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21st Century U.S. Breakdown, Debt + Dollar + Delusion + Depletion = Decline

Politics / US Politics Feb 24, 2010 - 01:51 AM GMT

By: James_Quinn

Politics

Diamond Rated - Best Financial Markets Analysis Article“Wherever we’re headed, America is evolving in ways most of us don’t like or understand.  Individually focused yet collectively adrift, we wonder if we’re heading toward a waterfall. Are we?”


Strauss & Howe – The Fourth Turning

Political leaders and the mainstream media have been blindsided by the sudden mood shift of the country in the last few years. The reason they have been blindsided is they believe world history is linear. Liberals have now begun referring to themselves as progressives. These people think the world only progresses. The facts indicate otherwise. History is cyclical. History is replete with grand empires like Rome, Spain and Britain. It is also replete with Dark Ages, depressions and wars. Strauss & Howe have established that history can be broken down into 80 to 100 year Saeculums that consist of four turnings: The High, The Awakening, The Unraveling, and the Crisis.

    • The First Turning is a High, an upbeat era of strengthening institutions and weakening individualism, when a new civic order implants and the old values regime decays.
       
    • The Second Turning is an Awakening, a passionate era of spiritual upheaval, when the civic order comes under attack from a new values regime.
       
    • The Third Turning is an Unraveling, a downcast era of strengthening individualism and weakening institutions, when the old civic order decays and the new values regime implants.
       
    • The Fourth Turning is a Crisis, a decisive era of secular upheaval, when the values regime propels the replacement of the old civic order with a new one.
    This isn’t some variety of mystical Nostradamus conjecture trying to foretell the future. Strauss & Howe have been able to link the human life span to generational shifts in mood. This makes logical sense. As generations progress through the four stages of life their attitudes and views change. When you are born within the four cycles will greatly sway the course of your life. History forms individuals and generations as individuals and generations shape history. In this age of individualism, Americans are highly insulted by being lumped into a generational category. The fact is that a generation is composed of individuals who share common experiences, music, literature, and economic circumstances. This shared time frame leads to recurring attitudes and reactions to events. Generations come in four archetypes, always in the same order, whose phase-of-life positions comprise a constellation. They are:
  • The Prophet archetype is born in a High, enters young adulthood in an Awakening, midlife in an Unraveling, and elderhood in a Crisis.
     
  • The Nomad archetype is born in an Awakening, enters young adulthood in an Unraveling, midlife in a Crisis, and elderhood in a High.
     
  • The Hero archetype is born in an Unraveling, enters young adulthood in a Crisis, midlife in a High, and elderhood in an Awakening.
     
  • The Artist archetype is born in a Crisis, enters young adulthood in a High, midlife in an Awakening, and elderhood in an Unraveling.

During a Fourth Turning, the constellation contains all four archetypes born in the current saeculum. We are now in the midst of the fourth Crisis period in U.S. history. The previous Fourth Turnings – The American Revolution, Civil War and Great Depression/World War II all required immense sacrifice and entailed great danger. There are only a few Americans alive who experienced and recall our last Fourth Turning. This is one of the foremost reasons the country seems surprised when the next Turning arrives. Just think about the response of politicians, mainstream media pundits, supposedly brilliant economists, and the elite thought leaders during the last five years. They have been blindsided by the housing collapse, worldwide financial crisis, election of Barack Obama, and furious rage of the Tea Party movement. This is because they prescribe to the belief the world only moves forward, never backward. They failed to identify the signs of Crisis. Threats that have been ignored and/or deferred for decades are now coalescing into a once in a lifetime emergency that will require public consensus, aggressive action, and personal sacrifice. Leaders who think the old way of governing will continue to work are learning a difficult lesson. This is why so many old time politicians like Chris Dodd are fleeing Washington DC. A maelstrom of government debt, unfunded liabilities, looming energy catastrophe, and consumer collapse is about to hit the United States. There is no politician in Washington DC willing to stand up in front of the American people and tell them the truth about the storms on our horizon.

 

Born Into Nixon

Born into Nixon I was raised in hell.
A welfare child where the Teamsters dwelled.
The last one born and the the first one to run.
My town was blind from refinery sun.

We are the [cries of] the class of '13
Born in the era of humility
We are the desperate in the decline
Raised by the bastards of 1969

Green Day – 21st Century Breakdown

The music of today best captures the generational shifts and attitudes that reflect the true mood of the country. Billie Joe Armstrong, the lead singer of Green Day, was born into Nixon in 1972 in the midst of an Awakening. This was a period of upheaval and passion. He was the last child born to a large working class family in Oakland, California. His reference to hell refers to the lower blue collar city he grew up in. Oakland was an awful place to be raised in, with drugs, gang violence and racial unrest. His Dad died when he was 10 years old, leaving his five older siblings to raise him while his mother worked the graveyard shift as a waitress. The family was on welfare and Armstrong’s childhood was disconnected and discontented. He fits the classic Nomad (Generation X) description of a tough, hard edged pragmatist who does not trust government or corporations. Armstrong’s lyrics have always reflected his distrust of traditional institutions. His description of their current album reflects his Nomad view:

"The album is a snapshot of the era in which we live as we question and try to make sense of the selfish manipulation going on around us, whether it be the government, religion, media or frankly any form of authority.” – Billie Joe Armstrong

The lyrics about the Class of 2013 reflect the fact that his eldest son Joseph will graduate high school in 2013. Born in 1995, he is part of the new Hero generation. This is the generation that will do the heavy lifting in the current Crisis. This cohort is known as the Millennial generation. This generation has been nurtured with increasing protection by pessimistic adults in an insecure environment. They will challenge the political failures of their elder leaders during the coming years, leading to a secular crisis. Armstrong’s son was born in an era of humility during the Unraveling. The Clinton years were a time of little action, with problems ignored and public civility declining. This generation has been raised by Generation X parents and will now be expected to guide the country through the desperate times ahead. If there are wars to fight, they will fight them. Since their elders have made impossible financial promises, the Millennials will have to make the sacrifices and tough decisions. Every generation will have their part to play in the current Crisis. Boomers will be the elder leaders who push the country to resolve the major issues of our time. They will summon the Heroes to make the ultimate sacrifice for the nation. Generation X will provide the tough resolute leadership in the midst of the Crisis, defending society. Let’s hope the country will produce Nomad leaders on par with previous Nomads - George Washington, Stonewall Jackson, George Patton and Dwight Eisenhower.

There is no way to avoid this Crisis. It can’t be bypassed. Just as the seasons must progress from Spring to Summer through Fall and into Winter, a Crisis must follow an Unraveling. History does not have a rewind button. Secular Winter has arrived and the country couldn’t be less prepared for the challenges ahead. The government and the governed enter this highly dangerous period weakened and fragile. The short-sighted economic choices and deferred fiscal decisions will collide with peak oil and uncontrolled globalization to inflict a horrific resolution to this Crisis. The gravity of our situation cannot be overstated. As politicians and the mainstream media play pretend games of recovery and false optimism, the country hurtles closer to the abyss. The country had a chance to prepare for this Winter by:

  • Forging consensus regarding the problems we face.
  • Preparing our governmental institutions for the challenges ahead.
  • Political leaders bluntly describing the issues before us, stressing duties over rights.
  • Developing community teamwork to solve local problems.
  • Treating our youth as a national priority.
  • Preparing elders for the sacrifices and unfulfilled promises in their future.
  • Reducing government and personal debt.
  • Conserve military resources for the long road ahead.

You may have noticed that as a country we not only did not prepare for Winter, we proceeded like it would never come. No leader has emerged to bluntly speak the truth to the American people. Culture wars still rage. Government has expanded and our military has been depleted in useless wars of choice. All that is left is for individuals to prepare their families for the immense challenges ahead.

Generation Zero

My generation is zero
I never made it
As a working class hero

21st century breakdown
I was once lost but never was found
I think I am losing what's left of my mind
To the 20th century deadline.

Videogames of the tower's fall
Homeland security could kill us all

Green Day – 21st Century Breakdown

 

To comprehend what awaits us in the next fifteen years, the blizzards of 2010 provide a preview.

“Reflect on what happens when a terrible winter blizzard strikes. You hear the weather warning but probably fail to act on it. The sky darkens. Then the storm hits with full fury, and the air is a howling whiteness. One by one, your links to the machine age break down. Electricity flickers out, cutting off the TV. Batteries fade, cutting off the radio. Phones go dead. Roads become impossible, and cars get stuck. Food supplies dwindle. Day to day vestiges of modern civilization – bank machines, mutual funds, mass retailers, computers, satellites, airplanes, governments – all recede into irrelevance. Picture yourself and your loved ones in the midst of a howling blizzard that lasts several years. Think about what you would need, who could help you, and why your fate might matter to anybody other than yourself. That is how to plan for a saecular winter. Don’t think you can escape the Fourth Turning. History warns that a Crisis will reshape the basic social and economic environment that you now take for granted.”

                                                       Strauss & Howe – The Fourth Turning

The two principal political parties that control our government continue to act like we are in the early days of Autumn, anticipating a mild Winter. They persist in adhering to their conservative and liberal talking point agendas. They continue to push forth more policies like those that put the country in its current mess. They govern based upon weekly poll results, not upon what is best for the country. Big Government, big Military, and big Debt is the mantra of both parties. In his new documentary, GENERATION ZERO, director Steve Bannon scorches both parties and particularly the Baby Boom generation that now holds the reins of power in Washington DC and in corporate America. It is not a coincidence that 4 out of 5 CEOs of the investment banks that leveraged 40 to 1 and brought the worldwide financial system to its knees were Baby Boomers. George Bush, Hank Paulson, and Ben Bernanke are all Baby Boomers. Their greed, fiscal mismanagement and warped ideology led to the financial disaster.

 “This film is about a crisis – one that is as profound as The Revolution, The Civil War, or The Great Depression and WWII.” The title ‘Generation Zero’ is ironic, as it refers to both the Baby Boomers and the generation born today: the one generation whose greed and fiscal mismanagement has destroyed the financial legacy and inheritance of the other.” – Steve Bannon

Anyone who doubts that Baby Boomers are most responsible for the current state of affairs just needs to review the following charts. These politicians have voted for bailouts of criminal banks run by Boomers, voted for hundreds of billions in pork projects for their corporate constituents, delegated their Constitutional duty of declaring war to the Executive branch, voted for the Patriot Act and creation of a Department of Homeland Security which have stolen freedoms & liberties from the citizens, and have deferred the critical cuts that must be made to entitlement promises they’ve made to the American public in order to get elected. These “honorable” politicians have doubled the National Debt of the United States to $12.4 trillion in less than 8 years. It took 213 years to accumulate $6 trillion of debt ($5.6 trillion added since 1971) and only 8 years to add another $6.4 trillion. These same politicians have approved current budgets that will add $1.5 to $2.0 trillion per year to the national Debt for the next 10 years. Progressives put forth the preposterous idea that piling on more debt will solve a problem created by too much debt. They have pressed the accelerator to the floor as we approach a turn on a mountain road.

We are truly in the midst of a 21st Century breakdown. Armstrong’s lyrics twist the lyrics of the inspirational Amazing Grace psalm. The inspirational message is changed from:

I once was lost but now am found, was blind, but now I see,” to  “I was once lost but never was found, I think I am losing what's left of my mind.”

These lyrics reflect hopelessness and frustration as the country approaches financial collapse. We are on an unsustainable fiscal path built upon an altar of debt. Progressives believe that debt is inconsequential and is necessary to the advancement of the welfare state. No politician will tell an American voter that their entitlements must be slashed. No politician will vote to reduce pork projects or useless programs or worthless Federal departments. No politician will vote for a reduction in Defense spending. Someone within the ruling elite must sense danger, based on their overt and covert actions in the last nine years. Allowing the government to monitor phone calls, emails, and internet messages along with stationing combat troops within the U.S. border is a warning sign of how government will treat American citizens during the current Crisis. The Department of Homeland Security has already issued reports suggesting that Tea Party members and returning Iraq War veterans are potential terrorist threats. The mainstream media has perpetuated these lies. Financial chaos will lead to social chaos. The recently signed Executive Order 13528 established a Council of Governors, an “advisory panel” chosen by the President that will rubber-stamp long-sought-after Pentagon contingency plans to seize control of state National Guard forces in the event of a “national emergency.”  Would U.S. troops fire on American citizens? That question will be answered in the coming decade.

Dream, America Dream

My name is No One
The long lost son
Born on the 4th of July
Raised in the era of heroes and cons
That left me for dead or alive

I praise liberty
The "Freedom to Obey"
Is the song that strangles me
Don't cross the line

Dream, America Dream
I can't even sleep
From the light's early dawn

Green Day – 21st Century Breakdown

The American dream has turned into a nightmare. Led by the selfish, materialistic, self-absorbed Boomers, the nation has degenerated into an individualistic society of wealth seekers. The country’s common good and attitudes of thrift, hard work, and self reliance have been cast aside for the corporate good, immediate material satisfaction, and entitlement attitude. America is no longer the land of opportunity. It is the land of corporate fascism, benefitting the few.

“The American Dream is that dream of a land in which life should be better and richer and fuller for everyone, with opportunity for each according to ability or achievement. It is a difficult dream for the European upper classes to interpret adequately, and too many of us ourselves have grown weary and mistrustful of it. It is not a dream of motor cars and high wages merely, but a dream of social order in which each man and each woman shall be able to attain to the fullest stature of which they are innately capable, and be recognized by others for what they are, regardless of the fortuitous circumstances of birth or position." -- Historian and writer James Truslow Adams in his 1931 book Epic of America.

This version of the American dream has been slowly fading away for decades. Those with ability who have earned a better life through their hard work, superior intelligence and integrity should attain a higher spot in the social order. Instead, government rewards those Americans who have taken unwarranted risks, made corrupt choices, and willingly chose a path of excessive debt to scale the social order. The game is stacked in favor of the elite, while middle class wages have stagnated for the last 40 years. Government bureaucracy strangles the entrepreneurial spirit of the people, while empowering those who want to control our every action.

 

Today’s aristocracy consists of Wall Street bankers, corporate chiefs, Washington lobbyists, the military industrial complex, and corrupt politicians, all engendered by the printing presses of Ben Bernanke and the Federal Reserve. The rich get richer and the middle class disappears, as their jobs are shipped overseas by corporate conglomerate CEOs who preach globalism as a benefit to society. It is a benefit to their country club elitist society. These elite Boomers have sucked the life and vitality from the American financial system. The three previous Crisis periods in U.S. history were all initiated by a financial related trigger based on excess.

The American Revolution Crisis was instigated by the colonist response to overly burdensome taxation by the English Parliament. This ultimately led to the dumping of English tea into the Boston harbor. Parliament’s response to the Boston Tea Party ignited a colonial tinderbox—leading directly to the first Continental Congress, the battle of Concord, and the Declaration of Independence. The Civil War Crisis had its roots in the issues of property rights and industrial versus agrarian society. The economic widening of the gap between slave and free states was symbolic of the changes occurring in each region. While the South was devoted to an agrarian plantation economy with a slow growth in population, the North had embraced industrialization, large urban areas, infrastructure growth, as well as was experiencing high birth rates. This boost in population doomed Southern efforts to maintain balance in the government as it meant the future addition of more free states and the election of a Northern, potentially anti-slavery, president. The Civil War began with a presidential election that many southerners interpreted as an invitation to secede. The attack on Fort Sumter triggered the most violent conflict ever fought on New World soil, with over 600,000 dead Americans. The Great Depression & World War II Crisis began suddenly with the Black Tuesday stock-market crash. The events leading up to the “sudden” collapse were caused by loose monetary policy by the Federal Reserve, Wall Street greed and corruption, and government incompetence. After a three-year economic free fall, the Great Depression triggered the New Deal revolution, and a vast expansion of government. The worldwide economic collapse led to the rise of Nazism and Fascism, a World War that killed 65 million souls, and mass destruction in Europe and Asia. The parallels with previous Crisis periods are eerily visible today.

The current Millennial Crisis which we are attempting to grasp was commenced by the combination of a housing collapse caused by loose Federal Reserve monetary policy, no regulation of financial institutions and corrupt greedy bankers on Wall Street. The depth and breadth of this financial disaster is being exacerbated by government borrow and spend policies and the free market globalism mantra of big business being sold to the American public. This fraudulent economy has been supported by a world awash in cheap oil. The American people have been scammed. Free market globalism didn’t benefit the middle class and the era of cheap oil is running out. James Howard Kunstler describes the scam perpetrated on the American people in his book The Long Emergency:

“Globalism had the same tendency to impoverish and enslave huge populations while enriching the elite who managed its operations. The American people were sold on it, even while it destroyed their towns, their landscapes, and their vocations. Globalism was primarily a way of privatizing the profits of business activities while socializing the costs. This was achieved by discreetly discounting the future for the sake of short-term benefits. Globalism was operated by oligarchical  corporations on a gigantic scale, made possible by cheap oil. As Wendell Berry put it, ‘a corporation essentially, is a pile of money to which a number of persons have sold their moral allegiance …. It can experience no personal hope or remorse. No change of heart. It cannot humble itself. It goes about its business as if it were immortal, with the single purpose of becoming a bigger pile of money’.”

 

We’ve sold out America for cheap Chinese hair dryers, low-priced Chinese TVs, inexpensive Mexican apparel, economy packs of Fruit of the Looms from Indonesia and yellow smiley face stickers for our kids.As reward for gutting the American economy by shipping jobs overseas, American CEOs have enriched themselves at a rate 500 times higher than the average worker’s pay. Wall Street bankers were paying close attention to how corporate CEOs were able reap ungodly profits while socializing the costs. With a clear signal from Alan Greenspan that the Federal Reserve would save any moron on Wall Street that got in trouble, the gluttonous Harvard MBAs created exotic financial products and convinced the world they could spin gold from straw. The CEO’s of the five biggest investment banks (including Hank Paulson of Goldman Sachs) convinced the SEC to waive their 12 to 1 leverage ratio and leveraged their Wall Street gambling casinos at 40 to 1. This excessive leverage combined with financial products designed to confuse and bamboozle investors generated billions in profits for these banks and hundreds of millions in pay and bonuses for their Boomer leaders. When the crooked house of cards collapsed under the weight of lies and fraud, these banks were essentially insolvent. At that point Hank Paulson, who was now Treasury Secretary, along with Ben Bernanke decided to socialize their losses by having the U.S. taxpayer pick up the tab. Middle class Americans lost 8 million jobs and Wall Street bankers used the taxpayer bailout to generate billions in fake profits while paying themselves hundreds of millions in pay again. The resentment of average Americans is boiling over and will play a main role in the unfolding Crisis.   

Scream, America Scream

I am a nation
A worker of pride
My debt to status quo

The scars on my hands
And the means to an end
Is all that I have to show

I swallowed my pride
And I choked on my faith
I've given my heart and my soul
I’ve broken my fingers
And lied though my teeth
The pillar of damage control

Scream, America scream
Believe what you see
From heroes and cons?

                      Green Day – 21st Century Breakdown

Progressives like Arianna Huffington clearly don’t comprehend what is happening. The anger and disillusionment of the population are seen as worrisome and disturbing by those who believe history is linear. The entrenched ruling elite should be apprehensive. During a Crisis existing institutions are torn down as the social fabric of the country undergoes wrenching changes. Those in power are rightfully fearful of the masses they have screwed for decades. President Obama, Ben Bernanke, Timothy Geithner, and the majority of economists and TV pundits are convinced the Crisis has passed and they have successfully maneuvered the country through the worst, avoiding a second Great Depression. History suggests otherwise. We have yet to experience the nastiest part of the Crisis. We can expect to encounter private and civic choices analogous to the cruelest ever confronted by ancestral generations. The recently submitted Obama budget, adjusted for reality, will add at least $12 trillion to the National Debt in the next ten years. That would bring the National Debt to $24 trillion in 2019. At a modest interest rate of 5%, the country would be paying $1.2 trillion per year in interest. The more likely scenario would be a 10% interest rate, resulting in annual interest costs of $2.4 trillion. The entire spending of the Federal Government was only $1.2 trillion in 1990.

Mr. Progressive, Paul Krugman, insists that worries about the debt are overblown. Despite the fact that our economy isn’t capable of growing more than 2.5% over the long term, he sees no problem growing our National Debt by 10% per year. It’s as if his Nobel Prize was coated in lead and he has been sucking on it. Only someone who is brain damaged would argue that doubling our debt will solve a crisis caused by too much debt. It’s as if Krugman wants to become the Irving Fisher of his time. One week prior to the Stock Market Crash of 1929 Fisher famously pronounced:

"Stock prices have reached what looks like a permanently high plateau. I do not feel there will be soon if ever a 50 or 60 point break from present levels, such as (bears) have predicted. I expect to see the stock market a good deal higher within a few months."

The truth is our lenders will not allow our National Debt to reach $24 trillion by 2019. The U.S. dollar has already lost more than 80% of its purchasing power since Nixon closed the gold window in 1971. The amount of currency in circulation since that time has gone up by a factor of 16 to $800 billion. The result has been a stagnation of real wages for the middle class, while the ruling elite have seen their wealth soar to astronomical levels. The correlation between printing more of something and its relative value are as clear as day to anyone with a smattering of intelligence. Ben Bernanke is attempting to print his way out of this financial crisis. He is playing a game of chicken with our foreign lenders. He wants to devalue the U.S. dollar slowly to reduce the unbearable weight of U.S. debt. Foreign lenders from China, Japan and the Middle East know what he is doing. They will be the long-term losers in this scenario. At some point in the next few years they will balk at buying more US debt. A “Weimar Moment” will strike the United States like a sledgehammer. The veil of financial stability will be revealed to be a fallacy and the worldwide reserve currency will revert to its intrinsic value of zero. The chaos that would ensue as people’s life savings are wiped out would test the mettle of our country’s citizens, government, and military.     

The dollar is likely to collapse just based upon current spending and borrowing trends. The unsustainable entitlement promises made by politicians over decades would have guaranteed a dollar collapse by 2030 anyway, so we will just arrive sooner. Not one politician from either political party has the courage to stand in front of the American people and tell them they will not receive the Social Security and Medicare benefits they were promised. Not one politician from either party is even willing to discuss the fact these promises cannot be honored. This train has been headed down the track since the 1960s, picking up speed, and no one is willing to apply the brakes. The Baby Boomers have sold their children and grandchildren into slavery. Their unwillingness to sacrifice entitlement benefits, guarantees a vastly lower standard of living for their descendents. How very egocentric and superficial of them. The most coddled, self absorbed, egotistical generation in history would rather crash the economic system than make any personal sacrifice for future generations. The $106.8 trillion of unfunded promises will not by paid, because there will be nothing left to pay. The country is bankrupt today. By 2030, half of all tax revenue would be needed to fund these programs. The Boomers will be forced to accept much less than they expected. The delusion of getting something for nothing will be put to rest during this Crisis.

The wildcard within the current Fourth Turning is cheap easily accessible petroleum. Progressives and those who only view the world in a linear way, fail to recognize that easily accessible oil only came onto the scene 150 years ago and we have depleted the easiest to reach 50%. The implication of these facts is beyond the comprehension of linear thinkers. They trust our ingenuity and brilliance to solve the problem. A new form of energy will magically appear on the scene and save our industrial world. Brain power and human resourcefulness played only a small part in the economic boom of the last 150 years, produced by cheap oil. The industrial revolution began more like Jed Clampett shooting at some food and getting bubbling crude. The world benefited from a positive Black Swan event. In other words, we got lucky. Now the luck is running out. There is a finite amount of petroleum on the planet. Most of the remaining supply is trapped beneath deep oceans, within tar sands, in shale rock and in inhospitable countries. Cheap sweet crude is running out. New oil discoveries peaked in 1964. Worldwide oil production peaked between 2005 and 2010. As supply enters terminal decline and demand continues its relentless rise, prices will soar and the world will be transformed forever. This could even put a creak in America’s military machine that consumes over 150 million barrels of oil per year.

The deniers believe that technology will save the day. They don’t step back and think that their technology couldn’t function without cheap oil. The hardware and software are made in factories run by fossil fuel. The amount of energy that exists on the planet is a closed loop system. The sun’s energy created fossil fuels. The population of the planet has converted 50% of these fossil fuels back into CO2 and other byproducts. This is the process of entropy.  Entropy is the movement of energy from complex, higher states to simple, lower states.  Energy cannot be created or destroyed, only changed – entropy dictates that energy flows in only one direction, from being concentrated in one place to becoming diffused or dispersed and spread out; from being ordered to being disordered. After 150 years of profligate use of oil, we are within a few years of experiencing an unsolvable oil shortage which will affect transportation, industry, heating, plastics, fertilizers, pharmaceuticals and all the myriad products essential to our contemporary lives. Our energy-devouring civilization has been accelerating entropy. Kunstler sees this entropy leading to a crisis of epic proportions:

“We don't really need to reach the end of oil to experience the disorder that accompanies entropy. The economic efficiency we praise creates one-industry towns that become simplified and vulnerable communities. Businesses evolve into big corporations that dehumanize and feudalize our lives. Our monocultures of specialization create ecological disasters. We poison our water, land and air using the justification that more and faster are always better. Mass production produces the homogeneity that deadens the spirit and vitality of people – they compensate by becoming hyper-consumers, fad-chasers, unsettled and disquieted beings in search of the meaning denied to them by a loss of complexity.”

The combination of debt, dollar devaluation, delusion and depletion will make this Fourth Turning the most challenging and dangerous in U.S. history. 

The Five Ds of the Fourth Turning

DEBT + DOLLAR + DELUSION + DEPLETION = DECLINE

Every previous Fourth Turning in U.S. history was triggered by an economic conflict or devastating financial event. The current Fourth Turning was activated by the collapse of our housing market, the subsequent revelations of Wall Street fraud and excessive risk taking and the actions of politicians to protect Wall Street from their hubristic exploits. The choices by leaders after these triggers will have a dramatic impact on the future course of the Crisis. George Washington decided to fight and stayed on the battlefield for eight years before succeeding. Abraham Lincoln could have let the South secede. He decided to fight in order to retain the Union. The result was 600,000 dead and abolition of slavery. Franklin Delano Roosevelt decided to implement massive social welfare programs to keep Americans employed. These programs planted the seed for our current Crisis. He also committed 16 million American men in World War II, with 450,000 dying for their country and another 670,000 wounded. All previous Fourth Turnings began as financial episodes and eventually led to total wars of destruction. There is nothing about this current Crisis that would lead me to an alternative picture of our future.

I could propose a number of logical Crisis scenarios based on the facts at hand, but the truth is that no one knows how the next fifteen years will play out. We do know there will be much upheaval, worldly peril, and cataclysmic changes to the exiting institutional and social order. I believe the financial crisis will transform into a Depression as the layers of new debt piled upon the old debt ultimately collapse our economic system. It could be a deflationary collapse or an inflationary collapse. Both scenarios would lead to further destruction of the middle class. When the U.S. dollar is no longer viewed as the reserve currency for the world, America’s worldwide influence will wane. How global economic rivals like China, Russia, and the Middle East react to our economic and social weakness will determine the next phase of the Crisis. When countries are experiencing severe domestic problems, they seek out or invent a foreign threat. The likely flashpoint which could lead to foreign conflict would be a terrorist attack on U.S. territory and/or a clash over depleting worldwide oil supplies. Strauss & Howe explain the nature of Fourth Turnings:

“The ‘spirit of America’ comes once a saeculum, only through what the ancients called ekpyrosis, nature’s fiery moment of death and discontinuity.  History’s periodic eras of Crisis combust the old social order and give birth to a new. A Fourth Turning is a solstice era of maximum darkness, in which the supply of social order is still falling—but the demand for order is now rising.  It is the saeculum’s hibernal, its time of trial. Nature exacts its fatal payment and pitilessly sorts out the survivors and the doomed.  Pleasures recede, tempests hurt, pretense is exposed, and toughness rewarded—all in a season.”

Personally, I have grave apprehensions about the coming years. As a libertarian minded person I will not be happy, as it is highly unlikely that government will willingly get smaller. The last two Crisis periods resulted in a much more powerful Federal government. It is difficult for me to conceptualize how the country will come out the other side of this Crisis as a stronger society. The likelihood of the citizens rallying around the flag and following a Boomer Prophet into a world war seems farfetched to me. I fear the angry have-nots are more likely to rise up against the ruling elite, with potential dire consequences as the military may have to choose sides. My principal fear is that Crisis periods always rely on the Hero generation to make the greatest sacrifices. An entire generation of Heroes was wiped out in four years during the Civil War. A million Heroes were either killed or wounded in World War II. My three sons are all part of the Hero generation. I’m not prepared to sacrifice them for a cause that I do not believe in or agree with. The Boomer generation has been discredited in my eyes. Following a Boomer leader into battle seems out of the question today.

My guess on the end result of this Crisis is that Americans will need to localize. Reduced fuel availability will force people to depend on their neighbors and locally produced food. Forging closer relationships with family and neighbors will stand you in good stead during the remainder of this crisis. This Fourth Turning has only just begun. Strauss & Howe do not predict the outcome, only the challenges that await us and the hope that we will rise to the occasion.

 Thus might the next Fourth Turning end in apocalypse – or glory. The nation could be ruined, its democracy destroyed, and millions of people scattered or killed. Or America could enter a new golden age, triumphantly applying shared values to improve the human condition. The rhythms of history do not reveal the outcome of the coming Crisis; all they suggest is the timing and dimension.

A Fourth Turning harnesses the seasons of life to bring about a renewal in the seasons of time. In so doing, it provides passage through the great discontinuities of history and closes the full circle of the saeculum. The Fourth Turning is when the Spirit of America reappears, rousing courage and fortitude from the people. History is seasonal, but its outcomes are not foreordained. Much will depend on how tall we stand in the trials to come.  

Strauss & Howe – The Fourth Turning

Will America in 2025 look anything like the America of today? Will the country resemble a dictatorship? Will it resemble socialist Europe? Will it break apart into regions? Will it reaffirm its roots as a Constitutional Republic? Or, will it no longer exist? The choice is ours. 

Join me at www.TheBurningPlatform.com to discuss truth and the future of our country.

By James Quinn

quinnadvisors@comcast.net

James Quinn is a senior director of strategic planning for a major university. James has held financial positions with a retailer, homebuilder and university in his 22-year career. Those positions included treasurer, controller, and head of strategic planning. He is married with three boys and is writing these articles because he cares about their future. He earned a BS in accounting from Drexel University and an MBA from Villanova University. He is a certified public accountant and a certified cash manager.

These articles reflect the personal views of James Quinn. They do not necessarily represent the views of his employer, and are not sponsored or endorsed by his employer.

© 2010 Copyright James Quinn - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.

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