Internal orders typically (though not always) change through a relatively standard sequence of stages, like how a disease progresses. By looking at their symptoms we can tell what stages they are in. For example, just as Stage 3 cancer is different from Stage 4 cancer in ways defined by different conditions that exist and have come about as a result of things that happened in prior stages, the same is true for the different stages of the big internal order/disorder cycle. Like diseases, different conditions warrant different actions to address them and they produce a different range of probabilities that those actions will produce. For example, an old, unhealthy set of circumstances produces a range of possibilities and warrants different actions than a young, healthy set. As with cancer, it is best to stop the progress before getting into the later stages.  

Below is the list of measures of health that I first passed along to you in Chapter 1. Most of these measures of health can be quantitatively measured to create a country’s health index. When the ratings of each of these items are strong/good (i.e., on the left side of the continuum) the health is strong/good and the period ahead is much more likely to be strong/good; when the ratings of these items are weak/bad, the condition of the country is weak and the period ahead is more likely weak/bad. The dimensions that we are measuring the strengths of are the most important determinants of total strength. In this chapter we will examine how these conditions together define a stage, so one will be able to look at the conditions that exist to tell what stage a country is in and then come up with a prognosis. In the concluding chapter of this book, which is on the future, I will show each country’s ratings for each of these measures, as well as use them in my attempt to explore what might be ahead. For now I just want to convey the concepts.

These strengths evolve together in archetypical ways to create the stages of the archetypical cycle. By using markers of them, we can identify where in the cycle each country, state, and city is and form our expectations of what the probabilities of different next developments will be based on the conditions at hand. In the following table, to help convey the picture, I converted most of our measures into colors with bright green being a very favorable reading and bright red being a very unfavorable reading. It is the average of these readings that defines at what stage the cycle is in, in much the same way as it was the average of the eight readings of power that I used as my measure of total power. Like those power readings, while one could reconfigure them to produce marginally different readings, they are broadly indicative in a by-and-large way. I am showing this to exemplify the typical process, not to look at any specific cases. I will look at the specific cases and their readings in the conclusion of this study.  

More specifically, from studying history it appears to me that the stages of the archetypical big internal cycle from internal order to internal disorder and back are as follows:

• Stage 1 when the new order begins and the new leadership consolidates power, which leads to…
• …Stage 2 when the resource-allocation systems and government bureaucracies are built and refined, which if done well leads to…
• …Stage 3 when there is peace and prosperity, which leads to… 
• …Stage 4 when there are great excesses in spending and debt and the widening of wealth and political gaps, which leads to…
• …Stage 5 when there are very bad financial conditions and intense conflict, which leads to…
• …Stage 6 when there are civil wars/revolutions, which leads to…
• …Stage 1, which leads to Stage 2, etc., with the whole cycle happening over again.    

Each stage presents a different set of conditions that the people facing them have to deal with. Some of these circumstances are much more difficult than others to resolve. For example, early in a long-term debt cycle, when there is plenty of capacity of governments to create debt to finance spending, it is easier to deal with the circumstances at hand than late in the long-term debt cycle when there is little or no capacity to create money and credit to finance spending. For these reasons the range of possible paths forward and the challenges that leaders face depend on where in the cycle a country is. These different stages present different challenges that require different qualities, understandings, and skills from leaders in order to effectively deal with them.[1]  How well those facing these circumstances—e.g., you facing your circumstances and our leaders facing our collective circumstances—understand and adapt to them affects how good or bad the outcomes will be within the range of possibilities that exist given the circumstances. Different cultures have different established ways of approaching these circumstances. Those leaders and cultures that understand them and can adapt to their circumstances will produce much better outcomes than those who don’t. That is where timeless and universal principles come in.  

While the length of time spent in each of these stages can vary a lot, the evolution through them generally takes 100 years, give or take a lot and with big undulations within the cycle. This evolution occurs because of logical cause/effect relationships in which existing conditions propel the changes that create the new set of conditions that propel the next changes and so on like a perpetual-motion machine. Because a given set of conditions creates a limited set of possibilities, by properly identifying the conditions and understanding the cause/effect relationships, one can improve one’s imagination of the possibilities of what will come next.    

The cycle’s archetypical evolution transpires as shown in the following diagrams.[2]  Like evolution in general, the evolution of internal orders typically occurs in a cyclical way in which one stage typically leads to the next through a progression of stages that repeat and, in the process, evolve to higher levels of development. For example, Stage 1 (when the new internal order is created by new leaders who came to power via a civil war/revolution) normally comes after Stage 6 (when there is a civil war/revolution, which is the low point in the cycle), which leads to the next stage and so on up to Stage 3 (which is the high point in the Big Cycle because there is a lot of peace and prosperity in that stage), which gets overdone in Stages 4 and 5 and so on, leading to the next new order (Stage 1). That happens over and over again in an upward-evolving way. Again, that archetypical cycle typically takes 100 years, give or take a lot.[3]  Within each of these big cycles are similar, smaller cycles. For example, there is a short-term debt cycle that leads to bubbles and recessions that come along roughly every 10 years, there are political cycles that move political controls between the right and the left that come along with roughly equal frequency, etc. Every country is going through them, and many of them are at different stages. For example, China and India are at very different stages than the United States and most European countries. What stages they are at in relation to other countries affects the relations between countries and is the primary determinant of the whole world order. We will explore all of these in the last chapter of this book rather than digress into them now.  

These cycles have taken place for as long as there has been recorded civilization (and probably before) so many cycles are linked together like so (figuratively speaking), and they are upward-sloping because of evolutionary gains that are made over time. 

The next chart, which I showed you in earlier chapters, shows China’s relative powers. The differences in this chart and the previous one are due to the fact that the first one shows the absolute level of power while the second one shows the relative level of power.    

Since different countries are typically in different stages of the cycle and since they take wealth and global political power from each other, some countries are rising while others are declining, so the whole is less volatile than any one country. In other words, the differences have had a diversification effect that has made the whole world’s evolution smoother than any of the individual countries’ evolutions. That is reflected in actual global real GDP, which I showed you in Chapter 1 and is shown in the following chart. The chart is not a figurative representation. It is literally the best estimates we have of real GDP per capita. Embedded in this chart are the rises and falls of major empires (particularly the Dutch, British, and the Ming and Qing dynasties in China), numerous wars, and numerous booms and busts. They don’t show up because they diversify each other and because they are small relative to the big trends, even though they are huge from the perspective of the people living through them.  

To reiterate, the figurative pictures of the archetypical six-stage cycle I just painted are simplified versions of what really happens. I simplified them to provide clarity. I find that too often in order to be precise people show so many details that one can’t see the essence of the big picture, and I don’t want to do that. I wanted to show you a simplified version that conveys the essence of the stages and then descend down into the details. While the cycle by and large progresses as I described, it doesn’t always progress exactly as I described. For example, like the stages of disease (let’s say Stage 3 cancer), being in one stage doesn’t mean that the progression to the next stage is inevitable. But it does tell us a lot that is very valuable. As with a disease a) certain symptoms are clearly exhibited that allow one to identify which stage in the cycle one is in, and b) being in that stage signifies the risks and ways of treating the situation that are essential to know are different from those that exist at different stages. For example, being in Stage 5 means that certain conditions exist that make it less likely, though not impossible, that the cycle won’t progress to Stage 6 than if it was in Stage 4 with those conditions existing. By having clear and objective markers to identify at what stage each country (or state or city) is in, and by having an understanding of the cause/effect relationships that produce change, one can better know the range of possibilities and position oneself accordingly, though one can never get them exactly right. 

As an example, we made an index of the number of economic “red flags” that have existed at different times in history, including measures of high inequality, high debt and deficits, inflation, and bad growth, to show how indicative they are of subsequent civil wars and revolutions. The following chart shows the estimated likelihood of a civil-war-type conflict based on the number of red flags. Based on what we have seen in the past, we estimate that when there are 60-80% of the red flags present, there is around a 1-in-6 chance of severe internal conflict. When lots of these conditions are in place (greater than 80%) there is around a 1-in-3 chance of a civil war or revolution—so still not probable but too probable for comfort. The US is in the 60-80% bucket today. In the concluding chapter of this book I will much more comprehensively pass along the indicators and what they show. Right now, I just want to convey the concept.  

I know that this model of mine is starting to get pretty complicated for the brain to process (though it’s not complicated for a computer to process), so I will describe just the highlights of each stage and just the most important factors. While I won’t take you through all 108 factors (i.e.,18x6) in these stages and their various configurations, below I will outline the forces and milestones to pay most attention to in each stage, with a special emphasis on the current state of disorder in the United States and how things are progressing.

Delving into the Six Stages of the Cycle with a Particular Focus on the US Now

We will now delve into what the archetypical six stages look like in greater detail so we can identify them easily when we see them and so we can better imagine what might come next. 

Because these circumstances transpire in repeating cycles (e.g., Stage 5 precedes Stage 6, which precedes Stage 1), we can start our examination at any stage and follow the sequence from there. Since the United States now appears to be in Stage 5, let’s start there.  

Stage 5: When There Are Bad Financial Conditions and Intense Conflict

The most important influence that transpires in a big cycle is that of debt, money, and economic activity. Because I covered that cycle comprehensively in Chapters 2 and 3, I won’t explain it here in detail. But to understand Stage 5, you need to know that it follows Stage 3, in which there is peace and prosperity and favorable debt and credit conditions, and Stage 4, in which excess and decadence begin to bring about worse conditions. This process culminates in the most difficult and painful stage—Stage 6—when the entity (country, state, city, company, or person) runs out of money and there is typically terrible conflict in the form of revolution or civil war. Stage 5 is the period during which the interclass tensions that go along with worsening financial conditions come to a head. How different leaders, policy makers, and groups of people deal with conflict has a major impact on whether the country will undergo the needed changes peacefully or violently.

You can see signs of this happening now in a number of countries. Those that have adequate financial conditions (i.e., have incomes that are greater than their expenses and assets that are greater than their liabilities) are in relatively good shape. Those that do not are in relatively bad shape. You can also see that these different conditions are big drivers of the differences in what is now happening to most aspects of these countries, states, cities, companies, and people—e.g., their education, healthcare, infrastructure, and well-being. You can also see big cultural differences in how countries approach their stressful conditions, with some approaching them more harmoniously than others who are more inclined to fight. 

Because Stage 5 is such a pivotal stage in the internal cycle and because it’s the stage that many countries are now facing, I will devote some time to going through the cause/effect relationships at play during it and the key indicators to watch in examining its progression. Then I will turn more specifically to where the United States stands and how it might best handle its internal conflicts.

The Classic Toxic Mix 

The classic toxic mix of forces that brings about big internal conflicts consists of 1) the country and the people in the country (or state or city) being in bad financial shape (e.g., they have big debt and non-debt obligations like pension and healthcare obligations), 2) large income, wealth, and values gaps within that entity, and 3) a severe negative economic shock. The economic shock can come about for many reasons, including financial bubbles that burst; acts of nature such as diseases, droughts, and floods; and wars. It creates a financial stress test. The financial conditions (as measured by incomes relative to expenses and assets relative to liabilities) that exist at the time of the stress test are the shock absorbers; the sizes of the gaps in incomes, wealth, and values are the degrees of fragility of the system. When the financial problems occur, they typically first hit the private sector and then the public sector. Because governments will never let the private sector’s financial problems sink the entire system, it is the government’s financial condition that matters most. When the government runs out of buying power, there is a collapse. But on the way to a collapse there is a lot of fighting for money and political power. 

From studying 50+ civil wars and revolutions, it became clear that the single most reliable leading indicator of civil war/revolution is bankrupt government finances, often after an economic shock and when there are big wealth gaps. That is because when the government lacks financial power, it can’t financially save those entities in the private sector that the government needs to save to keep the system running (as most governments, led by the United States, did at the end of 2008), it can’t buy what it needs, and it can’t pay people to do what it needs them to do. It is out of power.  

A classic marker of being in Stage 5 and a leading indicator of the loss of borrowing and spending power, which is one of the triggers for going into Stage 6, is that the government has large deficits that are creating more debt to be sold than buyers other than the government’s own central bank are willing to buy—i.e., that leading indicator is turned on when governments that can’t print money have to raise taxes and cut spending, or when those that can print money print a lot of it and buy a lot of government debt. To be more specific, when the government runs out of money (by running a big deficit, having large debts, and not having access to adequate credit) it has limited options. It can either 1) raise taxes and cut spending a lot or 2) print a lot of money, which depreciates its value. Those governments that have the option to print money always do so because that is the much less painful path, but it leads investors to run out of the money and debt that is being printed. Those governments that can’t print money have to raise taxes and cut spending, which drives those with money to run out of the country, state, or other jurisdiction because paying more taxes and losing services is intolerable. If these entities that can’t print money have large wealth gaps among their constituents, these moves typically lead to some form of civil war/revolution.[5]   

This late-cycle debt dynamic is now playing out in the United States at both the state and federal levels, with the main difference between them being that state governments can’t print money to pay their debts while the federal government can. Near the beginning of this chapter I showed where debt levels, wealth gaps, and political gaps—which are all at the highest since the 1930s—now stand in the United States. 

For example, in the United States now, the federal government and many state and city governments have large deficits, large debts, and large wealth gaps, and the central bank (the Federal Reserve) has the power to print money. So, it now prints a lot of money and buys a lot of federal government debt, which finances the government spending that is much bigger than the federal government’s intake. That has helped the federal government and those it is trying to help, though it has also cost those who are holding dollars and dollar debt a lot in real purchasing power. Thus far this money printing and buying of debt has not materially helped state and municipal governments that also have big shortfalls to deal with and can’t easily get printed money to fill them.

As a rule, those places (cities, states, and countries) that have the largest wealth gaps, the largest debts, and the worst declines in incomes are most likely to have the greatest conflicts. Interestingly, those states and cities in the US that have the highest per capita income and wealth levels tend to be the states and cities that are the most indebted and have the largest wealth gaps—e.g., New York City, Chicago, San Francisco, Connecticut, Illinois, Massachusetts, New York State, and New Jersey. If you are interested in seeing these numbers for the major states and cities in the US, they are shown in the appendix.  

Facing these conditions, expenditures have to be cut or more money has to be raised in some way. The next question becomes who will pay to fix them, the “haves” or the “have-nots”? Obviously, it can’t be the have-nots. Expenditure cuts are most intolerable for those who are poorest, so there needs to be more taxation of people who can afford to pay more and there is a heightened risk of some form of civil war or revolution. But when the haves realize that they will be taxed to pay for debt service and to reduce the deficits, they typically leave, causing the hollowing-out process previously described. If bad economic conditions occur, that hastens the process. These circumstances largely drive the tax cycle.  

History shows that raising taxes and cutting spending when there are large wealth gaps and bad economic conditions has, more than anything else, been a leading indicator of civil wars or revolutions of some type. To be clear they don’t have to be violent, though they could be.  

I see these cycles transpiring in my personal interactions where I live. I live in the state of Connecticut, which has the highest average per capita income in the country, the largest wealth gap and income gap in the country, and one of the largest per capita debt and unfunded pension obligations in the country. I see how the haves and the have-nots don’t have contact and/or don’t worry about the other because they don’t have much contact with each other and are focused on living their own lives. I have windows into what the lives of both the haves and the have-nots are like because I have contact with the people in our community of haves and because the work my wife does to help disengaged and disconnected high school students in disadvantaged communities brings her into contact with people who live in the communities of the have-nots. I see how terrible the conditions are in those have-not communities and how the haves who appear rich and decadent to the have-nots don’t feel rich. I see how they are all focused on their own struggles—with the haves struggling with work-life balance, making sure their kids are well educated, etc., and the have-nots struggling with finding income, food security, avoiding violence, trying to have their kids well educated, etc.[6]  I see how they are more likely to have critical, stereotypical impressions of each other that make them more inclined to dislike each other than to view themselves empathetically as members of one community in which they help each other. I see how difficult it can be to help each other because of these stereotypes and because the haves don’t feel that they have more than enough or that the have-nots deserve their financial support and I fear what the future might hold because of the existing circumstances and how they are likely to worsen. I have seen close up how COVID-inflicted health and budget shocks have brought to the surface the terrible conditions of the have-nots and are worsening the financial gaps that could bring about the previously described dynamic that happens when there is not enough money and taxes have to rise which drives the haves away, expenses have to be cut which is inhumane for the have-nots, or obligations like those for debt and pensions have to be defaulted on which is bad for those who were promised them, unless somehow they, like the federal government, have access to the money creation that only the central bank can provide.  

Averages don’t matter as much as the number of people who are suffering and their power. Those who favor policies that are good for the whole—e.g., free trade, globalization, advances in technology that replace people—without thinking about what happens if the whole is not divided in a way that benefits most people are missing the fact that the whole is at risk. To have peace and prosperity, a society must have productivity that benefits most people. Do you think we have these things today?  

What does history show as the path that bankrupt governments can follow to raise productivity that benefits most people? It shows that restructuring and/or devaluing enough of the previously created debt and non-debt obligations helps a lot. That is classic in Stages 5 and 6. Once the restructuring or devaluation reduces the debt burdens, which is typically painful at the time, the reduced debt burdens allow for a rebuilding.  

An essential ingredient for success is that the debt and money that is created is used to produce productivity gains and favorable return on investment rather than just being given away without yielding productivity and income gains because if it is given away without yielding these gains the money will be devalued to the point that it won’t leave the government or anyone else with much buying power. When we turn to Stage 3, we will look at how that virtuous cycle typically arises from the terrible conditions in Stages 5, 6, and 1, and how the conditions in one stage are good indicators of the probabilities of moving to the next stage. We will also look at several historical examples.   

History shows that lending and spending on items that produce broad-based productivity gains and return on investment that exceed the borrowing costs result in living standards rising with debts being paid off, so these are good policies. If the amount of money being lent to finance the debt is inadequate, it is perfectly fine for the central bank to print the money and be the lender of last resort as long as the money is invested to have an ROI that is large enough to service the debt. History shows and logic dictates that investing well (i.e., so it yields productivity) in education at all levels (including job training), infrastructure, and research that yields productive discoveries works very well. For example, big education programs and infrastructure programs have paid off nearly all the time (e.g., in the Tang Dynasty and many other Chinese dynasties, in the Roman Empire, in the Islamic Umayyad Caliphate, in the Mughal Empire in India, in Japan’s Meiji Restoration, and in China’s educational development programs over the last couple of decades), though they have rather long lead times. In fact improvements in education and infrastructure (among the other things in the list of factors shown earlier), even those financed by debt, were essential ingredients behind the rises of virtually all empires and declines in the qualities of these investments were almost always ingredients behind their declines. If done well, these interventions can more than counterbalance the classic toxic mix.   

While I just described the classic toxic mix, it is usually accompanied by other problems. The more of the following conditions that are in place, the higher the probability of having a severe conflict like a civil war or revolution.    

+ Decadence 

While early in the cycle there is typically more spending of time and money on productive things, later in the cycle time and money go more toward indulgent things (e.g., “the finer things in life” like expensive residences, art, jewelry, and clothes). This begins in Stage 4 when such spending is fashionable, but by Stage 5 it begins to appear grotesque. Often that decadent spending is debt-financed, which worsens the financial conditions. The change in psychology that typically goes along with these changes is understandable. The haves feel that they legally acquired their money so they can spend it on luxuries if they like, while the have-nots view such spending at the same time they are suffering as unfair and selfish. Besides increasing resentments, decadent spending (as distinct from saving and investing) reduces productivity. What a society spends money on matters. When it spends on investment items that yield productivity and income gains, it makes for a better future than when it spends on consumption items that don’t raise productivity and income.  

+ Bureaucracy 

While early in the big cycle bureaucracy is low, it is high late in the cycle, which makes sensible and needed decision making more difficult. That is because things tend to get more complex as they develop until they reach the point where even obviously good things can’t be done—necessitating revolutionary changes. In a legal and contract-based system (which has many benefits), this can become a problem because the law can stand in the way of doing obviously good things. I will give you an example that I’m close to because my wife and I care about it.  

Because the US Constitution doesn’t make education a central government responsibility, it has predominantly been a state and local responsibility with school funding coming from revenue raised by taxes in local cities and towns. Though it varies from state to state, typically those children in richer towns in richer states have much better educations than those in poorer towns in poorer states. This is obviously unfair and unproductive even though most people agree that children should have equal opportunities in education. But because this structure is so ingrained in our political system, it is nearly impossible to fix without a revolutionary reinvention of how we approach it. There are more examples of the bureaucracy standing in the way of doing sensible, productive things than I have time and space to convey here—i.e., it is now a big problem.

+ Populism and Extremism 

Populism is a political and social phenomenon that appeals to ordinary people who feel that their concerns are not being addressed by elites. It typically develops when there are 1) wealth and opportunity gaps, 2) perceived cultural threats from those with different values both inside and outside the country, and 3) “establishment elites” in positions of power who are not working effectively for most people. Populists come into power when these conditions create anger among ordinary people who want those with political power to be fighters for them. Populists can be of the right or the left, are much more extreme than moderates, and tend to appeal to the emotions of the common man. They present themselves as fighters for their constituents. They are typically confrontational rather than collaborative and exclusive rather than inclusive. This leads to a lot of fighting between populists of the left and populists of the right over irreconcilable differences. The extremity of the revolution that occurs under them varies. For example, in the 1930s, populism of the left took the form of communism and that of the right took the form of fascism while nonviolent revolutionary changes took place in the US and UK. More recently, in the United States, the election of Donald Trump in 2016 was a move to populism of the right while the popularity of Bernie Sanders, Elizabeth Warren, and Alexandria Ocasio-Cortez reflects the popularity of populism of the left. There are increased political movements toward populism in a number of countries. It can be said that the election of Joe Biden reflects a desire for less extremism and more moderation, though time will tell.   

The following chart shows a populism index that is based on a combination of populists who were elected to office and populist vote share. The election shift from the Trump populist, anti-establishment presidency to the Biden moderate, establishment presidency is what led the index to fall from its highly elevated level. Still it remains relatively high, though Biden scored as a moderate. Note that voters on both sides score high for supporting populists, as reflected in US election results and polling data, which makes clear how evenly and extremely divided the country is.  

Along with the rise of populists come more extreme positions on both sides and increased polarization.  

Right now there is an exceptional amount of polarization in the US as reflected in the stats. In Chapter 8 I showed you charts of the Republican and Democratic voting records of those in the Senate and House of Representatives being the largest and the party-line voting being the greatest since 1900. Survey data about the sentiments of the voters who elected these representatives paints a similar picture of polarization and intransigence. For example, in a 2019 Pew survey 55% of Republicans and 47% of Democrats view the other as more immoral than average Americans, and 61% of Republicans and 54% of Democrats say that those of the other party don’t share their values. When asked whether they had warm or cold feelings to those of the other party, 79% of Democrats and 83% of Republicans had cold or very cold feelings for members of the other party, with 57% of Democrats and 60% of Republicans reporting very cold feelings about members of the other party.[7] Another study reported that 80% of Democrats think that the Republican Party has been taken over by racists and 82% of Republicans think that the Democratic Party has been taken over by socialists.[8] A 2020 study showed that nearly half of Republican parents and a third of Democratic parents would be displeased if their child married someone from the other political party. This compares with about 5% for both parties in 1960.[9]   One recent survey showed that 15% of Republicans and 20% of Democrats thought the country would be better if large numbers of the other side “just died.”[10]   Based on these and other surveys, it appears that large numbers of members of both parties are more inclined to fight for deeply held preferences rather than compromise. While who is president has changed, the people have not changed, and in the long run what happens in a democracy depends on what the people are like in dealing with the system.   

Watch populism and polarization as markers. The more populism and polarization there is, the further along the cycle a nation is in Stage 5, and the closer it is to civil war and revolution. In Stage 5, moderates become the minority. In Stage 6, they cease to exist.

+ Class Warfare 

In Stage 5 class warfare intensifies. That is because, as a rule, during times of increased hardship and conflict there is an increased inclination a) to look at people in stereotypical ways as members of one or more classes and b) to look at these classes as either being evil enemies or good allies. It is important to watch whether or not this is happening because it’s a marker. In Stage 5 this begins to become much more apparent. In Stage 6 it becomes dangerous.  

A classic marker in Stage 5 that increases in Stage 6 is the demonization of those in other classes, which typically produces one or more scapegoat classes who are commonly believed to be the source of the problems, and if they are destroyed, imprisoned, or kept out, this will lead to better results. Minority ethnic, racial, rich, and poor groups are often demonized. Perhaps the most classic example of this is the demonizing and scapegoating of Jews, who were blamed and persecuted for virtually all of Germany’s problems by the Nazis. Similarly, Chinese minorities living in non-Chinese countries have been demonized and scapegoated during periods of economic and social stress. In the UK Catholics were demonized and scapegoated in numerous stressful periods since the 1500s, such as the Glorious Revolution and the English Civil War. The rich are also commonly demonized, especially those who are viewed to be making their money at the expense of the poor. Demonizing and scapegoating are a classic symptom and problem that we must keep an eye on.  

+ The Loss of Truth in the Public Domain 

Not knowing what is true because of distortions in the media and propaganda increases as people become more polarized, emotional, and politically motivated.

In Stage 5 those who are fighting typically work with those in the media to manipulate people’s emotions to gain support and to destroy the opposition. In other words, media folks of the left join with others of the left and media folks of the right join with others of the right in the dirty fight. For example, a common move among 1930s populists of the left (e.g., communists) and of the right (e.g., fascists) was to take control of the media and establish “ministers of propaganda” to guide them. The media they produced was explicitly aimed at polarizing the population against the groups that the governments considered “enemies of the state.” The government of the democratically run United Kingdom created a “Ministry of Information” during World War I and World War II to spread government propaganda, and leading newspaper publishers were elevated by the government if they did what the government wanted them to do to win the propaganda war[11] or were vilified and suffered if they didn’t cooperate. Revolutionaries did the same distorting of the truth in all sorts of publications. During the French Revolution, newspapers run by revolutionaries pushed anti-monarchical and anti-religious sentiment, but when those revolutionaries attained power, they shut down dissenting newspapers during the Reign of Terror. During times of great wealth gaps and populist thinking, stories that bring down elites are popular and lucrative, especially those that bring down left-leaning elites in right-leaning media outlets and those that bring down right-leaning elites in left-leaning media outlets. History shows that significant increases in these activities are a problem that is typical of Stage 5, and that when combined with the ability to inflict other punishments, the media becomes a powerful weapon.

It is well-recognized this is happening now—that truth in media, both traditional and social, is lower than at any other time in our lifetimes. For example, a 2019 Gallup study[12] said that only 13% of Americans surveyed have “a great deal” of trust in the media and only 41% of those surveyed said that they have either a “fair” or “great deal” of trust in media. That compares with 72% who trusted media in 1976. This is not just a fringe media problem; it is a mainstream media problem and a problem for our whole society. The dramatically decreased trustworthiness has even plagued former icons of journalistic trust such as the Wall Street Journal and the New York Times, which have seen their trust ratings plunge. In addition to being politically motivated, sensationalistic stories have become commercially rewarding at a time when the media business is in financial trouble. Most of the media folks I speak with share my concerns, though they typically won’t share them openly. Still, in reflecting on the problem, Martin Baron, executive editor of the Washington Post, said, “If you have a society where people can’t agree on the basic facts, how do you have a functioning democracy?”[13] This dynamic is impeding free speech because people are afraid to speak up because of how they will be attacked in both traditional and social media by distortions that are meant to bring them down. 

Even very capable and powerful people are now too afraid of the media to speak up about important matters or run for public office. Since most high-profile people are torn down, most everyone agrees that it is dangerous to be a high-profile, vocal person who fights for truth and justice, especially if one offends people who are inclined to use the media to fight. Though not discussed in public because of fears of media reprisals, this issue is continuously discussed in private. For example, during a lunch I had not long ago with a general who had held a very high political position and had just left government service, we explored what he would do next. I asked him what he was most passionate about. He said, “Of course helping my country.”  I asked him whether he would consider running for elected office, and he explained that while he was willing to die for his country he couldn’t bring himself to run for public office because of how enemies would use the media and social media to make up lies to harm his family as well as himself. Ironically, the result of such untruthful media attacks is less free speech: this general and almost everyone I know who I wish the world could hear what they honestly think are afraid to speak openly because they fear that attacks by extremists who oppose them will be enabled and amplified by the sensationalistic media. Many of my friends tell me that I’m crazy to speak so openly about controversial things such as those covered in this book because it is inevitable that some people or groups will try to take me down via the media. I think they are probably right, but I won’t let the risks dissuade me.[14]

+ Rule-Following Fades and Raw Fighting Begins 

History has shown that when the causes that people are passionately behind are more important to them than the system for making decisions, the system is in jeopardy. Rules and laws work only when a) they are crystal clear and b) most people value working within them enough that they are willing to compromise in order to make them work well. If both of these are less than excellent, the legal system is in jeopardy. If the competing parties are unwilling to try to be reasonable with each other and to make decisions civilly in pursuit of the well-being of the whole, which will require them to give up things that they want and might win in a fight, there will be a sort of “civil war” that will test the relative powers of the relevant parties. In this stage, winning at all costs is the game and playing dirty is the norm. Late in Stage 5 is when reason is abandoned in favor of passion. When winning becomes the only thing that matters, unethical fighting becomes progressively more forceful in self-reinforcing ways. When everyone has opinions that they are fighting for and no one can agree on anything, the system is on the brink of civil war/revolution.  

This typically happens in a couple of ways:

• Late in Stage 5 it is common for the legal and police systems to be used as political weapons by those who can control them. Also private police systems form—e.g., thugs who beat people up and take their assets, and bodyguards to protect people from these things happening to them. For instance, the Nazi party formed a paramilitary wing before it came to power that then became an official force when the Nazis were in power. So did the short-lived British Union of Fascists in the 1930s. The Ku Klux Klan in the US was effectively a paramilitary group as well. Such cases were quite normal, so view their development as a marker of moving to the next stage. 
• Late in Stage 5 there are increasing numbers of protests that become increasingly violent. Because there is not always a clear line between a healthy protest and the beginnings of a revolution, leaders in power often struggle over how to allow protests without giving the perceived freedom to revolt against the system. Leaders must manage these situations well. A classic dilemma arises when demonstrations start to push the limits of revolution. Both giving the freedom to protest and suppressing protests are risky paths for leaders, as either path could lead the revolution to get strong enough to topple the system. No system allows people to bring down the system—in most, an attempt to do so is treason, typically punishable by death. Nonetheless, it is the job of revolutionaries to bring down systems, so governments and revolutionaries test each other to see what the limits are. When broad-based discontent bubbles up and those in power allow it to grow, it can boil over to the point that when they try to put a lid on it, it explodes. The conflicts in the late part of Stage 5 typically build up to a crescendo that triggers the violent fighting that signifies the transition into what historians stamp as the official civil-war periods, which I am identifying as Stage 6 in the Big Cycle. People dying in the fighting is the marker that almost certainly signifies the progression to the next and more violent civil-war stage, which will continue until the winners and losers are clearly determined.  

That brings me to my next principle: when in doubt get out. If you don’t want to be in a civil war or a war, you should get out while the getting is good. History has shown that when things get bad, the doors typically close for people who want to leave. The same is true for investments and money as countries introduce capital controls and other measures during such times.

Before I move on to look at Stage 6, I want to distinguish between revolutions and civil wars and put them in the right buckets.  

What Is the Difference between a Civil War and a Revolution?

A revolution is the process of bringing about revolutionary changes in how the system works. Revolutions needn’t be violent, though they typically are. They can occur within the system/order without breaking the system, or they can occur after disposing of the old order and starting a new one. Civil wars, on the other hand, are violent fights for controlling wealth and political power or fights over ideologies that people feel are even more important than themselves. They produce a lot of injury and death[15] and the breakdown of basic protections for people and basic services including healthcare, education, and normal economic activities. They are attempts to end the old order and replace it with a new order. The difference between civil wars and revolutions can be confusing—e.g., were the French and Russian revolutions really civil wars, and was Franklin Roosevelt’s big move to the left a peaceful revolution? How does one distinguish between successful and unsuccessful civil wars and revolutions—e.g., should the US Civil War not be counted as a civil war since it was unsuccessful in changing the system? I will explain how I chose to categorize them.  

In categorizing civil wars and revolutions I decided to distinguish those that occurred within a system/order from those that were attempts or successes to break the order and start a new one. In other words, revolutions can happen as a way of addressing the challenges of Stage 5 before a nation progresses to civil war (i.e., Stage 6). These revolutionary changes can occur within the system even if there is brutal arguing, as long as there is not lots of killing (civil wars) and/or changes in systems/orders (which fall into the next category and section). Examples of revolutionary changes within the existing orders include Roosevelt’s revolutionary shifts to the left in the early 1930s and Reagan’s and Thatcher’s revolutionary shifts to the right in the early 1980s. They were reflected in radically different wealth distribution policies that were exemplified by the radically different top income tax rates. For example, the top marginal tax rate in the US and UK since 1900, the changes in which are shown in the following charts, went from 0% to over 90% in 30 years and almost all wealth was redistributed in the 30 years between 1914 and 1944. This is just one of a number of measures we use to show the revolutionary changes that took place within the system.

History shows us that revolutionary changes that take place within a system/order can be as large as those that come from civil wars. For example, the Big Cycle revolutionary changes that took place within the US system in the 90 years from 1860 to 1950 were nearly total in that they almost completely changed who had wealth and power from the boom to the unimaginable busts, wars, and redistributions. More specifically, after the US Civil War ended in 1865, the US joined other major Western countries in having great productivity, prosperity, and wealth creation.[16]  This period was known as the Second Industrial Revolution. That was when the “robber barons” such as John D. Rockefeller, Cornelius Vanderbilt, Andrew Carnegie, and J.P. Morgan accumulated vast fortunes, which led to popular reactions against them and their powers. This period was also called the Gilded Age in the US, the Victorian Era in the UK, and the Belle Époque in France because of the decadent spending that set in motion the revolutionary changes that started gradually and then accelerated to wipe out or redistribute virtually all wealth by 1950.

For example, in the US, strikes first began in the 1880s, the Sherman Antitrust Act was passed in 1890 to break up monopolies and was increasingly used to break up companies, and the debt-bubble-induced depression of 1893 raised tensions especially as money was kept hard (i.e., tied to gold), so in 1896 a populist—William Jennings Bryan—emerged and campaigned for the presidency on the platform of breaking the link with gold, printing money, and distributing it liberally. Bryan wasn’t elected. Theodore Roosevelt became president in 1901, and “muckrakers” in the mass media led to investigative journalism that helped stir up the public and was used by Roosevelt to make reforms. A new political party, the Populist Party, and the Progressive movement came into existence in support of a number of actions to deal with industrial and labor issues, trust busting, food and drug quality, women’s suffrage, etc. In 1913 the 16th Amendment to the Constitution allowing a federal income tax was passed. From that point of having no taxes to speak of, the top marginal tax rates increased to around 70-80% for both income and estate taxes. In the 30 years from 1914 and 1944, there were two world wars and the global depression, which led to the creation of a lot of debt that had the interest rates on it legally capped while all major currencies were delinked from gold, gold ownership was outlawed, the abilities to take money out of most countries were eliminated, and price controls on rent and other items were created. Then central banks printed a lot of money, which produced a lot of inflation, sharply reducing the real value of fixed-income and equity assets. Additionally, in most countries (especially in Europe) businesses were expropriated or nationalized, and the war damage destroyed a lot of property. Capitalists and capitalism were widely blamed and hated especially as a result of the stock market crashes and depressions, so many of them were killed.[17]

Those revolutionary changes in wealth and power that took place within the system that we looked at, are still studying, and by and large were driven in this archetypical way are: 

• 1828 US Election: Andrew Jackson—Conservative populist, refused to renew the charter of the US’s central bank (Second Bank of the US).
• 860s Russia: Abolition of serfdom.
• 880s Germany: Otto von Bismarck’s social legislation.
• 1890s-1920s: The Progressive Era—Trust busting, anticorruption, scientific thinking.
• 1906: Theodore Roosevelt introduced progressive estate taxation and, in 1909, the income tax. 
• 1908 UK Election: H.H. Asquith’s passage of big tax hikes and the major welfare reforms that led to the emergence of the modern welfare system in the UK.
• 1912 US Election: Woodrow Wilson—First Democratic president elected in 20 years, second in 55, which kicked off big tax changes and reform.
• 1920: The women’s rights movement led to the 19th Amendment of the US Constitution, which gave women the right to vote. 
• 1932 US Election: FDR’s move to the left—Upon election, Franklin Roosevelt immediately devalued the dollar to produce debt relief and implemented sweeping reforms on an unprecedented scale. His New Deal policies sought to tackle the economic depression through a vast expansion of the role of government and support for workers, debtors, and the unemployed. He created Social Security and unemployment insurance, increased financial regulation, created large government programs that directly employed people, and strengthened labor rights.
• 1936 French Election: Blum’s move to the left—Léon Blum passed a slew of labor reforms that gave workers increased rights, better working conditions, and higher pay. 
• 1940s-50s Argentina: Perónist moves to the left—Juan Perón nationalized industries, increased wages for workers, increased the numbers covered by social security, and expanded health insurance.
• 1950s Soviet Union: Nikita Khrushchev’s anti-Stalin reforms to eliminate oppression and raise agricultural production.
• 1960s-70s India: Gandhi’s socialist policies— Indira Gandhi expanded the public sector and helped enable the “Green Revolution” (protecting Indians from famine and dependence on imported grains).
• 1964 US Election: Lyndon Johnson’s tax cuts and civil rights and anti-poverty programs.
• 1978: Deng Xiaoping/“Capitalist Revolution.”
• 1979 UK Election: Margaret Thatcher’s move to the right.
• 1980 US Election: Ronald Reagan’s move to the right.

Crossing the line from Stage 5 (when there are very bad financial conditions and intense internal and external conflict exists) to Stage 6 (when there is civil war) occurs when the system for resolving disagreements goes from working to not working. In other words, it happens when the system is broken beyond repair. As you might imagine, it is a much bigger deal to break a system/order and build a new one than it is to make revolutionary changes within an existing system/order. Though breaking a system/order is more traumatic, it isn’t necessarily a worse path than operating within a system.  

Deciding whether to keep and renovate something old that is not working well or to dispose of it and replace it with something new is never easy, especially when the something new is not clearly known and is of the importance of a domestic order. Nonetheless, it happens, though typically it is not decided on intellectually; it is typically emotionally driven.  

When one is in late Stage 5 (like the US is now) the biggest question is how much the system will bend before it breaks. The democratic system, which allows the population to do pretty much whatever it decides to do, produces more bending because the people can make leadership changes and only have themselves to blame. In this system regime changes can more easily happen in a peaceful way. However, the one-person, one-vote democratic process has the drawback of having leaders selected via popularity contests by people who are largely not doing the sort of thoughtful review of capabilities that most organizations would do when trying to find the right person for an important job. So, while having great ability to bend, in democracies there is a big risk in not filling the most important jobs with the most capable people. Democracy also requires consensus decision making and compromise, which requires a lot of people who have opposing views to work well with each other within the system. That ensures that parties that have significant constituencies can be represented, but like all big committees of people who have widely different views (and might even dislike each other), the decision-making system does not lend itself to efficient decision making. History shows us that the biggest risk to democracies is that they produce such fragmented and antagonistic decision making that they can be ineffective, which leads to bad results, which leads to revolutions led by populist autocrats who represent large segments of the population who want to have a strong capable leader get control of the chaos and make the country work well for them.  

Also noteworthy: history has shown that during times of great conflict federalist democracies (like the US) typically have conflicts between the states and the central government over their relative powers. That would be a marker to look out for that hasn’t yet arisen in the US; it happening would signify the continued progression of this cycle toward Stage 6.

There are far too many breakdowns of democracies to explore, let alone describe. While I looked into a number of them to see the patterns, I haven’t fully mined them, and I’m not going to dive into them here. I will say that the factors described in the explanations of Stage 5 when taken to the extreme—most importantly, terrible finances, decadence, internal strife and disorder, and/or major external conflict—lead to a dysfunctional set of conditions and a fight for power led by a strong leader. Archetypical examples that come to mind are Athens from the late 400s to the 300s BC, the end of the Roman Republic in the century or so preceding 27 BC,[18] Germany’s Weimar Republic in the 1920s, and the weak democracies of Italy, Japan, and Spain in the 1920s and 1930s that turned to autocracies of the right (fascism) to bring order to the chaos.  

Different stages require different types of leaders to get the best results. When one is in Stage 5 one is at a juncture in which one path could lead to civil war/revolution and the other could lead to peaceful, and ideally prosperous, coexistence. Obviously the peaceful and prosperous path is the ideal path, but it is the much more difficult path to pull off. That path requires either a “strong peacemaker” who goes out of their way to bring the country together, including reaching out to the other side to involve them in the decision making and reshaping the order in a way that most people agree is fair and works well (i.e., is highly productive in a way that benefits most people) or a “strong revolutionary” who is capable of taking the country through the hell of civil war/revolution. In our discussion of the next two stages about civil war/revolution and the times right after them, we will explore what is required.  

The US Now

The United States is now in Stage 5 and has not yet crossed the line into Stage 6 (the civil-war stage). Will populism and fighting between extremists go past the point of no return? Judging by the indicators the honest answer is that it is too close to call. Hardly anyone expects that the US will cross the line to have a civil war/revolution, though it could. Because the United States has a long tradition of working out disagreements within the system, precedent favors making changes within the system. In its 244-year history it has had only one civil war, several rather peaceful revolutions, and many serious conflicts, so it has shown great capacity to bend without breaking. Of course, it was our ancestors who bent and compromised enough to work things out without abandoning the system, and now it is the responsibility of existing decision makers to interact with the system that our founding fathers gave us.  

The recent elections showed how split the country is—almost 50/50 along seemingly irreconcilable lines. Figuratively speaking the population 50 years ago used to look like this—i.e., the majority of each party were moderates and the extremists were less extreme.  

Now it looks like this—i.e., with a greater concentration and number of people at the extremes.  

Such changes are typical of progressing toward greater conflict as they reflect more people being at the extremes and the number of moderates shrinking. When moderates are in the minority and extremists are in the majority in each party there is a self-reinforcing pull to greater polarization and increased conflict. As previously described, after there are regime changes (such as Biden winning the presidency), those who were united in their desire to depose the incumbent common enemy fight each other for power after they defeat the incumbent and come to power. So, we should expect that the Democrats and the Republicans will fight among themselves for power as well as with those in the opposite parties. Since the extremists in each party appear to outnumber the moderates, the dynamic I am describing pulls the parties to greater extremes because if they don’t themselves lean in that direction they could be defeated in primary elections by greater extremists. A modern-day example of that dynamic is the possibility that Senate Minority Leader Chuck Schumer could be unseated by a Democrat who is more left than he is. That would be a straw in the wind.  

History has shown us that greater polarization equals either a) greater risk of political gridlock, which reduces the chances of revolutionary changes that rectify the problems, or b) some form of civil war. 

With a moderate/establishment president (Biden) and the Senate likely to be in Republican hands, it now appears most likely that neither side will be able to dominate the other and fighting for changes will most likely continue within the system. That is likely to force either gridlock or compromise. Greater gridlock could lead to more unethical fighting that the other side will find intolerable and reply to in kind, while compromise would require moderates to split from the extremists in their parties. For these reasons it would be unwise to be confident about whether the cycle will or will not progress to Stage 6. However, because that would be a very big deal, it will be important to watch the markers closely. In my opinion they will be best reflected in the 18 factors previously mentioned, though they can also be reflected by other markers.  

To reiterate, some of the most important markers I am looking at are:

• 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 seemingly unlikely, history has shown that people can be inventive when faced with seemingly intractable problems and get around them. For example, though seemingly unlikely, perhaps a third party for moderates who are no longer comfortable in their existing parties will be created, which could quickly increase the power of moderates because it wouldn’t take many votes in the Senate or House to give moderates the swing votes that would give them great power.[20]  

We will soon find out in what directions Democratic and Republican party members will be pulled and how well the representatives of the two parties deal with each other, as described above: either with gridlock or compromise. I just hope all parties recognize where they are in the cycle and what could come next—i.e., the costs of increased conflict and the benefits of reduced conflict.  

Stage 6: When There Are Civil Wars

This section is about the part of the Big Cycle when there is a fight to get rid of the existing system/order—i.e., when there is a civil war. 

History shows us that civil wars inevitably happen, so rather than assuming that “it won’t happen here,” which most people in most of the countries assume after an extensive period of not having them, one should be wary of them and look for the markers to indicate how close to one one is. In this section we will look at those markers.   

While in the last section we looked at nonviolent revolutions that took place within the order, in this section we will be looking at the patterns of civil wars and revolutions that were almost always violent and toppled the old order and replaced it with a new one. Though there are an innumerable number that we could have examined to understand how they work, we chose what I believe are the 29 most significant ones, which are shown in the following table. We categorized this group into those that produced big changes to the system/regime and those that did not. For example, the US Civil War was a real bloody civil war that failed to overturn the system/order, so it is in the second group at the bottom of the table, while those that toppled the system/order are at the top. These categories are of course imprecise, but once again we won’t let imprecision stand in the way of seeing what we couldn’t see if we insisted on being precise. Most of them, though not all of them, transpired in the archetypical way described in this section.  

A classic example of a civil war breaking the system and having to build a new system is the Russian Civil War/Revolution of 1917, which put into place the communist internal order that entered Stage 5 in the late 1980s, which led it to attempt to make revolutionary changes within the system, which was called perestroika (i.e., restructuring), which failed and was followed by the collapse of the Soviet Union’s order in 1991 and that order being replaced by the new system/order that is now governing Russia, which, after the collapse of the old order, was built in the classic ways described later in this chapter in my explanation of Stages 1 and 2. In that case, the communist domestic order and its big cycle lasted 74 years (from 1917 until 1991). Another is the Meiji Restoration, which came about as a result of a three-year revolution (1866-69) in Japan that came about because the Japanese were closed off to the outside world and failed to advance so the Americans forced the Japanese to open, which prompted a revolutionary group to fight and defeat the rulers (led by the military shogun) in battle, which led to overturning the internal order run by four classes—1) the conservative military, 2) farmers, 3) artisans, and 4) merchants—that had ruled Japan. The old Japanese order run by traditional people was ultra-conservative—e.g., social mobility was outlawed—and was replaced by revolutionaries who were extremely progressive and changed everything under the emperor to make great improvements. Early in this period there were lots of labor disputes, strikes, and riots that resulted from the classic wealth gaps and bad economic condition triggers. In the reform process the leadership provided universal elementary education for both boys and girls, adopted capitalism, and opened up the country to the outside world. Rather than using the old technologies they were able to use the new technologies, which led them to become very competitive and gain wealth. There are many such cases of countries that did the right things to produce revolutionarily beneficial improvements, just as there are many cases of revolutionaries doing the wrong things that inflicted terrible pain on their people for decades. By the way, as a result of its reformations Japan went on to move through the classic stages of the Big Cycle to become extremely successful and rich, but over time it became decadent, overextended, and fragmented; had an economic depression; had expensive wars; and that led to a classic demise. Its “Meiji order” and its classic Big Cycle lasted for 76 years from 1869 to 1945.   

Civil wars and revolutions inevitably take place to radically change the internal order (i.e., the system of distributing wealth and power). They include total restructurings of wealth and political power that include complete restructurings of debt and financial ownership and political decision making. These changes are the natural consequence of needing to make big changes that can’t be made within the existing system. Almost all systems encounter them. That is because almost all systems benefit some classes of people at the expense of other classes, which eventually becomes intolerable to the point that there is a fight to determine the path forward. When the gaps in wealth and values become very wide and economically bad conditions ensue so that the system is not working for a large percentage of the people, the people will fight to change the system. Those who are economically suffering the most will fight to get more wealth and power against those who have wealth and power and who benefit from the existing system. Naturally the revolutionaries want to radically change the system, so naturally they are willing to break the laws that those in power demand that they adhere to. These revolutionary changes typically happen violently through civil wars, though as previously described, they can come about peacefully without toppling the system.       

The periods of civil war are typically very brutal. Typically early in them these wars are forceful and orderly struggles for power, and as the fighting and emotions intensify and the sides do anything to win, the levels of brutality accelerate unexpectedly so the actual levels of brutality that occur in the Stage 6 civil wars and revolutions will have been considered implausible in Stage 5. Reading the stories of the civil wars and revolutions that I studied, such as the Spanish Civil War, the Chinese Civil War, the Russian Revolution, and the French Revolution, made my hair curl. The elites and moderates flee, are imprisoned, or are killed. 

How do they transpire? Earlier I described the dynamics of Stage 5 that led to crossing the line to Stage 6. During this stage all of those intensify greatly. I will explain.

How Civil Wars and Revolutions Transpire

As previously described, the cycle of building wealth and wealth gaps that leads to a very small percentage of the population controlling an exceptionally large percentage of the wealth eventually results in the poor majority overthrowing the rich minority via civil wars and revolutions. This has happened more times than one can imagine. 

While most of the archetypical civil wars and revolutions shifted power from the right to the left, many shifted wealth and power to the right and away from those on the left. However, there were fewer of them and they were different. They typically happened when the existing orders slipped into dysfunctional anarchies and a large percentage of the population yearned for strong leadership, discipline, and productivity. Examples of revolutions from the left to the right include Germany, Spain, Japan, and Italy in the 1930s, the fall of the Soviet Union in the 1980s to the early 1990s, the 1976 coup in Argentina replacing Isabel Perón with a military junta, and the coup leading to the Second French Empire in 1851. Like the other examples, there are many, many cases to look at—more than I could examine carefully or explain here. However, all those that I examined worked or didn’t work for the same reason. Like those of the left, these new internal orders succeeded when they produced broad-based economic successes and failed when they did not. They were also more evolutionary than revolutionary as the periods of peace and prosperity in which wealth, and typically wealth gaps, increases are much longer. That is why we see that the long-term trends have been to greater total wealth and broader distribution of the wealth. That big picture can be easily lost when one is in and experiencing one part of the Big Cycle. 

Typically the people who lead the civil war/revolution were (and still are) well-educated people from middle-class backgrounds. For example, three of the key revolutionary leaders of the French Revolution were Georges-Jacques Danton, a lawyer raised in a bourgeois family; Jean-Paul Marat, a physician, scientist, and journalist raised in a bourgeois family; and Maximilian Robespierre, a lawyer and statesman also from a bourgeois family. This revolution was initially supported by many liberal aristocrats, like Marquis de Lafayette, who were raised in moderately well-off families. Similarly, the leaders of the Russian Revolution were Lenin, who studied law, and Trotsky, who was raised in a bourgeois family of intellectuals. The Chinese Civil War was led by Mao, who was from a moderately well-off family and studied a variety of subjects such as law, economics, and political theory, and Zhou Enlai, who was from a middle-class scholarly family of civil servants. They also typically were (and still are) charismatic and able to work well with others to build big, well-run organizations that have the power to bring about the revolutions that they led. If you want to look for the revolutionaries of the future, you might keep an eye on those who have these qualities. Over time they typically evolve from being idealistic intellectuals wanting to change the system to be fairer to brutal revolutionaries willing to win at all costs.  

While having large wealth gaps during economically difficult times was typically the biggest source of conflict, there were always also other reasons for conflict that added up to a lot of opposition to the leadership and the system. Typically in revolutions the revolutionaries with these different grievances joined together to make revolutionary changes; so while they looked united during the revolution, after winning the revolution, the leaders of it typically fight with each other over issues and for power.   

As previously mentioned, during the civil war/revolution stage of the cycle the governments in power almost always had an acute shortage of money, credit, and buying power. That shortage created the desire to grab money from those who had it, which led those that had wealth to move them into places and assets that were safe, which led the governments to stop these movements by imposing capital controls—i.e., controls on movements to other jurisdictions (e.g., other countries), to other currencies, or to assets that are more difficult to tax and/or are less productive (e.g., gold).

To make matters even worse, typically when there was internal disorder, such as civil wars and revolutions, foreign enemies were more likely to challenge the country. This happens because domestic conflict causes vulnerabilities that make external wars more likely. For example, internal conflict splits the people within a country, is financially taxing on them, and demands attention that leaves less time for the leaders to tend to other issues—all things that create vulnerabilities for foreign powers to take advantage of. That is the main reason why internal wars and external wars tend to come close together. Other reasons include: emotions and tempers are heightened; strong populist leaders who tend to come to power at such times are fighters by nature; when there are internal conflicts leaders find that a perceived threat from an external enemy can bring the country together in support of the leader so they tend to encourage the conflict; and being deprived leads people/countries to be more willing to fight for what they need, including resources that other countries have. Almost all civil wars have had some foreign powers participating in attempts to influence the outcome to their benefit.

Entering and leaving civil wars and revolutions aren’t clear when they are happening, though it is clear that one is happening when deeply in the middle of it. While historians assign dates to the beginnings and ends of civil wars, they are arbitrary. The truth is that almost no one at the time knows that a civil war has begun or that it has ended although they know when they are in them. For example, many historians have designated July 14, 1789, as the day the French Revolution began because an armory and prison called the Bastille was stormed by a mob, but nobody at the time thought it was the beginning of the French Revolution or had any idea how terribly brutal that civil war and revolution would become. While one might not know what’s to come, one can have imprecise markers that help one place where one is, to see the direction that one is moving, and to know something about what the next stage will be like.  

Civil wars are incredibly brutal because they are fights to the death. Everyone is an extremist because everyone is forced to pick a side and fight. Also moderates lose out in knife fights.   

As for what types of leaders are best for civil wars and revolutions, they are the “inspirational generals”—people who are strong enough to marshal support and win the various types of battles they have to win. Because the fight is brutal they have to be brutal enough to do whatever is necessary to win. 

Fortunately these civil war/revolutionary periods eventually come to an end, though the ends like the beginnings are not as clearly defined as historians convey.  

The time that historians stamp as the civil-war period typically lasts a few years and determines the official winners and losers, which is conveyed by who gets to occupy the government buildings in the capital. But the fighting to consolidate power can go on for a long time after the official civil war has ended. That brings us to the next stage in this big cycle, Stage 1.  

While civil wars and revolutions are typically extremely painful, they often lead to restructurings that, if done well, can establish the foundation for improved future results. What the future after the civil war/revolutions looks like depends on how the next steps are handled. Let’s take a peek.  

Stage 1: When the New Order Begins and the New Leadership Consolidates Power 

After the official civil war is over there is typically post-civil-war/revolution fighting to consolidate power. In this stage new leaders typically mop up the remaining opposition and fight among themselves for power. In fact one might say that revolutions typically come in two parts—the first part is the fight to bring down the established leaders and systems, and the second part is the fight to mop up those who were loyal to the former leaders and the fight for power among those who won. I will call the second part “purges” and touch on them in this section.  

These consolidation of power/purge periods range widely in form and severity, depending on the degrees of conflict between the new leaders and their opposition, the amount of conflict between the new leaders themselves, and the levels of development of the various government departments and bureaucracies that they are inheriting. At their worst, these periods can be even more brutal than the official civil-war periods.  

This is the stage when, in some cases, the remaining opposition is killed or imprisoned so that the new leaders are assured that they won’t come back fighting. It is also when those revolutionaries who were on the same side and won the revolution fight against each other for power.

This stage has happened after virtually all revolutions, though in roughly the same degree as the degree of revolutionary changes. At its worst this post-revolution fighting to consolidate power produced some of the most brutal periods in the country’s history—e.g., the post-1789 French Revolution period called the Reign of Terror, the post-1917 Russian Revolution period called the Red Terror, the post-1949 Chinese Civil War period called the Anti-Rightist Campaign, etc. In some cases these purges happened a single time right after the revolution (e.g., the Reign of Terror), while in other cases they came and went episodically over decades (e.g., China’s Cultural Revolution happened 17 years after the Chinese Communist Party came to power). These “purges” are done to consolidate power and persecute perceived ideological enemies or enemies of the state, and they are sometimes more brutal than the revolution itself. At their best, and if conditions allow because the basic system and respect for it is maintained, they’re like the period after the US Civil War of 1861 to 1865 or during the peaceful Roosevelt revolution of the 1930s. In the table below, we show seven archetypical cases of “purges.”

During this stage the leaders who do best are "consolidators of power."They typically have qualities similar to those who did best in the revolution in the prior stage, as they are strong, smart fighters who are willing and able to win at all costs, though they have to be much more politically astute because in the earlier stages the enemies were much more apparent. As discussed further below, great dynastic founders like the Tang Dynasty’s Emperor Taizong and Rome’s Caesar Augustus, among others, excelled at this stage. More recently, leaders such as the US founding fathers (e.g., Alexander Hamilton) and Germany’s Otto von Bismarck also exemplify taking periods of conflict and within them establishing institutions that set up the country for future success.

This stage is over when the new power authorities are clear, and everyone is sick of the fighting and the rebuilding process begins.  

Stage 2: When Resource-Allocation Systems and Government Bureaucracies Are Built and Refined 

I also call this phase “early prosperity” because it is typically the beginning of a peaceful and prosperous period.  

After the new leaders have torn down the old order and consolidated power, or overlapping with that time, the new leaders have to start building a new system to better allocate resources. This is the stage when system and institution building are of paramount importance. What is required is designing and creating a system (order) that is effective in allocating resources requires people to row in the same direction in pursuit of similar goals, with respect for rules and laws, putting together an effective resource-allocation system that leads to rapidly improving productivity that benefits most people. This redesigning and rebuilding period has to be done even after lost wars because rebuilding still must occur. Examples of countries being in this stage include the United States in the 15 years after it declared independence in 1776, the early Napoleonic era immediately after Napoleon grabbed power in a coup at the end of the French Revolution in 1799, the early Japanese Meiji Restoration period immediately after the political revolution in 1868, the post-civil war and postwar periods in China, Japan, Germany, and most countries in the late 1940s through most of the 1950s, and Russia after the breakup of the Soviet Union.  

A timeless and universal principle to keep in mind during this stage is that to be successful the system has to produce prosperity for the middle class. As Aristotle conveyed in Politics:  “Those states are likely to be well-administered in which the middle class is large, and stronger if possible than both the other classes…where the middle class is large, there are least likely to be factions and dissensions…For when there is no middle class, and the poor are excessive in number, troubles arise, and the state soon comes to an end.”[21]

The leaders who are best during this stage are typically very different from those who succeeded in Stages 6 and 1. I call them “civil engineers.”  While they need to be smart, and ideally they are still strong and inspirational, above all else they need to be great civil engineers or have great civil engineers working for them to design and build the system that is productive for most people. The different qualities of leaders that are required to succeed in the revolutionary Stages 6 and 1 and those that are required in this rebuilding administrative Stage 2 are exemplified by Churchill and Mao being great “inspirational generals” and lousy “civil engineers.”  Examples of great leaders at this stage include Konrad Adenauer in Germany, Lee Kuan Yew in Singapore, and Deng Xiaoping in China, who came to power after wars and built systems that produced prosperity well beyond them.   

The most extraordinary leaders are those who took their countries through Stages 6, 1, and 2—i.e., through the civil war/revolution, through the consolidation of power, and through the building of the institutions and systems that worked fabulously for a long time after them—and did it at scale. The best ever probably were Tang Taizong (one of the revolutionary founders of the Tang Dynasty in China in the 600s, which was followed by about a century and a half of peace and prosperity that led China to become the world’s largest and strongest country); Caesar Augustus (the first emperor of Rome in 27 BC who began roughly 200 years of frequent peace and prosperity, in which Rome became the world’s largest empire); and Genghis Khan (who founded and led the Mongol Empire starting in 1206, which was followed by over a century of prosperity when it became the world’s largest and strongest empire, though there were civil wars shortly after his death).  

This sequence of rebuilding happens all the time in varying degrees depending on the amount of change that is warranted. In some cases it comes after brutal revolutions when there needs to be a rebuilding of nearly everything, and in other cases it comes when the instructions and systems that are there just need to be modified to suit the new leader. For example, there will be some changes in the United States after the presidential election that will lead to some amount of purging of those in government who were sympathetic to the old administration and fighting for power between moderate Democrats and very left Democrats.

Stage 3: When There Is Peace and Prosperity 

I also call this phase “mid-prosperity.”   It is the sweet spot of the Big Cycle. It is when people have an abundance of opportunity to be productive, are excited about it, work well together, produce a lot, get rich, and are admired for being successful. It is more opposite than similar to Stages 5 and 6—so pretty much whatever I said about Stages 5 and 6, the opposite can be said about this one. In this stage conditions are improving for almost everyone so most of the next generation are better off than most of the prior generation, so there is broad optimism and excitement about the future. History shows us through time that, when done well, there is wide and almost equal access to education and merit-based placements in jobs, which draws on the widest possible range of the population to access talents and yields a system that most people believe is fair. Successful entrepreneurs, inventors, and adventurers produce new ideas and take their societies to new places and become the heroes that others aspire to be like because of how they come up with revolutionary new ideas, make people’s lives better, and are rewarded for it. Debt growth fuels productivity and in turn real income growth, which makes debts easy to service and provides excellent excess returns that make equity returns excellent. Incomes exceed expenses and savings exceed liabilities with the savings financing investment in the future. Stage 3 is an exciting period that has a lot of creativity (e.g., the arts flourish), productivity, and energy.  

Examples of this period include most of the Victorian Era in Britain (covering much of the 19th century, marked by Industrial Revolution inventions producing a rapid increase in prosperity); the German Empire in the late 1800s (with rapid industrialization, technological innovation, and a quickly strengthening military); and the 1960s in the United States. For example, in the United States the 1960s moon shot project to put a man on the moon exemplified the shared mission. The whole country cheered and was brought closer together when the moon landing happened. 

This is the time for the “inspirational visionary” who can a) imagine and convey an exciting picture of a future that never existed before, b) actually build that future out, and then c) use the prosperity earned to broaden the inclusiveness of it and to invest in the future. They do this while d) maintaining sound finances and e) producing excellent international relations, so that they protect or expand their empires without any financially or socially debilitating wars. Examples include:

• In the British Empire’s Victorian Age in the mid-to-late 1800s, Prime Minister William Gladstone simultaneously a) maintained high levels of productivity, b) imposed strict budget controls that led to strong finances, and c) supported the common man so much that he was known as “The People’s William.”  He also ran a peaceful and prosperous foreign policy.
• In the German Empire in the late 1800s, Chancellor Otto von Bismarck united the disparate populations of 39 different states and people of different religions to build Germany as a country and an economic powerhouse. Under him Germany had an economic boom with sound finances while brilliantly navigating international relations to have it benefit internationally and avoid debilitating major wars.  
• Singapore’s Prime Minister Lee Kuan Yew successfully took the country through these stages by running the country as prime minister from 1959 to 1990 and mentoring until his death in 2015. He created the principles and shaped the culture to be successful way beyond him and avoided wars without losing power.
• In the postwar US, John F. Kennedy in his 34 short months as president from January 20, 1961, to November 22, 1963, simultaneously inspired the country to go to the moon, advanced the civil rights movement, undertook the war on poverty with Vice President Lyndon Johnson, and kept the United States out of major wars while simultaneously strongly containing opposition to the American Empire. 
• In China, Deng Xiaoping transitioned a weak and inefficient communist system to a highly productive state capitalist system, quickly changing the nation’s psychology to make these changes with sayings, such as “it is glorious to be rich” and “it doesn’t matter whether the cat is black or white as long as it catches mice”; built China’s economy and finances to be very strong; enormously improved the education and quality of life of most people; dramatically lengthened life expectancies and reduced poverty rates; successfully led China through internal political conflicts; and strictly maintained China’s sovereignty while avoiding major external conflicts. 

The longer countries stay in this stage, the longer their good times last.  

During this stage the developments to pay attention to that reflect the big risks that naturally develop and undermine the self-sustaining good results are the widenings of the opportunity, income, wealth, and values gaps accompanied by bad and unfair conditions for the majority, luxurious and unfairly privileged positions for the elites, declining productivity, and bad finances in which excess debts are created.    

History shows us that the great empires and great dynasties that were able to sustain themselves stayed in Stage 3 by avoiding these risks. The failure to avoid these risks leads to the next stage, which is a period of excesses. This is the stage in which the temptation to do everything and borrow money to do everything can lead to the movement to the next stage.

Stage 4: A Period of Excesses 

I also call this “the bubble prosperity phase.” I will describe it briefly because we touched on these elements before. Classically:

• There is the rapidly increasing debt-financed purchases of goods, services, and investment assets, so debt growth outpaces the capacity of future cash flows to service the debts. So, bubbles are created. These debt-financed purchases emerge because investors, business leaders, financial intermediaries, individuals, and policy makers tend to assume that the future will be like the past so they bet heavily on the trends continuing. They mistakenly believe that investments that have gone up a lot are good rather than expensive so they borrow money to buy them, which drives up their prices, which reinforces this bubble process. That is because as their assets go up in value their net worth and spending-to-income level rise, which increases their borrowing capacities, which supports the leveraging-up process, and so the spiral goes until the bubbles burst.[22]  
• There is a shift in spending of money and time to more on consumption and luxury goods and less on profitable investments. The reduced level of investments in infrastructure, capital goods, and R&D slows their productivity gains and leads their cities and infrastructures to become older and less efficient.  
• There is a lot of spending on the military at this stage to expand and protect global interests, especially if the country is a leading global power.  
• The country’s balance of payments positions deteriorate, reflecting its increased borrowing and reduced competitiveness. If the country is a reserve currency country, this borrowing is made easy and the result of non-reserve currency savers having a preference to save/lend to their currency.  
• Wealth and opportunity gaps are large and resentments between classes emerge.  

During this phase, the archetypical best leader is the “well-grounded, disciplined leader” who understands and conveys sound fundamental behaviors that yield productivity and sound finances and creates restraints when the crowd wants to overdo things. These leaders are the ones who lead the country to continue to reinvest a significant amount of their earnings and their time to being productive when they become richer. As mentioned, Lee Kuan Yew, the former Prime Minister of Singapore, assured that his country and fellow citizens had the culture to become well-educated, disciplined, and of strong character even after becoming successful and rich. However, these leaders are few and far between because their fighting the ebullience of the masses is very unpopular. In almost all cases, after becoming rich, the country (and its leaders) become decadent, borrow to finance excess consumption, and lose competitiveness. This period of decline is exemplified by decadent leaders such as the notorious Roman emperor Nero (who used a city-wide fire in Rome to confiscate land to build an expansive palace)[2] as well as Louis XIV (who similarly expanded the Palace of Versailles while productivity fell and people endured hardships at the height of his power)[3] and the Ming Dynasty’s Wanli Emperor[4] (who withdrew from actively governing and focused on the construction of his own immense tomb).

Conclusion

My study of history has taught me that nothing is forever other than evolution, and within evolution there are cycles that are like tides that come in and go out and that are hard to change or fight against. To handle these changes well it is essential to know what part of the cycle one is in and to know timeless and universal principles for dealing with them. As conditions change the best approaches change—i.e., what is best depends on the circumstances and the circumstances are always changing in the ways we just looked at. History shows us that the best internal systems/orders depend on the circumstances at the time. For that reason it is a mistake to rigidly believe that any economic or political system is always best because there will certainly come times that that system is not best for the circumstances at hand, and if a society doesn’t adapt it will die. That is why constantly reforming systems to adapt well is best. The test of any system is simply how well it works in delivering what most of the people want. The effectiveness of any system can be objectively measured, which we will continue to do. Having said that, the lesson from history that comes through most loudly and most clearly is that skilled collaborations to produce productive win-win relationships to both grow and divide the pie well, so that most people are happy, is much more rewarding and much less painful than fighting civil wars over wealth and power that lead to one side subjugating the other side.

For important disclosure please see the end of Chapter 8, linked here.

Appendix: US State and City Indebtedness, Inequality, and Income Picture

Here’s the same cut, looking at the 30 largest cities.[26]

Appendix: Major Empires

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[1] To get a rich picture of what makes great leaders great in different types of circumstances I recommend Henry Kissinger’s upcoming book on leadership.

[2] There are a lot of developments and changes in psychology behind these cycles, which range from good developments and corresponding emotions that lead to harmony and effectiveness in Stages 2 and 3 to bad developments and emotions that lead to fighting and ineffectiveness in Stages 5, 6, and 1. Because each stage is distinctive—e.g., Stage 5 looks almost opposite to Stage 3—it is easy to see which stage any country is in, though the exact points of transition can be challenging to identify since the transitions tend to blend into each other.  

[3] See Appendix for more detail on the duration of major empires through time.

[4] Based on historical analysis of nine great powers (covering about 2,200 years of history in total). The likelihood of conflict is based on major cases of civil war, rebellion, and revolution but excludes peaceful revolutions that did not change the existing system. The analysis does not count the probability of conflict arising in a period when a country is already in the midst of internal conflict (and the five years following) to avoid counting periods in which economic conditions were bad because of the conflict itself.

[5] To be clear, when a government’s finances are in bad shape that does not necessarily mean it will run out of buying power. But it does mean that there is a much higher risk of that happening than if the government were in a financially strong position.  

[6] Of course, these two kinds of struggles aren’t equivalent. Still, in both cases, I have found that people are focused on their own issues and communities and don’t understand the circumstances of those they don’t have direct contact with. In many communities, people, and most heart-breakingly the children, are desperately poor and neglected. There is an acute shortage of money for basics such as adequate school supplies, nutrition, and basic healthcare and an environment of violence and trauma that perpetuates a cycle in which children are brought up intellectually and physically malnourished and traumatized; this leaves them disadvantaged as they grow into adulthood, which makes it hard for them to earn a living, which perpetuates the cycle. Consider this fact: a recent study that our foundation funded showed that 22% of the high school students in Connecticut—the richest state in the country by income per capita—are either “disengaged” or “disconnected.” A disengaged student is one who has an absentee rate of greater than 25% and is failing classes. A disconnected student is one who the system can’t track because they dropped out. Imagine the consequences in 10 years and the human and social costs of this cycle. Our society has not established limits to how terrible it will allow conditions to get.  

[7] https://www.pewresearch.org/politics/2019/10/10/how-partisans-view-each-other/

[8] https://www.prri.org/research/fractured-nation-widening-partisan-polarization-and-key-issues-in-2020-presidential-elections/

[9] https://www.vox.com/xpress/2014/9/23/6828715/heres-how-many-republicans-dont-want-their-kids-to-marry-democrats

[10] From Nathan Kalmoe and Lilliana Mason, “Lethal Mass Partisanship: Prevalence, Correlates, & Electoral Contingencies,” NCAPSA American Politics Meeting, 2019.

[11] Viscount Northcliffe, who controlled just under half of daily newspaper circulation in the UK around World War I, was known for anti-German coverage and was made “Director of Propaganda in Enemy Countries” by the government in 1918. 

[12] https://news.gallup.com/poll/267047/americans-trust-mass-media-edges-down.aspx

[13] https://www.nytimes.com/2016/11/07/business/media/medias-next-challenge-overcoming-the-threat-of-fake-news.html

[14] What can be done?  The news media is unique in being the only industry that operates without quality controls or checks on its power. I and most others believe that it would be terrible for our government to regulate it and, at the same time, believe that something has to be done to fix the problem. Perhaps if people protest enough the media could be motivated to create a self-regulatory organization to regulate and create ratings the way the Motion Picture Association did.   I don’t have a clue about what should be done because this problem isn’t in my areas of expertise, and it’s not my place to offer suggestions to try to fix the problem; however, it is my responsibility to point out that we are in an era in which sensationalism, commercialism, and political desires to manipulate people’s views have superseded accuracy and journalistic integrity as the primary objectives of most of those in the media and that this is like a cancer that threatens our well-being.  If you believe that fake and distorted media is a problem and you are interested in watching the media/propaganda for clues about whether and how this is transpiring, here are a few commonly recommended things to look out for.  Ask yourself:

1) Does the story consist of emotionally triggering, unsubstantiated accusations or are the facts substantiated and the sources provided?  When the facts are put aside to create an exciting story and the sources are undisclosed, don’t believe the story.

2) Does the writer welcome or not welcome replies or arguments that refute what they are asserting, and are they willing or not willing to publish them along with what they published?  

3) Are the accusations in the story consistent with what has been identified and proven in the legal system?  If people or groups are accused in the media of doing bad things but they haven’t been accused and judged to have done bad things in the legal system (which follows a process that tries to weigh the evidence to get at what is true), at least ask yourself why that is and probably don’t believe the story.    

4) If the writer or outlet has shown themselves to be biased, assume that they and their stories are biased.   

[15] Historians require more than 1,000 deaths a year to call such internal conflict a civil war.

[16] Notably after the Napoleonic Wars (when the then-new world order was established at the Congress of Vienna in 1815), Western Europe and particularly the UK by and large experienced 100 years of peace and prosperity and great wealth creation until World War I developed in 1914, which was followed by a very painful and turbulent 30 years.

[17] In some nondemocratic countries, capitalists were also killed.

[18] The Roman Republic and Athens both had democratic elements, but not everyone was able to participate or vote equally. Although democracies have existed for thousands of years, it is only recently that most people were allowed to vote. For example, in the US African American men were not universally allowed to vote until 1870, and women of all races until 1920.

[19] Note: shade of coloring indicates degree of polarization.

[20] Though it is unlikely that a third party of moderates could elect a president or large numbers of senators or representatives soon, it wouldn’t take much to elect the few whose votes would be needed by the opposing parties to get what they want passed, which would give these moderates great power.  It also, with time, would give moderate voters and moderate politicians a party to go to that could better reflect their desired positions, which could negate some of the pull to the extremes.

[21] Aristotle, Politics, IV.11 (translated by Stephen Everson)

[22] Japan in 1988-90, the US in 1929, the US in 2006-07, Brazil and most other Latin American commodity producers in 1977-79 are classic examples.

[23] https://www.britannica.com/topic/Golden-House-of-Nero

[24] https://www.britannica.com/biography/Louis-XIV-king-of-France

[25] https://www.britannica.com/biography/Wanli

[26] Note: a couple cities have a positive net worth (liquid assets in excess of liabilities), appearing as negative on the charts. Analysis based on data from a variety of US government organizations and Truth in Accounting’s January 2020 report: Financial State of the Cities.

 

 

 

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