Thus, according to LEAP/E2020, the 2012 election year, which opens against the backdrop of economic and social depression, complete paralysis of the federal system (3), strong rejection of the traditional two-party system and a growing questioning of the relevance of the Constitution, inaugurates a crucial period in the history of the United States. Over the next four years, the country will be subjected to political, economic, financial and social upheaval such as it has not known since the end of the Civil War which, by an accident of history, started exactly 150 years ago in 1861. During this period, the US will be simultaneously insolvent and ungovernable, turning that which was the “flagship” of the world in recent decades into a “drunken boat”.
To make the complexity of the current process understandable, our team has chosen to organize its anticipations around three key areas:
1. US institutional deadlock and the break-up of the traditional two-party system
2. The unstoppable spiral of recession/depression/inflation
3. The breakdown of the US socio-political fabric
Below the line: the other two parts of the series.
Real estate, the foundation of US household wealth along with the stock market, continues to see prices drop year after year despite desperate attempts by the Fed (3) to facilitate lending to the economy through its zero interest rate policy.
. . . . . . . .
Poverty is gradually increasing in the country every day, where one in six Americans now depend on food stamps (6) and one in five children has experienced periods of living on the streets (7). Public services (education, social, police, highways…) have been significantly reduced across the country to avoid city, county, or state bankruptcies. … And the coming years will see these trends get worse.
. . . . . . .
Our team considers the players of the “Beltway” are unable to imagine this shock and its consequences.
Thus, to take one telling example: when the Pentagon works with difficulty on a possible 5% reduction of its budget over the next five years, it’s totally mistaken in terms of the magnitude in budget cuts. Between the institutional deadlock and the 2012 economic and financial shocks especially, it should be working on cutting its budget by 50%.
The breakdown of the United States’ socio-economic and socio-political tissue is a phenomenon that started some forty years ago. In previous GEAB issues, we emphasized the importance of the breakdown of the 1970s turning point in the US dynamic: end of the fixed link between the Dollar and gold, defeat in the Vietnam War, “impeachment” of President Nixon, the last period of great inventions / US scientific adventures (the conquest of space, Internet…), etc…
One particular aspect seems strategically important and crucial to the coming period: the collapse of the education system (1). In simple terms, LEAP/E2020 estimates that the change in the 1970s to an education system based on student assessment via multiple choice questions, from primary school to university, has generated a far-reaching and lasting weakening of the education of US generations under the age of 40 today. At the same time, it has accentuated the establishment of a two-speed education system, alienating the country’s social elite from the middle class even further, because of the rising costs of access to quality education
Phi Beta Iota: The USA is much stronger — has much deeper roots — than the above suggests, but the above is a most helpful summary — a realistic and truthful summary — such as one does not see in the controlled US media. As Bob Seelert, Chairman of Saatchi & Saatchi Worldwide (New York) has stated so famously: When things are not going well, until you get the truth out on the table, no matter how ugly, you are not in a position to deal with it. The fact is that 50% waste is unaffordable and unsustainable. The sooner the next President and Congress get in touch with reality and the truth, the sooner a real recovery can begin.