Campaign 2020 ignores the big threats to America

Larry Kummer, Editor

7 years ago

Summary: Why does Campaign 2020 generate sparks – infotainment! – but so little vision? America faces serious threats. Too bad most are ignored by the candidates. We can change this – if we try.

“We did not come to fear the future. We came here to shape it.”
— Barack Obama’s State of the Union speech to Congress on 9 September 2009.

Photo 81958892 © Eziogutzemberg – Dreamstime.

About our strange elections

“A country’s thinking lies in ruins before the land is ruined.”
— By Franklin Nathaniel Daniel Buchman in his “War of Ideas” speech on 15 August 1945.

The Democratic Party’s presidential debates discuss issues that excite the Left and offer the potential for them to gain power over America. A generation from now, I suspect that Americans will wonder why the 2020 campaign ignored the big issues facing America.

(1) We are the big cause of America’s problems.

We are a nation of three hundred million, collectively the richest in the world. Largely well-educated, with an adaptive and entrepreneurial society residing in a land richly blessed with natural resources. Our history is that of a skeptical and unruly people, fiercely protective of their liberties. There should be no obstacles to our governing America in peace and prosperity.

Unfortunately, something changed during the past generation or so, for mysterious and perhaps unknowable causes. We have become a weak and gullible people. People easily manipulated by propaganda, and easily led by our fears. We are a gift to our ruling elites, competent folk who see our weakness and exploit it. That’s the great circle of life.

We see our fears used by both Left and Right. As time passes some of these threats evaporate; new ones emerge to replace them. Only our fear remains constant. It is now turning into hatred, as has happened so often in history. Our elections are stages on which these irrational fears and hatreds duel, with low odds of outcomes that benefit America.

“No passion so effectually robs the mind of all its powers of acting and reasoning as fear.”
— Edmund Burke in A Philosophical Enquiry Into the Origin of Our Ideas of the Sublime and Beautiful (1757).

(2) Climate Change.

“We don’t even plan for the past.”
— Steven Mosher (member of Berkeley Earth; bio here), a comment posted at Climate Etc.

The IPCC and the major climate agencies have warned about the potential for anthropogenic global warming to cause climate change effects ranging from small to large. But nothing like the doomster predictions of the activists of the Climate Emergency movement – let alone the Extinction Rebellion extremists. Both groups ignore the uncertainties: the uncertainties in our understanding of climate dynamics, in the models that make the predictions, in the future development of technology, and in the unknowable future public policy actions we take.

The guild-like behavior of climate scientists and climate extremists’ exaggeration and misrepresentation of climate science all make a rational public policy response almost impossible. The elections debates are a cacophony of nonsense.

It need not be like that. I recommend reading the important things to know about climate change, with recommendations that would have broad support. See all posts about climate change, and especially these.

(3) The robot revolution.

The next wave of automation is already beginning. Every day we ignore it reduces our ability to prepare. We have been warned.

I am no fan of Jeremy Rifkin, but his 1995 book was a prescient attempt to grapple with the problem: The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era — He advocates a kind of socialism as the solution. From the publisher …

The effects of automation were visible to some people long ago. One of the first was James Blish, as in this his A Life for the Stars (1962), the second of his Cities in Flight series. This passage describes what New York might look like in the late 21st century.

“The cab came floating down out of the sky at the intersection and maneuvered itself to rest at the curb next to them with a finicky precision. There was, of course, nobody in it; like everything else in the world requiring an I.Q. of less than 150, it was computer-controlled.

“The world-wide dominance of such machines, Chris’s father had often said, had been one of the chief contributors to the present and apparently permanent depression: the coming of semi-intelligent machines into business and technology had created a second Industrial Revolution, in which only the most highly creative human beings, and those most fitted at administration, found themselves with any skills to sell which were worth the world’s money to buy.”

Jeremy Rifkin is a Jeremiah of our time. But just as a stopped clock is right twice a day, he scores occasionally – as in The End of Work: The Decline of the Global Labor Force and the Dawn of the Post-Market Era (1995).

“The Information Age has arrived. In the years ahead, new, more sophisticated software technologies are going to bring civilization ever closer to a near-workerless world. In the agricultural, manufacturing, and service sectors, machines are quickly replacing human labor and promise an economy of near automated production by the mid-decades of the twenty-first century.

“The wholesale substitution of machines for workers is going to force every nation to rethink the role of human beings in the social process. Redefining opportunities and responsibilities for millions of people in a society absent of mass formal employment is likely to be the single most pressing social issue of the coming century. …

“We are entering a new phase in world history-one in which fewer and fewer workers will be needed to produce the goods and services for the global population. The End of Work examines the technological innovations and market-directed forces that are moving us to the edge of a near workerless world. We will explore the promises and perils of the Third Industrial Revolution and begin to address the complex problems that will accompany the transition into a post-market era. …

“In the past, when new technologies have replaced workers in a given sector, new sectors have always emerged to absorb the displaced laborers. Today, all three of the traditional sectors of the economy agriculture, manufacturing, and service – are experiencing technological displacement, forcing millions onto the unemployment rolls.

“The only new sector emerging is the knowledge sector, made up of a small elite of entrepreneurs, scientists, technicians, computer programmers, professionals, educators, and consultants. While this sector is growing, it is not expected to absorb more than a fraction of the hundreds of millions who will be eliminated in the next several decades in the wake of revolutionary advances in the information and communication sciences….

“The restructuring of production practices and the permanent replacement of machines for human laborers has begun to take a tragic toll on the lives of millions of workers.”

To see the rest of this history, read 50 years of warnings about the new industrial revolution. It’s here. Ignore the naysayers. See all posts about it here.

(4) Demographics: the age wave.

The coming crash of US consumer spending as Boomers retire with high levels of debt, low savings, and small pension incomes. Experts have warned about this for decades, yet it will catch us by surprise. Eventually, we’ll confront the consequences, after so many warnings, of underfunded pension plans. Both public plans (see articles by Bloomberg and by CNBC and private plans (see this by Fitch). Our time to prepare is rapidly running out.

(5) The Debt Supercycle.

The dynamics of what Hamilton Bolton and Tony Boeckh of Bank Credit Analyst so long ago christened The Debt Supercycle is probably now entering its final stage. See the posts about it here.

It’s not just the burden of servicing the debt, and the eventual drag of repayment. An additional problem is the decreasing marginal elasticity of GDP with respect to debt, first identified in the mid-1980s by Maria Fiorini Ramirez (then an economist at Drexel). How much does GDP rise from an injection of another dollar of debt? This, the marginal impact of debt, has been dropping since WW2. The post-WW2 era will have ended when it reaches zero – which it might already have. We will learn more about this in the next recession.

(6) The new world of work

The structure of the employment market has changed as the corporations perfect a combination of operational methods and technology to reduce wages and prevent unionization. The new model is an outsourced, part-time, contingent, no-benefits workforce that spreads through the US economy. The gig economy is part of this. It is one of the large drivers of increasing economic inequality. See all posts about our high inequality and low social mobility, and especially these …

(7) The results of a low-investment nation.

After thirty years of slowing rates of investment by both the public and private sectors, we have a decaying public infrastructure and slow-growth economy. See all posts about economic growth, and especially these.

Special attention should be paid to the new Triangle Trade: Options to Stocks to Buybacks, funneling much of US corporations resources (not just free cash flow, but also borrowing) to senior executives (for many corporations, large and long-term stock buyback programs are offset by options issued to executives, so outstanding shares do not drop.

(8) There will be war.

Since Mao brought 4th generation warfare to maturity in 1950, it’s been the dominant form of war. Insurgents have an almost perfect record of defeating foreign troops – foreign troops by all kinds of nations. Until a defense is found, 4GW will continue to reshape the world. Neither of our big political parties has any interest in even thinking about these matters. See all posts about 4GW, especially these …

These and other threats put America at risk.

“National decay starts at the heart, and spreads like cancer.”
— Me.

We face so many serious threats. Yet our political campaigns revolve around minor or even imaginary threats – or proposals to take money from one group and give it to others. This posts describes only a few of our threats, and not necessarily the most serious ones. That we have so many is a symptom of a deeper problem: the forces making our institutions dysfuncational, so they are toppling like a row of dominoes. We have to retake the reins of America and begin the necessary deep reforms to put America back on a path to a secure and prosperous future. This election is an opportunity to take the first step.

See part two: How a candidate can win in 2020 with solutions for America.