Saturday, May 7, 2016

The Fall of the Modern Order

The Recovering Bureaucrat has been amazed if not dismayed at the banality of most commentary on the anomalous popularity of Donald Trump and Bernie Sanders over the past ten months.  Americans are not known for our depth of historical knowledge and appreciation, but the reactions of most of our clerisy on both sides of the alleged political divide must surely set a new record for shallowness and inaccuracy.

While the RB is sure there are more than a handful of people grasping the immensity of what we are experiencing, to date he has found only Walter Russell Mead and his analysis of the “blue social model” and the anonymous authors of the Journal of American Greatness offering any exploration in depth of the historical currents that have carried us to this moment.

Something has been demonstrably afoot since we Americans twice elected Barack Obama, a committed purveyor of postmodern statism, whose public philosophy—like that of an earlier Democrat president, Woodrow Wilson—is an explicit rejection of America’s founding principles of limited government, individual sovereignty, and rule of constitutional law.  It was a tentative seal of approval by the body politic of a collective turning away from the philosophy and institutions that made America great and unique, and toward embrace of a more nebulous, inchoate taxpayer-fed security blanket mimicking European social democracy.

The RB says “tentative” because each election of Obama was followed two years later by an electoral version of buyer’s remorse in which we first gave and then increased the Republicans’ control of Congress.  Even so, the Republicans did little with this power beyond occasionally limiting Obama’s post-American adventurism.  But regarding his signature policies like Obamacare and the “deal” with Iran, the Republicans showed almost no adroitness or strategy in opposition.

This occurred in part because the push-back was almost entirely led by the Tea Party, a spontaneous grassroots movement, which from the start was public in its disdain for the Republican “establishment.”  From 2009 forward, a large portion of the electorate began to become aware that their mutual unhappiness with the state of affairs did not solely derive from their opposition to the “progressive” proclivities of the Democrat establishment.  Although self-identified Tea Party adherents never numbered a majority of the GOP caucus in either the House or the Senate, they did accumulate enough members to constitute a veto on the get-along, go-along tendencies of their leadership but rarely enough to impose their will.

But it wasn’t just on the “right” that mass unhappiness was making its presence known.  A decade earlier, the “left” was beginning to organize against what many of its adherents saw as an ever-growing concentration of political power in what they eventually labeled “the 1%.”  The street protests in Seattle in 1999 against the World Trade Organization’s meeting to negotiate a new round of international trade deals were evidence of something new emerging among the ever-restless social justice warriors of the nation.

From the WTO protests to the huge anti-war rallies (not only in America but across the globe) against the Iraq war that eventually morphed into the “Occupy Wall Street” movement, its target ceasing to be simply the evil Republicans but, with a greater sophistication, the perceived bipartisan political-financial power axis of Washington and Wall Street.  Still, the "President from Goldman Sachs" and his first Secretary of State remained firmly in thrall to the "progressive"/rent-seeker axis that was determined to maintain the blue social order at all costs.

Thus by the 2010 elections large numbers of voters on both ends of the spectrum had begun to peel off from allegiance to and trust of the two traditional political parties.  It would be useful to understand why.

For those few of us conservatives left guided by the insights of Edmund Burke, history necessarily plays an irreplaceable role in the configuration of the present.  To fail to understand history is to be completely at sea about what’s happening now.  This applies equally to nations and humanity as a whole as it does to individuals.

The period we’ve entered since 1989 when the Soviet Union surrendered its eastern European empire is characterized by the complete reorganization of the global economy via the invention and application of information technology.  It is impossible for most us, even though we’ve been living through it, to grasp how disruptive the introduction of the computer and the rule of Moore’s Law has been to our society.  The internet of things, just to name a salient example, has all but taken over management of the economies of the Advanced Sector, and will soon do so in China and then India.  We are also bound together through the application of GPS in millions of items large and small.  At the same time, continuous improvements in nanotechnology, biogenetics, and 3-D printing—to name but a few—are poised to promote even greater disruptions of the way we live and do business.

Undergirding and impacting the chaos of this reorganization of our political economy is our total inability to repeal the exigencies of the business cycle.  We still have not, after several centuries of a modern system, been able to sync the productive economy with the financial system essential to its functioning.  Money and currency formation and investment still refuse to track efficiently with the creation of actual—as opposed to fictitious—wealth.  From time to time the divergence between the two creates bubbles of sufficient expanse that a retrenchment is necessary for the actual economy to function, and boom! another recession ravages our economy.  (They used to call them “panics” in the eighteenth century; bad branding.)

We humans have experienced something similar to this period in the past century or so, and it might be worth revisiting it if only to glimpse both the magnitude of the problem and the impossibility of any organized way to impose order on a transformation of a fundamental nature.


Lessons of la Belle Époque and World War I

The forty years leading to World War I, starting with the collapse of the Second French Empire and the unification of imperial Germany in 1871, saw the full emergence of the modern, industrial economy in central and western Europe, as well as in the United States and Japan.  The disruptions of modernity to the agricultural, aristocratic order that had prevailed universally across the globe since the end of the Great Ice Age were perhaps even more spectacular and alarming to humans than the disruptions of the postmodern Information Age are to us today.

By 1870, only Great Britain, Holland, and the U. S. were fully modernizing via industrial manufacturing and distribution.  Bismarck’s unification of the various German states under the Hohenzollerns, and his taming of his French rivals, created a secure foundation for Germany to catch up—and catch up it did.  The swift emergence of a mighty empire in central Europe challenged the French and the Russian governments to encourage their own industrial development.

The wealth created by these new policies not only spurred a rapid increase in these countries’ per capita income and wealth, it generated a social surplus capable of financing an escalation in the size and quality of their military and naval forces.  The arms race was also a feature of the European determination to expand imperial holdings in Africa and Asia.  Internally, the exponential expansion of industrial centers acted as a powerful attractor to draw millions into major urban centers from the countryside, thus swiftly overwhelming the existing physical and social infrastructure of these cities. 

These dynamics simultaneously put enormous strains on existing political structures, designed as they were over centuries to support relatively stable and static aristocratic power relations both internal and external.  Agitation for greater political participation, inspired by the American model, increased with the expansion of the middle and working classes.  Mass parties began to emerge to represent these new social expressions.

In the meantime, significant discoveries in the physical sciences kept pace with the expansion of wealth.  Every feature of our environment became an object of inquiry, from the vast universe beyond our skies to the microscopic and even subatomic realms.  Expressions in music, painting, and literature similarly explored novel and/or unfamiliar themes and perspectives.  Education and literacy were accessible by the masses.  To the average European it must have seemed a dizzying, if not frightening, time.

The political and economic elites were, not surprisingly, relatively clueless about the mega-trends and dynamics they were experiencing.  Barbara Tuchman captures a bit of their disorientation and their scrambling to deal with the ever-surprising developments that modernity had unleashed in The Proud Tower.  The stable and predictable world they thought they knew was producing surprises in increasing numbers and complexity.  By the time world war broke out in the late summer of 1914, nobody was more astonished than the European establishment.

Someday some historian may write The Proud Tower II to similarly describe the disarray and confusion our elites and their clerisy are experiencing today.

Since the end of the Cold War and the decade or so of a general Pax Americana abruptly guillotined by Osama bin Laden in 2001, the dynamics of the Information Age economy have exponentially spread first through the Advanced Sector and now China, with India consciously striving to reach its own tipping point.  The disruptions engendered by these are of a similar degree to those that modernity imposed upon aristocratic, agricultural Europe after the Treaty of Frankfurt in 1871.  Only now our world is exponentially more interdependent—not to mention inhabited by another 5.8 billion of us.  The amount of chaos and dislocation that we 7+ billion can create is unimaginably immense—and here we are.

Ray Kurzweil and other postmodern futurists have documented a possible trajectory of our unfolding bedlam; the point to be grasped is that if we have a sense of the blind being led by the blind, why should this be a surprise?  In late July of 1914 almost no one either in power or on the streets of Paris, Berlin, or Vienna had the slightest inkling that within weeks millions would be on the march and that, within four short years, millions would be dead, empires would be pulverized into historical dust, and new horrors—and opportunities!—would now set the pace.  The parochial factors that convinced the Archduke Ferdinand to visit Sarajevo that hot summer day seemed unconnected to the furies about to be unleashed, yet it turns out that they were.


It's Not Trump or Sanders, Stupid

So today as Barack Obama, the Clintons, the grandees of Goldman Sachs, the GOP’s Washington establishment, and their clerisy in the mainstream media look around, they must feel a little like the Marquis of Salisbury, Arthur Balfour, and their Tory allies peering out anxiously at events in Birmingham or Manchester; or Nicholas II, Pyotr Stolypin, and the Russian oligarchs eyeing the Petrograd Soviet; or Wilhelm II, Theobald von Bethmann-Hollweg, and their Junker colleagues wondering what the SPD were up to in Hamburg or the Saar.

It must seem to our esteemed rent-seeking establishment that the barbarians are approaching the gate, led by the vulgar Trump and the sanctimonious Sanders.  The great unwashed masses, for different reasons on the left and the right, are showing with votes that we no longer trust our political economic institutions, created as they were in the aftermath of World War II to support a modern industrial economy that hasn’t characterized the U. S. since the days of Ronald Reagan. 

They cannot understand why people would rally to the standards of such flawed tribunes.  For all the insights into psychology that we humans have discovered since the days of Baldwin and Freud, we appear to have learned little of value to the practical challenges of self-government. 

We are well into a period of transformation that started with the invention of the transistor in the late 40s, now driven by decisions made on a daily basis by billions of people in a global economy that has yet to create effective and liberal institutions that provide a sound foundation for our postmodern, post-industrial Information Age political economy.  It is trial-and-error writ large, and as in the last years of la Belle Époque, complacency is a wasted luxury.  To focus on Trump and Sanders as if they were conventional political figures in a now-bygone era is as big a blunder as for the Habsburgs to plan a trip to Sarajevo as if the Black Hand and Serbia would fail to notice.

Trump and Sanders are the symptom, not the disorder.  And the disorder can no longer be controlled by the rent-seekers who dominate the American political establishment, striving mightily to defend their position. 

The voters storming the gates via these candidates are, of course, equally clueless about the nature of, and the dangers and opportunities in, the forces they are pushing and being pushed by.  All they know is that things are out of whack, and that they desperately want some dependability back in their public institutions.  They are aware in the back of their minds of the ticking time bomb that is the exponentially mounting public debt (from $10.6 trillion when Obama took office to $19.2 trillion today) and of the potential devastating impact of the off-the-books Quantitative Easing debt that no one can authoritatively measure.  They are aware that the Obama rent-seeking policies—underwritten to a great degree by the Republican Congress—have rewarded Wall Street to the disadvantage of Main Street. 

Whether this has been the result of greed, ignorance, and/or desperation will be for future historians to sort out; we are stuck with the results of these decisions regardless.  What we are witnessing is the collapse of the modern order, and the birth pangs of whatever comes next, guided in large part by the discoveries and breakthroughs of the postmodern era.

If history is any guide, the one thing we can say for certain is that we are bound to be surprised, over and over and over again, for the foreseeable future.  Keep your seat belts fastened and your heart open.  We will be sorely challenged to let the better angels of our nature prevail in such turbulent times.

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