The 2020s are here

Elderly Shanghai woman practicing tai-chi (Wikipedia – Tom Thai)



Two years ago I wrote about "The Crisis of the 2020s." I argued that this decade would see a worsening confrontation between two world views:

On the one hand, the globalist consensus will continue to radicalize in the core countries of the Western world. On the other hand, a very different consensus will dominate most of central and eastern Europe, with inroads being made into France and Germany. These opposing consensuses will diverge more and more, if only because mutual antagonism will make dialogue impossible. (Frost 2017a)

This confrontation is taking place at a time when the "consensus" no longer seems to be delivering the goods. Economic growth is sluggish not only throughout the West but also in the supposed beneficiaries of globalization—China, in particular. For some, this slowdown means that the current system has failed. For others, it means that the failings of globalization can be resolved only through more globalization.

The Crisis of the 2020s is thus primarily ideological. People are split into opposing camps, and it is far from clear which one will win. While the globalist consensus is losing ground in eastern, central, and southern Europe, it still dominates the western core of the UK, France, and Germany ... as well as North America. The West has lost its manufacturing base but is still culturally dominant. That dominance, not so much in ideas as in the packaging of ideas, is critical to promoting a model of society where people are interchangeable units in a global marketplace.

The ideological crisis will nonetheless be made worse by real-world problems:


China: a shrinking work force

China’s exports will become more expensive as its work force shrinks and grows old. This shrinkage will be worse than expected because the Chinese authorities have been overestimating the country’s fertility rate for almost two decades. The current rate is not 1.6 children per women. In fact, it had already fallen to 1.4 by 2003 and is now probably one child per woman. And this is happening even though the one-child policy is no longer in effect. The fertility rate is even lower among Han Chinese and lower still in the industrialized northeast—where it is down to 0.75 (Frost 2019a; Wang 2018). 

There are already fewer Chinese workers with each passing year, and this decrease will accelerate as the smaller cohorts of the noughts and teens enter the job market. Inevitably, the price of labor will rise. This will be good for China, which needs to reorient away from exports and toward its domestic economy. Western countries, however, will have to be weaned off their dependence on cheap Chinese goods.

Can the same goods be produced elsewhere? Unlikely. None of the alternatives sources of cheap labor have the same worker quality or, just as importantly, worker quantity. In hindsight, China was a lucky find for globalization—a country where the average worker was not only inexpensive but also intelligent and disciplined.

Western consumers are already cash-strapped, with most of them living from pay check to pay check. Where will they get the money to pay for a steep increase in the price of consumer goods?


The global food crisis

The Arab Spring was triggered by a surge in food prices. That surge was no fluke. We are reaching the end of a long increase in food production, a “green revolution” made possible by large-scale monoculture, intensive plowing, and heavy use of chemical fertilizers. That increase has come at a price, particularly degradation of soil fertility. Further increases will be modest and will require a more sustainable model of agriculture, as well as more investment in automation and robotization. Unfortunately, such changes, especially the latter, are impeded by the current heavy reliance on cheap migrant labor.

Agribusiness, particularly in the U.S., has become a conservative force that will stubbornly resist change. Like the culture industry, it will push for more of the same.


The decline of high-trust societies

The evolution of social complexity is far from easy. One of the main challenges has been the creation of large societies in which economic transactions take place mostly between unrelated individuals. Such societies are impossible in most of the world because of the high level of mistrust between unrelated individuals. Each transaction has to be checked and double-checked for lying, cheating, and outright theft. Many transactions never take place because they just aren't cost-effective.

This obstacle has been overcome in northwest Europe and East Asia. In both areas, the solution is behavioral and psychological. Northwest Europeans are more individualistic, less loyal to kin, and more trusting of strangers. Because they attach less importance to kinship, they have been able to build large, functioning societies on the basis of “impersonal prosociality,” i.e., willingness to obey universal social rules, affective empathy toward nonkin, and feelings of guilt for unwitnessed rule breaking (Frost 2017b; Frost 2019b; Schulz et al. 2019). East Asians are less individualistic but just as willing to obey universal rules, which are enforced more by shame than by guilt. Empathy is also at a high level, but less differentiated between affective and cognitive empathy:

The main difference is in the relationship between self and society. Whereas a greater sense of self has helped Northwest Europeans to transcend the limitations of kinship and, thus, build larger societies, East Asians have relied on a lesser sense of self to create a web of interdependence that extends beyond close kin. (Frost 2015)

Northwest Europeans and East Asians are now in steep demographic decline. Inevitably, less wealth will be created. I say "inevitably" because those two groups produce most of the world’s wealth. When they go, most of the wealth will go too. This is not a problem we can resolve by passing laws or changing the school curriculum. To some extent, we could force people to adopt the behaviors of a high-trust society, but that would take time and will. And we don't have much of either.


A name with a nice ring to it

When I wrote that post two years ago I settled on the name "Crisis of the 2020s." It had a nice ring to it. While doing research for this post, I googled the same name ... and got over 56,000 hits. The oldest hit seems to be a 2011 article: "Global Aging and the Crisis of the 2020s." I hadn't read it previously, but it points to the same underlying problem:

The working-age population has already begun to contract in several large developed countries, including Germany and Japan. By 2030, it will be stagnant or contracting in nearly all developed countries, the only major exception being the United States. In a growing number of nations, total population will begin a gathering decline as well. Unless immigration or birthrates surge, Japan and some European nations are on track to lose nearly one-half of their total current populations by the end of the century. (Howe and Jackson 2011)

That article differs from mine in its implied advocacy of immigration as a solution. To be sure, it does mention "the lawlessness of immigrant youths in large cities [of Western Europe]," but it remains upbeat about the United States "because of its higher fertility rate and because of substantial net immigration, which America assimilates better than most other developed countries" (Howe and Jackson 2011). That optimism was already exaggerated in 2011. Today, mass immigration is just as much a process of cultural and demographic replacement in the U.S. as it is in Western Europe.

Let's be frank. The high productivity of North America, Western Europe, and East Asia has profound behavioral and psychological causes. It is not due to political ideals, universal education, or a particular legal system. It is due to a higher level of social trust, as well as a higher level of cognitive ability and a lower level of personal violence. When immigrants enter that kind of environment, their productivity dramatically rises. They are now working in a society where laws are observed, where information is reliable, and where disputes are not normally settled through violence. We all benefit from that kind of society—simply by virtue of living in it.

That’s the "unearned privilege" that antiracists and right-wing economists love to denounce. Their argument is deceptively simple: “By what right do we deny this privilege to others?  It’s a mere accident of birth! Just think, they’re less productive because we’re keeping them out. So let them in! We’ll all be better off!”

Well, no. Do I have to explain why? 


References

Frost, P. (2015). Two Paths. The Unz Review, January 24
https://www.unz.com/pfrost/two-paths/

Frost, P. (2017a). The Crisis of the 2020s. Evo and Proud, December 19.
http://evoandproud.blogspot.com/2017/12/the-crisis-of-2020s.html

Frost, P. (2017b). The Hajnal line and gene-culture coevolution in northwest Europe. Advances in Anthropology 7: 154-174.
https://file.scirp.org/pdf/AA_2017082915090955.pdf 

Frost, P. (2019a). Autumn in China. Evo and Proud, March 26
http://evoandproud.blogspot.com/2019/03/autumn-in-china.html 

Frost, P. (2019b). Was Western Christianity a cause or an effect? Comment on: J.F. Schulz, D. Bahrami-Rad, J.P. Beauchamp, and J. Henrich. The Church, intensive kinship, and global psychological variation. Science 366 (6466)
https://science.sciencemag.org/content/366/6466/eaau5141/tab-e-letters  

Howe, N., and R. Jackson. (2011). Global aging and the Crisis of the 2020s. Current History, January, pp. 20-25
https://pdfs.semanticscholar.org/9879/fe3ea41e85f5fdfb6bc1ffcc2ae5c44a1a2a.pdf 

Schulz, J.F., D. Bahrami-Rad, J.P. Beauchamp, and J. Henrich. (2019). The Church, intensive kinship, and global psychological variation. Science 366(707): 1-12. 
https://web.ics.purdue.edu/~drkelly/SchulzHenrichetalTheChurchIntensiveKinshipGlobaPsychologicalVariation2019.pdf

Wang, M. (2018). For Whom the Bell Tolls: A Retrospective and Predictive Study of Fertility Rates in China (November 8, 2018). Available at SSRN: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3234861