Ever since the election of Ronald Reagan in 1980, the US has been dominated by conservative views on the limits of big government, the primary role of markets, and the imperative to lower taxes and regulations. While this boosted life under Reagan, the gains diminished under two Bush presidents as the Federal debt ballooned and excessive enthusiasm led to the 2000 and 2008 crashes. Invading Iraq added to these problems. Meanwhile, the concentration of wealth has reached levels comparable to the roaring twenties preceding the Great Crash of ‘29. Markets are essential, of course, but these shortcomings make a convincing case that free markets alone are not sufficient for healthy economic growth.
My work shows that market cycles run in roughly 35 year periods, and this means 2015 may mark the end of the Reagan Era. Republicans have been advocating more extreme terms, and Trump seems to have appeared to carry Reaganism to what may be its logical conclusion – the proverbial last straw after decades of crisis and gridlock.
Symbolically, Trump seems a throwback to the American past of robber barons who patronize the public with their power and largesse. Except in this case, many think the robber baron happens to be a narcissist, demagogue and bigot. As I argued in my blog “Forecasting the Rise of Trump,” the best way to understand this strange development is to see Trump as a caricature of Reaganism that may lead the party to a historic defeat in 2016.
All scenarios look dismal for Republicans. As of June 15, Trump’s poll numbers are declining well below Clinton’s, and a solid democratic victory seems likely unless something dramatic alters opinion. If the Republican Party splits from Trump, the division of conservative votes also seems likely to elect Clinton. Even if the Party rejects Trump as its nominee, his replacement would hardly be able to mount a strong campaign.
One way or another, the present Republican ideology seems to have run its course, and the coming defeat of 2016 is likely to throw the Party into disarray throughout its ranks. The Democrats are not in much better shape. The extreme views of Sanders supporters who simply want more free benefits confirm the stereotypical criticism of liberals.
The US seems to be in a political vacuum, with Hillary likely to serve as a caretaker government while Americans figure out where we should be going and how to get there. Almost anything could happen, but I think we have seen the limits of both right- and left-wing ideologies, and the country may be ready for a middle path working both sides of the aisle.
I have outlined collaborative solutions through this impasse many times in this column, and we could be surprised to find that Hillary is a closet centrist able to do the job. But I would not count on it as the US is entering uncharted political territory. Stay tuned to this blog as I hope to serve as a guide to the difficult path ahead.
June 19, 2016 No Comments