While we cannot see around corners, we can certainly sense the direction and go with the flow. So it pays to know accurately where the various socio-economic avenues of current history are headed. Since history proceeds like waves on the shore, at least some turns in the road ahead should be predictable.
- Most immediately and important to all Americans is crony capitalism and the lax tax laws that actually encourage the amoral folks to corral capital and call it growth when it is no such thing. No new capital is created; no net new jobs are created, yet these features are now endemic in our system of finance. As a nation, we are no longer the manufacturing leader. The financial system we now have is now just a casino of unprecedented power where the naive get taken. On the national scale, now in trillions, any one asset management firm that specialize in private equity can make a killing that is hardly noticeable, but upon enough years of accumulation will slowly but surely bleed our great nation into inflation that knows no bounds. In the process the rich can only get richer, increasing the gap in wealth that is already obscene. The crucial problem is that the capital gains tax is just 15%. This is the rate Romney and his bed fellows pay as their "fair share". Earned income reflects jobs and capital formation. Capital gains may masquerade as growth but it creates no jobs, nor does it create new capital, to reiterate. The fact that the "one percent" now call the economic shots is a harbinger for economic disaster if allowed to continue as it has.
- Another very serious, global threat we see is the global financial system itself: It is inherently unstable and perhaps even worse, too few economists, let along governments fully understand how it works. The whole system is much too opaque, a feature that opens the door to the greedy, the ambitious, and the would-be conquerors alike. The financial strengths of several nations appear to be too weak to allow a turn around any time soon. Globalization, for all its strengths and benefits, has, through tight financial linking all around the globe, created a situation where if one sector goes down, everyone else could too. The huge surplus of money seeking investment is not now fueling entrepreneurship, except in China and to a lesser extent India. A world-wide 21st century great recession could set new records of suffering for a good long while. The world economy, the money supply, has become a power unto itself with the potential for drowning sovereign states. Dollar-driven-economic extremism is now upon us. Money surplus is surely a product of unbridled capitalism. But it may take a generation or to deal with it. Job growth will continue to be anemic until stability in the global financial system is realized.
- China is weathering the world-wide recession well, thanks to freely flowing government credits. China will continue to have the fastest growing economy on earth for quite some time. But corruption, disenfranchised peasantry, shortage of English speakers and the increasing income gap are all worrisome in China. The smashing 2008 Olympics were a coming-out party. China's success arose from Deng's policy of gradual relaxation of central authority in contrast with Yeltsin's shock treatment that supplanted the gradualism of Gorbachev in Russia. Still, the rise of oligarchs could result in future trouble. Meanwhile, China has become the leader in developing green technologies. At the same time, it is expanding industries and infrastructure that produce carbon dioxide and other waste products.
- Taiwan will remain something of a sore point for at least another generation. Rapprochement with China of some ilk will eventually come--maybe by mid-century.
- India is moving ahead at a more deliberate rate, enfranchising a strong middle class, has a stable government and has English as the most significant native language. Look for India to rival China in Asia by 2020 or so if it can solve its remaining caste problems. Corruption is a continuing sore point.
- Russia will continue to revive under Putin who has a strong system of support. The ruling oligarchy is essentially part-and-parcel the government. That situation came about as a consequence of Yeltsin's "Shock Therapy" in divvying up the Union's capital. Clinton never treated Yeltsin as an equal. Yeltsin may have been driven to extreme measures partly for that reason. Russia never was an economic super power; politically it was. In terms of nuclear weaponry, Russia retains its number two status. These asymmetries need to be addressed to create a better balance to improve prospects for peace. Peace can exist among friends, not among enemies. Obama is negotiating in a more even-handed way than did his two immediate predecessors. Look for a new treaty or treaties to come into being in 2010 and a possible thaw in relationship. Until then, investments in Russia may be ill-advised.
- Europe will continue its slow, steady, economic growth despite upheavals in the euro as well as in the French Islamic quarter. Germany leads in implementing solar power and will for some time yet. Germany is a western show case for its economic system for its full employment during the recession! We should emulate and support them. The "Grecian monetary crisis" reveals a deep flaw in how the "united Europe" is working out in practice. Too often the central European Union authorities have winked at new entries, going back to the entry of Italy. If the EU has an Achilles heel, that is it. The European central banks are part of the problem. They are adding too much to the financial burdens of the troubled nations.
- The US is headed down in most measures that count, and will continue to through 2012 and probably well beyond regardless of the next presidential outcome. The costs of war and empire brought us to the tipping point. Our military budget is grossly out-sized by any reasonable standard; deficit spending will continue to erode our economic potential and be a probable election issue into 2016, by which time we will likely have to print money to get out of the huge hole in our sovereign debt. It is also true that our social entitlements are out of balance--largely because Congress mismanages the programs, eg. using Social Security income over decades to support other projects. The US will find it increasingly hard to maintain its economic empire. A ballooning national debt will eventually, perhaps sooner rather than later, drag the US down and ordinary citizens will pay the price. Meanwhile, China will enjoys increasing leverage as the main foreign creditor for our deficit spending.
- US business lobbies will likely strengthen their influence in Washington even in the face of yet more scandals. Their influence continues to hamper progress the economic and Global Warming fronts. All this bodes ill for both America and the world.
- Polarization in American politics will continue through 2011 with the Iraq/Afghanistan Wars being the main fault line across the nominal two-party system. Americans have a clear choice: continue playing HAWK to destruction or start engaging in diplomacy. Happily, the Obama administration has begun diplomatic talks with several contenders, most pointedly with Israel and Palestine. This bodes well externally, but has too little support, or even recognition at home. Passage of a deficient health bill may exacerbate some problems while relieving others. Still, the existence of any bill at all is a step forward which may be rolled back by some future conservative administration.
- The lurch to the right in American politics has largely stopped, if only temporarily. A generation will likely be required to restore a progressive foundation in the Supreme Court. That is likely to happen when enough women feel sufficiently empowered to take control of their own bodies for an extended period of time. Terrorism will remain high on the agenda even though increased openness by the Administration should re-frame this matter into a somewhat better perspective as a police rather than as a military matter.
- "Money drenched politics" will continue to be the American norm. Corporations and the K-street bunch have distorted the operation of our governance system beyond recognition. As a result, we have a sitting president who is hamstrung when it comes down to needed reforms. "Money drenched politics" will get worse before it gets better. Both parties are addicted to money and caught in the webs of influential lobbies, the military-industrial complex, gerrymandering, and cronies.
- Voters in America will continue to lose clout in things that matter--like getting to know our candidates during primary elections. However, the Internet will empower voters who avail themselves of the information now on the Internet. They can make their presence felt if they care about their progeny. Look for the continued influence of big money on the American electorate. Our tripartite system is failing us in the face of a plutocratic onslaught. It will likely get worse until an unpredictable, perhaps unthinkable, ending takes place. The power of Blogville provides a damping force, perhaps the only one of significance. Blogville is a chaotic place where emotions freely reign, but thoughtful people reside there too. Expect them to be heard from if they can coalesce.
- New material: Voter independence movements attempting to deal with this will grow if they remain focused on the process of electing officials via democratic means. If instead, they opt out by becoming a "middle of the road" party, it will be grid-lock all over again. tolerance beyond what we now see will be required to maintain democracy. Since gridlock arises from our genetic endowment, it will torpedo the movement by sowing internal dissonance--which will arise among those with personalities on the extremes of the dominance scale. The movement must deal with that potential effectively if it wants to stay in business.
- New material:By the end of the century, biochemistry will have our genome so well studied that temperament can be programmed. Since such procedures are science that anyone can discover, it is bound to result in species changes within Homo toward this ideology or that depending only on the practitioner. To repeat, the biggest political danger facing humanity is human nature itself, and with it, our inborn tendency to form ideologies. This issue, like the nuclear one, will require tight oversight by an international agency. International agencies to deal with either problem remain pie in the sky until events bring all peoples together to emphatically resolve both issues.
- America has been welcomed back into the fold of peaceful democracies. But that was offset in large measure by the extreme rhetoric by Republicans who are Hell-bent on preserving the failed Neocon policies at all cost.
- If the Democrats do not stand up to the lobbyists (we expect they won't) who corrupt government and disenfranchise American voters, the business of government will continue as usual. The door be open for further deterioration of democracy and freedom.
- As for the rest of the world, China will continue to liberalize; Communist countries will continue their slow transformation to new styles of governance. China has huge gaps in income and serious pollution problems. At the same time, China is responding in a much more resolute manner than any other significant polluter. That situation will likely continue through 2020.
- Theocracy as a means of governance is losing its way In the lands of Islam, consistent with history. But it will be around in the Middle East at least until the oil engines deplete along with external support. Surrogate wars among the three major monotheisms will continue. The world of Islam in particular will remain at war with itself.
- Europe will continue its steady increase in international influence, especially if a way is found for Turkey to join the union. Turkey's joining the European Union would be a legitimate advance for all nations concerned. But Otherwise, NATO must avoid pushing to hard toward the East where Russia has a legitimate sphere of influence and history of cultural commonality with nations of the former Soviet Union. Meeting these conditions may he requisite for a European Union to emerge as a "supernation" the world's first such experiment.
- African turmoil will continue unabated up to a decade or more. Look for more genocides that the world will continue to ignore.
- The three great monotheisms are basically at war, but reconciliation, let alone reformation, seems remote any time soon. The mythos / logos reality now receiving acceptance in non-Muslim Asia, Pacific Rim, South America, and Europe will come only slowly to the Middle East and the United States. As far as we can see, de facto theocracy through the numerous dictators in the Middle East will not go away any time soon. Diaspora Islam could change that--millions of Muslims live peacefully in democratic societies. They and their counterparts in the Middle East hold the keys. See The Arab Center for more.
- In the US, Intelligent Design proponents, though properly admonished in court, will not go away. New ways of subverting the educational system will continue to turn up, particularly in the South. Look for a backlash at some point, maybe this year, but don't expect right-wing Christian organizations to back down. It could turn more violent than shootings at abortion clinics. The Ku Klux Klan experience only has a paper thin barrier restraining its resurrection. If that seems unbelievable, see Zimbardo for the background where ordinary college students, selected for their maturity, became abusive tyrants or submissive sheep overnight. Anonymity of the KKK variety enabled not only the KKK, but Abu Ghraib and Guantanamo as well.
- Iraq, Abu Ghraib, Guantanamo, and hurricane Katrina have punctured the US facade of morality and invincibility. Enlightened leadership will be required to repair the damage. Will the Obama administration be able to repair this damage? A start has been made, but only time will tell.
- Recovery in New Orleans has become politicized in favor of white privilege over true restoration. There will surely be a backlash--White House denials notwithstanding. Meanwhile, concerned citizens from other states are trekking to New Orleans to help with rebuilding, a tiny bit at a time. These folks are middle America, the fiber of our nation.
- Immigration policies will remain adrift and divisive until resolved rationally where all the pros and cons of the issue are evaluated in dialogue--enabling just laws to be written.
- Japan, Norway, Portugal and many other peaceful countries will continue setting examples of how to live in relative peace. Look for Honolulu and El Paso to remain peaceful in stark contrast with Washington, Baltimore and Detroit--all cities of similar size.
- Physics: The recent current stir is all about the Higgs boson. That it fails to fit well in important ways, one of two things will happen. Either it will give rise to new physics, or it will be found to fit the standard model better than it now seems to after more data are gathered, or the standard model will be modified.
- Biology will dominate the 21st Century as not only the glamor science, but the philosophical as well. Creation of life via natural processes will likely be discovered as will cures for cancer and man "genetic diseases." Creation of new species has already been done. And all-new microbes that reproduce themselves have been generated from computer instructions on how to assemble snippets of DNA. Since the growth of this region of science is now on an exponential curve, and since computing power is there to model the final product, designer-life forms will become common place, for better or worse. Make that better and worse, given the current tendency of humanity toward violence. Firestorms of debate will erupt. Ethical and religious quarters of society will be in the forefront of criticism while seeking its results as they now do with medicine for certain reasons. One thing seems certain science will continue to chart unknown genetics in the laboratories of the world.
- As long as humanity exists, technology will continue to advance. Efficiency will be the order of the day, and cause increasing dislocations in wealth sharing, equal opportunity, and justice. Early trends are not encouraging. This century looks like a defining one for "purpose in this life." That is, if we do not blow ourselves up first.
- Since the US is still not addressing the basic causes of terrorism, it will not go away and could yet destabilize the Middle East--to no one's benefit. Look for continued degeneration for a generation. The Arab Awakening may take some time before we can know whether it can establish a reformation akin to what Europe went through.
- To employ a metaphor from the Internet, Al Qa'ida has given the terror movement a template permitting virtual operations, with no direction at all from headquarters. Terrorism will be accomplished on the local scale for at least another two generations.
- Al Qa'ida, though splintered, will survive for a generation or more, and the number of terror groups will continue to grow world-wide indefinitely until desire for empire is abated and diplomacy becomes the order of the day--on all sides. This cannot happen soon.
- Iraq will eventually stabilize, but only if the three ethnic groups agree on how to proceed or if one of them becomes dominant. There are some indications that it might. Their could be a peaceful partitioning, some sort of federation, or the acendence of yet another dictator.
- Insurgencies will continue until the oppressed are accommodated. This will not happen any time soon. Peace will only come when all ethnic groups have settled their differences--an unlikely event historically-- and economic inequality is leveled out--also an unlikely event this century.
- No amount of military action can achieve a peaceful resolution to terror. At the same time, we cannot afford abrupt withdrawals from Iraq of Afghanistan--we would then shoulder the blame for the human tragedies that civil wars and resulting chaos would likely create.
- Iran turmoil will continue. If history repeats, expect the demise of the theocracy. In any event their nuclear program will continue to be an international matter. Concerned nations, Russia and Europe in particular working together with the US via legitimate international means, are the best bet for reaching accomodation.
- North Korea will continue playing cat and mouse on the nuclear front to its economic advantage. It is not likely that North and South Korea will reach rapprochement as long as Kim Jong-Il remains in power. The Kim Dynasty should be expected to maintain its power into the next generation.
World Economic Trends
Governance and Politics
This area is where one might dream and live to see it happen. At least that has been the case for a century now.
Terror and Terrorism
Economic Data and forecasts:
- Africa Renewal
- Central America
- Central and South Asia
- East Asia
- Global Economics Forum
- South America
Posted by RoadToPeace on Tuesday, March 28, 2006.