The combination of financial circumstances, wealth gaps, and economic shock (“Classic Toxic Mix”)
Decadent spending of money and time
Bureaucracy
Populism and extremism
Polarization and loss of moderates
Class warfare and demonization of people in different classes
Polarized and distorted media
Rule-following fading and power-grabbing increasing
Legal and political systems increasingly used for personal political power
Fighting with fatalities
History shows us that when empires decline they decline in most of these ways because when each of these types
of strengths and weaknesses improve or decline, they reinforce the others. It also shows us that past a certain point,
the factors deteriorate very rapidly together.
What Would Good Look Like?
It would be great to keep the peace and do the things necessary to have the 18 factors stop moving to the
right (bad) part of the continuum and to start moving to the left (good) part of the continuum. To move in
the right direction there will have to simultaneously be greater unity and big restructurings. For example, a) many
debts and non-debt obligations (e.g., for pensions and healthcare) and balance sheets will probably have to be
restructured or devalued, b) the ways of doing things will have to be restructured so productivity can be increased
so that incomes will rise relative to expenses and balance sheets will improve for most people and governments
(i.e., central, state, and local) while the benefits are broadly shared, so c) financial, educational, and health
disparities will have to be reduced with those suffering the most being increasingly protected and d) the
fundamentals that lead to these improvements in areas such as education, infrastructure, and supports for healthy
bodies, minds, and environments will have to be improved. Conversely it would be very bad if Americans
increased their fighting with each other at the expense of the order that is needed to bring about revolutionary
improvements. Hopefully realizing what the next two stages—i.e., the civil-war and post-civil-war stages—will
probably be like will help motivate people not to go there and instead to make the needed changes.
How should we judge whether policy makers are making the right moves to improve these things? Very
simply, what governments do economically is reflected in just two types of policy—fiscal and monetary—
and each can be either easy or tight. Easy means a lot of debt and money is created, which will lead it to
become worth less if the country doesn’t raise productivity by more than a commensurate amount, but it is
stimulative for the economy and is an innocuous way of getting money into the hands of those who would
not get it through the normal means. Tight means that a lot less debt and money is produced so it will be
devalued less, all else being equal, but it is less stimulative to the economy and gets less money into the
hands of those who most desperately need it. So, we can watch how those trade-offs are handled. In addition
to paying attention to the tight or easy fiscal and monetary trade-offs, which tell us the amount of borrowing
and spending, we need to pay attention to what that borrowing and spending is used for; most importantly,
will it increase productivity and the well-being of most people, or will it not? History has shown that what
matters most is what the system puts the credit and money into. We can watch that and judge whether or not it
will raise productivity and real incomes for the whole and for most people. Of course, non-fiscal and non-
monetary policies such as laws and regulations matter too, so they also should be assessed in terms of
whether or not they will increase the country’s strengths.
The challenges of doing what is needed are that getting the necessary cooperation requires a) moderates to
split from the extremists in their parties to try to pull the country together, which is very difficult to pull off,
and b) big restructurings and revolutionary changes to be pushed through to yield revolutionary
improvements, which is also very difficult to pull off. History has shown that moderates in environments like
those that exist now (in Stage 5) have been more inclined to be pulled to the extremes than to work well with
moderates of other parties to bring the country together behind sensible and mutually agreed-upon policies. While