I can't remember if it was you or Chris who posted the article by David Brooks mentioned in this article but here is one person's reaction:
The View From a Political Perspective
By Jim Griffin
Commentary
You don't have to accumulate much experience with markets, whether as a short-term trader or long-term institutional investor, before cyclicality of one sort or another impresses itself upon you.
What's true in markets is derived from what's true in life; from string theory and electromagnetism to the more easily observable and comprehensible movements of the moon and tides, everything is cyclical, apparently.
For example, politics. With midterm elections dead ahead, David Brooks offered a longer-term wave-pattern perspective on liberalism vs. conservatism. The New York Times columnist noted last week that the 1932-to-1968 period of dominance by liberalism led to such accomplishments as Social Security and civil rights advances. By 1980, the cycle had changed, and conservative dominance brought about a renaissance of the economy through deregulation and "the rebalancing of the culture to emphasize family, work and individual responsibility."
Sometimes, however, neither ideology is dominant; there are changing times when, in a sort of first-derivative-goes-to-zero, it is not clear what will dominate in the future. Brooks suggests that this is one of those times; whether Republicans lose their majorities or not, conservatives have exhausted their agendas, and the Reagan coalition is unraveling. Identification with the Republican Party is falling, but Democratic affiliation is not rising. "Instead, there is a spike in the number of people who do not identify with either."
With the political first derivative now at zero, he posits that the next period of political dominance is likely to be achieved by whichever ideology is best able to address today's defining challenges. His list: confronting Islamic fundamentalism, managing entitlement spending and the "stultification of government," coping with emergent China and India, and "the growing importance of cognitive skills and cultural capital, the need to surround people, especially children, with stable relationships if they are to flourish."
This sort of thinking may be above my pay grade as an economist, but I believe it's important on occasion to step back for a longer perspective in order to put our daily cyclical interests in context. In this time of saturation advertising by political campaigns, Brooks' formulation struck me as an insightful hypothesis that is not obviously refuted by contemporary data. Whatever the outcome on Nov. 7, he suggests, change is upon us. |
