Kruse Kronicle

Decline in Neonatal Deaths

Economist: Good news, sort of

The number of deaths among babies is declining

THE first 28 days of life are among the most vulnerable in a human’s existence. In 2009 3.3m children died before they were four weeks old, down from 4.6m in 1990, according to a new  paper from the World Health Organisation. The burden is not spread evenly. Five populous countries—India, Nigeria, Pakistan, China and the Congo—now account for more than half of all neonatal deaths. And though mortality rates for newborns are falling, progress is much faster in some regions than others. If current trends continue, neonatal mortality rates in Africa will not reach the rich world's levels until 2166.

Babysitting bill in Calif. Legislature

TheUnion.com: Babysitting bill in Calif. Legislature

How will parents react when they find out they will be expected to provide workers' compensation benefits, rest and meal breaks and paid vacation time for…babysitters? Dinner and a movie night may soon become much more complicated.

Assembly Bill 889 (authored by Assemblyman Tom Ammiano, D-San Francisco, will require these protections for all “domestic employees,” including nannies, housekeepers and caregivers.

The bill has already passed the Assembly and is quickly moving through the Senate with blanket support from the Democrat members that control both houses of the Legislature – and without the support of a single Republican member. Assuming the bill will easily clear its last couple of legislative hurdles, AB 889 will soon be on its way to the Governor's desk.

Under AB 889, household “employers” (aka “parents”) who hire a babysitter on a Friday night will be legally obligated to pay at least minimum wage to any sitter over the age of 18 (unless it is a family member), provide a substitute caregiver every two hours to cover rest and meal breaks, in addition to workers' compensation coverage, overtime pay, and a meticulously calculated timecard/paycheck.

Failure to abide by any of these provisions may result in a legal cause of action against the employer including cumulative penalties, attorneys' fees, legal costs and expenses associated with hiring expert witnesses, an unprecedented measure of legal recourse provided no other class of workers – from agricultural laborers to garment manufacturers. (On the bright side, language requiring an hour of paid vacation time for every 30 hours worked was amended out of the bill in the Senate.)

Unfortunately, the unreasonable costs and risks contained in this bill will discourage folks from hiring housekeepers, nannies and babysitters and increase the use of institutionalized care rather than allowing children, the sick or elderly to be cared for in their homes. I can't help but wonder if that is the goal of AB 889 – a terrible bill that needs to be stopped.

More information on the text and status of the bill can be accessed from my webpage at senate.ca.gov/lamalfa.

Unbelievable. On second thought ... it is Califonria. Maybe not so unbelievable.

 

The Original Wal-Mart Story?

Wall Street Journal: How a Grocer Bagged Profits

(A Book Review of "The Great A&P and the Struggle for Small Business in America.")

... The brothers' business philosophy was simple, writes Mr. Levinson: "If the company keeps its costs down and prices low, more shoppers would come through its doors, producing more profits than if it kept prices high." The more stores they could open, the greater the take.

But the Hartfords had a public-relations problem. Since the nation's earliest days, small family stores had served as community anchors. There were thousands across the country. Mom and pop knew every customer who came through their door; they extended credit to families down on their luck. If low-priced chains drove out such stores, what would happen to small-town America?

In fact, many mom-and-pop operations were inefficiently and incompetently run. A&P might be coldly corporate by comparison, but it offered consumers far more variety and fresher, better-quality goods at less cost to the family budget. But it didn't seem to matter: By 1912, chain retailing had become a political issue, Mr. Levinson says, one that would nag A&P for the next 50 years. The critics' persistent charge was that A&P's prices were too low. Because the chains were so much bigger, they could offer special deals to wholesalers. They could also build their own bakeries and canneries, options unavailable to the independents.

New Dealers and other politicians, like Texas Rep. Wright Patman, would spend their careers in Washington attempting to punish the chains for their "unfair" advantages by forcing them to close stores or taxing them out of town. "We, the American people, want no part of monopolistic dictatorship in . . . American business," Patman declared in a radio broadcast. "Think of Hitler. Think of Stalin. Think of Mussolini."

A&P, eventually offering thousands of items in close to 16,000 stores, had a different outlook. "In A&P's view," Mr. Levinson writes, "its aggressive efforts to cut purchasing costs, narrow its own margins, and reduce consumer prices in order to build business were exactly what a company was supposed to do in a competitive economy."

Nevertheless, by 1937 more than half the states had imposed chain-store taxes, many based on the number of stores owned. A&P responded by replacing small stores with large supermarkets, a shift that only made matters worse for mom and pop. Legislators persisted in trying to rescue consumers even when the public didn't want to be saved: A 1949 Gallup poll showed that twice as many people sided with A&P's position as with the government's. No business so popular could be easily reined in, and the chain continued to thrive. ...

Just more evidence that history may not repeat itself, but it rhymes. Wal-Mart is just the latest in a long line of low-cost providers. I don't know much about the A&P story but I do know that primary business victim of Wal-Mart is not Mom & Pop shops. It is other chain discount stores. Small bouitque stores tend to offer something (location? service?) for which customers are willing to pay a premuim price. Wal-Mart can benefit some small businesses by bringing more traffic through the vicinity of the small stores.

As I've written before, economists show that Wal-Mart has benefitied the poor in America probably more  than any other factor in recent years by keeping the daily staples of life inexpensive. That improves people's standard of living. The poorer a particular area, the great the entusiasm for the giant discounters. But nostalgia and the myth of an egalitarian America with quaint stores and tight community still run deep. Never mind that many of these stores were poorly stocked and over priced, thus reducing the living standards of people captive to them. With any economic issue, there are always trade-offs.

Isaac the Cat: 1992-2011

My long time readers have read my occassional references to our cat, Isaac. We had to put Isaac down this morning. He was experiencing kidney failure.

Isaac was born in March of 1992. He lived nineteen years and five months. I think that is something like 97 years old in human years! He led a good long life and, as I've said many times, he has been my shadow, following me around the house wherever I go.

We are thankful to God for having had so many years and good times with such a sweet pet. We are really going to miss him.

Saving African Rhinos: A Market Success Story

PERC: Saving African Rhinos: A Market Success Story

By Michael 't-Sas Rolfes

In 1900, the southern white rhinoceros was the most endangered of the five rhinoceros species. Less than 20 rhinos remained in a single reserve in South Africa. By 2010, white rhino numbers had climbed to more than 20,000, making it the most common rhino species on the planet.

Saving the white rhino from extinction can be attributed to a change in policy that allowed private ownership of wildlife. While protecting the rhinos encouraging breeding, the ranchers were able to profit by limited trophy hunting.

 Poaching for rhino horn, which is in high demand for medicinal and ornamental purposes, had also devastated the rhino population. CITES banned the commercial sale of rhino horn, which caused black market sales to sky rocket and encouraged poaching. If the ban were lifted, ranchers are ready to supply the market by harvesting the horns humanely, which then regrow just like fingernails.

Strong property rights and market incentives have provided a successful model for rhino conservation, despite the negative impact of command-and-control approaches that rely on regulations and bans that restrict wildlife use.

AUTHOR: Michael 't Sas-Rolfes is an environmental economist based in South Africa and a 2011 PERC Lone Mountain Fellow. For more information visit his website: rhino-economics.com

Full-Text

Beloit College Mindset List for Class of 2015

Associated Press: List: Web older than incoming college freshmen

Every year, Beloit College in Beloit, Wis., releases its Mindset List to give a snapshot of the world view of the incoming freshmen class. The list for the Class of 2015:

___

Most students entering college for the first time this fall — members of the Class of 2015 — were born in 1993. For these students, Andre the Giant, River Phoenix, Frank Zappa, Arthur Ashe and the Commodore 64 have always been dead.

Their classmates could include Taylor Momsen, Angus Jones, Howard Stern's daughter Ashley, and the Dilley Sextuplets.

1. There has always been an Internet ramp onto the information highway.

2. Ferris Bueller and Sloane Peterson could be their parents.

3. States and Velcro parents have always been requiring that they wear their bike helmets.

4. The only significant labor disputes in their lifetimes have been in major league sports.

5. There have always been at least two women on the Supreme Court, and women have always commanded U.S. Navy ships.

6. They "swipe" cards, not merchandise.

7. As they've grown up on websites and cellphones, adult experts have constantly fretted about their alleged deficits of empathy and concentration.

8. Their school's "blackboards" have always been getting smarter.

9. "Don't touch that dial!" . what dial?

10. American tax forms have always been available in Spanish. ...

Church Attendance Falling Among Less-Educated Whites: Study

Huffington Post: Church Attendance Falling Among Less-Educated Whites: Study

While overall church attendance has declined slightly in the United States in recent decades, a new study says attendance at religious services among white Americans who did not go to college has fallen more than twice as quickly as it has among more highly educated whites.

The study, released Sunday by the American Sociological Association, draws on decades of data from the General Social Survey and the National Survey of Family Growth to conclude that "moderately educated whites," defined as people with high school degrees, attended religious services in the 1970s at about the same rate as whites with degrees from four-year colleges. In the last decade, however, they attended much less frequently.

“Our study suggests that the less educated are dropping out of the American religious sector similarly to the way in which they have dropped out of the American labor market,” says researcher W. Bradford Wilcox, a professor of sociology at the University of Virginia.

The research shares some conclusions with a recent study by a University of Nebraska-Lincoln professor whose findings contradicted the common myth that less-educated people are more religious. That study, released in early August, concluded that a college degree does not make a person less religious, but that more education does make people more accepting of the validity of religions other than their own. Both studies used data from the General Social Survey, which is an ongoing survey of American' attitudes and behaviors that began in 1972. ...

A Hitch in time: save the Hitchcock 9

Guardian: A Hitch in time: save the Hitchcock 9

Nine of the 10 films Hitchcock directed in the 1920s are getting a full restoration. Henry K Miller enters the dusty world of the archivists and learns about the race to save the silents.

The audience at the Capitol cinema in London during the middle week of April 1926 witnessed an unusually bold declaration of authorship. The opening moments of The Pleasure Garden, touted in the fan magazines as the debut of "the youngest director in the world", contained, under the "directed by" credit, the slanted and underlined signature of the 26-year-old Alfred J Hitchcock. What followed was also – as it would become clear over the decades – signature Hitchcock film-making. The film's first scene gives us a voyeur's-eye-view of a dancer's legs; and then makes us share the voyeur's unease as the look is returned. The Spectator's influential critic Iris Barry scented the "new blood" desperately needed by the ailing British film industry, writing that Hitchcock had "astonished everyone with his freshness and power".

Despite the plaudits, and despite Hitchcock's self-confidence, there was no inkling that his films would be seen in five years' time, let alone 85. Three million Britons went to the pictures every night, and the turnover was fast. Most movies played for half a week before being replaced, with a favoured few lingering in circulation a little longer. Survival was a matter of luck and the market. But next year, if all goes to plan, nine of the 10 films Hitchcock directed during the 1920s will be seen as no one has seen them since their first release, restored thanks to the BFI National Archive's Rescue the Hitchcock 9 project.

Publicly launched a year ago, and yoked to 2012's Cultural Olympiad, the biggest single undertaking in the archive's history is global in scope, but has its nerve-centre on the edge of Berkhamsted, Hertfordshire, in what used to be – and from the road still resembles – a farm. Home to vast air-locked, low-temperature film vaults, and to the personal papers of the likes of Michael Powell and David Lean, "Berko" is a hive of white-coated, clean-handed, obsessive activity.

Now the largest film archive in Europe, it was among the very first. The National Film Library, as the archive was originally called, was launched in July 1935, a few weeks after the release of The 39 Steps. A lowly department of the young and deeply troubled British Film Institute, it started out, in the words of its first curator Ernest Lindgren, 24 years old when he took on the role, with "no films, no equipment, and no money". Most of the silent heritage had been destroyed since the coming of talkies at the end of the 1920s, and so the library comprised, said Lindgren, "scraps of flotsam and jetsam, the wreckage of a vast output of film, which purely by chance have survived the destructive storm of time". ...

U.S. revises amount of Marcellus gas higher, much higher (42 times higher)

Philly.com: U.S. revises amount of Marcellus gas higher, much higher

The U.S. Geological Survey on Tuesday dramatically increased its estimate of the natural gas contained in the Marcellus Shale, the deep deposit that has triggered a drilling frenzy in Pennsylvania.

The USGS now estimates that the shale contains about 84 trillion cubic feet of undiscovered, technically recoverable natural gas and 3.4 billion barrels of undiscovered, technically recoverable natural gas liquids.

The agency's latest numbers are 42 times greater than its 2002 assessment, which said the shale contained about two trillion cubic feet of gas. The Marcellus lies under Pennsylvania and seven other Appalachian states. ...

GDP recovery since the recession

Economist: GDP recovery since the recession

Which economies have fared best and worst during the global financial crisis?

Perpetually Connected Millennials Prefer Personal Contacts to Make Important Life Decisions

4A's: Perpetually Connected Millennials Prefer Personal Contacts to Make Important Life Decisions

Research Shows Cohort’s Use of an Advisory Board on Critical Family, Financial and Career Decisions

A national poll conducted by Capstrat and FGI Research found that the online generation of Millennials (people between ages 22 and 30) are creating and consulting an informal advisory board of family members, spouses, friends and co-workers to make important life decisions. Overall, 73 percent of respondents prefer to obtain information through one-on-one informal conversations with their advisory boards. In total, 402 interviews were completed to understand how Millennials make decisions at key milestones, who influences those decisions and what matters most to them.

When comparing the importance of Millennial milestones, our research found that getting married is considered the most important life milestone (30 percent ranked this most important), followed by starting a career (26 percent), having children (19 percent) and buying a home (10 percent).

Additional notable research findings include

• • person-to-person first-hand accounts are the most common type of sought-after information (73 percent). Looking to online sources was only ranked higher than the advisory board when seeking information about buying a car (60 percent) or starting a career (52 percent).
  • Millennials prefer to consult members of their advisory board when seeking information about getting married. Parents (57 percent) and potential future spouses (55 percent) ranked first for sources of information about getting married.
  • When making decisions about having children, spouses (63 percent) and parents (50 percent) were ranked as top sources of information.

“There are many stereotypes about Millennials—that they’re a digital generation with unrealistic expectations who are ill-prepared for the real world,” says Karen Albritton, President of Capstrat. “But this research has proven that this generation is thinking and planning ahead for their major life decisions. And the way Millennials make their decisions have important implications for companies that communicate with, market to or even employ members of this generation.”

Visit additional research materials at http://www.capstrat.com/insights/millennials/.

To learn more, please contact Karen Albritton with Capstrat at 919-882-1958 or kalbritton@capstrat.com.

It's thrilling: the rise of Africa's amusement parks

Global Post: It's thrilling: the rise of Africa's amusement parks

What Africa's booming middle class really wants is a roller coaster.

... At least eight theme parks have opened or are scheduled to open in West Africa alone since 2000. The region’s roller coaster tycoons — some foreign, many local — brave one of the world’s least friendly business environments.

Power outages in Dakar last half the day; Nigeria’s last longer. Most citizens of either country can’t earn enough in 24 hours to ride Magic Land’s bumper cars for even 15 minutes.

And yet, triumphing over power outages, corrupt governments and widespread poverty, Africa's middle class is flourishing. And that middle class, theme park operators say, craves roller coasters.

“More and more, Senegalese parents bring their children here to ride the attractions and play,” said Abdoulaye Ndiaye, security guard at Magic Land. “It’s super. We have given them a place to relax in a city where we don’t have a lot of space to play.”

However discouraging West Africa’s economics are, its demographics make it ripe for a theme park bonanza. Half the continent is under 20. By 2050, one in every fifth person on the planet will be a sub-Saharan African, according to the United Nations. Hundreds of millions of those will be teenagers with no place to go on a date. ...

Think Again: War

Foreign Policy: Think Again: War

World peace could be closer than you think.

The early 21st century seems awash in wars: the conflicts in Afghanistan and Iraq, street battles in Somalia, Islamist insurgencies in Pakistan, massacres in the Congo, genocidal campaigns in Sudan. All in all, regular fighting is taking place in 18 wars around the globe today. Public opinion reflects this sense of an ever more dangerous world: One survey a few years ago found that 60 percent of Americans considered a third world war likely. Expectations for the new century were bleak even before the attacks of Sept. 11, 2001, and their bloody aftermath: Political scientist James G. Blight and former U.S. Defense Secretary Robert McNamara suggested earlier that year that we could look forward to an average of 3 million war deaths per year worldwide in the 21st century.

So far they haven't even been close. In fact, the last decade has seen fewer war deaths than any decade in the past 100 years, based on data compiled by researchers Bethany Lacina and Nils Petter Gleditsch of the Peace Research Institute Oslo. Worldwide, deaths caused directly by war-related violence in the new century have averaged about 55,000 per year, just over half of what they were in the 1990s (100,000 a year), a third of what they were during the Cold War (180,000 a year from 1950 to 1989), and a hundredth of what they were in World War II. If you factor in the growing global population, which has nearly quadrupled in the last century, the decrease is even sharper. Far from being an age of killer anarchy, the 20 years since the Cold War ended have been an era of rapid progress toward peace.

Armed conflict has declined in large part because armed conflict has fundamentally changed. Wars between big national armies all but disappeared along with the Cold War, taking with them the most horrific kinds of mass destruction. Today's asymmetrical guerrilla wars may be intractable and nasty, but they will never produce anything like the siege of Leningrad. The last conflict between two great powers, the Korean War, effectively ended nearly 60 years ago. The last sustained territorial war between two regular armies, Ethiopia and Eritrea, ended a decade ago. Even civil wars, though a persistent evil, are less common than in the past; there were about a quarter fewer in 2007 than in 1990.

If the world feels like a more violent place than it actually is, that's because there's more information about wars -- not more wars themselves. Once-remote battles and war crimes now regularly make it onto our TV and computer screens, and in more or less real time. Cell-phone cameras have turned citizens into reporters in many war zones. Societal norms about what to make of this information have also changed. As Harvard University psychologist Steven Pinker has noted, "The decline of violent behavior has been paralleled by a decline in attitudes that tolerate or glorify violence," so that we see today's atrocities -- though mild by historical standards -- as "signs of how low our behavior can sink, not of how high our standards have risen." ...

The Secret Language Code

Scientific American: The Secret Language Code

Psychologist James Pennebaker​ reveals the hidden meaning of pronouns

... Much to my surprise, I soon discovered that the ways people used pronouns in their essays predicted whose health would improve the most. Specifically, those people who benefited the most from writing changed in their pronoun use from one essay to another. Pronouns were reflecting people’’s abilities to change perspective.

As I pondered these findings, I started looking at how people used pronouns in other texts -- blogs, emails, speeches, class writing assignments, and natural conversation. Remarkably, how people used pronouns was correlated with almost everything I studied. For example, use of  first-person singular pronouns (I, me, my) was consistently related to gender, age, social class, honesty, status, personality, and much more. Although the findings were often robust, people in daily life were unable to pick them up when reading or listening to others. It was almost as if there was a secret world of pronouns that existed outside our awareness. ...

... PENNEBAKER: Almost everything you think you know is probably wrong. Take this little test. Who uses the following words more, women or men?

 > 1st person singular (I, me, my)
 > 1st person plural (we, us our)
 > articles (a, an, the)
 > emotion words (e.g., happy, sad, love, hate)
 > cognitive words (e.g., because, reason, think, believe)
 > social words (e.g., he, she, friend, cousin)

Most people assume that men use I-words and cognitive words more than women and that women use we-words, emotions, and social words more than men. Bad news. You were right if you guessed that women use social words more. However, women use I-words and cognitive words at far higher rates than men. There are no reliable differences between men and women for use of we-words or emotion words (OK, those were trick questions). And men use articles more than women, when you might guess there’d be no difference.

These differences hold up across written and spoken language and most other languages that we have studied. You can’t help but marvel at the fact that we are all bombarded by words from women and men every day of our lives and most of us have never “heard” these sex differences in language. Part of the problem is that our brains aren’t wired to listen to pronouns, articles, prepositions, and other “junk” words. When we listen to another person, we typically focus on what they are saying rather than how they are saying it.

Men and women use language differently because they negotiate their worlds differently. Across dozens and dozens of studies, women tend to talk more about other human beings. Men, on the other hand, are more interested in concrete objects and things. To talk about human relationships requires social and cognitive words. To talk about concrete objects, you need concrete nouns which typically demand the use of articles. ...

... In my own work, we have analyzed the collected works of poets, playwrights, and novelists going back to the 1500s to see how their writing changed as they got older. We’ve compared the pronoun use of suicidal versus non-suicidal poets. Basically, poets who eventually commit suicide use I-words more than non-suicidal poets. ...

... One of the most interesting results was part of a study my students and I conducted dealing with status in email correspondence. Basically, we discovered that in any interaction, the person with the higher status uses I-words less (yes, less) than people who are low in status. The effects were quite robust ...

... Across four years, we analyzed the admissions essays of 25,000 students and then tracked their grade point averages (GPAs). Higher GPAs were associated with admission essays that used high rates of nouns and low rates of verbs and pronouns. The effects were surprisingly strong and lasted across all years of college, no matter what the students’ major.

To me, the use of nouns -- especially concrete nouns -- reflects people’s attempts to categorize and name objects, events, and ideas in their worlds. The use of verbs and pronouns typically occur when people tell stories. Universities clearly reward categorizers rather than story tellers. ...

 

 

Prosperity for Today's Teenagers Versus Their Grandparents

Carpe Diem: Young Americans: Luckiest Generation in History

... In 1952, the minimum wage was $0.75 per hour (equivalent to $6.39 in today's dollars), and a full-time summer job at 40 hours per week for 12 weeks would have generated $360 in total summer earnings (ignoring taxes). Using retail prices from a 1952 Sears Christmas Catalog, I found that a teenager then would have only been able to purchase the following 3 items with his or her entire pre-tax summer earnings of $360 working at the minimum wage (with $15 borrowed from the parents to cover the full $375 cost):

Royal Deluxe Portable Typewriter  $120
Silvertone Portable Phonograph  $65
Silvertone 17-inch TV  $190
Total   $375

Now compare that to the items in the table below that could be purchased by a teenager or college student this year with his or her summer earnings of $3,480 (ignoring taxes) at the current minimum wage of $7.25 per hour: (Go to the link to see the full list)

Dell Inspiron Laptop    $450
Apple iPod Touch    $210
Apple iPhone 4G    $200
Garmin GPS    $100
Canon 14.1 Megapixel Digital Camera    $120 ...

... De'Longhi EC702 Espresso Machine    $150
Kindle    $114
Apple iPad    $500
Total    $3,480

The U.S. Content of “Made in China”

Federal Reserve Bank of San Francisco: The U.S. Content of “Made in China”

Abstract

Goods and services from China accounted for only 2.7% of U.S. personal consumption expenditures in 2010, of which less than half reflected the actual costs of Chinese imports. The rest went to U.S. businesses and workers transporting, selling, and marketing goods carrying the "Made in China" label. Although the fraction is higher when the imported content of goods made in the United States is considered, Chinese imports still make up only a small share of total U.S. consumer spending. This suggests that Chinese inflation will have little direct effect on U.S. consumer prices.

Article

The United States is running a record trade deficit with China. This is no surprise, given the wide array of items in stores labeled “Made in China.” This Economic Letter examines what fraction of U.S. consumer spending goes for Chinese goods and what part of that fraction reflects the actual cost of imports from China. We perform a similar exercise to determine the foreign and domestic content of all U.S. imports.

In our analysis, we combine data from several sources: Census Bureau 2011 U.S. International Trade Data; the Bureau of Labor Statistics 2010 input-output matrix; and personal consumption expenditures (PCE) by category from the U.S. national accounts of the Commerce Department’s Bureau of Economic Analysis. We use the combined data to answer three questions:

•  What fraction of U.S. consumer spending goes for goods labeled “Made in China” and what fraction is spent on goods “Made in the USA”?

•  What part of the cost of goods “Made in China” is actually due to the cost of these imports and what part reflects the value added by U.S. transportation, wholesale, and retail activities? That is, what is the U.S. content of “Made in China”?

•  What part of U.S. consumer spending can be traced to the cost of goods imported from China, taking into account not only goods sold directly to consumers, but also goods used as inputs in intermediate stages of production in the United States?

Answers?

Although globalization is widely recognized these days, the U.S. economy actually remains relatively closed. The vast majority of goods and services sold in the United States is produced here. In 2010, imports were about 16% of U.S. GDP. Imports from China amounted to 2.5% of GDP. ...

... Obviously, if a pair of sneakers made in China costs $70 in the United States, not all of that retail price goes to the Chinese manufacturer. In fact, the bulk of the retail price pays for transportation of the sneakers in the United States, rent for the store where they are sold, profits for shareholders of the U.S. retailer, and the cost of marketing the sneakers. These costs include the salaries, wages, and benefits paid to the U.S. workers and managers who staff these operations. ...

... This U.S. fraction is much higher for imports from China. Whereas goods labeled “Made in China” make up 2.7% of U.S. consumer spending, only 1.2% actually reflects the cost of the imported goods. Thus, on average, of every dollar spent on an item labeled “Made in China,” 55 cents go for services produced in the United States. In other words, the U.S. content of “Made in China” is about 55%. The fact that the U.S. content of Chinese goods is much higher than for imports as a whole is mainly due to higher retail and wholesale margins on consumer electronics and clothing than on most other goods and services. ...

Conclusion

Figure 2 shows the share of U.S. PCE [personal consumption expenditures] based on where goods were produced, taking into account intermediate goods production, and the domestic and foreign content of imports. Of the 2.7% of U.S. consumer purchases going to goods labeled “Made in China,” only 1.2% actually represents China-produced content. If we take into account imported intermediate goods, about 13.9% of U.S. consumer spending is attributable to imports, including 1.9% imported from China.

Since the share of PCE attributable to imports from China is less than 2% and some of this can be traced to production in other countries, it is unlikely that recent increases in labor costs and inflation in China will generate broad-based inflationary pressures in the United States.

Remember the Poor: Paul, Poverty, and the Greco-Roman World - Book Review

Jesus preached the Kingdom of God, calling for social justice, while Paul wrote about theology … or so a common refrain goes. But is it true? Bruce Longenecker, in Remember the Poor: Paul, Poverty, and the Greco-Roman World, presents a compelling case that this is not true.

Part of the challenge in New Testament scholarship is being clear by what we mean when we say “the poor.” Some scholars have been inclined to believe that the top 1% of society was "the wealthy" and everyone else was "the poor." Others, like Steven J. Friesen, have done extensive work in stratifying the Greco-Roman world. Longenecker builds on Friesen’s work and proposes the following economic scale. The categories are Friesen’s. The estimated percentages of the total population are Longenecker’s:

• ES1 – Imperial Elites (.04%)   imperial dynasty, Roman senatorial families, a few retainers, local royalty, a few freedpersons
• ES2 – Regional or provincial elites (1%)  equestrian families, provincial officials, some retainers, some decurial families, some freedpersons, some retired military officers
• ES3 – Municipal elites (1.76%)  most decurial families, wealthy men and women who do not hold office, some freedpersons, some retainers, some veterans, some merchants
• ES4 – Moderate Surplus  (15%)  most merchants, some traders, some freedpersons, some artisans (especially those who employ others), and military veterans
• ES5 – Stable near subsistence level (with reasonable hope of remaining above the minimum level to sustain life)  (27%)  many merchants and traders, regular wage earners, artisans, large shop owners, freedpersons, and some farm families
• ES6 – At subsistence level (and often below minimum level to sustain life)  (30%)   small farm families, laborers (skilled and unskilled), artisans (esp. those employed by others), wage earners, most merchants and traders, small shop/tavern owners
• ES7 – Below subsistence level  (25%)  some farm families, unattached widows, orphans, beggars, disable, unskilled day laborers, prisoners

Longenecker also talks about an elongated spectrum for ES4, with an upper and lower group. Paul was likely from ES4. Many of the household churches were probably of this status, but by no means all. Jesus was from ES5. When Jesus talked about the poor, he was most likely talking about ES6 and ES7. It is also possible that the percentage of people in various strata were different in Palestine compared to urban centers.

One of the challenges with using economic strata is that it imposes somewhat of a Marxian lens onto the ancient world. The Greco-Roman world was not so much defined by class as it was by an intricate web of pyramidal patron to client relationships. A slave could be economically comfortable while a free farmer may have been living on the edge. Still, when we come to the question of who were “the poor,” it gives us a clearer picture.

There is also an interesting discussion about what level of charity and generosity was present in ancient cultures. According to the analysis in this book, the tendency by some to say that there was no charity and generosity until the Judeo-Christian movement is an overstatement. (For instance, why were there beggars if no one gave to them?) There were measures to care for the poor but the Judeo-Christian movement was unique in both the extent to which the poor were valued and in the centrality that caring for the poor played in their communities.

Longenecker begins his analysis of Paul and the poor by taking a look at Paul’s famous comment in Galatians 2:10:

“They asked only one thing, that we remember the poor, which was actually what I was eager to do.”

For much of church history, interpreters have said that Paul was referring to the poor in Jerusalem … not the poor generically. Paul was speaking to the particular context. This view is held by many prominent scholars today. Yet Longenecker shows that there is no evidence of this view prior to the 4th Century and that interpreters prior to that time interpreted it as though it generically meant “the poor.” He builds a convincing case that, far from addressing an isolated context, Paul was articulating something that he saw as central to the gospel.

But if there was concern for the poor, it was primarily for the poor as they became part of the Jesus-movement. Longenecker writes:

In general, it is most likely that care for the poor was primarily practiced intra-communally within Jesus-groups. In view of the huge number of destitute and poor within the ancient urban context, and the relatively limited resources of Jesus-groups, it would be foolhardy to imagine much other than an intra-communal practice of extending support in limited supply to a few within a community. Anything beyond that was probably unlikely to transpire. (291)

Although broader concern for the poor of society fit with the grand Judeo-Christian narrative, the Jesus-groups were limited in what they could address. Longenecker also writes:

At no point do we get the sense that the ES4 members were selling all of their resources in an effort to equalize the economic profile of all Jesus-followers. There is no sense that Paul expected all members of urban Jesus-groups to pool their resources and distribute them equally between all of the members. Economic differences continued to exist within communities of Jesus-followers that Paul established, and Paul imagined nothing to be wrong with that, as long as the needs of the needs of the poor were being met. (288-289)

At some point I think he comments that it was neither “communism nor charity.” The poor were cared for in a context where people were responsible for themselves (you don’t work, you don’t eat). People reaped rewards according to their status and their labor. But the Jesus-communities were also inclusive of the poor with dignified means of caring for the poor as full partners in the community.

The book is a treasure trove of economic and sociological analysis. I’ve only highlighted a couple of key points. At the end of the book he summarizes his analysis in nine key observations:

1. Paul, the follower of Jesus and apostle to gentiles of the Greco-Roman world, was concerned about the plight of the poor in the urban contexts in which he operated.
2. Although this was not his sole interest, and although he was not forced to deal with it extensively in his extant letters, care for the economically needy was a matter that he deemed to be characteristic of the identity of Jesus-followers.
3. Communities of Jesus-followers that Paul established were expected to offer care for the poor – albeit in their own groups in the first instance, although theoretically beyond those confines as well, if/as resources permitted.
4. Paul shared this conviction with other sectors of the early Jesus-movement that were committed to caring for the poor, and with leading figures of the early Jesus-movement – including its influential “founder” (i.e., Jesus) and that founder’s influential brother (i.e., James).
5. With Paul properly situated in this respect, care for the poor is recognized to have been practiced fairly ubiquitously across the spectrum of first-century proto-orthodox circles of the Jesus-movement.
6. The early Jesus-movement, including Paul’s own mission to Greco-Roman urbanities, embodied and exemplified values long embedded with mainstream forms of Early Judaism.
7. Rightly or wrongly, Paul and other leading figures of the early Jesus-movement imagined (along with some other Jews of their day) that care for the poor was not a notable feature of Greco-Roman paganism.
8. Paul imagined care for the poor among gentile communities of Jesus-followers to be an expression and embodiment of the invading triumph of the deity of Israel who had made himself known in the scriptures of Israel, in the life, death and resurrection of Jesus, and now through the Spirit/spirit that enlivened small groups of Jesus-followers.
9. Proto-orthodox forms of Christianity from the second through fourth centuries are known to have enormously augmented the strategies and institutions for caring for the poor to an unprecedented extent in the Greco-Roman world. Those efforts are organically related to more low-level forms of similar efforts evident throughout the early Jesus-movement, with Paul taking a prominent lead in spearheading such efforts among the gentile urbanites of the Greco-Roman world.

This book does a masterful job of opening a window into the socio-economic context of the early Christian world. Its extensive documentation makes it a rich resource for pursuing more study. In case you can’t tell, I think this book is a must read.

Average Home Size Shrinks

Source: Carpe Diem

 

Why companies won't hire - David Frum

CNN: Why companies won't hire

... In fact, on our current trajectory, the U.S. will catch up to 2007 levels of economic output sometime in the next couple of months. Yet at the current job creation rate of a little north of 100,000 jobs per month, the U.S. economy will not recover its 2008-2009 job losses until the middle of the decade. And because so many distressed workers have quit the labor force altogether, the pace of job creation would have to double for the U.S. to see total employment rates return to pre-crisis levels before 2015.

What's the problem? Consider just these factors:

1. This past recession delivered its hardest blow to some especially labor-intensive industries: construction and retailing. Even as economic activity recovers, we're not going to see lots of new home building. Nor will we see people using their cash-out refinancings to go shopping at Best Buy. Americans are saving again. Those who have jobs are paying down debt.

2. Recessions lead to consolidations. Weak firms go broke, strong firms gain market share. The strong firms hire, the weak firms fire. But because the strong firms are more productive (that's why they are strong!), they do not hire nearly as many people as the weak firms have laid off.

3. A catastrophic experience like the 2008-2009 recession changes an employer's expectations about the future. Caution and self-protection become the guiding rules of business management. Companies decide it's safer to have one worker too few than one too many. They may not recover their exuberance and optimism for years.

4. Last and most important: The economy, although growing, is not growing very fast. The rule of thumb is to reduce unemployment by 1 point, the economy must grow 2 points over trend. Right now, the U.S. economy is still growing below trend. The engine is just not revving fast enough to move the car.

Then there's public policy. Employers must fear that the future probably holds heavier taxes, more regulation and higher employee health care costs. The outlook might be worse under a President Obama than a President Romney, but it looks sufficiently ugly either way.

As I said: That's the optimistic scenario, the 1936 scenario.

Don't get me started on the other.

What's Wrong With This Deficit Graph?

Lately I've seen various graphs that purport to show the key compenents driving our budget defecit. Below is the latest one making the rounds:

The issue that we need to pay particular attention to is the inclusion of Bush-era tax cuts. Taxation is directly related to economic growth.

A 0% tax rate is not workable. There would be no government. A 100% tax rate isn't workable either. People would starve and die, ceasing to create any income to tax. If you go from 0% to 5%, then government will generate higher revenue. If you go from 5% to 10% you will get even more revenue. But at some point, raising the tax rate actually generates less revenue. Resources are taken out of the private sector, slowing the growth of the economy, which means a smaller base of revenue to tax. At the extreme end of taxation, the economy contracts and dies.

Source

So changing tax rates is ALWAYS a trade-off. The Bush era tax-cuts were made based on the assumption that lower taxes would stimulate economic growth to a rate higher than it otherwise would be. At some future date (say, five years) the revenue would be greater with lower tax rates and faster economic growth than it would have been with higher tax rates and slower economic growth. The Bush folks believed that we were somewhere between the Equilibrium Point and Point B on the graph. If they were correct, than the tax cuts actually kept the deficit lower than it otherwise would have been.

Now, the big question, of course, is whether or not the Bush folks were right. Did the tax cuts "pay for themselves" in stimulating economic growth and creating a larger tax base? I don't know a definitive answer for that. But I do know that throwing tax cuts into the chart above with no compensation for the changes in overall revenue those tax cuts generated (or failed to generate) is deceitful. The tax base does not stand still in isolation as we change tax rates. It changes in relationship to them. It is the comparison of tax rates AND economic growth in context "A" that must be compared with context "B."

The reality in the deficit debate is that if we taxed the wealthy at 100% of their income above middle class levels, it would make only a tiny dent in the problem. I'm not convinced that slightly higher taxes like the Democrats are proposing will make a substantially hurt the economy but tax increases aren't going to fix the deficit. Only substantial spending reductions coupled with economic growth will have an impact.

 

 

Obama at 50: Older, Wiser ... Happier?

Slate: Obama at 50: Older, Wiser ... Happier?

... Take the 2010 study that looked at more than 340,000 Americans and found that self-reported levels of anger, stress, and worry plummet at 50 and that a few years later, happiness rises. This pattern held true for men and women, married and unmarried, the working and the jobless—and, presumably, for presidents, too.

The exact age at which the shift happens is a matter of some dispute. A study that Slate wrote about in 2007 found 45 to be the average pivot point among Americans and Europeans. (The same study found that for some reason, the age at which happiness increases varies by country. Things start to look up after age 42 in South Africa, whereas Ukrainians have to wait till they pass 62.) But whatever the exact timing, the fact of this mood swing feels counterintuitive: As we near decrepitude, should we not feel gloomier? Our friends are dying, our knees are giving out. What's so great about getting old?

Despite the recent popularity of happiness studies among economists, psychologists, and other social scientists, the cause of the correlation between age and happiness remains somewhat mysterious. Psychiatry professor Arthur Stone of Stony Brook University, who helmed the 2010 study that named age 50 as an emotional turning point, initially figured environmental factors might account for his results. Shouldn't people's growing happiness in their 50s, 60s, and 70s have something to do with the joy of retiring? Or "maybe it's kids going out of the house that changes people's well-being, reduces their stress," Stone told me he had theorized. But when he and colleagues controlled for these and other likely outside factors, the results stayed the same. So what was causing this shift in well-being?

"I don't think that we actually know," Stone said. ...

... What is clear from the preponderance of studies, though, is that the compensation for crummy eyesight is rose-colored glasses. Some scholars, pondering the well-being of older people, have begun to wonder whether this facility at regulating emotions might contribute to another ineffable attribute: wisdom. A study out of the University of Michigan presented subjects with sociopolitical conflicts—ethnic tensions in Djibouti, for instance—and found that older people were better at seeing others' points of view, grasping nuanced issues and forging compromise. The young may have all the idealism, but the old seem better equipped to actually fix the world. ...

Quiz: Pet ministries and the spiritual growth of congregations

Faith & Leadership Blog: Quiz: Pet ministries and the spiritual growth of congregations

Religious institutions responding to Americans’ love affair with their pets are adding new ministries, drawing new people to church and advocating greater care for all living creatures. Take our quiz to test your knowledge of the relationship between believers and their nonhuman loved ones.

The tears came easily for the burly truck driver in his 40s at the animal memorial service at Christ United Methodist Church in suburban Pittsburgh.

For nearly two decades, his black-and-white cat slept with him and his wife at night, greeted him every morning and was there each time he came into the house. The cat, he said, was like one of his kids -- one he didn’t have to send to college.

The memorial service gave him a chance to recognize his loss and say goodbye. “I really needed this,” he told a church volunteer afterward. “I think this was what Christ would have done.”

The monthly animal memorial service, part of the church’s Hearts and Paws program, is representative of a growing number of pet ministries throughout the country. In a nation where commercials refer to dog and cat owners as “pet parents,” and not even a recession can slow spending on animals, religious institutions are responding in multiple ways.

The Hearts and Paws website states its mission theologically, explaining that “God has given us dominion over the animals of the earth, meaning that He has challenged us to take care of them. God also expects us to be in love and charity with our neighbors, meeting the needs of others whenever and wherever possible.” ...

Why Being Certain Means Being Wrong

Harvard Business Review: Why Being Certain Means Being Wrong

Of all the headwinds we face as decision-makers, the power of one overshadows all others: our need for certainty. It is typically more important for us to feel right, than to be right — a difference that didn't matter much in the lives of our ancestors, but now matters a lot. ...

... Just as the few thousand sperm are stronger than the millions that perished along the way, some ideas are favored over others: our "fittest" explanations are those that cohere with all of our other beliefs and values — they are easily integrated with everything we already "know." But just as one sperm will get to the egg first, even if more genetically fit sperm are available, the urgent drive to reduce the tension of uncertainty pushes us to accept the first reasonable explanation we craft. Our mind becomes "fertilized" and the calm feeling of knowing instantly infuses us, stopping our search for alternative explanations.

The lockdown of our minds serves an important purpose: Generations of our ancestors wouldn't have survived had they constantly second-guessed their conclusions. In a harsh environment characterized by straightforward challenges that demanded quick responses, an indecisive caveman was a dead one. The rush to certainty became our standard operating procedure for two reasons: i) because we needed speedy thinking, and ii) because speed did not force a significant tradeoff in accuracy. The risk of interpretive error is low when you are confronted by a charging tiger or bush of lush berries because the cause-effect relationships in these straightforward situations are not convoluted or ambiguous. Even today, the majority of micro-decisions we make every hour are fairly straightforward, so there is no reason to second-guess or reflect on the limitations of our senses and intuitions.

But the whole speed-accuracy tradeoff falls apart in a world that tosses up complex problems. The need to be certain gets in the way of accuracy when it comes to problems that have multiple, interwoven causal factors that are difficult to unbundle. Complex problems require exploration, multiple perspectives, and a variety of possible explanations, before it is safe to draw any conclusions. Many complex problems can only be tackled with experimentation because they do not converge to definitive solutions. But a mind that is "fertilized" by the first satisfying interpretation is closed to the more subtle and complicated explanations that are often better. It is our mind's lockdown feature that makes certainty the #1 enemy of effective decision-making in the face of complexity. Think of all the business failures that were avoidable if it weren't for the hubris of leaders who were unwilling to revisit their faltering strategies, or the public policy failures that could have been mitigated, or our personal relationships that would run so much more smoothly if we weren't so certain that we were right all the time. But there is an antidote to premature certainty: Adopting a mindset of "provisional truth."

Provisional truth requires that we think of our explanations as hypotheses — always subject to replacement based on new information or alternative ways of structuring existing information. ...

This is sounds like what I call tentatvie finality. We often must take action in the midst of risk and uncertaning. So we often must come at an issue with some degree of finality but we must always hold the finality with tentatively, being open to new learning.

U.S. Income Inequality: It’s Not So Bad

Federal Reserve Bank of St. Louis: U.S. Income Inequality: It’s Not So Bad

Thomas Garrett

Each year, the U.S. Census Bureau releases data on the income levels of America’s households. A comparison of the annual data over time reveals that the income of wealthier households has been growing faster than the income of poorer households—the real income of the wealthiest 5 percent of households rose by 14 percent between 1996 and 2006, while the income of the poorest 20 percent of households rose by just 6 percent.

As a result of these differences in income growth, the income of the wealthiest 5 percent of households grew from 8.1 times that of the income of the poorest 20 percent of households in 1996 to 8.7 times as great by 2006. Such figures commonly lead to the conclusion that income inequality in the United States has increased. This apparent increase in income inequality has not escaped the attention of policy makers and social activists who support public policies aimed at reducing income inequality. However, the common measures of income inequality that are derived from the census statistics exaggerate the degree of income inequality in the United States in several ways. Furthermore, although many people consider income inequality a social ill, it is important to understand that income inequality has many economic benefits and is the result of—and not a detriment to—a well-functioning economy.

An Inaccurate Picture

The Census Bureau essentially ranks all households by household income and then divides this distribution of households into quintiles. The highest-ranked household in each quintile provides the upper income limit for each quintile. Comparing changes in these upper income limits over time for different quintiles reveals that the income of wealthier households has been growing faster than the income of poorer households, thus giving the impression of an increasing “income gap” or “shrinking middle class.”

One big problem with inferring income inequality from the census income statistics is that the census statistics provide only a snapshot of income distribution in the U.S., at a single point in time. The statistics do not reflect the reality that income for many households changes over time—i.e., incomes are mobile. For most people, income increases over time as they move from their first, low-paying job in high school to a better-paying job later in their lives. Also, some people lose income over time because of business-cycle contractions, demotions, career changes, retirement, etc. The implication of changing individual incomes is that individual households do not remain in the same income quintiles over time. Thus, comparing different income quintiles over time is like comparing apples to oranges, because it means comparing incomes of different people at different stages in their earnings profile.

The U.S. Treasury released a study in November 2007 that examined income mobility in the U.S. from 1996 to 2005. Using data from individual tax returns, the study documented the movement of households along the distribution of real income over the 10-year period. As shown in Figure 1A, the study found that nearly 58 percent of the households that were in the lowest income quintile (the lowest 20 percent) in 1996 moved to a higher income quintile by 2005. Similarly, nearly 50 percent of the households in the second-lowest quintile in 1996 moved to a higher income quintile by 2005. Even a significant number of households in the third- and fourth-lowest income quintiles in 1996 moved to a higher quintile in 2005.

The Treasury study also documented falls in household income between 1996 and 2005. This is most interesting when considering the richest households. As shown in Figure 1B, more than 57 percent of the richest 1 percent of households in 1996 fell out of that category by 2005. Similarly, more than 45 percent of the households that ranked in the top 5 percent of income in 1996 fell out of that category by 2005.

Thus it is clear that over time, a significant number of households move to higher positions along the income distribution, and a significant number move to lower positions along the income distribution. Common reference to “classes” of people (e.g., the lowest 20 percent or the richest 10 percent) is quite misleading because income classes do not contain the same households and people over time.

Another problem with drawing inferences from the census statistics is that the statistics do not include the noncash resources received by lower-income households—resources transferred to the households—and the tax payments made by wealthier households to fund these transfers. Lower-income households annually receive tens of billions of dollars in subsidies for housing, food and medical care. None of these are considered income by the Census Bureau. Thus the resources available to lower-income households are actually greater than is suggested by the income of those households as reported in the census data.

At the same time, these noncash payments to lower-income households are funded with taxpayer dollars—mostly from wealthier households, since they pay a majority of overall taxes. One research report estimates that the share of total income earned by the lowest income quintile increases roughly 50 percent—whereas the share of total income earned by the highest income quintile drops roughly 7 percent—when transfer payments and taxes are considered.

The census statistics also do not account for the fact that the households in each quintile contain different numbers of people; it is differences in income across people, rather than differences in income by household, that provide a clearer measure of inequality. Lower-income households tend to consist of single people with low earnings, whereas higher-income households tend to include married couples with multiple earners. The fact that lower-income households have fewer people than higher-income households skews the income distribution by person. When considering household size along with transfers received and taxes paid, the income share of the lowest quintile nearly triples and the income share of the highest quintile falls by 25 percent.

Is Policy Needed?

Income inequality will still exist even if the income inequality statistics are adjusted to account for the aforementioned factors. Given the negative attention income inequality receives in the media, it is important to ask whether reducing income inequality is a worthy goal of public policy. It is important to understand that income inequality is a byproduct of a well-functioning capitalist economy. Individuals’ earnings are directly related to their productivity. Wealthy people are not wealthy because they have more money; it is because they have greater productivity. Different incomes reflect different productivity levels.

The unconstrained opportunity for individuals to create value for society—and the fact that their income reflects the value they create—encourages innovation and entrepreneurship. Economic research has documented a positive correlation between entrepreneurship/innovation and overall economic growth. A wary eye should be cast on policies that aim to shrink the income distribution by redistributing income from the more productive to the less productive simply for the sake of “fairness.” Redistribution of wealth increases the costs of entrepreneurship and innovation, with the result being lower overall economic growth for everyone.

Poverty and income inequality are related, but only the former deserves a policy-based response. Sound economic policy to reduce poverty would lift people out of poverty (increase their productivity) while not reducing the well-being of wealthier individuals. Tools to implement such a policy include investments in education and job training.

Income inequality should not be vilified, and public policy should encourage people to move up the income distribution and not penalize them for having already done so.

Rancor Out of Control: Welcome to the Fourth Turning?

(I originally posted this in March of  2010. But in light of events in D.C. and around the nation, I thought I would reprise it.)

Are we in the middle of a "Fourth Turning" as described by William Strauss and Neil Howe? I know some of my readers roll their eyes at this stuff about generations but a couple of years ago I did an eleven part series (Index) on Strauss and Howe'€™s work, focusing primarily on their books Generations: The History of America's Future, 1584 to 2069 and The Fourth Turning: An American Prophecy written in the 1990s. S&H don't believe that history repeats itself but it rhymes. They see a four part rhythm to events that are tied to recurring cycles of archetype generations. They believe we have entered a fourth turning in the past decade and that the fourth turning will play out through the rest of this decade. Characteristic of the fourth turning is a rancorous civil strife leading to a climactic set of events that sets in motion the consensus for the next several decades.

Two years ago I wrote a post "McCain vs Obama. A "Fourth Turning" Phenomenon?" I thought I would reprise a portion of it here:

At the core of S&H's thesis is the idea that there is a repeating cycle of four generational archetypes. Each generation consists of people born within approximately a twenty year period; give our take a few years. The types are the Hero, the Artist, the Prophet, and the Nomad, which repeat in that order. Every twenty years one archetype is dying off while society is giving birth to the successor version of the dying archetype. This is not to say that everyone in a given generation exhibits the characteristic of the archetype but in the aggregate, and in terms of the type leadership that emerges, the archetype gives each generation a distinctive feel.

About every twenty years there is an alignment where each generation is located overwhelming within a particular part of the lifecycle: childhood, young adult, mature adult, elderhood. This alignment signals a shift in the culture from one turning or "mood" into the next. There are four turnings that follow in succession: 1. High, 2. Awakening, 3. Unraveling, and 4. Crisis. (They can also be likened to spring, summer, fall, and winter.) The high comes in the wake of resolving a great crisis and is characterized by a civic spirit and general optimism. The Awakening is a period of spiritual awakening and turning more inward to address issues that have been suppressed in the previous Crisis and High periods. The Unraveling is an increasingly inward focused era where societal institutions begin to fray and come apart. Escalating rancor and coarseness become part of life. The Crisis usually features escalating societal division that finally gets resolved in the midst of addressing some major social crisis like a war or economic collapse. The resolution gives way to a new High and the cycle starts again. A complete cycle is called a saeculum. S&H would suggest we are in the first 5-10 years of a Fourth Turning, a Crisis era.

The four generations driving events in this Crisis era are categorized as follows:

• Silent Generation (Artist). Born 1925-1942
• Baby Boom Generation (Prophet). Born 1943-1960
• Thirteenth Generation or Gen X (Nomad). Born 1961-1981
• Millennial (Hero). Born 1982-2000?

The Prophet Generation, in this case Boomers, is the wild card in the Crisis era. Boomers were brought up to question things, were told they could accomplish anything, and were filled with visions of making a new and better world by their parents who had just endured tremendous crisis. They had a destiny to fulfill.

In youth, Boomers began challenging tradition with idealistic visions that ranged from the noble to the utterly narcissistic. As they moved into adulthood they became increasingly inward focused while still bending the world toward meeting their perceived needs. In the Crisis era, a prophet generation enters a stage of life where they begin to confront their own mortality. The kids are grown and there is a pressing awareness that all those idealistic visions of youth have not be realized. Suddenly the clock is running out. Urgent action is needed in order to fulfill the idealism they once felt in there youth.

Yet there is one problem: there are polar versions of what the new vision should look like within the generation. For instance, polls on controversial issues like, say, the Vietnam War, show that Boomers register the highest percentage of people who intensely feel the war was wrong. But Boomers also register the highest percentage of people who intensely feel the war was right. This dynamic tends to lead to a combative, winner-takes-all, take no prisoners mindset in the public square.

Meanwhile, the Boomers are sandwiched between two very different generations. The Silent generation (Artist) grew up in awe of the sacrifices and accomplishments of the G.I generation (Hero) that preceded them. But they often found themselves uneasy with the self-confident, often cold and mechanistic feel of the G.I. generation. They value the more humanistic and idealistic elements of the Boomers but are often disturbed by the Boomers disregard for what those before them have contributed and are particularly put off by the Boomers’ rancorous way of addressing problems. The Silent generation is the generation of consensus, bi-partisanship, and fair process.

Meanwhile, the Gen X generation (Nomads) have grown up in a time of decaying institutions and child neglect. While they were children, divorce increased and adults went off somewhere to find themselves. As the Fourth Turing unfolds. Gen Xers are evermore focused on what kind of world their children will inherit. They want them to have a better and more wholesome world than they grew up with. Societal institutions are not seen as allies and all of their energy is consumed with trying to make life work at the most elemental levels. They grow increasingly impatient with the grandiose idealism of Boomers and their antics, pushing things ever closer to the brink of chaos.

Finally, there is the Millennial generation (Hero) emerging on the scene. Boomers see this new generation as the folks who are going to partner with them in there idealistic visions, whichever variety of visions that may be.

What S&H suggest is that in the Fourth Turning, idealism is needed to surmount the Crisis problems. The Prophet generation often plays an important role in this respect but they are ever at the brink of spiraling out of control. The Artist generation and the Nomad generation act as a brake on the Prophet excesses.

So far in American history, the Artists and the Nomads were successful every time but one. That was in the 1860s. Idealistic Prophet abolitionists and Prophet Southerners succeeded in leading others into their idealistic crusades that resulted in the American Civil War. At the beginning of the war about 90% of congress was of the Prophet generation. In 1865 it was still 73%. In the two elections after the war, the Prophet generation dropped to 44%. S&H point out that this the only time in American history where the stats show an entire generation being voted out of office in such short order.

From Bush is a Nazi who secretly conspired to bring down the World Trade Center to Obama is a socialist who wants to kill babies, does this feel familiar? What do you think?