Like the other great spasms in our history, the one that now seems to be unfolding is unlikely to be narrow in scope, shallow in depth or short-lived in duration. In fact, the myriad strains that have built up over the course of the past several decades will continue to break loose in a seemingly endless sequence, careening into one another like a long line of cascading dominoes……
......people will have to evaluate circumstances as realistically as possible and figure out for themselves what their options are – as individuals, owners, managers, and investors. So goes a crucial excerpt from the new book by author and co-blogger, Michael Panzner, titled “When Giants Fall”.
This book will likely elicit strong reactions from people, both good or bad. It’s going to either make people more afraid, or more vigilant…. more pessimistic, or more aware,…….more distrustful of institutions, or more trusting of those that they do choose to rely on. One thing is for sure, this book is going make you sit up and think.
Throughout the book, Panzner goes on about the ramifications of a world struggling with the large void that will be left when the US falls from its vantage as the sole economic, military, and political superpower. He takes note of the political tensions being created by a more confident China, the new political realignments that link Russia with China, China with Latin America, Russia and Saudi Arabia - alignments that bypass the US and will likely diminish its influence in years to come. He takes note of changing demographics, peak oil, increase in carbon emissions, and the possible negative effects of a return to nuclear power.
He then talks about the growing social and civil unrest in various parts of the world, the loss of status of the US dollar as a safe haven, the growth of sovereign wealth funds, and their potentially increasing influence in how the US conducts its economic and industrial policy. He mentions about the rising tide of isolationism and protectionism throughout the world.
Many of the points Panzner makes are clear, and closely parallel what other observers such as myself have already been noticing in bits and pieces over these last few years. But he takes it up another notch, and projects a future where violence will further increase, economic uncertainty prevails, and power failures, rising crime, and infrastructure failure could become common.
This scenario, which became common in places such as Kosovo, Bosnia, and Somalia in the last decade, are unheard of, and unimaginable, in the developed world. Yet, Panzner imagines how these could stem from the current mess being experienced by the US and other rich nations. While it is true that some scenarios he envisions seem too far-off from the current status, we should keep in mind that before social and economic hardship swept over the above-mentioned places, they were generally peaceful, and the descent they went down to were probably furthest from everybody’s mind at the time.
My main take away from reading this book is that these are all dire predictions, which we may or may not find the world getting into in the next few years. But it pays to be aware. And, being aware, we may perhaps try harder to change our current lack of resolve and cooperation. After all, to know the future is to know how to alter it.
When Giants Fall seeks to provide a roadmap for businesses, managers, and the people in general, for how the world will likely evolve, and how people will likely adapt to the changes. Readers of economic blogs will likely see common threads in the topics covered by the book, but I’m sure they will find interesting the new synthesis that Panzner comes up with, as he tries to take things to the next step.
I’m reminded of the scene in a movie I saw once, where the playground bully decides to become nice and refrain from his bullying ways. So soon after the other children cheered for their newly-found freedom from this bully, they find themselves confronting new and possibly worse situations. New little bullies suddenly rise among them, little kids form into little gangs for common protection, or to gain prominence when each one acting along couldn’t, and suddenly there is more violence and mayhem in the playground. If this is the scene we are going to find ourselves in, we will need all the guides we can get.