“It is easy to prescribe improvement for others; it is easy to organize something, to institutionalize this or that, to pass laws, multiply bureaucratic agencies, form pressure groups, start revolutions, change forms of government, tinker at political theory. The fact that these expedients have been tried unsuccessfully in every conceivable combination for 6,000 years has not noticeably impaired a credulous unintelligent willingness to keep on trying them again and again.”
— Albert Jay Nock, from Memoirs of a Superfluous Man
Stocks went nowhere yesterday. Gold dropped a few bucks. No big deal. So, let’s move on…
We’ve been thinking lately about cycles. Not the kind you pedal along winding roads out in the French countryside…but the kind you experience day to day…year to year…generation to generation. And sometimes, beyond…
Some cycles are short. Election cycles, say. Barely has one president finished fluffing his White House pillows when it’s time to start penning the empty slogans and gearing up for the next election campaign. Presidents occupy their position for four short years…eight if they’re particularly adept at fudging numbers and whipping the nation into a prideful frenzy. In the grand scheme of things, that may not seem like a lot of time to make a complete mess of things. Nevertheless, the politicians do their best.
In 2009, the year of the current president’s inauguration, US federal debt stood at about $10 trillion, give or take a few hundred billion, with roughly half that amount held by “the public.” By 2013, when the next term begins, that figure will have ballooned to over $17 trillion. The public will by then be on the hook for $10.6 trillion. Maybe more. Only in the few years immediately following WWII was the debt-to-GDP ratio higher than it is today. And then only marginally. The graph, if you’ve seen it, has a very “hockey stick” feel to it.
And so, these mini-cycles proceed, on and on, with a parade of cheats, scammers and dodgy salesmen marching in turn through the Oval Office. They really ought to install a revolving door. One might think this process would quickly erode a country’s resources but, as Adam Smith was famously said to have remarked, “There’s a lot of ruin in a nation.”
In any case, string a half-dozen or so of these mini-cycles together and you get…slightly longer cycles. Generational cycles, we’ll call them. No doubt you’ve heard of these before. They’re made up of fathers who vote one way their whole lives…and of wives who go along just the same. (Or maybe it’s the other way around.) These people spend their years voting Labor or Tory, Republican or Democrat…or they go in for the Independents in a mild-hearted effort to “throw the bums out!”
The supply of bums yearning for power, however, appears to be without exhaustion. Good folk who dedicated their entire lives to casting these rascals out of office go to their graves having made no change at all, save for validating the system they so raged against. Then, the mantle passes to the next generation…along with a whole lot more debt, bureaucracy and rot corrupting the process.
“The plans differ,” noted French political scientist, Frédéric Bastiat, but “the planners are all alike.”
Still, we’re only talking here about relatively short cycles. What, after all, is a quarter century? The cycle of political systems themselves, for instance, can be, and often is, larger. Much larger. In the US, the system of constitutional republicanism came to supplant that of King George III’s own particular brand of monarchy. In Russia, the Bolsheviks booted out the Tsars, paving the way for the Union of Soviet Socialist Republics (USSR)…which eventually gave way to communism…(and after the perestroika)…to rule by oligarchy…and, at present, a curious form of politics known as “Putinism.”
The cycle of political systems can be short, sharp and oftentimes violent…or they can be long, slow undulations spanning many, many hundreds of years, remaining almost imperceptible to we busy little humans. One could, for example, have lived and died in communist Russia (as many poor souls did) without ever having known anything different…without seeing either the beginning nor the end, of the political cycle. Same thing in the US, where the current system has been around, more or less in its current form (though gradually, steadily degenerating) for two and a quarter centuries.
Broadly, we’re talking here about centralization and decentralization. At times, political systems work toward honing and focusing power, concentrating it into fewer and fewer hands. Centralizing it, in other words.
At its height, the Roman Empire represented the pinnacle of centralized power. “Right as diverse pathes leden the folk the righte wey to Rome,” wrote Chaucer, almost a millennium after the Great Empire’s fall. But as with all cycles, short and long, the wheels of history were always turning. During Rome’s later, degenerate stages, and certainly after its collapse, the continent of Europe fragmented into hundreds of smaller, feuding principalities. The Middle Ages (roughly 450-1350) were, by and large, an era of a great political decentralization. Princes and dukes wielded absolute power over their small territories, weakening various kings’ claims on their lands.
Indeed, it wasn’t really until the Renaissance that any meaningful, large scale consolidation took hold on the continent. During this period, stronger principalities, those that had prospered in trade and were therefore better equipped to withstand military attacks and plagues, began working together and expanding their territories. Once again began a cycle of centralization, of disparate states coagulating into a mass of cells, fused together by broader, overarching legal and political systems, trade agreements and strategic alliances.
Wealthy families, too, began to gain power and control over larger territories during this time. It was an era that gave rise to the Medici’s, for example, a family of bankers from Florence that gained control of governments in various Italian regions and, later, even assumed the papacy. The Medici appointed family members as princes in lands afar and assured their protection by the Medici-controlled Vatican. Once again, power came to rest in fewer and fewer hands. It was as if history itself had inhaled, drawing closer the disjointed peoples of once-warring regions into bordered, sovereign states. By the 18th and, especially, the 19th century, principalities had fallen almost entirely out of favor…and the world witnessed the birth of the modern nation state.
So where does that leave us? Ah…you’ll have to tune in next week, Fellow Reckoner.
Joel Bowmanfor The Daily Reckoning
Joel Bowman is managing editor of The Daily Reckoning. After completing his degree in media communications and journalism in his home country of Australia, Joel moved to Baltimore to join the Agora Financial team. His keen interest in travel and macroeconomics first took him to New York where he regularly reported from Wall Street, and he now writes from and lives all over the world.
“The public will by then be on the hook for $10.6 trillion.”
well how dare the government do such a thing! that was money the public could have owed YOU! harumph! harumph!
“Once again, power came to rest in fewer and fewer hands.”
every infestors dream – to WIN the free market competition! and having won, then to go on winning ….
whats a few trillion between wage slaves?
…it will never be repaid anyway.
What’s so chilling about the Soviet and Nazi governments, is that they show you how far out of hand the State can get. They really take on a life of their own.
Everything is just correct. But what is with this PUTINISM? So now everyone can make money in russia AND KEEP IT.
Even K. Sobchak, 1.5 mio in Cash found in her home had not been arrested. (In Us you are a suspect with just 1000 in cash)
What a problem do you have with Putin? Had you have even once been in RU?
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