Warning: The following is a longish post, and contains things some people might consider political. It takes no partisan positions. It is a commentary on the underlying conditions upon which politics and economics will proceed over the next generation. If you wish to avoid this kind of thing, stop reading now.

So, politics is going crazy right now and everyone is trying to figure out why. Have the Republicans lost their minds? Have the Democrats sold out their base? Is the US doomed? And what the hell is going on with Europe? And why are the Russians taking an interest in our elections (even throwing government resources behind it)?

What, in fact, are we in for?

Predicting the future is a mug’s game because, most of the time, it’s impossible to get right. But sometimes, you really can boil everything down to one single factor, and this time we can.

That factor?

Demography.

In my Brexit post I explained a bit about the world’s demographic problem. Long story short, almost every country in the world has more old people than young people, and that’s creating huge economic and social changes. Because this is a situation that humanity has literally never had to deal with before (it’s basically the cultural equivalent of suddenly needing to breathe water), it’s creating a bunch of problems.

In the US, though, we have a different problem, and this is one we’ve dealt with before:

We have a demographic bulge chasing hard on the heels of a lost generation.

Gen X is SO small compared to the Baby Boomers that we are just now reaching wage parity with where we “should have been” at this point, based on historical trends, and that’s only because the boomers are retiring (finally!) and freeing up higher paying jobs.

But coming up right behind us are the Millenials, and they’re almost as big as the Boomers were (in terms of percentage-of-population). What’s more, their relationship to us is very similar to the Boomers relationship to the Builder generation.

When you have demographic stutter like this, you get a couple things that are VERY culturally destabilizing.

    1. A generation gap
      Generation gaps–where the older people can’t even talk sensibly to the younger people because they inhabit different worlds–is normal when the younger generation is in their teens and still in high school. When there’s a demographic stutter, though, the effect persists into middle age.
      Generation gaps are culturally dangerous, because they create discontinuity–younger people don’t acquire a natural understanding of history or heritage or the way the world works, and older people–who wield power–become unmoored from the ground-level problems that their power exists to address. A stark generation gap creates a society where almost nobody understands what’s going on–and where almost nobody wants to.This causes gigantic political divides and major political restructuring. Read up on how the Democrats and Republicans basically switched sides along the cultural divide in the late 1960s (setting us up for the culture wars we’ve been living through ever since) for a taste of what that can entail.

From the realm of politics, the generation gap brought us the Civil Rights movement and women’s lib, but it also brought us the drug war (specifically designed as a tool to disenfranchise young people and keep black communities down), the New Right, the New Left, race wars, etc..

In the realm of culture, it brought us psychadellic rock, the summer of love, and New Hollywood–but it also brought us Charles Manson, Jim Jones, the Satanic Panic (a late effect of the same demographic shifts), and a whole bunch of other crap–some of which is still ringing in our ears today.

  1. A jobs gap
    Lots of twenty-somethings and not so many forty-somethings mean that there aren’t going to be enough jobs to go around. The Boomers marched like an invading army into the job market in lockstep between 1960 and 1975, and their entry into the job market created stagflation, declining wages, moribund unions, rising qualifications, and the general economic malaise that characterized the 1970s.
    And because there weren’t enough American jobs to supply the generation with money, the goods for them to live had to come from somewhere. So, cheap foreign cars (VW and Honda and Toyota), and cheap foreign consumer goods (Chinese and Japanese electronics and trinkets) had to flood in to meet the demand–and these cheap foreign substitutes very quickly developed a superior reputation to the American alternatives, which drove American companies out of business.
    Where once it was expected that wages in general would rise every year, suddenly they stopped. Benefits rose instead once job growth resumed (because benefits are taxed differently).
    And, during this pinch-period, you started needing things like a high school diploma to collect garbage, or a college degree to go into electronics. This isn’t because those jobs required those things–a smart person willing to learn can pick up what they need in on-the-job training–it’s because there were too many applicants, and hiring managers needed a way to quickly thin the herd.

We are currently somewhere in the middle of our on-lining of our next demographic bulge, which would, in historical analog terms, put us in the 1969-1971 era. Not all the fundamentals are the same, so the effects won’t be identical, but I think we can extrapolate a few things.

So, here are a few things that I’m fairly certain will happen, no matter who’s in power, over the next few years:

Wages dip, then rise, for Millenials
Millenials are doing to the job market what the Boomers did, but the effect is a little less pronounced because the economy is more diverse, so it’s hitting different sectors differently. Still, we should see flat wages and eternal ennui for Millenials through about 2020-2022, after which things will get a lot better.

Interest rates are about to go way up
The Boomers are retiring. That means they’re pulling their money out of the lending markets. By about 2020, they’ll be all-out, and interest rates will go from 0-3% to 6-9% for mortgages and other prime-tethered stuff. Your credit cards will get a LOT more expensive.

Taxes will also go way up
The Boomers are going to cost us a fortune in social security and medicare, and employees are going to pay for it with higher SocSec and income tax contributions.

There will probably be another European war
Russia has the opposite problem we do–instead of too many people, they have too few even to secure their own borders…unless they re-capture the Balkans and some of the East Bloc countries (that gives them the Caucus mountains on their border, which they DO have enough people to defend). That’s why they’re moving on Ukraine now. Expect the rest of the Balkans to come soon–they only have another five years before their army is too small to do the job.

Authoritarian Political Candidates and the Destruction of Political Parties
As a result, partly, of the generation gap, the major political parties are in disarray. It’s in the nature of humans (especially ones in middle age and over) to react to uncertainty and cultural fragmentation by looking for “strong leaders” who will “help people” and “preserve our failing culture/nation/ideals/etc.” so that’s what both parties are nominating.
On the other hand, it’s in the nature of younger voters to seek more libertarian candidates. Expect a major political re-alignment along two major axes: class (working class vs. upper and middle class) and power (authoritarian vs. libertarian). This will replace our old major alignment which was forged by different attitudes toward culture (race/gender equality/immigration) and the cold war (too much to fit into a parenthetical).

in the mid-to-late 2020s through the 2050s, America is going to see the kind of prosperity it saw in the 80s and 90s
A demographic bulge sucks at the front end, but once the mass of people reaches their mid 30s, things get very, very nice indeed. We can expect a long period of stability and prosperity coming out of this shift, aided by a continually-rising floor due to other factors that I don’t have time to go into here.

The Take Away
It’s also going to be very, VERY bumpy. And this will happen no matter who gets elected or holds power. This is all the stage upon which politics is played–politicians can make things better or worse within a narrow window of possibilities set forth by reality.

Demographics is the biggest single factor shaping our reality today. And it will be for the next decade.

There are other big factors (like tech), but they pale in comparison to what demogrpahy is doing.

So, don’t worry too much. The future is bright. REALLY bright. Literally brighter than it has ever been in all of human history.

But, for a while, at least, it is going to require us all to be very adaptable and fast on our feet.

8 Comments

  1. I like your overall analysis and am kind of nibbling around the edges, but so be it.

    My big concern is that VERY bumpy periods can completely alter demographic predictions. WWI is the classic example of a wiped out generation that reset the demographic projections and calculations. In the USA, I could easily see an end to our Republic form of Government if an Authoritarian President had enough popular support to ignore the Constitution and get away with it. We’re already awfully close to that as it is. So how do we reset after we tear up the basic institutions of our country?

    My other concern is that demographic predictions often don’t take into account population mobility. This is the biggest impact on real estate prices and some of the corresponding wealth disparities we’re seeing in the USA. Trump’s anti-immigrant screed is an attempt to stop this mobility. Brexit was clearly an attempt to reduce some of that mobility as well. I don’t know if you’ve accounted for that in your predictions.

    Big Ed Magusson
    1. Hi Ed —

      They’re good concerns. Here’s my take on them, FWIW, and in reverse order:
      1) The Demography thing
      You’re entirely correct that big events (like a world war) can seriously reset the demographic situation. In terms of demography, wars impact people aged 15-25, more or less. The predictions above based on current demographic trends are just that–they’re predictions based on what is already in play. Demographic changes, absent plague or massive civilian casualties, take 20 years to effect economics and government appreciably.

      Of course, that young-adult age IS uniquely vulnerable to slaughter in war, especially the male half of the cohort. Yes, a lot of civilians get killed as well, but I honestly don’t think we will *ever* see civilian slaughter like we did on the battlefields of Europe in the 40s (I’m not even counting the holocaust here). There are too many constraints on that kind of wanton slaughter, and I can’t see them all disappearing at once. There is also less need for it. When an IR sattelite and a high-altitude drone, working in concert, can destroy supply lines and render an army useless (and do it from the safety of the Nevada desert), the need to bomb cities loaded with civilians becomes vanishingly rare. It also makes warfare in any terrain except mountain and jungle very, very expensive–especially if you’re behind the tech ball compared to your adversary.

      Because of this, I do not think that the demogrphy of the US will be significantly effected in the event of a European (or even a world) war.

      I also honestly don’t believe for a moment that Brexit or Trump will be able to staunch the flow of people. In Europe, the movement pressure is only going to build, and in the US the movement pressure is going to slacken, no matter what governments do. I worked for a while at an INS detention facility that dealt with human trafficking–my experience there leads me to believe that not only is it impossible to actually close a border anywhere, but the US has borders that are completely impossible to close, even were the full resources of the US armed forces and the full federal budget committed just to that endeavor (there are a lot of reasons for this, but the most basic is the scale of the border itself).

      2) Authoritarian Constitution shredding
      I think we’re in for more of this, at least until this transition is complete (it’s possible the trend will reverse as a result, but I am not confident enough to make a prediction to that effect). The last four presidents have done a LOT of rule-through-executive-order, and it has not done us any favors as a nation. The whole 20th century, come to think of it, was characterized by Presidents who did all they could to violate the separation of powers, frequently with Congress’s fervent support.

      I’ve read a few papers lately that argue that Republican government might be an unsustainable form. I consider it an open question. “How do we reset if it is” is a question I’m considering heavily right now, as I’m writing a series of books where the main characters DO face that question, and I’m determined not to fall into either of the easy and obviously unworkable alternatives (a return to feudalism or a reincarnation of tribal consensus communitarianism) that show up so frequently in SF novels.

      However, I *really* don’t think that a fascist leader would get very far in the US. The situation post WW1 that made that possible in Germany, Italy, and Spain simply do not obtain here. One of the features of the US system is that the government truly is irrelevant to most people’s lives (that’s why we have 40% voter turnout in a high-participation year). I honestly think the leader that awakens the vast majority who want to be left alone will be awakening a sleeping dragon (apologies to General Yamamoto).

      And that’s assuming the military and police establishments would follow his/her lead. It ain’t impossible, but I think we’ve got a ways yet to slide before we hit that kind of situation. The US is a BIG place, and it’s *incredibly* culturally diverse and deeply divided along at least seven major lines. You can’t run a decent dictatorship under those conditions.

      Anyway, those are my thoughts on your thoughts, FWIW.
      Thanks for dropping by! 🙂
      -Dan

      jdsawyer
      1. I’m not sure which seven major lines you’re referring to, but I’ve seen several breakdowns of the divisions. It’s the one thing that gives me a modicum of hope, in that I think the increased decentralization of the economy along with our Federalism system gives us a prayer of surviving an Authoritarian President.

        Part of this, of course, is I became acquainted with the Sanctuary Movement when I lived in Tucson. Trump’s wall is useless if American citizens hide and protect those who get over the wall. I have to remind myself that we survived the Klan running a lot of places and so we should be able to survive the push towards authoritarianism by many of our fellows.

        But that brings me back to the Diamond Age comment. It’s pretty clear now that different political groups have completely different “facts”. How long until we become communities living side by side but not really interacting? What does that mean for the terms “nation” and “culture”? And what happens when those cultures take up guns against each other? I don’t see a full civil war without militias, but we could see a lot more homegrown terrorism, especially since the lone wolf is so hard to stop…

        Big Ed Magusson
  2. Cool stuff! I found this super interesting. 🙂

    Clarifications:
    I don’t get how there not being enough places to work at meant we had to import more stuff in the 70’s?

    Isn’t the world of Antithesis more about geo-political boundaries getting (re)drawn on earth and in the solar system than on the fallout of a generational stutter?

    Comment:
    It’s neat looking at this and being reminded how the lines got drawn – now 60 years out – and if what I see in places like youtube are any indication, witnessing the process of them getting redrawn again along different axis. It’s kind of interesting and exciting!

    Noble Bear
  3. Hey Noble Bear! Thanks for stopping by.

    On the clarification point:
    A lack of available high-paying jobs meant that fewer Americans could afford high-priced home-grown goods, especially big-ticket items like cars. However, these boomers needed those items nonetheless, and foreign versions of those same things, available at lower cost and at higher quality (for complex historical reasons involving Bretton Woods, the US manufacturing unions, and some other factors) rushed in to fill the gap, so that the Boomers could enjoy more material prosperity even though they did it on thinner cash margins.

    — —
    The world of Antithesis is about those boundaries being re-drawn yes, but a major part of the redrawing happens because of the generational stutter. Now, to be perfectly honest, I had not factored in demography when I first planned out my future history, but I arrived at the same conclusion looking at a more limited set of social, historical, and geopolitical factors. Now that I understand how demography is the keystone mover of most of those other factors, and have studied it for the last few years, I’m using that data to fine-tune the future history going forward. I didn’t *mean* to get a likely future, jut a plausible one. I “lucked” into the likely one.

    — —
    Agreed. It’s exciting times 🙂
    -Dan

    jdsawyer
    1. Thanks for responding and answering my questions!

      My question about antithesis was largely informed by a podcast by Historian Mike Duncan called Revolutions where he discusses just that in a more or less chronological order, so far covering Britain, America, French, Haitian, and is currently going over Spanish-American conflicts, focusing on Columbia. Not having studied much history prior, I found it gave me a framework through which to better understand the big picture course of events. Whereas before, I had mostly focused on the plurality of characters, now I’m seeing the larger motivations and piece movements; at least as much as I think I’m able. 😉 This in turn as made excited for the series all over again.

      Anyway, thanks again and thanks for being awesome! 🙂

      Noble Bear

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