The U.S. gross federal debt to GDP ratio has surged into the dangerous region above 90%.
Click

In the recent Hoisington Quarterly Review and Outlook, Van Hoisington and Lacy Hunt indicate that the high U.S. debt will lead to recession in 2012. They quote an authoritative NBER study (“Growth in the Time of Debt”; January, 2010) that demonstrates

that when a country’s gross government debt rises above 90% of GDP, the median growth rates fall by one percent, and average growth falls considerably more.

Hoisington and Hunt conclude:

This study sheds considerable light on recent developments in the United States. After suffering the most serious recession since the 1930s, the U.S. has recorded an economic growth rate of only 2.4%. Subtracting 1% from this meager expansion suggests that the economy should expand no faster than 1.4% in real terms on a trend basis going forward, which is virtually identical with the economy’s expansion in the past twelve months.

They expect that this slow, debt-ridden recovery will lead to a recession in 2012.

Concerns about US debt have risen in recent years, including from Mike Mullen, former Chairman of the Joint Chiefs of Staff, who observed in 2011:

Debt is the most significant threat to national security.

Likewise, in 2010 the National Academy of Sciences linked concerns about US competitiveness, education, and basic research to the debt:

The latitude to fix the problems being confronted has been severely diminished by the economic recession and the growth of the national debt over this period from $8 trillion to $13 trillion.

The debt is now over $ 15 T.

Unfortunately, current trends are consistent with a 200-year pattern of sluggish recoveries from financial panics and great recessions in the decade prior to Maslow Windows, leading to double-dip recessions like Hoisington and others are forecasting for 2012. However, the outlook brightens considerably toward mid-decade.

Hoisington’s and others’ warnings of a recession in 2012 were underlined by the head of the International Monetary Fund last week who warned that Europe could tumble into a “1930s moment” or depression, which would likely trigger a recession in the U.S..

Indeed, the Congressional Budget Office recently forecasted another trillion+ dollar US budget deficit for 2012. And unless something is done, trillion dollar deficits could continue for years to come.

With America’s sons in the fields far away, with America’s future under challenge right here at home, with our hopes and the world’s hopes for peace in the balance every day, I do not believe that I should devote an hour or a day of my time to any personal partisan causes or to any duties other than the awesome duties of this office–the Presidency of your country.

Accordingly, I shall not seek, and I will not accept, the nomination of my party for another term as your President.

…President Lyndon Johnson on March 31, 1968 with reference to Vietnam.

In 1968 President Johnson took the moral high ground and, to reduce “partisan divisions”, declined to run for a 2nd term.
Click

Today in the Wall Street Journal (11/21/11) two veteran Democratic pollsters suggest Obama might do likewise because of his inability to develop a “bipartisan” economic and foreign policy and his low job approval numbers.

Patrick Caddell and Douglas Schoen assert that:

When Harry Truman and Lyndon Johnson accepted the reality that they could not effectively govern the nation if they sought re-election to the White House, both men took the moral high ground and decided against running for a new term as president. President Obama is facing a similar reality—and he must reach the same conclusion.

They conclude that Obama would have to run the “most negative campaign in history” to overcome his record while President, and, even if he won, it would be “almost impossible for him to govern”. As “patriots” and “Democrats” Caddell and Schoen call on Harry Reid and Nancy Pelosi to bring this message to President Obama and to convince Hillary Clinton to run in 2012.

Last September, Dick Morris — President Clinton’s former pollster — came to a similar conclusion and felt there was a “good chance” Obama will not run in 2012.

This is especially intriguing in the context of the eerie parallels between the economic and political chronology of the late 1890s — events that eventually triggered the early 20th century Peary/Panama/T. Roosevelt Maslow Window — and our trajectory today.

For example:
1. Both Presidents Grover Cleveland and Obama were elected near major financial panics (1893 for Cleveland and 2008 for Obama) that were followed by great recessions. Click: Wave Election.

2. The 1890s panic and great recession are becoming more widely recognized for their similarities to the economic crisis that began in 2008. Click: Eerily Similar.

According to Samuel Rezneck (Business Depressions and Financial Panics; 1968) the “unprecedented fiasco” began on May 5, 1893 and …

Spread to a nation-wide epidemic of some five hundred banks and nearly sixteen thousand business failures during the year … Recovery was slow, despite the recurring tendency, as during 1895, to grasp at “harbingers of widening prosperity,” only to be warned that, “the alleged era of prosperity is not in sight.”

Indeed, the second recession (double-dip) followed soon.

3. Cleveland’s and Obama’s presidential elections were each followed 2 years later by mid-term elections that featured significant political realignments favoring the other party. Click: Michael Barone.

4. Because of his inability to deal successfully with the great 1890s recession as well as union issues, Grover Cleveland was not renominated by his party for a second term. The fact that something similar may be happening to Obama today is extraordinary.

However, Obama’s political destiny (including possibly even his re-election) is obviously not as important as the game-changing signifcance of the societal drive for prosperity that we see around us today. Based on 200+ years of macroeconomic data and historical trends, it suggests the “Great Prosperity” can be expected to return by mid-decade.

Are Americans still interested in human expansion into the cosmos…JFK-style?
Click

The Economy is Down
For example, official unemployment continues at 9% or above, and the outlook is not good because only 80,000 jobs were added in October which is far short of the number needed to substantially reduce unemployment (>150,000 per month). And Fed Chair Ben Bernanke recently lowered its jobs forecast to 8.6% in late 2012 (Wall Street Journal, 11/3/11), assuming the European debt crisis stabilizes and there is no double-dip (nearly 40% of Intrade.com participants think one will occur).

On Halloween the Wall Street Journal noted that the “Slow recovery feels like a recession,” partly because median household income in the U.S. fell 6.7% from June, 2009 to June, 2011, and also that:

No recession since the Great Depression was deeper or longer than the most recent.

And in June, CNBC reported that the U.S. housing crisis, which already entered a double-dip, “is now worse than the Great Depression.”

In his most recent poll of likely voters in the U.S., Rasmussen reports that only 17% of the country feels things are going in the right direction, while a 76% think we’re on the wrong track. According to Peggy Noonan (Wall Street Journal, 10/8/11),

We are in a remarkable moment and I’m not sure we’re noticing it in the day-to-day of politics and media … I wrote of the new patriotism that I see taking hold of the American establishment …

What’s behind it is fear. The economy is tanking and can take a whole world with it … They all agree—no one really argues about this anymore—the government is going bankrupt.

But Space is Up
The U.S. manned space program — which in 1969 delivered the first humans to the Moon — continues to be directionless. For example, it has no specific goal (Moon, Mars, asteroids), although an expensive Shuttle-derived heavy launch vehicle (the Space Launch System, SLS) is planned by NASA for first human flights in 2019. Others have suggested a propellant depot would be more viable economically and politically. To add to this disarray, the Mars Society reports today that OMB has zeroed out future Mars exploration programs after the MAVEN orbiter in 2013; e.g., the joint Mars missions with Europe in 2016 and 2018 would be canceled.

In this time of economic and program distress, it’s interesting to see how the public is thinking about our future in space.

The Shuttle
Last month 52% of American adults surveyed said the Space Shuttle has been worth the expense to taxpayers (Rasmussenreports.com, 10/5/11). This is particularly interesting when compared to public support of Apollo. According to Roger Launius, 1960s opinion polls reveal only one year between 1962 and 1972 when more than 50% of people surveyed felt Apollo was worth the cost: 1969 (53%); indeed only two other years were above 40% (1965 and 1970).

Considering that the recent Shuttle poll comes during a time of economic distress while the Apollo polls (especially during the early 1960s) were during the major JFK economic boom, it suggests that Americans remain proud of and committed to manned space.

U.S. Leadership in Space
In july, 2011 a CNN/ORC International Poll asked, “How important do you think it is for the United States to be ahead of Russia and other countries in space exploration?” The replies were: Very important: 38%; Fairly important: 26%; Not too important: 36%; No Opinion: 1 %.

The fact that 64% of Americans currently believe that U.S. leadership in space is either fairly or very important — even during this economic distress — suggests that there will be significant support for space during the upcoming 2015 Maslow Window.

JFK vs. Obama
In July, 2011 a Fox News poll asked, “Who do you think had the right idea on the importance of space exploration–President (John F.) Kennedy or President (Barack) Obama? The replies were: JFK: 63%; Obama: 13%; Undecided: 24%.

This suggests that Americans are still interested in bold human space adventures and will be stimulated by the upcoming intrernational Space Age.

Professor Richard Sylia’s intriguing plot of stock market behavior reveals the secrets of our past, over the last 200 years, and points toward our near-term, ebullient future.
Click

Sylia, an economic historian with NYU’s Stern School of Business, has studied stock data back to 1790 and produced this (above) marvelous graphic showing annual returns as inflation-adjusted, 10-year averages including dividends. He used the S&P 500 back to 1871 and his own calculations from 1790 to 1860, augmented by data from Bryan Taylor (Global Financial Data).

Interpreting Professor Sylia’s data in the context of Maslow Windows leads to two key results:

1) Based on his reading of the last 200+ years of stock market waves, he forecasts a significant upswing of stocks — specifically 6.5% annual average — in the next decade (see red line post-2010).

Even if we had a couple more years of bouncing around, 2013 to 2022 would be much better … I think the country is going to recover and go on to prosperity again …

His forecast is consistent with the expected timeframe and market behavior of the next Maslow Window.

… and …

2) Each of the Maslow Windows of the last 200 years — including their financial panic/great recession precursors — is clearly identifiable in Sylia’s data. This includes the Lewis and Clark Maslow Window (1791- 1804), the Panic of 1837 and great recession until 1843 plus the Manifest Destiny Maslow Window (1847-1860), the Panic of 1893 and great recession until 1899 plus the Peary/Panama Maslow Window (1901-13), and the Apollo Maslow Window (1957-69).

According to Browning, Professor Sylia also sees the Panic of 1893 and the great 1890s recession as having special significance for today:

Prof. Sylla says the current period resembles a downturn period in the late 19th century.

These parallels with long-term market data, over the last 200+ years — in addition to long-term trends in growth super-cycles, GDP, societal energy use, and others – provide increased confidence in the timing and positive character of the next Maslow Window expected to open near 2015.

This Op-Ed is by Bruce Cordell and Euel Elliott

The fall of 2011 would hardly seem the time to be discussing a near-term return to prosperity. Yet despite the worst economic and financial morass since the Great Depression, including a possible double-dip recession, history suggests that the U.S. and indeed, the world may be approaching a tipping point: the beginning of another 1960s-style sustained period of economic growth, part of a recurring cycle of economic prosperity and decline that has manifested itself over more than 200 years.

For example, economists at Standard Chartered Bank frame their analysis in terms of “Super-Cyles” that they document back to 1820. They predict that a period of extended global growth that actually started in 2000, albeit interrupted in the developed world by the current economic and financial crises, will continue into the 2020s.

These twice-per-century periods of rapid growth – also consistent with nuclear physicist Hugh B. Stewart’s well-documented (back to 1840) 56-year societal energy use cycle — are a hallmark of what we refer to as “Maslow Windows.” Based upon the work of the social psychologist Abraham Maslow, who closely studied the needs and motivations of humans, Maslow Windows are periods of unusual optimism (“ebullience”) triggered by sustained, rapid economic growth. During these periods, as many ascend Maslow’s hierarchy and their worldviews momentarily expand, a strong “can-do” spirit is characterized by the desire for unprecedented exploration and the building of great infrastructure projects.

Previous expansive eras associated with Maslow Windows include the exploration of the vast North American continent in the early 1800s by Lewis and Clark, “Manifest Destiny” and transcontinental railroads of the mid-19th century, the Panama Canal “fever” and “pole mania” in the early 20th century, and most recently, the 1960s U.S. – Soviet “Space Race” culminating in the first lunar landing in July 1969.

In fact, our current lingering recession/weak recovery is similar to typical precursors of transformative booms over the last 200+ years. With one exception, each prior boom that opened a Maslow Window was characterized by weak growth and profound pessimism just prior to the upswing. (The 1950s did not experience a financial panic/great recession probably because of the post-WW II expansion and financial reforms dating back to the Great Depression.)

However, the Panic of 2008 suggests we have returned to the 200-year-old pattern of financial panic/great recession pairs followed by a JFK-style economic boom. Indeed, we expect a new, transformative Maslow Window to arrive by mid-decade.

For example, the financial Panic of 1893 – with parallels to the Panic of 2008 — signaled the impending arrival of the next Maslow Window. It caused unemployment over 10% for over 5 years. The crisis initially lasted only 18 months but was followed by another (double-dip) recession that continued into 1897.

According to Hugh Rockoff of Rutgers, “I think the analogy between the 1890s and today is better than the analogy with the Great Depression … One of the many similarities is the real estate crisis. There was a subprime mortgage problem in the 1890s that was very similar to what precipitated the recent crisis,” (RealClearPolitics.com; S. Zito, 9/18/11).

The Panic of 1893 began about 6 years before its recovery generated a JFK-style economic boom that triggered the early 20th century Maslow Window. A similar pattern now would suggest that the global economy should recover to its mid-2007 “greatest ever global boom” status by 2015.

The early 20th century Peary/Panama Maslow Window (1901-13) included the internationally contested polar expeditions, the greatest macro-engineering project of the last 200 years (until Apollo) — the Panama Canal, the Wright Brothers’ first flights, the Great White Fleet’s global voyage, and President Theodore Roosevelt. This was perhaps the most ebullient period in U.S. history.

This eerily repetitive pattern – a financial panic/great recession followed by a major boom that ignites the Maslow Window — began with the post-Revolutionary War “depression” of 1784-88 and the 1790s major boom which led to the extraordinary Louisiana Purchase and Lewis and Clark. It repeated during the Panic of 1837 — a major contraction when 40% of the U.S. banks failed and unemployment was at record highs — that lasted 6 years and led to the mid-1840s major boom, which triggered the Age of Manifest Destiny via James Polk.

The multi-century patterns sketched above suggest that our current weak recovery is signaling the impending arrival of a new Maslow Window by mid-decade. We expect that it will be driven by advances in biotechnology, information technology, artificial intelligence, green technologies, and others.

The coming boom will be enhanced by a new international Space Age. In addition to the Apollo Moon program, the 1960s Maslow Window included the 1962 Cuban Missile Crisis, so the road ahead may be bumpy. But as the complex international system continues to self-organize into a Maslow-style “critical state,” we expect to see unprecedented commercial and scientific development of the Earth-Moon system, including Moon bases, as well as possibly even humans to Mars by 2025.

We expect that during the next year or so the political realignment that began in 2008 will continue to set the stage for a renewed burst of economic and social dynamism by mid-decade.

Dr. Elliott is professor of public policy and political economy at the University of Texas at Dallas, and co-author of Money (2007).

According to Zito, Michael Genovese, a political science professor at Loyola Marymount University in Los Angeles, believes that the financial Panic of 1893 and the wave elections of 1884 to 1896 are “eerily similar” to the Panic of 2008 and the great recession that began in 2008.

Ironically, establishing a parallel between a disastrous 1890s recession and today would potentially be good news because of the story’s happy ending.

At the Chicago World’s Fair in 1893 — the year of the financial Panic — was Charles Ferris making an economic point with his first Wheel? For example, ‘Things that go around, come around…’
Click

in October, 2008, I noted the exceptional prosperity and ebullience that followed the great 1890s recession:

Although the Panic of 1893 began about 10 years before the opening of the 1903 Adm. Peary Maslow Window, the 1903-1913 decade featured exceptional ebullience, including the daring, world-famous races to both N. and S. poles, and construction of the greatest MEP of the last 200 years (until Apollo): the Panama Canal.

And on April 23 I felt something eerie going on too.

This political situation is eerily reminiscent of the Great 1890s Recession that followed the financial Panic of 1893, and the challenges of President Grover Cleveland.

As the issue of a “double-dip” ascends again, I noted in January, 2011:

Three years after the Panic of 1893 — about where we are now in January, 2011 relative to the Panic of 2008 — the second contraction of the 1890s Great double-dip Recession occurred. This may mean we’re either luckier or smarter than folks one century ago.

Or it may mean we’re not out of the woods yet.

According to Zito,

Both eras feature … fiercely competitive and highly partisan elections, an ineffectual and seemingly corrupt government, and an angry, disillusioned electorate.

Hugh Rockoff, an economist with Rutgers sees stronger parallels with the 1890s than the Great Depression.

I think the analogy between the 1890s and today is better than the analogy with the Great Depression … that we often focus on. One of the many similarities is the real estate crisis. There was a subprime mortgage problem in the 1890s that was very similar to what precipitated the recent crisis.

In any case, the U.S. continues to have one of the most technologically advanced workforces in the world, with the potential to move rapidly once the current self-inflicted barriers to action are removed.

It’s likely that during the next year or so the political realignment that began in 2008 will continue to set the stage for a renewed burst of economic and social dynamism by mid-decade.

A transformative 1960s-style decade, complete with a Camelot-like zeitgeist, is expected to emerge by mid-decade. President Kennedy (right) is with Dr. Wernher von Braun (center) at Cape Canaveral in November, 1963,
Click

The 1960s Apollo Maslow Window — named for the outstanding great exploration (or macro-engineering project) of its time — did not experience a financial Panic/Great Recession probably because of the post-WW II expansion and financial reforms dating back to the Great Depression.

However, the Panic of 2008 suggests that we have returned to the 200+ year-old pattern of financial Panic/Great Recession pairs followed by a JFK-style economic boom. Affluence-induced ebullience (e.g., the Camelot zeitgeist) is the fundamental driver of unprecedented activities (e.g., the Panama Canal; Apollo Moon program) characteristic of Maslow Windows.

Our current economic situation fits the 200-year-0ld pattern (as do current global trends) and points toward a new, transformative Maslow Window arriving by mid-decade.

That’s the story. A few details follow.
(A longer version of this post is available by clicking HERE.)

Although it was the only Maslow Window of the last 200+ years not to be preceded by a Panic or Great recession, the 1960s Maslow Window displayed their hallmark signatures.

The Apollo Maslow Window (~1958-69)

The Apollo Moon program was the greatest combined exploration and technology event in the history of the world because it was off-world. It was fundamentally triggered by a major economic boom preceded by the surprise 1957 launch of Sputnik and the intense competitive atmosphere of the Cold War. However in the typical pattern of Maslow Windows during the last 200 years, Apollo was effectively terminated by declining ebullience due to the escalating Vietnam War after 1966.

The 1960s were extraordinary. In their inaugural edition of “The Sixties” academic journal, the editors remark that the 1960′s produced an ebullience “that continues to intrigue, inspire, confound, amuse, tempt, repel, and capture us.”

In The Sixties, the editors recognize that “all this energy — by parts dignified, militant, uptopian, and delusional — was of great consequence…No recent decade has been so powerfully transformative in much of the world as have the Sixties.”

The 1960s Apollo Maslow Window displayed the classic characteristics of “critical states” over the last 200 years; Quotes are from Mackenzie and Weisbrot (2008).

1) Maslow Windows are brief, rare, profoundly transformative intervals:
They are watersheds that feature quantum leaps in technology, the economy, politics, and culture.
Powerful historical forces caught up with America in the 1960s and swept through every corner of national life…

2) Maslow Windows are triggered by major economic booms:
The 1960s were accompanied by unusual society-wide affluence.

America’s unprecedented affluence in the postwar years (was) keyed to an industrial engine that nearly doubled its output during the 1950s and again during the 1960s…

Disposable personal income, in constant dollars, grew by 33% in the 1950s. In the 1960s it grew by more than 50%.

3) Affluence-induced ebullience becomes widespread:
As ebullience spreads, many people ascend the Maslow hierarchy where their expanded worldviews and this brief, almost giddy feeling make most technology, exploration, and social programs seem not only favorable, but almost irresistible.

With wealth never before imagined, Americans could dream dreams never before possible. In the early years of the 1960s , national optimism reached epidemic levels …

The 1960s were presumed to be an age of unique possibilities. The wealth produced by the powerful engine of the American economy…made anything — and everything — seem possible…It was an optimistic age, and belief was too easily suspended.

4) Maslow Windows typically end abruptly:
As the economic boom begins to slow and/or geopolitical events intervene, ebullience fades and elevated Maslow states collapse. Affluent individuals or nations who do not ascend the Maslow hierarchy typically cause Maslow Windows to close prematurely.

By mid-1966 the liberal storm was passing…It came suddenly and raged briefly, but it left a deeply altered landscape in its wake … And the booming economy of the early 1960s…that fueled the limitless sense of possibility in those years, was also confronting the inevitabilities of the business cycle and the impacts of the combined costs of a foreign war (Vietnam) and a Great Society.

The Peary and Panama Maslow Window (~1903-1914)

The early 20th century Maslow Window featured the internationally contested polar expeditions, and the greatest macro-engineering project of the last 200 years (until Apollo) — the Panama Canal.

The Financial Panic of 1893 Signaled the New Maslow Window:
It caused unemployment over 10% for 5+ years. The crisis initially lasted only 18 months but was followed by another (double-dip) recession that continued into 1897. The combination of GDP declines of several % coupled with population growth meant that GDP per capita didn’t recover to 1892 levels until 1899.

The Panics of 1893 and 2008 have interesting parallels”
The Panic of 1893 began about 6 years before its recovery generated a JFK-style economic boom that triggered the Maslow Window, suggesting that the global economy should recover to its mid-2007 “greatest ever global boom” status by 2015.

World War I and the End of Ebullience:
According to historians Sullivan et al. (1993),

To a visitor from Mars it must have appeared that the Western world in 1914 was on the brink of Utopia.

Instead they were on the brink of WW I and the end of ebullience. Keep in mind that the Titanic set sail from England on April 10, 1912. Although clearly second to the Canal, it was another extraordinary MEP decorating the crown of this Maslow Window.

The Manifest Destiny Maslow Window (~1847-1860)

The mid-19th century Maslow Window was unique in its diffuse international focus. For example, the great exploration was Dr. Livingstone in central Africa and the Suez Canal was the primary MEP, neither of which originated in the U.S. However, global ebullience was so strong at the time that an American newspaperman was sent to find Dr. Livingstone because of the obsessive concern of Americans, while the Gold Rush erupted in California.

Even more remarkably, “manifest destiny” overwhelmed the U.S. under a most unlikely president (James Polk), while the great revolutions of 1848 swept Europe.

The Panic of 1837 Set the Stage:
The financial Panic of 1837 was a major contraction when 40% of the U.S. banks failed and unemployment was at record highs; it lasted 6 years until 1843. According to Nobel Prize-winning economist Milton Friedman writing in 1960, the Panic of 1837 …

is the only depression on record comparable in severity and scope to the Great Depression of the 1930s.

The Boom of 1845 Ignited Ebullience:
As Polk assumed the presidency in 1845, the dynamic duo of prosperity and ebullience was everywhere. According to historian Robert Merry,

the national economy had been expanding at an average annual rate of 3.9%. Not even the Panic of 1837, for all its destructive force, could forestall for long this creation of wealth.

And throughout the land could be seen a confidence that fueled national success. “We are now reaching the very height, perhaps, to which we can expect to ascend,” ebulliently declared the Democratic Wilmington Gazette of Delaware.

Ebullience and Human Expansion in the West:
Manifest Destiny was fueled by an “Exuberance of Spirit” across the U.S. Against all odds, this smaller-than-life man (President James Polk) ebulliently changed the world in only 4 short years.

In his unlikely, self-imposed one-term presidency, Polk accomplished the nearly impossible — he “engineered the triumph of Manifest Destiny” — including the annexation of Texas (1845), and the acquisition of the Oregon Territory (1846) and essentially the rest of the U.S. West including California, Nevada, Utah, and Arizona — all by 1848.

The Lewis and Clark Maslow Window (~1791-1806)

The seminal Lewis and Clark expedition (1804-06) explored the Louisiana Territory to the Pacific and has many parallels with the 1960s Apollo Moon program and lessons for future human exploration

The Early Recession and the Boom:
Although this historical timeframe in America suffers from less official economic data than later Maslow Windows – not to mention a very new national government — it’s clear from historical accounts that similar economic triggers were operating.

A post-Revolutionary War “depression” existed from 1784-88. Its reality and severity are evidenced by the armed Shay’s Rebellion in 1786… Assuming the Stewart Energy cycle peak is near 1801 (1857 – 56), this would put the downturn about 17 years ahead of the peak; within one sigma of the observed intervals (21 yr) after the Panics of 1837 and 1893.

As we have learned to expect, after the recession of 1784-88 came the economic boom of the 1790s. The country’s credit was so good that every foreign money house was eager to offer low rates. The eastern industries and their financiers were “thriving,” as were the frontiersmen while Westward expansion gained momentum.

Affluence-induced ebullience was so strong that it added glue to the new national government by restraining the “hottest tempers” and making “conflict bearable.” The smaller, regional financial Panics of 1792 and 1796 did not alter this trend.

PLEASE NOTE: A longer version of this post is available by clicking HERE.

The “Big Bang Theory” is now a popular American television sitcom, but in 1927 it was a Big Idea based on the work of Albert Einstein (below) and Edwin Hubble.
Click

Gabler perused the so-called “14 Biggest Ideas of the Year,” (e.g., “The Players Own the Game”) in The Atlantic (July/August, 2011) and came away forlorn that they were only “observations” not really Big Ideas. Big ideas not only connect the dots but they “change the ways we look at and think about the world.”

Examples of Big ideas include “the end of history,” “the Big Bang theory, and “the medium is the message.”

Gabler frets that we are in the “Post-Idea World”…

a world in which big, thought-provoking ideas that can’t instantly be monetized are of so little intrinsic value that fewer people are generating them and fewer outlets are disseminating them, the Internet notwithstanding. Bold ideas are almost passé.

It appears that the “Age of Information” is part of the problem.

Courtesy of the Internet, we seem to have immediate access to anything that anyone could ever want to know … It may seem counterintuitive that at a time when we know more than we have ever known, we think about it less.

One Big Idea not mentioned by Gabler is “the colonization of space,” including human settlement and utilization of the solar system. If we apply Gabler’s point, is it possible that endless trivial information — especially via social media — stifles thought and serves as a distraction from the next step in human expansion?

A similar idea was advanced in 2003 by Marina Benjamin.

Since the death of the space program (!), frustrated would-be space travelers have taken refuge in cyberspace – another form of pop culture — where they now focus most of their “cosmic” energies.

Perhaps Gabler’s most serious concern is that America, in particular, lives in a “post-Enlightenment age,”

in which rationality, science, evidence, logical argument and debate have lost the battle in many sectors, and perhaps even in society generally, to superstition, faith, opinion and orthodoxy.

We often see this prominently displayed in the political arena where some advocate policies that run counter to decades of historical experience and scientific evidence, especially in areas like economics, business, and climate change.

Therefore, space colonization — excruciatingly dependent on high technology and science — might seem threatened by our post-Idea/post-Enlightenment world.

As we struggle to recover from the Great Recession that began in 2008, many are unaware that we also live within only a few years of the next stunning, 1960s-style Maslow Window, complete with unprecedented commercial and scientific adventures in space and an ebullient, Camelot-style zeitgeist.

Fortunately for us, patterns over the last 200+ years indicate these “golden ages” are not triggered by a widespead intellectual reawakening — but by major economic booms, such as the JFK Boom during the 1960s. Affluence-induced ebullience elevates many in society to higher levels of Maslow’s hierarchy where their expanded worldviews make great explorations and large technology projects seem not only intriguing, but almost irresistible.

Gabler laments that, “our current style of thinking no longer deploys the techniques of rational thought.” But, as in the 1960s, this will rapidly change as we strive to compete globally in the new Space Age. New energy sources will be developed, new worlds will be glimpsed, and genuine education reforms will transform newly motivated students.

In reality, the Maslow Window is the natural antidote to our current condition.

The planned Saudi kilometer-high super tower will become the world’s tallest building (and tallest man-made structure) and dwarf the Burj Khalifa in Dubai by 564 feet (20%).
Click

The lesson of the last 200 years is that widespread societal ebullience — usually triggered by a major economic boom (e.g., the 1960s JFK Boom) — is the fundamental driver of twice-per-century, transformative decades known as “Maslow Windows.”

Here at 21stCentuyWaves.com, ebullience is a technical term that indicates a very positive, somewhat irrational emotional state characterized by unusual confidence in the future.

In the 1960s Apollo program and Peace Corps of John F. Kennedy it was the ebullient feeling that we could do almost anything; … and about 200 years ago it began auspiciously with Jefferson, Napoleon, and Lewis & Clark.

The last Maslow Window featured the first man on the Moon, the Peace Corps, and the still-famous Camelot zeitgeist associated with JFK. The next one is anticipated by mid-decade, based on long-term indicators (multi-century GDP trajectories) and current global trends (e.g., the Panic of 2008 and great recession of 2008-).

Saudi Arabia’s planned super-tower is an impressive example of early ebullience because it looks beyond the recession to the completion of the world’s tallest building for a lot of money.

The planned tower will soar to 3,281 feet (1,000 meters) and will include a hotel, luxury condominiums and offices. It would dwarf the Burj Khalifa, which is 2,717 feet (828 meters), and would also be the world’s tallest man-made structure.

Prince Alwaleed bin Talal announced the $ 1.23 B (USD) project that will be completed in 2016, shortly after the next Maslow Window is expected to open.

Is this really a lot of money in today’s world? Well if it were constructed in New York City, where building costs are higher, its price tag would exceed $ 5 B, which would make it comparable to the Panama Canal Expansion Project (another example of early ebullience) — just short of the cost of the original canal.

Although the world’s tallest buildings are usually not known for exceptional ROI — e.g., when it was #1, New York’s Empire State Building used to be known as the “Empty State Building” — the Saudi Prince sees ebullient global symbolism associated with his project:

Building this tower in Jeddah sends a financial and economic message that should not be ignored, It has a political depth to it to tell the world that we Saudis invest in our country.

And nobody has to hit Antony Wood, executive director of the Council on Tall Buildings and Urban Habitat, with a Mack truck; he gets it:

The world’s tallest building has never been about making the maximum financial return. It’s about ego. It’s about attention. It’s about making a statement.

Just so no one is misled about the scale of early ebullience on display in Saudi Arabia today, consider their plans for the super tower. According to WSJ …

The Saudi project is designed to be the showpiece of Kingdom City, a 57-million-square-foot megadevelopment north of Jeddah. Overlooking the Red Sea, it is slated to cost $20 billion.

Twenty billion … Now you’re talking! That’s ebullience befitting the next Maslow Window!

This administration if the greatest wet blanket to business, and progress and job creation in my lifetime…

The Huffington Post cited first quarter GDP growth of only 1.3% and a Q1 number that was revised downward to only 0.4% (from the previous estimate of 1.9%) as evidence that U.S. economic recovery will “remain slow through 2011.”

As if this weren’t enough bad news, some normally attentive readers of 21stCenturyWaves.com apparently became afflicted by negative “animal spirits” and questioned in emails to me whether a 2015 boom is in the cards!

Yes it is, and you can see more here:
“The Maslow Window — Summary.”

Nobel economist Robert Lucas believes that this chart is the secret to the coming prosperity.
Click

In his Milliman Lecture at the University of Washington in May, the Nobel economist Robert Lucas expllained that the U.S. (and other modern economies) growth trend since 1870 is 3% (2% per person), and

this ongoing miracle is mainly due to free-market capitalism.

In plots (see above) of per capita GDP growth since 1870 of 8 large, successful economies (e.g., UK, U.S., France, Germany, Japan), the “catch-up” in growth occurred after WW II but stalled in the 1970s; a 20-40% gap in income levels has appeared relative to the U.S.. According to Lucas, “European tax and regulatory structures discourage savings and work effort relative to the U.S…”

The 20-40% gap represents cost of larger welfare state.

In Lucas’ chart below, the long-term real U.S. growth rate of 3% is plotted against the U.S. recession of 2006 to 2011. It’s clear that current growth — except for the last 6 months (see above) — recovered to nearly 3%, but the rapid post-recession growth chatacteristic of most recoveries is not seen. Instead, GDP remains down by about 10% from the long-term trend.

How long will the U.S. growth gap continue?
Click

Lucas asks:

Recently, Stanford economist John B. Taylor (Wall Street Journal, 7/21/11) reminded us again that government economic policies really do have effects, and an empirical (rather than a political) approach to understanding them is invaluable.

For example, with lessons learned from the 1930s’ Great Depression and the 1970s’ Great Inflation, the 80s and 90s were a time of extraordinary job creation: 44 million new jobs. With lower tax rates and limited government spending, the result was economic growth, and

the federal budget moved into balance.

As the 21st century opened, ambitious politicians from both parties wanted to “tame the business cycle, increase homeownership, or provide the elderly with better drug coverage.” The avalanche of unintended consequences is well-known and includes:

a financial crisis, a great recession, ballooning debt and today’s nonexistent recovery.

Despite the U.S.’ current weak recovery, the road to near-term, JFK-style prosperity is clearly visible based on empirical, long-term studies of international economic growth by Lucas, Taylor, and others.

The only question is which U.S. political party will best manifest prosperity in 2012; the candidates who do it best will win.