Ralph Nelson Elliott proposed the theory of the Grand Supercycle, which represents a period of relatively steady growth in the financial markets punctuated by a collapse. But an even larger view is possible, like that of Brooks Adams (the famous brother of Henry Adams and grandson of John Quincy Adams), who saw an even larger cycle of economic rise and decline. Then there was Georg Wilhelm Friedrich Hegel, who interpreted the movement of history as something more than a set of repeating cycles. Hegel described a phenomenology of mind producing successive changes in the “truths” that rule over us; for example, that we might pass from Adam Smith to atomization and then to a reaction against atomization.
But first, let us begin with a larger cycle view. Peter Chardon Brooks Adams (b. June 24, 1848) suggested that commercial civilizations are subject to predictable cycles. In 1900 Adams foresaw that New York would become the main hub of global finance. He also believed this would signal the beginning of the end of American civilization. In 1895 Adams wrote a book titled, The Law of Civilization and Decay, intended to prove that history is cyclical. His focus was on economic history.
Adams showed how certain decadent economic tendencies of ancient civilization (Greco-Roman) were already afflicting modernity by the 1890s. These tendencies included political centralization, devaluation of the currency; the growth of large cities with small farms being turned into large food-producing businesses, growing indebtedness, the rise of money-power and moneyed interests above all others. For Adams the destruction of civilization necessarily coincided with the rise of financial elites. Bankers and financiers inevitably replaced landed aristocrats as power-brokers. This signaled the collapse of old values in favor of naked materialism.
Adams seemed to be saying that the more we focus on material pursuits, the more shallow and wicked we become. Eventually, this shallowness and wickedness must result in an economic collapse. Strangely enough, our economic obsession may indeed be the grounds for our demise; the idea being that as men pay more and more attention to making money the civilization on which money-making depends becomes unhinged. That is to say, the ground of a solid economy is founded on something deeper and more fundamental than economics. Aristotle, perhaps, would have argued that success comes from the pursuit of goodness. With the realization of goodness, money comes of its own accord. But today, we have reversed the proper order. And this reversal is said to happen on a cyclical basis.
But is history merely cyclical? Surely there is something more complex involved. It was Hegel’s philosophy of history that proposed the existence of an underlying and guiding mind or spirit (Geist) behind the rise and fall of civilizations. This may seem to be a somewhat superstitious view of history, but Hegel was not selling spiritualism or proposing something along the lines of John A. Keel’s Our Haunted Planet. Instead, Hegel was suggesting that the history of the world represents the progress of the consciousness of freedom through what he called the “phenomenology of mind.” Hegel’s proposal is something akin to the idea that every action gives rise to an equal and opposite reaction (a simplification of Newton’s Third Law). Only Hegel was talking about consciousness, not matter. Consider the following simplification: each age naively supposes it has found The Answer; and each age ends by discovering that its answer is not entirely correct, which leads to what Hegel calls “a determinate negation.”
Believe it or not, we can trace the emergence of a determinate negation in Roman antiquity, and Edward Gibbon hinted that this determinate negation destroyed the Roman Empire once and for all. And we should not be surprised to learn that Karl Marx offered up his “dialectical materialism” as the determinate negation of capitalist modernity. It may be argued that the 21st century bears a marked resemblance to the 4th century. In both centuries we see a new religion emerging out of the cities to the consternation of the “ignorant country dweller” (i.e., pagans then, Christians now). Today the new secular religion (i.e., socialism) is sweeping away Christianity in the same way Christianity swept away paganism 17 centuries ago.
The impending long-term decline in our economy, coinciding with the destruction of the old religion, is also reflected in art and poetry. “No poetry can bloom in the arid modern soil,” wrote Adams, “the drama has died, and the patrons of art are no longer even conscious of shame at profaning the most sacred of ideals. The ecstatic dream, which some twelfth-century monk cut into the stones of the sanctuary hallowed by the presence of his God, is reproduced to bedizen a warehouse; or the plan of an abbey … is adapted to a railway station.”
It is a special kind of inspiration that makes a great economy. The producer is not simply a person who chases the almighty dollar. The real producer is inspired to build something with care and fidelity. He doesn’t want to make something inferior that he can swindle buyers with. He takes pride in his production, in his artistry. It is not really about the money, though money has an important role to play. It is about the spirit or mind that animates the men who work and build. This is what predicts ultimate success for a generation or an era.
I would argue that there is, indeed, a cycle or passage of the spirit. I would further say that this cycle is marked by crisis points. And I believe we are entering into the cross-hairs of the greatest crisis-point of all time. We suffer from all the symptoms of decaying antiquity. We have been losing our religion, shedding our moral values, and we have lost our financial common sense. Just as with ancient Rome our birthrate is falling, our legions are reduced in size and number even as the barbarians multiply. We are ruled over by demagogues and manipulators of public opinion. There seems to be no accountability, and no real concern for the larger community. The core of the family is disrupted, abortion is prevalent, cheating is commonplace, fatherhood is denigrated, authority mocked.
It is no wonder, then, that prognostication staggers from uncertainty to uncertainty and all the best minds have turned toward market pessimism. It is the Zeitgeist. It is the spirit of the times.
