Feb 22 2010

200 Years of GDP Trends Support a Near-Term, New Space Age

Published by Dr. Bruce Cordell at 1:41 am under Wave Guide 1: Economic Growth

Over the last 200 years, great human explorations (e.g., Lewis and Clark), massive Macro-Engineering Projects (e.g., Panama Canal), and major wars (e.g., W.W. I) cluster together exclusively during rhythmic, twice-per-century, major economic booms (e.g., the Kennedy Boom of the 1960s).  These spectacular pulses of creativity and expansion appear to be driven by affluence-induced ebullience that catapults many to higher levels of Maslow’s hierarchy, where their expanded worldviews make Apollo-style exploration and engineering projects seem not only intriguing, but almost irresistible. 

Since major economic booms are their hallmark, large increases in Gross Domestic Product (GDP) are a necessary condition for Maslow Windows.  Thus U.S. real GDP (corrected for inflation) trends over the last 200 years should inform us of whether the expected 2015 Maslow Window is still in the cards. 

The 56 year energy cycle is a convenient, well-documented manifestation of the long business cycle (the “long wave”) that apparently drives Maslow Windows.  The economic booms culminate near energy cycle peaks, and great explorations and MEPs typically begin in the decade before the peaks.  Therefore, GDP trends 36 years after a particular energy peak year (e.g., 1969) are also 20 years before the next peak (e.g., 2025) and thus can potentially illuminate GDP circumstances just prior to the coming Window.

Figure 1.  Trends in GDP over the last 200 years support the 2015 Maslow Window.  Click

 Figure 1 shows the energy cycle peak years and the peak years plus 36 for each of the four Maslow Windows of the last 200 years; the U.S. real GDP (all are in B of 2005 USD) for each peak year + 36 years is also given.  It is interesting to compare the ratio of real GDP for peak year plus 36 (e.g., 1969+36= 2005) to that of the real GDP for the peak year (e.g., 1969).  Although the 19th century real GDP ratios are larger than 20th century ones, it is especially significant that the 20th century ratios are very close (2.97 vs. 3.08). 

This reveals that our recent GDP trajectory — from 1969 to 2005, after the Apollo Maslow Window –   is similar to the GDP trajectory from 1913 to 1949, after the Peary/Panama Maslow Window that led to the Apollo Maslow WindowThus Post-Peak real GDP data from the last 200 years suggests that we are on track for a new Maslow Window — probably at least comparable to both 20th century Windows – by 2015 (i.e., 1969 + 56).

 Another way to evaluate more recent GDP trends is given in the right-side column of Figure 1; it shows the ratio of real GDP for the peak year + 36 vs the real GDP for the energy cycle trough year (i.e., peak year + 28).  This is a measure of how well real GDP is rebounding during the 8 years following the energy cycle trough. 

Notice that this peak+36 -to- trough real GDP ratio gently declines from 1.45 after the 1801 Lewis and Clark Maslow Window to 1.28 following the Apollo Maslow Window.  Of particular interest are the ratios for 1949 and 2005: 1.35 and 1.28 respectively.  Because they are so close — within one sigma of each other – they suggest  that our GDP ascent just prior to 1949 (and the 1960s Apollo decade) is very comparable to our current GDP rise just before 2005.  Thus Trough Recovery real GDP data from the last 200 years — including data from the last 5 years — suggests we are on track for a new Maslow Window to open near 2015.

 Figure 2.  Real GDP values for each Maslow Window (energy peak year) have consistently increased over the last 200 years.  Click 

 Because two sets of independent GDP data show that our current ramp up to the 2015 Maslow Window is comparable with spectacular Maslow Windows over the last 200 years,  it is of interest to estimate how much national wealth will be available in 2025 to potentially fund unprecedented space activities between 2015 and 2025. 

One simple way to do this is to extrapolate the line in Figure 2.  This technique gives the 2025 GDP as $ 35.0 T (2005 USD)

Figure 3.  Real GDP trends over the last 200 years show the U.S. GDP may approach $ 35 T (2005 USD) in 2025.  Click

Figure 3 shows the ratios of real GDP at the peak year to real GDP 20 years before the peak (Peak – 20) for the last 4 Maslow Windows (GDP in 1781 is estimated).  (This is convenient because 2005 is 20 years before the expected energy peak in 2025. )  Pre-Peak GDP ratios range from 2.48 for 1857 to 1.88 in 1913, with a ratio of 2.41 for Apollo in 1969. 

The bottom 4 rows in the Figure show the range of expected real GDP values for 2025 based on ratios over the last 200 years and the U.S. real GDP for 2005. They vary from $ 23.7 T to 31.3 T (2005 USD) with $ 29.1 T being characteristic of Apollo Maslow Window Pre-Peak GDPs.  The bottom row indicates the Pre-Peak GDP ratio would have to be 2.77 if we assume the 2025 GDP value from Figure 2 (using Peak GDP extrapolation). 

This suggests the 2015 Maslow Window might be the biggest one of the last 200 years (ratio of 2.77).  Although any of the 2025 GDP estimates in Figure 3 would imply unprecedented space and technology activities that would dwarf Apollo.

This analysis shows that the 2015 Maslow Window is not precluded on the basis of GDP data from 230 years ago up through 2005.  But after 2005 the situation seems more complex due to the financial Panic of 2008 and our current great recession, and because it is not clear when it will end — e.g., some see another “global dip” as a possibility. 

However, all Maslow Windows over the last 200 years (except Apollo) experienced a financial panic/great recession in the decade just preceding them.  And despite that, no Maslow Window of the last 200 years has ever been delayed or diminshed in any observable way,  by any events.

The economics and politics of the anticipated 2015 Maslow Window  — with a focus on times since 2005 — are explored in this post: “How President Obama is Creating the New Space Age.”

2 responses so far

2 Responses to “200 Years of GDP Trends Support a Near-Term, New Space Age”

  1. Monique D Mageeon 05 Mar 2010 at 4:30 pm

    I find all of these studies based on Maslow Windows very interesting. I’ve always thought that the study of history, generally, benefits from a long perspective so that cycles can be identified. The cyclical nature of most things is, well, undeniable really.

    I do have a two questions. First, what does MEP stand for? It appears in the third paragraph of this post. I’m sure I’ll say “da” when I find out but, I just can’t figure it out — “Maslow Economic Peak,” maybe.

    Second, is it assumed that one of the areas of focus during a Maslow Window period is exploration, and in our era, exploration of space?

    The reason I ask is because it seems that in the next couple of decades we will be faced with several challenges that will focus our attentions nearer to home–one important one being the end of cheap energy, around which moder, industrial society is built. Then again, perhaps the efforts to deal with this shift will be yet another impetus to explore…

    Cheers!

    Hi Monique,
    Thanks for your comment.

    An MEP is a Macro-Engineering Project. It’s a very expensive, state-of-the-art project that, although it may have a practical side, is very inspiring to many people.

    The 2015 Maslow Window is likely to feature space as a major exploration arena for several reasons, including an extrapolation of the last 200 years. The trajectory of Great Explorations is U.S. northwest (Lewis & Clark), central Africa (Dr. Livingstone), polar regions (Peary and Amundsen), and the Moon (NASA). The exploration arrow still points outward.

    It’s also true that space and energy intersect in the future. Endless clean energy is from the Sun. And the best way to access it in the future will be space-based solar power stations that collect solar energy in space and beam it to Earth via microwaves. Japan has announced a new initiative in this area.

    Keep in mind that during a Maslow Window, many in society are momentarily in an affluence-induced ebullient state. With plenty of cash on hand they want to do something exciting and have fun. That will drive the space tourism industry and keep people interested in space. The same will be true of government space activities on the Moon and/or at Mars.

    Best regards,
    Bruce

  2. Monique D Mageeon 06 Mar 2010 at 8:45 pm

    Oh, Macro Engineering Projects, MEPs, got it.
    Thanks.

    I am ever so hopeful about these MEPs! We could use a nice infusion of energy, enthusiasm, creative thinking and money into that sort of project. It feels so like we’ve allowed years of healthy economic growth to be accompanied by far too little saving or spending on infrastructure, and when I say infrastructure, I’m using the braodest sense of that term.

    Thanks too for the link to the news on space-based solar power stations. I’ll check that out now.

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