There’s no doubt that the United States is in a period of transition. But from what to what else? Through the last 16 years the economy has been tough on everyone – except the very wealthy. The most recent few years have been a time of terrible social upheaval. Pessimism is understandable.
Yet if we look back through history there is a lot of good reason to believe that everything does move in cycles. Business cycles which seem permanent eventually give way to better opportunity. Social upheaval does usually reach a consensus and progress is made.
Hope comes naturally by taking the Barataria view that cycles are real and that the economy is really nothing more than a social arrangement. Sure, it’s the dismal one with all the numbers and the brutal one that defines rich and poor. But at the heart it is only about turning our personal “values” into a socially convertible “value”. How it changes through generations and lifetimes defines us even as we define what this thing called an “economy” really is.
This essay is a continuation of the previous piece, Spring is Coming! as a cycle on my personal political philosophy and read of history.
The state of the economy defines entire generations because it places an actual value on the most important definitions of self – our work and our ability to support our families. At its worst it’s about surviving from day to day, but at its best it’s about thriving and allowing us to find genuine happiness.
As a purely social construction economics defines other social movements even as it is defined by them. Where the economy moves in waves, so do periodic social movements demanding progressive change or personal righteousness. Those tend to move opposite each other, in different cycles, as the social movements themselves move as derivatives of the economy.
Where economic cycles are the sine, social change is the cosine – often peaking when the economy comes back to even. We are in one of those times now. But there are two types of economic downturns described through the cycles of the world.
The father of business cycles, Nikolai Kondratieff, named the phases for the four seasons. Spring is an up time, a re-awakening of growth – followed by the lazy Summer of stagflation. Fall is an uptime of harvest – followed by the deflationary dying off of Winter.
The completion of this Winter, which started in 2000, will define the end of the Postwar cycle of economic seasons.
Through them all social upheaval comes as downturns end and everything comes back to even. People naturally focus on themselves and their families in hard times, but as we emerge from the hole we seek a broader social arrangement to refresh society generally. The passage from Summer into Fall usually comes with an awakening of morality and the passage from Winter into Spring usually brings a progressive movement of some kind.
I will ignore the moral movements, as they don’t describe our time. The rise of the most recent Pentacostal movement in the 1980s matches the Charismatic movement that started around 1905 or the Great Awakening of the 1840s. For now, we should focus on where we are – at the end of a Winter and passing into Spring.
The time between these “Winters” is roughly one lifetime. They do seem to come when we forget what our grandparents tried to teach us, but more importantly they are defined by generations even as they define them. Where the life expectancy was only 40 years in the early 19th Century, it is over 70 years today – and the time between “Winters” is stretching out.
Barataria has asserted many times that we are in roughly the fifth “Winter” or Depression in US history. We can look at each of these Winters and see what came after them to help us understand what may indeed come in the next few years.
First Depression: 1812-1823. This was the first event in American history to be called a “Depression”, as President Monroe said that “A depressed feeling has come across the nation.” This downturn started with the downturn in European demand in the Napoleonic Wars, some of which came to our shores in 1812. There was some improvement until the Panic of 1819, which took years to unwind. The Spring which came was ultimately defined by Andrew Jackson 1830-1837, who broke the Bank of the United States, and encouraged universal male suffrage (all men could vote, property owner or not). Public education became available to everyone starting with the Massachusetts Public School law in 1827.
Second Depression: 1853-1866. This started with the Panic of 1853 but accelerated through the Panic of 1857. The Civil War only made things worse. There was no significant progressive movement or achievements after the war, however, save an opening of Western land for settlement.
The Long Depression: 1873-1896. This started with the Panic of 1873 but came to be defined by a series of smaller panics and stock market failures driven by speculation. When we came out of this the movement known as the Progressive Movement sought great society change, much of which had been bottled up by the failure of any significant movement after the Civil War. This included the Sherman Anti-Trust Act, direct election of Senators, the rise of Labor Unions, the development of the Federal Reserve to counter the influence of large New York Banks, and ultimately the right to vote for women. The period after 1896 was, without doubt, the period of greatest Progressive advance in our history.
The Great Depression: 1929-1947. This was defined by the stock market crash in 1929, as well as bank failures through the 1930s. It ultimately led to World War II, which has to be included in the definition of economic “Winter”. But through it all the New Deal and greater role for the Federal Government in evening out economic cycles cannot be underestimated. The birth of the Civil Rights movement can be traced to the migration of African-Americans northward during the dislocation of the Depression and War. Much social change came after this period.
The Managed Depression: 2000-2017? History may record this as starting on 9/11, but without doubt the economy was weak before that. As we pass from this Winter to the coming Spring, what will we see?
The previous Wintertimes, save the Second, gave us progressive movements. The greatest came after the third Winter, probably in response to the failure to re-form after the Civil War which led to a compressed timeline for economic collapse. From where we stand today, millions of ghosts are looking at us and asking, “Now that it is your time, what will you do?”
Social reform and economic reform naturally go together, usually both addressing social pressure. The third Winter finally addressed the far too long ignored issue of slavery, for example, in its own brutal way. Today’s redefinition of “marriage” to include equity for same-sex couples is nothing more than the culmination of the high divorce rates seen 30 years earlier – marriage has already changed from a primary social arrangement to a personal statement of love.
Social change is constant, but acceptance of social change comes in waves which usually peak when times turn better.
What world are we about to make? As shown by the example of Marriage Equity, we have already started. But we know there is a lot more to do. The movement we start now is likely to define social progress for the next 90 years, given how long life expectancy is growing. We can’t be sure about everything that may come from where we are, but we can take a few guesses:
- Racial division must be put to an end. This is the time to complete the work started in the previous Spring, which culminated in the March on Washington and the Civil Rights Act.
- It is time to reform our justice system for the same reasons, no longer accepting that race or income will determine conviction more than actual guilt.
- Health care access for everyone will come. The open question remains how it will be structured and how it will be paid for, but it will happen.
- Money has to be taken out of politics. It’s hard to see how that leads to public financing, and indeed laws on this are tricky given the First Amendment. More than anything, the rise of the “small donor” as a way around big-money lobbyists may change how we view campaigns without a change in law if voters start seeing big money contributions as a huge negative – even with no changes in law.
- Economic opportunity must be extended to all. Exactly what this means in terms of access to capital and corporate structure remains unclear, but we can see how the internet has already democratized advertising and sales dramatically.
- Gerrymandering has to end, and redistricting has to be put into the hands of non-partisan commissions which do not give either party a distinct advantage.
- Education must reform so that there is indeed legitimate opportunity for everyone, regardless of the conditions of their birth. This is also something that must be worked out in greater detail, but as an issue is likely to define this generation.
- Lastly, a proper understanding of national sovereignty – indeed, what it means to be a “nation” – will have to be worked out in a world that has moved much closer together. International cooperation for security as well as cultural understanding will almost certainly define the lives of he generation now passing into adulthood – the children of this Winter who will soon be the strong backs planting this Spring.
Where are we going in the next 17-18 years? If history is any guide, a strong progressive movement is due. We cannot be sure about how much of this will be about purely social reform and how much will be governmental or economic reform. Indeed , we cannot yet tell whether the young generation will shake off its aversion to big government or if they will find innovative free market ways of creating social progress.
Whatever the methods, if we do not do this we will flounder. But as the economy crosses to even, as it is now starting to do, the wave of social upheaval is probably peaking. The “angry phase” is already yesterday’s news and hopefully will look outdated before this election. It’s time to stop shouting and accusing and time to get to work.
Progress comes from times like this – real social and economic progress, as if those are two separate things. The definition of the “rules” which define all of our interactions – economic, social, legal, and political – are due for redefinition.
Spring is coming, and Spring is the season of hard work. What we plant is indeed what we will harvest – for the rest of our lives. Millions of ghosts from progressive movements past are looking at us right now and awaiting our decisions. What, indeed, will we do?
Better than any history/economic text I’ve ever read! Thank you.
Thank you very much!
As usual, I hope you are right. Good article, I really learned a lot!
Thank you very much!
How does this jibe with your post that neoliberalism is dead?
It’s not dead it’s resting. Pining for the fjords. 🙂
Seriously, I didn’t say it was dead, I agreed with the IMF paper which said it was oversold. And the way it was oversold was by not recognizing the effects of business cycles – which is what I centered on in this piece on progressive eras.
What it comes down to is this: A rising tide still lifts all ships, but when the tide goes out and the ship hits the rocks, guess who is first in the lifeboats? Income inequality is a strong function of business cycles for a lot of reason.
There’s more to cycles than that, of course, and I’m trying very hard to not turn into one of those cranks who says that K-Waves explain everything. But they sure explain a lot.
Is Neoliberalism dead? The term describes a re-invention of “Liberalism” as the term was used in the late 19th/early 20th Centries – a term still used by The Economist.
What I see is a Neo-Neoliberalism, another wave of new thought interjected into the notion that free markets do work and economic freedom is closely tied to political freedom. I still buy that.
I suspect that this wave of progressivism will include that, given the general skepticism of big government. But it’s not coming together very quickly as a philosophy.
Good blog! I don’t doubt progress comes in waves. What triggers it is probably a good story.
There is a lot more to say about waves and progress, but it’s very easy to get really far into the weeds with this. I struggle with that all the time.
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