Six-Chart Sunday – Crisis Consensus

6 Infographics + 1 Video (Neil Howe "The Fourth Turning is Here")

What a year this past week has been. Whether you think we are at last liberated or all is lost… whether Trump has paused or is pivoting… whether we’ve hit a bump in the road or something fundamental has broken… many observers believe we’re headed for a serious crisis.

I’m a big fan of the work of economists, analysts and scholars who scrutinize history for patterns and cycles that might better explain current & future trends. What’s been worrying me for some time, and was summarized pithily by my friend John Mauldin last winter, is how many of these independent analysts – often writing years apart, many decades before the Trump Era - each separately concluded America will face a major crisis (or crises) in the second half of the 2020’s.

Here’s a look at the crisis consensus.

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1. Samuel Huntington. Summarizing the writings of historian Samuel Huntington, David Brooks wrote: “American history is driven by periodic moments of moral convulsion… These moments share certain features. People feel disgusted by the state of society. Trust in institutions plummets. Moral indignation is widespread. Contempt for established power is intense…. A highly moralistic generation appears on the scene. It uses new modes of communication to seize control of the national conversation. Groups formerly outside of power rise up and take over the system. These are moments of agitation and excitement, frenzy and accusation, mobilization and passion. In 1981, Huntington predicted that the next moral convulsion would hit America around the second or third decade of the 21st century—that is, right about now.” (Chart from my 2021 “Crossroads” deck)

2. George Friedman. “American history must be viewed in cycles—particularly, an eighty-year ‘institutional cycle’ that has defined us (there are three such examples—the Revolutionary War/founding, the Civil War, and World War II), and a fifty-year ‘socio-economic cycle’ that has seen the formation of the industrial classes, baby boomers, and the middle classes. These two major cycles are both converging on the late 2020s—a time in which many of these foundations will change. The United States will have to endure upheaval and possible conflict, but also, ultimately, increased strength, stability, and power in the world.”

3. Neil Howe. “History is seasonal, and winter is coming.” That was the warning issued in 1997 by “generational theorists” Howe and William Strauss as they laid out a provocative theory: Americans experience a new social mood or “turning” every 20 years or so, when each new generation comes of age. And every “fourth turning”—that is, every 80 to 100 years—Americans push their society through an urgent, divisive, even violent era of public mobilization and civic upheaval in which their nation is essentially reborn. They foresaw a “crisis era” climaxing in the 2020’s with a “great devaluation” in which “real hardship will beset the land, with severe distress that could involve questions of class, race, nation, and empire.”

4. Ray Dalio. “The world order is now rapidly shifting in important ways that have never happened in our lifetimes but have happened many times before in history. What follows here is an ultra-distilled description of the dynamics that I saw in studying the rises and declines of the last three reserve currency empires (the Dutch, the British, and the American) and the six other significant empires over the last 500 years (Germany, France, Russia, India, Japan, and China), as well as all of the major Chinese dynasties back to the Tang Dynasty in around the year 600…. I believe that we are now seeing an archetypal big shift in relative wealth and power and the world order that will affect everyone in all countries in profound ways.”

5. Jack Goldstone & Peter Turchin. “In Ages of Discord, published early in 2016, we showed that America’s ‘political stress indicator’ had turned up sharply in recent years and was on track to send us into the ‘Turbulent Twenties.’”

6. The Mandate-Overreach Cycle. (This one’s less a “crisis” than a consistently-recurring cycle). When Presidents fail to deliver what voters elected them to do (aka their mandate), they pay a price. A major question facing President Trump in 2025 is whether his tariff policies will lower prices (what he was elected to do) or raise them… and whether DOGE efforts to “purge the deep state” and make government more efficient (mandate) will instead undermine essential services such as social security, air traffic control or drug/food safety.

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Live discussion Derek Thompson tomorrow… Monday 4/14 @ 4pm ET… Register HERE

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VIDEO

I had the chance to discuss the coming crisis and subsequent new dawn with aforementioned generational theorist Neil Howe. His 2023 book is brilliant history & fascinating sociology.