras and the stagnation that is the unraveling.  It marked the end of a period of Democratic dominance of Congress, the start of a time where neither party could get its full agenda passed.  America stopped being blue.  While the red couldn't exactly take over all the controls cleanly, they did have their foot firmly on the breaks.

I do think we need a newer deal.  This would involve tuning the country to benefit the People more, the elites less.  One problem is that there is no new elite group that would benefit from such a transition.  Thus, the People seemingly have to kick start it going themselves without wealthy allies priming the pumps from within the hall of power.

[Mikebert]

[Bob Butler]These days, instead of 'Communist' or 'Nazi' people are using 'authoritarian'.  Same thing.  The word has been changed to protect the propagandists.

[Mike]I don’t think you have this right at all.  Authoritarian is not a synonym for fascist.  FDR was authoritarian.  People who think what we need is another New Deal  to address  economic inequality or who favor a “Manhattan project” for alternative energy” are pining for an authoritarian approach.  Are they fascists?

[Bob Butler]I'm the modern Whig.  I'm in favor of democracy, human rights, equality and freedom.  

 [Mike] I am not recognizing anything in this description as particularly Whig-like, either American or British versions.  The American Whigs were not democrats.  America had an egalitarian culture (restricted to white men), and the Whigs were less egalitarian of the two parties.  The British Whigs of the 18th century were the party of the large landowners, the Tories were more from the gentry.  The Whigs were more politically liberal though.

[Mikebert]

[Bon Butler]Not so clear today…there are no new elites that in order to size power over the old elites must make promises of change to the People.
[
Mike]I might suggest part of the difference is the benefit of hindsight.  I agree with Kinser, and the definition of Progressive is the history of what happens, which is written by the winners.

[BobI see it as a red - blue thing, a rural - urban thing, perhaps to some extent a religious - secular thing.  

[Mike] Also white versus minority. And culturally old versus new.

[Bob Butler]There are folks on either side of all these divides in all generations, though there is a trend that the younger generations are leaning more blue.
[
Mike]I suspect it’s always this way, the younger generation tends to be more comfortable with the new, having no experience of the past.

[Bob]I see the turning point as the National Malaise as declared by President Carter….

[Mike] And that is when inequality began its upwards surge.
  
[Bob]I do think we need a newer deal.  This would involve tuning the country to benefit the People more, the elites less.  One problem is that there is no new elite group that would benefit from such a transition.

[Mike]Well who was the new elite last time?  The new economy and old economy elites were pretty much on the same side politically then as they are now.  What happened was new elites were created by the Democratic party in order to preserve the political advantage the Depression had temporarily granted them.  Big Labor became an elite during the 4T.  WW II programs helped create a new professional/ academic elite whom I call the mandarins.

During the 2T mandarins migrated to the left and the Democratic party decided to embrace them (as a rising group to replace the Southern political elites fleeing the party) .  Hence, since Carter the Democratic party has emphasized mandarin values rather than Labor values, and that is largely why the white working class feels abandoned.  They pretty much have been.

[Mikebert]

[MillsT_98] Speaking of which, when did the "new elite" become the "old elite"? I know right now the Boomer elite is now the old elite but I know back in the 2T they were the new elite, but when was the turning point?

[Mike]It’s not generational.  Bob is referring to elite factions.  An elite faction is a group who has a seat at the table when national policy is decided upon.  For example the Religious Right is an elite faction who was given a seat at the table by the post-Reagan GOP.  

Big landowners had a seat at the national table at the founding, but lost it during the Civil War. The industrial capitalist elite did not exist at the founding.  it appeared during the Civil War saeculum and became dominant in the next.  Bob sees the first of these as an "old" elite who was displaced by "new" elite as a result of the Civil War 4T.

Not all elites get displaced by new ones.  Wealthy financiers are an economic elite who has had a seat at the political table since the nation’s founding. Since a capitalist economy requires money  and capital markets to function this elite will always be with us.

At any time the individuals representing these elite factions do not necessarily come from different generations.  Members of an old elite are not necessarily older than members of a new elite.

[beechnut79]

(05-30-2016, 10:34 PM)MillsT_98 Wrote:

(05-27-2016, 11:42 PM)Bob Butler 54 Wrote:

(05-26-2016, 12:12 PM)Eric the Green Wrote: I'm not worried about rich "individuals" having to pay more, and do not consider this "authoritarian."

Not so many years ago, it was standard partisan (expletive deleted) to call any Democrat a Communist, any Republican a Nazi.  I tried to suppress this false argument as ridiculous abuse of words which ought to have real meaning.  While I won't claim significant credit, the free use of Communist / Nazi descriptors seems to be far less fashionable these days.  If nothing else, it has just been over done.  If somebody uses these inappropriate descriptions, it reflects poorly on the person using the description more than the person allegedly being described.

These days, instead of 'Communist' or 'Nazi' people are using 'authoritarian'.  Same thing.  The word has been changed to protect the propagandists.  

Who is the word being used to attack?  What is the new meaning of the word?  It seems like an 'authoritarian' is anyone who dislikes the corrupt politics as usual that favors the wealthy few.

Now, I'm not authoritarian.  I'll express dislike of Stalin, Hitler and Saddam equally and vehemently.  I'm the modern Whig.  I'm in favor of democracy, human rights, equality and freedom.  At the same time, I see an element in all of the crises in modern Anglo-American history of a wealthy elite establishment having too much power.  There is generally a new elite who acquired wealth using a new technology allying with the People to weaken the hold of the old elite in the name of the Whig virtues.

From my neo-whig perspective, the authoritarian is generally the establishment rather than the People and the new elite.  The authoritarians using force and coercion to subdue and subjugate the People are the kings, nobility, slave owners and robber barons.  This generalization might not apply so cleanly this time around.  Still, applying it to the anti-establishment side doesn't feel right to me.

Anyway, when you see the word 'authoritarian' thrown around, compare it to the recent use of 'Communist' or 'Nazi'.

Speaking of which, when did the "new elite" become the "old elite"? I know right now the Boomer elite is now the old elite but I know back in the 2T they were the new elite, but when was the turning point?

The Boomer elite had not materialized yet during the 2T. They were in their disco phase at that time. Their version of elite materialized in the mid-1980s with the Yuppie phenomenon. Officially the Yuppie craze lasted only about four years and ended with the stock market crash in the fall of 1987. By then it had  become as fashionable to bash Yuppies as it had once been to be one. And yet the term is still very much with us today.

[FLBones]

Recessions happen every so often. The last one began nine years ago. I do think that there will be another recession before this decade's end but I also do think that the economy will start to boom in the 2020s.

[Anthony '58]

I'll stick with my original October 2019 date for the financial crash.

And a Donald Trump victory makes it fit in nicely: He slams the door on immigration - and deports a couple of million illegals who are already here - and the boom of 1926 is replicated, with super-low unemployment; then, after the crash, since now it is an established fact and not mere theory that we can "war" our way out of a depression, we find a convenient pretext for starting a war against whatever enemy is "handy" at that point, possibly as soon as March 2020. That war continues until mid-2025, its end also ending the 4T.

[pbrower2a]

We approach the economic crisis of the End of Scarcity, when overproduction threatens to become the norm.

Contemporary elites have been using it, paradoxically, to cut pay, worsen working conditions, and raise economic rents; as such they establish their own class privilege as the sole objective of us all. All the fruits of technological change, human toil not necessary for a level of survival suitable for livestock, and old investment still workable end up going to the economic elites. We are expected to exult in the sultan-like indulgence of those elites.

Let me suggest a group that does not fit that pattern: the Old Order Amish. I doubt that many of us would like to live as they do with their rejection of even the most wholesome of entertainment, their limited education (they keep repeating eighth grade until the school-leaving age of 16), and their limited opportunities in life (practically no white-collar or professional jobs). They are good businessmen, practically re-creating the Gilded Age without the ostentatious display of Gilded elites. Male chauvinism is the norm; women simply work like men. But they don't have an economy that better serves legalized loan-sharks than working people. Nobody gets rich among the Amish.

They have given up any prospect of living in the post-industrial age by maintaining technology (except for productivity of farm goods and their marketability -- refrigerators and even solar power are OK, but even a transistor radio is prohibited).

But how great is economic modernity if it comes with gross exploitation characteristic of a plantation society or a fascist regime? I question whether our economic elites have any virtues. What is so great about a loan-shark economy?

[MillsT_98]

(07-29-2016, 04:18 AM)pbrower2a Wrote: We approach the economic crisis of the End of Scarcity, when overproduction threatens to become the norm.

Contemporary elites have been using it, paradoxically, to cut pay, worsen working conditions, and raise economic rents; as such they establish their own class privilege as the sole objective of us all. All the fruits of technological change, human toil not necessary for a level of survival suitable for livestock, and old investment still workable end up going to the economic elites. We are expected to exult in the sultan-like indulgence of those elites.

Let me suggest a group that does not fit that pattern: the Old Order Amish. I doubt that many of us would like to live as they do with their rejection of even the most wholesome of entertainment, their limited education (they keep repeating eighth grade until the school-leaving age of 16), and their limited opportunities in life (practically no white-collar or professional jobs). They are good businessmen, practically re-creating the Gilded Age without the ostentatious display of Gilded elites.  Male chauvinism is the norm; women simply work like men. But they don't have an economy  that better serves legalized loan-sharks than working people. Nobody gets rich among the Amish.

They have given up any prospect of living in the post-industrial age by maintaining technology (except for productivity of farm goods and their marketability -- refrigerators and even solar power are OK, but even a transistor radio is prohibited).

But how great is economic modernity if it comes with gross exploitation characteristic of a plantation society or a fascist regime? I question whether our economic elites have any virtues. What is so great about a loan-shark economy?

Maybe we'll overcome that during the 4T—maybe it's what the 4T is all about.

[Mikebert]

(07-28-2016, 07:05 AM)Anthony Wrote: I'll stick with my original October 2019 date for the financial crash.

And a Donald Trump victory makes it fit in nicely: He slams the door on immigration - and deports a couple of million illegals who are already here - and the boom of 1926 is replicated, with super-low unemployment; then, after the crash, since now it is an established fact and not mere theory that we can "war" our way out of a depression, we find a convenient pretext for starting a war against whatever enemy is "handy" at that point, possibly as soon as March 2020.  That war continues until mid-2025, its end also ending the 4T.

Well we had a war in 1917-1918 and that did not "war us out" of the problem that eventually caused the Great Depression. It was not the war per se that gave us the widely-shared post-war prosperity, but what the New Dealers did that the Wilson crew did not do, that made the difference.