Spinning Out of Control?
“… Turning and turning in the widening gyre.” *
By Erik Dolson
There’s a sense of vertigo from looking into the near future, like peering over a cliff, down from the top of a high dam, or at the edge of a whirlpool.
Our world is on that edge. Big change is coming, maybe chaos.
It’s not just the weird, self-destructive politics. That’s a symptom, though it will be mistakenly blamed for social breakdown. A problem when focusing resources on symptoms: we run out of resources to fight the disease.
Two of my favorite futurists are Nouriel Roubini (aka “Dr. Doom”) and Peter Zeihan. They describe the coming train wreck differently but in stark terms that overlap.
Zeihan’s focus is on demographics, and he points out that huge and irreversible population declines will upend economies. In short, there won’t be enough workers to support societies across the the developed world.
It’s not just a shortage of “stuff,” it’s also a shortage of taxable income to support basic needs. We’re not talking affordable housing and drug treatment, the lack of which may again be symptom as opposed to disease. We’re talking about water, policing, bridges (see Jackson, capital of the U.S. state of Mississippi).
Roubini, an economist who was an isolated voice when predicting the great recession of 2008, talks about the tragedy of inaction when facing problems that are looming. We have been “kicking the can down the road,” in his words.
His view of the problem is that there is a cost to fixing what’s wrong, and anyone in power who would make us pay that cost won’t be in power for long. It’s our very nature that is the problem, and systems we use to manage our community existence prove inadequate.
Roubini’s list is specific and long: huge public debts we have now will only be reduced through the “tax” of inflation; now-obvious threats will cause spending on national defense to increase with less available for other services; climate change impacts will cost a fortune to mitigate; new pandemics will hamper supply chains; automation will lead to technological unemployment with transfers to those left behind; political backlash against inequality will bring programs focused toward the middle and lower economic classes with fewer resources to address them.
In Roubini’s view the problems will go unaddressed, the can “kicked down the road,” even though the ultimate consequences are dystopian.
It’s hard for this Old White Liberal to use the word “dystopian” as a boomer who grew up believing the world was always getting better: better health, more wealth, cleaner water and air, more opportunities for more people. I believed in Adam Smith’s invisible hand, the power of technology, in human ingenuity, in spirituality that recognized “tragedy of the commons.”
I now believe we’ve crested, and the path forward is a path down, into a quickening whorl of causes and effects chaotically tied to everything else.
These two are mainstream. I'm writing a review of Edward Dutton's "The Past is a Future Country." He is the only writer I know who is unafraid to write about every dimension of the problem: race, gender, declining intelligence, woke philosophy....
Much to worry about, certainly. As another senior watching us vote ourselves the treasury has been interesting. The debt burden is a concern in that service on that debt rises so the proportion means something must give. While Ike built the Interstates and we did get to the moon, at the time we were not spending ~ 60% on transfer payments to individuals. And we saw this coming long ago as Mr Obama faced a horrid recession just as the boomer retirement bomb burst. Politicians are loath to throw grannie off that cliff although some gannies could very well jet away on their private jet to most anyplace they wish.
We have decimated the supply side both by greed and the pandemic; the greed allows us to despise the makers of things we "need". The only answer to the resultant inflation is to raise interest rates to force us to limit demand. But that only makes debt service worse. So I see the Fed arriving at ~ 5% inflation allowing the dollar to devalue even more over time and holding there until the supply side resolves, if it ever can. Our history shows revenue at ~20% of GDP and outlays at ~ 22%, so the lovely 2% allowed servicing the deficit without too much pain. The 2008 calamity erased that stale flow.
Not sure if we can recover the supply side readily. Our demographics are bad for the skilled workers we need going forward. Businesses will need to establish internal training programs that they are quite reluctant to do. But Germany does it quite well, so we must.
Perhaps as we wallow in this uncertainty, our leaders might set aside personal graft and petty bickering to lay out a path. Likely will need that to wait until '24. Perhaps many of those retired in place will decide to leave government and some vital 50 year old people ascend.