WTF Happened in 1971? (2019)
I think the idea that major historical trends have one cause is a huge fallacy. There are almost always many causes.<p>Other than the end of Bretton Woods a lot of things happened in the early-mid 1970s, like...<p>* Breaking of union negotiating power by explicit anti-union measures and by globalization that allowed corporations to undercut domestic labor with cheaper overseas labor.<p>* The establishment of environmental controls and the EPA. While this was in many ways a very good and needed thing, it made US industries much less competitive with overseas industries that could operate in countries <i>without</i> environmental laws. Nothing was done with tariffs or any other measure to compensate. We just pretended all things were equal and let corporations send pollution <i>and jobs</i> overseas.<p>* The rest of the world rebuilt after WWII and started to compete with the USA in manufacturing.<p>* The depletion of really cheap domestic oil, the Arab oil embargo, and the EPA meant the end of really cheap energy. Around the world cheap energy (often from dirty sources) is closely tied to the growth of the middle class. Expensive energy tends to be correlated with a decline in middle class living standards, and it&#x27;s not hard for me to see a clear causative factor here.<p>* The 1970s saw the rise of many forms of office and bureaucratic automation such as widespread computer use, copy machines, printers, etc. These cut into the low-mid range of white collar jobs.<p>* The 1970s also saw the rise of industrial automation that reduced the need for many lower-skill factory jobs.<p>* The post-war suburban building boom started to wind down in the 1970s. Building all that housing, highways, etc. employed a lot of people. Furthermore, we started to enter an era of <i>under-building</i> of housing that drove house price appreciation to levels that have really started to harm the middle class.<p>* Women entered the work force in droves. Like environmental regulation this is largely a good thing <i>except</i> that it may have driven down wages due to increasing labor supply.<p>* The rise of consumer debt and credit cards, which made it easy for people to go into massive debt that would over time erode their real purchasing power.<p>* The &quot;maximizing shareholder value&quot; business philosophy started to take over, and many industries saw engineers and experienced operators replaced in leadership by MBA types. This is likely a cause of the next thing...<p>* A much more conservative and risk-averse mentality took over in many industries. A great case in point is aerospace which saw the &quot;can-do&quot; Apollo era mentality replaced with the &quot;if it hasn&#x27;t flown before, it can&#x27;t fly&quot; post-Apollo mentality. This is what I&#x27;ve long called a &quot;minor dark age&quot; that began in the 1970s and I think is starting to end now.<p>* The rise of a new kind of conservatism that found itself steadfastly opposed to government investment in industry, science, technology, or other domestic things. This would come to be identified with Reaganism. The US basically stopped building infrastructure and over time cut investment in basic research and other bedrock areas where government historically led investment.<p>* At the same time government spending became less politically palatable, there was quite ironically a monstrous bloating of the Federal budget. Some of this was driven by growing entitlement programs and some of it by runaway defense spending. While the new right opposed most government spending, it tended to favor the almost unlimited expansion of the military budget.<p>* The cultural rise of religious fundamentalism&#x2F;literalism, luddite green ideology, postmodernism, the New Age, conspiracy thinking (of both left and right leaning varieties), and many other anti-intellectual and anti-modern movements. This is a trend I see cresting today with things like anti-vaccination, Qanon, etc.<p>* Television replaced radio and reading as the major information source for most people, leading to an elevation of style and presentation over substance. People started to be elected on how they look and carry themselves rather than their ideas or competence.<p>That is not an exhaustive list.<p>Instead of debating the one cause and wringing our hands, we should instead look at the many causes and divide them into things we can and can&#x27;t (or shouldn&#x27;t) reverse.<p>Things we can and should reverse: anti-intellectualism, unfair trade policy, mis-allocation of government spending, lack of infrastructure investment, financialization (&quot;MBA mentality&quot;) of capitalism, excessive consumer debt, under-building of housing.<p>Things we can&#x27;t or shouldn&#x27;t reverse: international competition, the need for environmental protections, women in the workforce, and automation.