Why doomster stories are so popular: we want to believe America is doomed

Summary: Yesterday’s post examined widely believed reasons that America will fall, and debunked them. This post discusses why such doomster narratives have become so popular and widely believed. The answer explains much about Campaign 2016.

Independence Day at the White House

This is follow-up to follow-up to The big list of reasons why America will fall (with rebuttals). It examined “The US Position is Untenable” by Karsten Riise, an unusually comprehensive doomster rant. The rising US public debt will crush the US dollar! The US is not competitive! The US has a weak education system! The US middle class is dying! We can’t raise taxes on the rich! America’s poor at risk of starvation; they just need more education! America’s military grows weaker! The US economy is unsustainable!

A few of these are partially correct. Most are exaggerated, or describe global problems (hence not a cause of relative decline). Some are outright wrong. But all of these are popular complaints, as it the overall doomster narrative.

Yesterday’s post discussed the objective accuracy of these claims. Today’s looks at their subjective truth, asking why these — and the overall doomster narrative of national decline — are so popular. The answer explains the unexpected strength of the Trump and Sanders insurgencies (see their overlapping views).

The first subjective truth: life at home

Many Americans feel the national doomster narrative is true because they see it in their own communities and in their own lives. America is filled with ruined communities and families with broken hopes, despite the nation’s fantastic growth in wealth since 1971.

Continue reading

The big list of reasons why America will fall (with rebuttals)

Summary: Here is a compendium of gloomy news about America, the news that drives political campaigns, fear-mongering op-eds, and advertisements for guns and gold. These stories cloud our minds with misinformation and dampen our spirits. Why are they taken seriously by so many people? Debunkings like this are the only antidote. Pass it on! Tomorrow’s post will discuss why doomsterism is so popular in America today.

America at the end

Continuing our series about doomster forecasts, today’s post examines an unusually detailed prediction of doom for America. Like most doomster writing, the content is almost entirely exaggerated or wrong, but it shows us people’s fears and ignorance — both largely fed by propaganda. The author’s key points are given in quotes.

The US Position is Untenable
By Karsten Riise at Martin van Creveld’s website.

(1)  The rising US public debt will crush the US dollar

“The CBO analysis shows that Federal debt is on path to increase from 75% of GDP to 146% of GDP in 2046. …such high public debt figures are bound to lead to a fundamental crisis of non-confidence in the US dollar.”

Riise starts with the usual doomster favorite (as it has been since the New Deal): the US fiscal deficit. The wolf will always be at the door in 30 years! This is from the CBO’s 2016 Long-Term Budget Outlet. Also see the CBO’s slide deck.

Federal spending, revenue, and debt

These long-term predictions are useful planning tools, but range from unreliable to quite wrong. To treat them as indicators of certain doom is absurd. The many variables create a wide range of possible futures. In brief, the US government’s liabilities are among the easiest solved of America’s major problems (details here).

Continue reading

A new study shows why we are polarized about climate change

Summary: Slowly scientists’ investigations produce insights about the psychological and social dynamics that create our dysfunctional politics. Here is a new study about one of drivers of political polarization, that which keeps us divided (despite our common interests), ignorant (despite the internet), and easily ruled. The specific subject is one of the central political issues of our time, and among the most contentious: climate change.

The essential accessory for the modern politically-active fashionista…

People Blinders

Here is a provocative new study (not peer-reviewed) by blue-chip authors. It’s well worth reading, and reveals much about the polarization that is a defining characteristic of modern politics.

How People Update Beliefs about Climate Change: Good News and Bad News

By Cass R. Sunstein, Sebastian Bobadilla-Suarez, Stephanie C. Lazzaro, Tali Sharot.
Excerpt from the preliminary draft posted at the Social Science Research Network.

“People are exposed to a great deal of variable information with respect to climate change. {The footnote cites an example: “Developing a Social Cost of Carbon” (ungated copy) — whose complex and assumption-laden calculations are certainly “variable information”.} …We aim here to investigate two simple questions:

  1. How do people update their beliefs when they receive new information about likely warming?
  2. How do people’s prior attitudes affect their response to such information?

“…We find that people who are doubtful that man‐made climate change is occurring, and unenthusiastic about an international agreement, show a form of asymmetrical updating: They change their beliefs far more in response to unexpected good news, suggesting that average temperature rises likely to be (even) smaller than previously thought, than in response to unexpected badness, suggesting that average temperature rises likely to be larger than previously thought.  In fact, we do not find a statistically significant change in their views in response to bad news at all.

“By contrast, people who strongly believe that man-­‐made climate change is occurring, and who strongly favor an international agreement to reduce greenhouse gas emissions, show the opposite asymmetry: They change their beliefs far more in response to unexpected bad news, suggesting that average temperature rises likely to be even greater than previously thought, than in response to unexpected good news, suggesting that average temperature rises likely to be smaller than previously thought. People with moderate beliefs about climate change show no asymmetry.

Continue reading

Stratfor: Hanjin’s bankruptcy reveals much about the world economy

Summary: This cycle’s combination of slow growth and widespread overcapacity have taken another victim – global shipping giant Hanjin. Those who like exciting news turn to Zero Hedge and read “Global Supply Chains Paralyzed” and “Supply-Chain Contagion Arrives – ‘Global Trade’ Roiled, Cargo-Owners Panic“. Those who like accurate news turn to this report from Stratfor.


Shipping Giant Hanjin Has Hit a Rocky Shoal
Stratfor, 3 September 2016

Buffeted by overcapacity in the global shipping market, South Korean giant Hanjin Shipping Co. appears to be sailing toward oblivion. In the past week, creditors pulled the plug after 1 trillion won ($900 million) in support failed to keep the company afloat, forcing Hanjin to file for bankruptcy protection. Seoul Central District Court, which will decide the eventual fate of the company, has set a Nov. 25 deadline for Hanjin to develop another restructuring plan, but many experts think liquidation will be the most likely outcome.

In the short term, the company’s demise has temporarily raised some shipping rates, which have remained persistently low industrywide thanks to the sluggish global economy. It likely will also cause some supply disruptions during the peak season for orders of holiday goods.

But even if the company, the eighth largest by capacity in the world, finds an unlikely way out of its predicament, the underlying problems of overcapacity and sluggish global demand growth will continue to hamper the industry. In addition, the collapse of Hanjin deals another blow to the South Korean economy, which faces stiff competition in the high-tech market from rivals Japan and China.

Continue reading

The jobs report shows why so many don’t understand the US economy

Summary: Today’s job report show one reason we see our world so poorly — we read the news. Journalists and the experts who make headlines give us exciting stories of constant change. But the world usually changes slowly. Sometimes, as in this economic cycle, slow stable boring growth is the story. That generates no clickbait, so we get statistical noise magnified into thrilling news. People of bearish views (temperamentally, or because the “other” political party rules) read the stories of imminent collapse — and vice versa. And vice versa for the bulls. Both become entertained and ignorant.

What’s happening? Slow growth, with small fluctuations around the trend.

Change in Employment - MoM - August 2016

Excerpts, slightly paraphrased, from the Employment Situation Report for August tell the tale, as this slow expansion continues — frustrating both the bulls (boom soon!) and bears (recession now!).

  • Total nonfarm payroll employment rose by 151,000 in August, compared with an average monthly gain of 232,000 over the prior three months and 204,000 over the prior 12 months.
  • “Little movement over the year” in the unemployment rate, and the labor force participation rate, and in the number of unemployed and discouraged workers.
  • No change in the past year in the average weekly hours of production and non-supervisory employees in the private sector. Their average weekly earnings were almost unchanged during August, and rose 2.2% YoY.

Continue reading