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拙林:【The Storm Before The Calm】PART_II: American Cycles(4): Socioeconomic Cyc ...

2021-2-25 02:28 PM| 发布者: 昨夜雨| 查看: 844| 评论: 2|原作者: 拙林|来自: 小站空间

摘要: 继续第七章对第三到第五个社会经济周期的分析。PART TWO: AMERICAN CYCLESChapter 7: The Socioeconomic CyclesThe Third Socioeconomic Cycle: The Hayes Cycle, 1876-19291. As with Jackson's election, the elec ...


Chapter 7:  The Socioeconomic Cycles

The Third Socioeconomic Cycle:  The Hayes Cycle, 1876-1929

1.  As with Jackson's election, the election of Rutherfold B. Hayes was chaotic and full of charges and countercharges.  The 1876 election is considered one of the dirties and most tumultuous in American history.  Hayes received few votes than his opponent, Samuel Tilden, but won in the Electoral College.  He was charged with stealing, which was not an irresponsible claim.  However he was elected.

2.  Two core technologies emerged during this period.  First was electricity, and the second was the invention of the internal combustion engine.  Industrialization was now transforming everyday life, and the appetite for new technologies created a hunger for capital.

3.  Hayes and his Treasury secretary, John Sherman, a much more significant figure, chose to stabilize the currency in a different way than Jackson had done.  Hayes's problem was a currency that had lost all confidence at a time when investment in industrialization was essential.  Therefore, Hayes chose to back it with only gold.  

4.  A gold standard introduced rigidity, but it also installed confidence.  This encouraged individual to deposit their money into banks, and investment began to flow rapidly into industrialization.

5.  A gold standard also tightened the money supply.  It hit the poorer farmer who had trouble getting the credit they needed.  Poorer farmers were being forced out, and wealtheir farmers and small-town businessmen were able to acquire foreclosed farms at a discount.

6.  The small town, which had begun to emerge in the Jackson era, became the social foundation of this new era.  It enforced moral behavior, including the most important virtues:  frugality and hard work.

7.  English had distrusted the Scots-Irish, and farmers distrusted small-town merchants and bankers.  Farmers lived through labor, whereas the small town lived by trade.  This was a crucial social distinction.  It was also a culture and moral difference.  It was a normal process for the dominant class of the existing era to distrust the rising class and ethnicity of the forthcoming era.  So those in small-town America deeply distrusted the large, flourishing industrial cities.

8.  The gold standard was generating massive investment.  By 1900, the United States was producing half the manufactural goods in the world.  For most of the third cycle, the Unites States was rapidly expanding its production and increasing its consumption.   (by 1890, 美国的GDP超越英国,成为世界第一。 --- 拙林注)

9.  WWI set the stage for the problem that would force a cyclical shift.  Massive industrial growth created a desperate need for customers.  WWI destroyed customers.  Giving the global economic situation, it is impossible to sustain the level of production that was constantly increasing between 1922 and 1927.  Reflected in the irrational rise of the stock markets, a crisis was inevitable.

10.  Hayes successfully propelled the American economy upward, but the same solutions that permitted the surge could not solved the problem posed by the Depression.  Hayes had succeeded in generating massive investment through a stable currency.  But the problem was that he had succeeded too well.  The industrial plant of the United States outstripped the ability of the American and global markets to consume what it produced.  Increasing savings would not address the problem.  The solution was to increase consumption.  But the strategy of the third era focused obsessively on encouraging investment.  Encouraging consumption so as to utilize existing capacity was outside the framework of the era.

11.  This era had been built around the gold standard and frugality.  The ideology of frugality, the interests of factory owners, and the availability of surplus labor via immigration inevitably suppressed wages.  With wages stagnant and production increasing, the system went out of balance and finally, in 1929, went into a deep crisis.

12.  Hoover was caught in a failed era.  The assumption was that hard work and frugality would solve economic problems.  It was assumed that unemployment was the result of the lack of work ethic of the jobless and if that was fixed they would go back to work.  The model of the current era simply didn't work any longer.  Herbert Hoover joined John Quincy Adams and Ulysses Grant as the final, failed president of an era.

The Fourth Socioeconomic Cycle:  The Roosevelt Cycle, 1932-1980

1.  The election of 1932 forced Hoover out and elected Franklin Roosevelt.  He actually had no clear plan, but he knew he couldn't do what Hoover had done.  The solution was to create jobs, even make-work jobs, in order to get the money into the hands of the workers.

2.  Intense political instability proceeded the election.  Throughout the 1920s, there was significant activity on the Left, including Communists.  The Ku Klux Klan had become increasingly powerful not only in the South but in the North as well.

3.  The social foundation of this era was an urban industrial working class.  They were either already organized or organizing into labor unions, which were allied with big-city Democratic machines.  They demanded transfers of wealth.

4.  Roosevelt's policies were both necessary and insufficient.  The imbalance between productive capacity and demand kept factories idle and the workers unemployed.  WWII finally ended the Depression.  The United States went from having a labor surplus to having a labor shortage.  The war achieved what the New Deal intended to achieve.  It eliminated unemployment and brought factories to full production.

5.  The war also created a tremendous amount of pent-up demand, because civilians goods were in short supply or not being produced at all.  That resulted in a great deal of cash being placed in the hands of consumers who could not spend it during the war.  Demand was there, factories were there, one additional thing was needed.  That was consumer credit.

6.  The postwar era saw the increase not only in mortgages but in consumer credit for other products, such as automobiles.  This evolved into credit for virtually everything via the credit card.  The underlying principle was the founding principle of the cycle.  Put factories to work by increasing demand.  Jobs were one step.  Consumer credit was the logical next step and the one that sustained the economy.

7.  Technocrats are a class that is built around the principle of pragmatism.  Getting the job done, whatever it is, is the art of the technocrat, and as they demonstrated in WWII, it was a powerful art.  After WWII, they spread to manage not only business but government and other spheres of American life.  The vast industries that had emerged during the Hayes era now came under the control of the technocrats.

8.  Technocracy is a critical concept necessary to understand the last and next socioeconomic crisis.  A technocrat is someone who has expertise in a certain area and credentials to certify that he has that expertise.  In a way technocracy might simple be considered merit.  They represented a moral principle of efficiency.  They rose in Roosevelt era and became powerful in the Reagan era.

9.  The concept of Roosevelt and Keynes worked extraordinarily well between 1945 and about 1970.  It was a period of prosperity.  

10.  In 1970, we saw the first indication of the termination of the cycle, when a small wave of inflation hit and Nixon put a wage and price freeze on the economy to stabilize it.  Any slight possibility of this working disappeared in 1973, when the Arab countries placed an embargo on the sale of oil to the United States following the Arab-Israeli War.  That accelerated both inflation and the process of economic deterioration.  

10.  The solution to this depression became the next problem.  The fourth era focused on high rates of consumption over investment.  Further complicating this were high tax rates imposed on the upper income brackets.  The tax rate on income over $250,000 was 70%.  Wealthy investors saw little reason to invest when success would cost 70% of the gain.

11.  As a result of the oil embargo, inflation surged.  But underneath this problem was a deeper one.  High demand had hidden an underlying problem with the industrial plant.  It had aged, and the reluctance to invest curtailed the availability of capital to renew in the industrial base.  Countries like Germany and Japan, defeated in WWII, had many newer factories and produced more efficiently than American factories.  They entered the U.S. market and took advantage of the credit-driven consumption.

12.  The demand for money was high, both from consumers and from business.  But the propensity to invest was low.  The natural impulse of this era was to try to increase consumption.  The big problem with doing so was that U.S. factories were increasingly inefficient.  Increasing demand drove up the purchase of foreign goods.

13.  All of this was preceded by massive political instability beginning twelve years before the defining election of 1980.  In 1968, Robert Kennedy was murdered, along with Martin Luther King Jr.  Massive riots broke out in Chicago during the Democratic National Convention.  National guardsmen shot demonstrators at Kent States University in 1970.  In 1974, Richard Nixon resigned after a wrenching crisis.  As usual, the end of a cycle and the beginning of a new one were marked by political uncertainty, sometimes beginning more than a decade before the transition.

14.  The result was the crisis of the 1970s, when inflation reached double digits, unemployment surged, and interest rates were astronomical.  Jimmy Carter had been elected president in 1976 and faced a full force of the capital shortage.  His response, of course, was drawn from the Roosevelt era.  The problem he was facing was a shortage of capital and excessive demand forcing up prices and utilizing inefficient plants.  What had made sense in the 1930s made little sense in the 1970s.  Carter joined Hoover, Grant, and Adams in the role of president over the last phase of a cycle.

The Fifth Socioeconomic Cycle:  The Reagan Cycle, 1980-2030

1.  The Reagan cycle solved the problem of capital shortage by shifting the tax structure.  Reducing taxes on the upper, investor class freed up money for investment.  The result was a burst of investment in aging factories designed to modernize them and reengineer their management.  Alongside this came a burst of entrepreneurial activity, heavily focused on the microchip.  It was an expansion that would dominate the American, and global economies until the 2008 financial crisis.

2.  The Roosevelt cycle corporation, symbolized by General Motors, had been an efficient organization for much of that period.  But its ability to grow declined.  General Motors searched for other way to maintain growth.  One was GMAC, which evolved into an enormous financial institution.  It generated more profits than vehicle sales did.  General Motors became so diffuse and entangled in so many industries that it could not compete in the core market with Japanese and German companies, all of whom had much newer industrial plants and intense focus on their main product.  GM had to be reengineered. 
3.  The price of the increase of efficiency was a loss of jobs, particularly industrial jobs.  Efficiency was created in two ways.  One was organizational and technical; the other was in relocating factories to areas with lower costs, like China, or permitting exports from those countries.  Both were designed to make the economy more efficient, but that result in needing fewer industrial workers.

4.  At the same time, a revolution in the American economy was taking place.  The microchip technology and a new wave of entrepreneurship combined to further disrupt the economy while creating a magnificent new economy and culture.

5.  The theory of free trade is that it increases the wealth of nation.  Left open are two questions.  First, how long will it take to achieve this end?  Second, how will the increased wealth be distributed?  In the abstract theory of the free market, those who lose their jobs as economic revolution takes place, are a part of the price that has to be paid.  In the real world, the reality is that this process can destabilize important and powerful sector of the economy.  That's what happened, but it became a political reality in the middle of the second decade of the twenty-first century.  

6.  As in previous cycle, the problem was that the victims kept growing at the same time as the economy surged.  The middle class currently can barely afford a middle-class life.  Ironically, this deterioration occurred during one of the major booms in American history.  GDP started growing faster than median household income in the early 1990s, and the gap widened throughout the rest of the Reagan cycle.

7.  It was not the inequality that was important.  American had always accepted inequality.  It was the material standard of living that the middle-class expect to enjoy that mattered to them.  Owning a home and two cars and taking an annual vacation have been the definition of middle-class life and of the American dream.  In the 1950s and 1960s, this was possible for the lower-middle class as well as the middle class.  By the middle of the second decade of the twenty-first century, it was barely in the reach of some with the median household income and not at all in the reach of the lower-middle class.

8.  Total wealth had increased, but it flowed away from the industrial workers and toward those who worked in finance, technology, and other area that now constitute the upper-middle class.

9.  The Reagan cycle succeeded so well that there is now a massive surplus of capital.  Interest rates, which had been extremely high at the beginning of the cycle, plunged later.  Unfortunately, this does not make the money easily accessible to small business.  The financial crisis of 2008 result in extreme caution at any interest rate.  Thus, there is a combination of limit money for small business and excess money chasing fewer investments as the microchip era matures.

10.  The dislocation of industrial workers, couple with the damage done to prudent savers by low interest rates, has begun to generate an economic crisis.  Inevitably, there follows a social crisis.

11.  The new economic crisis flows from the very success of the Reagan cycle, which generated a great deal of wealth but distributed it in the end, as it did in the beginning, with a focus on investment.  But as with all cycles, the problem solved in the currently cycle generates the problem to solve in the next.  The social problem that flows from this economic crisis is the tension between the declining class and the technological class.

12.  In laying out these five economic cycles, I have tried to show the broad cycles that have forced the evolution of the United States.  But another point is that these cycles work in similar ways.  The prior cycle reaches a failure point, political crisis break out, starting as much as a decade before the crisis demands a solution.  New social forces emerge and mature, dividing the country in new ways.  The economy enters a period in which economic dysfunction becomes unbearable to one social faction, even while another continues to benefit.  The old social order had contempt for the new one, believes that the future should be a continuation of the past.  The new social order demands a radically different approach.

13.  It is always a time of tension and mutual loathing that appears to be tearing the country apart.  The last act of the decaying era is the election of a president utterly committed to the principles and practices of the prior era.  After this presidency, a new president is elected who, because of either understanding or simply reacting to reality, dramatically shifts the economic policies of the old era and begins the extended process of cycling in a new era.

14.  This is the process that we are living through at the moment.  The Reagan era has reached its limits and can't sustain the economy.  The failure is in the process of creating a new set of competing social classes.  This is reflected in the intensifying political crisis of the Trump presidency, in which the new social forces begin battling each other.  This crisis will last through to the 2020s.

15.  And finally, in the 2030s, a new cycle will emerge.  Over the following few years in the 2030s, the political confrontation, social tension, and economic dysfunction will be solved.  The cycle will have created a new era, different from the past but built on the same foundation of invention, and it will endure for another half a century.



引用 2021-2-26 12:02 PM
阿理郎: 先问侯一下你们那里最近的寒潮吧,既然有心思上来贴文章,估计日子还过得下去。
谢谢问候。  我们还可以,停了2天电和网,半天水,基本没有什么损失,没网的日子就拿来读书练字 。  水管没爆很幸运了。
引用 2021-2-25 10:34 PM



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