Tuesday, May 24, 2022

Dangerous Decade


Friends, my latest article is a tour de force of historical analysis, according to authorities no less respected -- nay, adored --!  I argue that, so far, commentators are suggesting that we could experience in the 2020s something akin to the "stagflation" of the 1970s.  Well, duh!  I go further and suggest that we could experience some of the same financial/fiscal turbulence, combined with high food and energy prices, triggering mammoth levels of political instability on a global scale.  See if you're convinced by my arguments...

Are We in For a Bumpy Ride in the 2020s?

Many talking heads have made comparisons between the inflation and decelerating economic growth we face now, and similar conditions of “stagflation” that beset the West and the world in the 1970s. Few have contemplated the full range of potential consequences of these economic headwinds, however, besides the obvious: the party out of power, i.e. the GOP, is likely to benefit in the short term by a simple process of electoral elimination.

The 2020s are starting to look like the 1970s in several other important respects, however, and these may prove determinative not just of partisan success or failure, but of more fundamental issues like global security, prosperity (or the lack thereof), and the degree to which democratic norms and institutions are respected and upheld.

In purely economic terms, broad-based inflation and slow economic growth were only part of what made the 1970s so challenging. The decade also saw much instability in commodity prices (and not just oil), which was highly injurious to the economic performance of many “Third World” countries, and contributed to a debt crisis that hamstrung these developing countries well into the 21st century. In some cases, the aftershocks are still being felt today.

Likewise, commodity prices have seesawed in recent years, partly because of the global COVID pandemic, which produced wild fluctuations in demand. This, in turn, coupled with higher inflation and higher interest rates, threatens to make government finances untenable once again, but not just in the developing world. OECD countries are also treading on thin financial ice.

Imagine, for instance, a fiscal environment in the 2020s in which interest rates rise to 10% – a not entirely absurd hypothetical, given that current inflation levels in the U.S. are touching double figures. In that case, for the U.S. federal government to service our national debt, which approaches $30 trillion, it would have to commit $3 trillion/year just to making interest payments.

To put this in context, the entire annual budget of the federal government for 2023 is expected to amount to $5.7 trillion. In other words, it is conceivable, if not yet likely, that the U.S. government, and other Western governments, could soon be called upon to spend most of their public funds servicing their considerable debts. Needless to say, this would make sustaining normal public spending on social services, defense, and other important priorities impossible – unless, of course, such governments were to print money (or “add liquidity”) even more wildly than they did during the recent pandemic, which in turn would make inflation and interest rates even worse.

In short, like in the 1970s, in our own decade many world governments could face fiscal and debt crises. Unlike in the 70s, though, Western, developed countries are carrying much higher debt loads, and public spending is generally higher as well, meaning there is less fiscal cushion and more exposure to the risk of a serious financial emergency, up to and including default, which, we can only assume, would produce in turn a depression equal or greater in terms of severity to the one seen in Greece in the wake of that country's sovereign debt crisis, which began in 2009. Greece saw its GDP plummet by at least 25%, a worse performance than in the U.S. during the Great Depression.

It is also worth recalling, though, that the economic turmoil of the 1970s helped to produce alarming levels of political instability. The incidence of coups, civil wars, and mass unrest surged in the 70s, leading to such political sea changes as the Soweto Uprising in South Africa, the reign of terror of the Khmer Rouge in Cambodia, and the Iranian Revolution.

One has to wonder, therefore, whether the “stagflation” of 2022, which may or may not persist, coupled with higher energy prices and food insecurity, both of which have been exacerbated by the Russia-Ukraine war, could trigger similar episodes of violence, instability, or even regime changes in certain countries. If so, Western governments, battered by their own internal problems and by severe fiscal restraints, could struggle to respond effectively to the upsurging forces of chaos. That they might be distracted in such attempts by the exigences of a new “Cold War” between NATO and Russia might make the successful management of these challenges even harder.

In short, the 1970s were a time of grave uncertainty, and an era in which the West skirted not just a profound sense of “malaise”, but also a host of real and very serious economic, political, and strategic challenges – challenges formidable enough that they could have upended the global order. Instead, we powered through the vexations of the 70s, conquered high inflation and high interest rates, won the Cold War, and ushered in a prolonged era of price stability, economic growth, low levels of military conflict, and widespread democratization.

All of these achievements are now hanging by a thread – even the West's victory in the Cold War, which seemed settled and permanent. The decade of the 2020s, moreover, could be every bit as challenging as the 1970s, but with one crucial difference: this time, the U.S., and the West, may not have the fiscal resources, or the political unity, to navigate these troubled waters as successfully as before.

The danger, therefore, is that, by the time the 2020s are over, analysts will find that comparisons to the 1970s have grown stale, and that the tests we face are actually on a scale not seen since the 1930s. And, needless to say, when the experts start wheeling out the decade that gave us Hitlerism and Stalinism, we'll know we're in trouble!

Dr. Nicholas L. Waddy is an Associate Professor of History at SUNY Alfred and blogs at: He appears on the Newsmaker Show on WLEA 1480/106.9.


And here it is at American Greatness: 




In other news, Sleepy Joe has done it again: he's overstated America's willingness to intervene in foreign conflicts, potentially provoking our enemies and endangering our national security.  And, once again, his own underlings have had to walk back his ramblings. 

Finally, here's an informative poll that reveals why the Biden Administration may have decided to pull the plug on its own "Disinformation Board": in a nutshell, only Democrats were inclined to trust anything it said.  Of course, that never bothered Biden and Co. before, so why now?


  1. Dr.Waddy from Jack ::You have presented a plausible prediction of what could be close!y in store! A scene not seen since the '30s? But who is to manifest Hitler's ultimately mad mantle? But you have well supported, in your characteristically objective, empirically bolstered manner, the possibility of dangers defeated in the70s but not surely now!

  2. Dr.Waddy from Jack: Agreed, comparisons to modern day Hitlerism or Stalinism are appalling and not to be discredited.At present I do not see such monstrous personalities emerging but a similarly unsettling effect could be at hand! I think a 2022 national sense of the"malaise" so lamented by pore ol' Jimmy in his ridiculous neo fireside chats, does obtain! But its origin is in the far leftist ordered Pino Biden administration.

  3. A good question, Jack: who could play Hitler's part in the 2020s? I know many in the West are pining for Putin and Xi to be deposed. My take: we should be careful what we wish for! Another thought -- way, way outside the box: who says Hitler II has to germinate in foreign soil? Intellectually speaking, America itself is home to some very warped and fanatically intolerant potential leaders...