There are today only about 170 independent nations on this planet but since World War II there have been over 150 wars around the world. What is the relationship of war to a society?

Wars have been analyzed by the mathematically minded as to their frequency, graded by their size, the number of nations involved, the number of participants, the number of casualties. For example, as you go down the scale of frequency of involvement Richardson has found from 1820 AD to 1945 first China, then Turkey and then Britain in that order. And Quincey Wright found in a much longer period from 1550 to 1900, analyzed into 50-year periods, first in each period was France, then Spain, then Britain, then Britain, then Russia, then Britain and then Britain. Such information is interesting but has not told us why wars are fought.

Contemporary psychologists and philosophers have turned their attention to the problem of cooperation. If there is cooperation there is no conflict. What are the principles underlying cooperation? One famous problem dealing with cooperation is known as the Prisoner's Dilemma. That's because the original version related to two prisoners. Let's make up a simplified version and try it out on you.

Suppose you have plenty of wood, and your neighbour John has crops of grain. Each of you wants some of what the other has, and you arrange to trade fixed amounts monthly. But you each have to drop your goods off at a location on the other's land not knowing what the other has left in exchange, and you never meet. For the first exchange should you leave the agreed amount, or nothing, hoping to go to John's lot and pick up the first load of grain and so gain an advantage. Logically, if you do this and there is nothing for you, you have lost nothing, and if the load is there you have gained something for nothing. But John will have the same thoughts. If both of you leave nothing, logically, neither has lost on the deal, but you could each have had a lasting benefit with what you wanted if you had 'cooperated' and not 'defected'. If both you and John bring full loads the first month, what will you do the next month, and so on. Collectively, you would be better off by cooperating, but as 'egoists' acting logically you might decide to 'defect', each trying to win an advantage.

From our point of view one particular Prisoner's Dilemma experiment is very interesting because a fully cooperative person who was a pacifist by nature cooperated at every move in full expectation that the other player would cooperate. But in this case, throughout the entire course of the experiment the other player did not once change his strategy, and instead of seeing the long term advantage of cooperating, from the beginning to end took advantage of the pacifically minded player, and apparently considered him naive or foolish. The experimenter noted that this was a traumatic experience for this particular believer in non-violence. I'm sure you can see the relevance of this to the problem of relationships between nations, armaments and disarmament, and therefore national security of a society and the problem of war.

But thousands of years before our contemporary psychologists were experimenting with the "Prisoner's Dilemma", Phoenicians, the Mediterranean civilization's greatest sea peoples, were trading with north African peoples. Neither could speak the language of the other. The Phoenicians would come ashore, lay out on the beach the items they were prepared to trade, then retreat back to sea again. The North African people would come down to the beach, look over what was there, take what they wanted, and replace it with items they were willing to provide in exchange. Then they would withdraw and the Phoenicians came back, took what they wanted of what was left for them plus their own goods not taken, and sailed away.

We did not find in the whole life cycle of Venice that it acted altruistically to help a friendly state. It obtained trading privileges for any assistance it gave, fought many wars, had few allies and always appeared to act in what it considered its best self interest. Rome apparently behaved in the same way. In all that we noted of Rome's life span we did not once come across a treaty of friendship with another society, although conquered societies were sometimes required to support Rome as allies in the future.

By the time of the middle ages in our Western civilization kings ruling societies would often arrange royal marriages to try to cement friendly relationships with other societies. This only worked when the societies themselves had a common interest.

Computers are now generally used in war strategies and in war 'games'. Computer analysts have developed what is now called game theory. Don't be misled by the word game. It doesn't mean 'play' but strategic theory worked out in simulated form on computers. For example, political scientist Robert Axelrod invited a number of game theorist professionals, and academics who had published studies on the logic of the problem of cooperation, to compete in a round-robin tournament to see which computer encoded strategy could best respond to the Cooperation or Defection of all other entrants. 15 programs were entered. The shortest was 4 lines, Tit for Tat, by Anatol Rapoport of the University of Toronto. The longest was 77 lines. One entry, Random, merely 'flipped a coin' so to speak. Tit for Tat began by cooperating and then it merely repeated the other player's previous move. If the other player defected, then it defected in its next move, and so on. It never provoked a breakdown of mutual trust, but it replied in kind to a punitive act. Tit for Tat won the contest.

Dr. Axelrod then solicited entries from around the world for a more sophisticated contest. 63 strategies were submitted, the longest being 152 lines from New Zealand. World experts on game theory competed this time, but Tit for Tat, the shortest, simple 4 line program, won again.

Computer game theory doesn't tell us why societies fight, but suggests that the best strategy for survival is not to attack, but always to reply in kind to an attack. This seems quite similar to the foreign policy of Israel in the late 20th century.

So why do societies fight? Here's a cameo example. The Suez canal, passing through Egyptian territory, joins the Mediterranean sea with the Indian Ocean. It was built by a French corporation, completed in 1869. The Egyptian ruler was near bankruptcy and sold all his shares in the Canal to Britain in 1875, for 4 million pounds. That was about half the total shares outstanding.

The Ottoman Empire (Turkey) sided with Germany in World War I (1914-1918) and so lost most of its possessions at the end of the war, including Egypt. In 1914 a British protectorate was set up in Egypt. During World War 2 there was fighting nearby between British, German and Italian forces. A republic was proclaimed in Egypt in 1953 . In 1956 General Nasser became president and British troops were withdrawn from the Suez canal. A month later Egypt announced nationalization of the Canal. Britain and France landed forces and attacked Egypt. They intended to take back their rights to the Canal. The US told them to stop it and go home, which they then did.

So why did these societies fight? Because they had perceived infringement of their interests. Societies can do what they like unless there's someone to stop them.


We saw how Venice died, through internal collapse because it knew resistance to Napoleon's declaration of war was hopeless, and death when Napoleon stripped it. But is it really war that kills a society? Let's look at a living society: Germany today.

In the 20th century Germany was defeated in World War I, was forced into paying 'reparations' and suffered hyperinflation (with trillion mark bank notes) and virtual national bankruptcy. It lost its colonial empire. It was defeated again in World War II and suffered severe manpower losses. Some of its cities were more or less levelled. It was stripped of its rocketry expertise and advanced equipment, it was partitioned and its capital and territory were still occupied over 40 years later. Is it a dead society? Obviously, not.

The answer is that if a 75-year old man is badly beaten and stripped of his possessions he will probably die, but a 30-year old receiving exactly the same treatment will probably survive. The German Mercedes and Porsche have as great or greater reputation and prestige value as any US cars. And the then East Germany, living under a political system which appeared to give little outlet for its talents, in the 1987 world games won 40 gold medals, more than either the US or the USSR, one of the few ways it could express its national identity -- how it did this (apparently by use of banned drugs) is, I suggest not as significant as its determination to express itself nationally as the best.

Japan is a modern example of a society in its phase of expansion. Between 1894 and 1941, a period of less than 50 years, Japan attacked first Russia, then China, then the US. That's 3 major powers, all with much larger populations than Japan's 120 million. But after defeating Russia and China, Japan was finally stopped militarily. The US nuclear attack had a profound effect on the psyche of the Japan society, causing it to create films where monstrous prehistoric creatures hatched from eggs to tear down cities. At the other extreme Japan society avidly took up baseball as a national sport. Since World War 2 Japan has directed its efforts into economic expansion. By 1990 5 of the 10 largest banks in the world were Japanese. Japan has established manufacturing facilities in Canada, the US, Europe and Asia. It is a world leader in technology and has the second largest economy in the world. So, blocked in military expansion it has succeeded in economic expansion and has reached its phase of dominance as a society in this non-militaristic way.

We have evidence, then, that societies in the expansionary phase, if stopped in territorial expansion through warfare continue to expand in other ways. Unless a society is in the decayed stage and is stripped so that it dies, or is deliberately put to death as was Carthage by Rome, we can conclude that wars do not ordinarily kill a society.


There may be another way to look at this problem of war. If societies have life cycles, as I say they do, then the wars they get into in the various stages of their life cycle may be different.

Societies move through their life cycle in 5 main phases. Wars may accompany each phase. There is a type of war we can call a Phase I war. This arises in the first few hundred years of life of a society when establishing its position. It's a formative war, to secure its existence as a society, Rome fought such wars in its first phase. Its methods were always thorough. It conquered a nearby Etruscan city, Falerii, that it thought threatened it. Then Rome systematically destroyed it, and moved the inhabitants to another site, Falerii Nova, which was on a plain and indefensible. That is a calculated protective act of a society in its formative phase.

Phase II wars are wars of ascendancy. The society is now fighting its neighbours to establish and secure its place in its civilization, obtain defensible frontiers and sustainable resources and absorb when it can weaker neighbours which seem to be in its way.

Phase III wars are wars of expansion. A society is now expanding through its trade, its beliefs, its message, its cultural identity. Expansion may be by armed conflict overpowering others to create colonies, but can be by Christian missionaries, Marxist adherents, McDonald's (25,000 restaurants in 114 countries), acquisition by multi-national corporations, and so on. This is the phase of colonization at a distance, beyond its boundaries. It may lead to cannibalistic wars, wars of unnecessary over-expansion. In time the society finds it easier to go on taking from others than pursuing its own productivity, which brought it to power. It has permeated the areas it has reached and seems to be unable to stop the process of conquest. Venice in this phase digested the spoils of Byzantium, and Rome digested Britain and Egypt. (Venice and Rome were each about 800 years old at the time.) These wars continue into the phase of dominance.

Phase IV wars begin to occur during the mid to late stages of the phase of dominance. They are merely actions as necessary to ensure the dominance is maintained.

Phase V wars begin to occur during the last stages of the phase of dominance of a society. They are defensive wars against extinction. In some cases they are initiated by less sophisticated, less enervated, less exhausted and less wealthy societies or groups which have not yet coalesced into mature societies, but are in their formative or ascendancy phase. These wars occur when a society in the phases of growth crosses paths with a society in its declining phase. For example, the expanding Turks moved into the territory of the declining Venice. These defensive wars continue during the decline and decay of a society and usually end with its final defeat and demise.


Let's try our theory on a recent example of war. We'll take a simple case: the Falklands war. The Falklands, or Malvinas, are about 400 miles (700 km) off the coast of Argentina, close to 8,000 miles (13,000 km) from Britain. Population of the islands about 2,000, 97% English speaking settlers. The English apparently settled there in 1766, Britain took possession in 1834.


Brazil is the largest society in South America. Argentina is the second largest. Brazil has a population of over 150 million, larger than all the other South American societies put together, including Argentina. Brazil's land area is almost as great as the rest of South America, including Argentina.

Argentina, Brazil, Paraguay and Uruguay are neighbours. Argentina and Brazil each have borders with the other three. Both Paraguay and Uruguay have borders with their two large neighbours, but not with each other.

Brazil is Portuguese speaking, the others are Spanish. Buenos Aires, now capital of Argentina, was Spanish, but soon had a strong Portuguese element. About 97 % of all four societies are practising or non practising Catholics. Since their territories are all composed of arable or pasture land or forest with crops and beef exports, you would expect a peaceful co-existence between them. It was Jesus himself, the founder of their religion, who is reported to have said one of the two great commandments on which "hang all the law and the prophets" is "Love thy neighbour as thyself" (Matthew 22.39) and "turn the other cheek" to enemies.(Matthew 5.39) Such is not the case here among these devout Catholics as we will soon see.

All four got their independence, from Portugal (Brazil) and Spain (Argentina and Paraguay) thanks to the Napoleonic wars. Then Uruguay obtained its independence from Brazil in 1828. Civil wars raged there until 1865.


The territory which later became Argentina was first invaded by the Spanish in about 1513-14. But settlement began in about 1536. In 1810 there was a revolt against Spanish rule. In 1816, again thanks to Napoleon, the "United Provinces" declared their independence. But Buenos Aires refused to join them. It was already a growing city. The United Provinces convened a constituent assembly in 1824 and created the office of President. If we take the creation of the society of Argentina as about 1536, then the formative phase as ending with a Presidency in 1824, we have 288 years, close to Venice's 276 years, which included the first Doge at 270 years. Argentina was sheltered by and subject to the Spanish empire until it claimed independence.

Now that the provinces had coalesced there was an immediate 3 year war by the fledgling Argentina against Brazil (1825-8). Remarkably, apparently Brazil was defeated. Next, there was a war with Buenos Aires (1859-61). After that Buenos Aires joined the United Provinces in 1862. Argentina in conjunction with its two neighbours now embarked on a 5 year war against Paraguay (1865 to 1870). Almost all Paraguay's male population was lost, its total population dropped from about 450,000 to 220,000. Paraguay also lost 60,000 square miles of territory. It was the only one of the four without a seacoast.

Following that war Argentina turned inwards to war with its interior indigenous peoples until they were 'subdued' to use the language of historians and military strategists.

Between about 1850 and 1930 Argentina had to cope with massive immigration from Italy and Spain, said to total about 30% of its population. From 1946 the Perons were in power and on their deaths there were civil wars between their supporters and the military. It's said about 20,000 perished in these conflicts. All these military activities after the end of the formative phase are characteristic of an ascendancy phase which, having lasted only 158 years by 1982 is apparently far from over. And in 1982 Argentina with a population of about 30 million, invaded the Falkland Islands.

Argentina is probably moving towards the end of its ascendancy phase and nearer the beginnings of the expansionist phase, a phase usually involving external wars and internal unrest as the society struggles to establish itself and chart a course for expansion from the location it finds itself in, using the resources available to it. We have seen from our examples that regrettably a society in its ascendancy phase will attack any other society that stands in its path of expansion, even if that territory is occupied by a much larger and far more powerful society. So for Argentina the Falklands war was a phase II or ascendancy war.


Now let's look at Britain's side of the war. Unfortunately for Argentina, Britain had claimed the islands 148 years previously, and by 1982 there were about 2,000 British settlers there comprising almost the entire population. The principal occupation is sheep grazing and wool processing. The major trading partners are Britain, the Netherlands and Japan, not South America. Britain was not going to allow its citizens to be overrun without support from the mother country and so found itself unwillingly dragged into a war.

Britain is a complex society with a population close to 60 million, but after World War I it began the slow wind down from Phase IV to Phase V. So for Britain the Falklands war is a Phase IV or defensive war.

In this particular instance Britain, close to 1,100 years old but still the 3rd largest naval power in the world, was able, though at a great distance, to push the 450 year old invading society back from the Falklands. There was much publicity in Britain as to the great cost of the war and that the defence of the Falklands would have to continue as a much higher expense than formerly.

Britain used the same strategy as Tit for Tat. It pushed the invading society out of the disputed area but made no attempt to attack the society itself. Nor did the invading society attempt to attack Britain elsewhere.


So far we've only mentioned external wars, but can civil wars and rebellions tell us something about the phase a society has reached and the condition it's in? Let's select 4 societies to check on this phenomenon: Canada, the US, Britain, and Venice. Here are the results in schematic form. The numbers give the approximate age of the society in years at the time of the occurrence:

CANADA . . . . . . . US . . . . . . . .BRITAIN. . . . . . . . . .VENICE

230 (1) . . . . . . . . . 260 (4) . . . . . . . .340 (6) . . . . . . . . . . 350 (11)

270 (2) .. . . . . . . . .370 (5) . . . . . . . .415 (7) . . . . . . . . . . 550 (12)

330.(3) . . . . . . . . . . . . . . . . . . . . . . .600 - 700 (8) . . . . . 900 (13)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .850 (9)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . .1100 (10)


(1) Papineau in Quebec; William Lyon Mackenzie in Toronto (rebellions)

(2) Red River (Manitoba) rebellion; Northwest rebellion (1885)

(3) Regina Riots; On to Ottawa Trek


(4) Civil War (North vs South)

(5) Watts Riots, Los Angeles, (1965)

. . . Detroit and Newark race riots (1967)

. . . Kent State, Ohio, and National Guard (1970)


(6) Civil war: Stephen & Matilda

(7) Magna Carta

(8) A century of internal strife. Eg. Jack Cade's rebellion (in Kent): York vs. Lancaster: Simnel: Warbeck: Cornish uprising.

(9) Cromwell

(10) Poll tax riots (1990)


(11) Civil uprising: partisans of Franks vs. Partisans of Byzantines

(12) Uprising. Palace burned, Doge murdered

(13) popular revolt, 10 years later a patricians revolt.

All this is interesting but no regular pattern is discernible. What does lie behind it then? One thing we notice is that the same period, 1400s to 1500s AD, when Britain was 600 - 700 years old, was a similar period of internal upheaval in central Europe. The Hussites were fighting and defeating their government, there were wars between towns and princes, there were peasant rebellions in various places.

The Hussite movement may give us a clue. John Huss was a follower and friend of Wycliffe. This was the beginning of the religious (Protestant) reformation movement. It spread across the societies of Europe, the Western civilization, and was a war of ideas, a rising movement of change in patterns of thought. There were empathetic leaders in various societies more or less at the same time. The dates, as usual, are approximations:

NAME.. . . . . . . . . SOCIETY. . . . .ACTIVE

Calvin. . . . . . . . . . .France. . . . . . . . .1535

Erasmus. . . . . . . . . Dutch . . . . . . . . .1520

Huss. . . . . . . . . . . .Bohemia. . . . . . . .1410

Luther. . . . . . . . . . Germanic. . . . . . .1530

Wycliffe. . . . . . . . . .English. . . . . . . .1370

Zwingli. . . . . . . . . . Swiss. . . . . . . . . .1520

If we are right about this, can we find it occurring again at another time, with new ideas? I think we can: 1848, the year of revolutions, the year Marx and Engels published their Communist Manifesto, reflecting the ferment of the age. There were revolutions or uprisings in Baden, Berlin, Cracow, Dresden, Hungary, Milan, Paris (France became a Republic), Parma, Prague, Sicily, Venice, and Vienna.

So we conclude civil war doesn't have the same origins as external war. Civil war is connected with the spread of new ideas or frustration at excessive government oppression, for example by over-taxation or religious persecution. Internal conflict in a society relates to the ferment of new ideas as societies pass from age to age.


We've seen that in our own time Germany and Japan have been deflected from expansion by armed conflict into economic expansion. But in each case this was not voluntary but was accomplished after war with much personal injury, and great loss of life and property. Adolf Hitler may not have conquered the world but his German 'people's car' the Volkswagen Beetle certainly did, and Volkswagen at the end of the century is one of the largest car manufacturers in the world. Two generations after World War 2, Sony of Japan had certainly conquered the world of media equipment.

Wars are very prevalent. They can accompany the self-interested activity of a society in each phase of its life cycle. There are no practical restraints on the actions of a society other than by violence against it. Economic sanctions have not been particularly successful. NATO was only able to cause Serbia to desist from apparent genocide in Kosovo by intensive air attack on Serbia which seems a very tardy and primitive approach by large societies against a small one. The destruction of Kosovo was not prevented, Serbia suffered significant destruction in retaliation and the leadership of Serbia, responsible for the attack on Kosovo, remains in power. Evidently we have a great deal to learn about societies and how to civilize their behaviour.

If war is a concomitant in the growth of a society and not a motivating force, what is? In the next chapter we'll look at another primary part of a society -- its industry, trade and commerce -- to see if we can better identify what drives a society to cause its rise and then its downfall.





If we want to find out whether the economic factors of industry, trade and commerce can have a life and death effect on a society we have a good test case in 1987-9 with Panama vs. The US.

Panama, a republic, has a population of about 2 million, in an area smaller than Nova Scotia in Canada, slightly larger than the state of West Virginia in the US. Panama has oil refining, international banking, crops such as bananas and pineapples, some copper, mahogany forests, and fishing. About half its work force is in agriculture and fisheries, the other half in industry and commerce. About half its imports and exports are to the US. Its currency is closely tied in with the US dollar. Because of easy financial and shipping regulations, Panama has considerable merchant marine tonnage registered and substantial international banking. In 1903 Panama granted to the US occupation and control of the Canal zone; in 1977 a new treaty arranged gradual take-over by Panama and withdrawal of US troops by 1999.

By 1987 General Noriega had risen to a position of dominance in the government of Panama. It was alleged in the US that the General had been involved in drug trafficking into the US, and the US government wanted him removed from office.

To accomplish this the US put economic pressure on Panama, for example, by causing US corporations there to make payments to the US government in escrow instead of to the government of Panama. The banks in Panama were closed for weeks. More US troops were shipped into the Canal zone. Businesses shut their doors. The general was then indicted in the US on narcotics charges. But General Noriega did not leave, and his government remained in power. Almost a year later the General was still in office and the US was still unable to dislodge him.

In May 1989 General Noriega annulled election results that showed him losing and he became a dictator. After one unsuccessful coup attempt in October 1989 the US invaded Panama on December 20, captured Noriega and took him to Miami to stand trial on narcotics charges.

I think we have to agree that one of the most powerful economic societies in our present day was unable by purely economic means to force its will on one of the puniest societies in the world today. Similarly the US found it necessary to replace economic sanctions with use of air power to discourage the perceived pretensions of Libya and later, on a larger scale, Iraq.

We can expand our examples of economic sanctions. These were tried in the days of the League of Nations in the 1930s and again more recently in the case of South Africa. The ability of Castro's Cuba to withstand US economic pressure has become almost legendary. So far none of these attempts has achieved its objective -- to force a particular line of conduct on another society and cause a change of government. External trade is apparently so much a part of the life of a society that it cannot just be choked off by economic action of certain other societies, but will find a way to continue. Apparently any effect of economic sanctions was felt most by the poorest section of a society and least by its government. It seems reasonable to conclude that economic pressure put on a society, even on a very small one by a much larger one, cannot of itself bring down a government, and certainly not an entire society.


It has been said that in the earlier more repressive past of the Soviet Union the underground market was as great as 30% of the gross national product, and in Italy the black market is said to have been about 30% in the 1980s. So the natural tendency within a society is to trade, and if governments over-tax or prohibit certain trade for policy reasons, or are unable to enforce effectively their laws regarding trade, their restrictions are likely to be sidestepped by the will of the society.


I'd like to tell you about the Canadian subsidiaries of four small international corporations that came to my firm for auditing services, within a few years of one another. All four were European, two were German, two were British. All four had the same general purpose. They had been impressed by American technology and the enormous size of the North American consumer market. They thought a subsidiary in Canada would pave the way to breaking into this rich American market.

The Germans exercised extremely strict control over their new subsidiaries. They used state of the art direct communications technology. Head Office in Germany required a copy of every invoice, many detailed reports on prescribed forms, the stockrooms had tight inventory controls, were properly fenced off and locked. The parent company required additional occasional surprise special in-depth investigative audits. The Chairman of the parent Board came each year from Europe and required a detailed personal report from his auditors in addition to the audited annual financial statements. Their businesses prospered, they attacked the American market with confidence and energy and now their network in Canada and the US is almost as big as in Europe. They have subsidiaries in many nations around the world, including Japan.

The British companies left things more or less to their appointees in Canada, just paid the bills and absorbed the losses. Their equipment was not really rugged enough to face American competition. They never did break into the US market and had less than marginal success in Canada. They found it easier to do business in Africa. After a few years both companies folded their subsidiaries and left Canada.

Four is a very small sample, but I think the results are indicative. It was not just that the mini-colonizations of one society failed, it was their method and their merchandise that failed to take hold. I think this supports my view that Britain is in what I have called Phase 4, the declining phase and approaching Phase 5.

Let's take one more example from business: Honda. Honda has set up a manufacturing facility near the small town of Alliston, Ontario. It has become a big employer there. It has gone out of its way to make friends with the local population which was based mainly on potato farming. Honda brought in its nationals for top management and its state of the art engineering techniques. It has trained local personnel in its ways. It has arranged the setting up of another dedicated subsidiary for parts supplies and a further supplier partially owned. Honda is not resented in the area, but appears to be respected and appreciated for the capital investment it has made and the employment and increased business life it has brought to the area. Here then is a successful mini-colony. It has a first class product and by its presence is upgrading local Canadian know-how and employment, and contributing to an increase in the gross national product.

We began by asking does the rise and fall of its trade cause the rise and fall of a society. My own conclusion from the evidence is that it's the other way around. The rise or fall of a society causes the success or failure of its industry, trade and commerce.


If we look at the governments of Carthage, Rome, Byzantium, Venice, Britain, Germany, the US, Canada, Japan and Hong Kong, we see no two are alike. The most successful societies, and here we mean the most powerful economically, seem to have prospered because their government at the time was either composed of the trading class or ruled with a light hand sympathetic to it, and avoided over-taxation or policies detrimental to business. We saw this particularly in the case of the ascendancy of Venice and Hong Kong. The present rate of income taxation in Hong Kong is about half the rate of income taxation in Britain.

The conclusion is that there will be trade, whatever the form of government, but that some attitudes of government encourage trade to prosper, while others depress its energy. This has less to do with the political outlook of a government -- e.g. socialist or capitalist -- than its policies on taxation, employment and trading patterns.


The earliest exchange of goods and services was generally by barter. This very early form of trading may even be without the use of language between the parties. And there is of course no government interference in trading at that level. Later, gold and silver were used as a medium of exchange, and the metal was cut up into various sizes by weight to denote the relative value. This was really the beginning of coinage. So honest weights and measures were very important in early times. And cities established their own coinage, some more highly regarded by traders than others.

Down the ages what tended to happen was that goldsmiths and silversmiths who did workmanship in these metals, as their names imply, had quantities of those metals on hand, suitably protected in their strongrooms. Merchants wrote notes to one another, IOUs as it were, saying that the bearer was entitled to so much gold say, from such and such a goldsmith who kept some or all of the merchant's stock of gold. The goldsmiths would also issue their own notes. This was the first stage in banking.

But by say the 18th century AD, governments started to issue paper money and then as so often happens with governments, once they got into the business they monopolized it and made it illegal for anyone else to do it. We can now go all the way to 1922 in the US when the $20. bill said on the face of it in small print "This certifies that there have been deposited in the Treasury of the United States twenty dollars in gold coin, payable to the bearer on demand." You cannot claim the equivalent in gold from any western government today as they have all gone off the gold standard. More than that, by 1999 many major Western Societies have severely reduced their gold reserve: for example, Canada had reduced its gold reserves by 86% in the decade ending in 1999. Instead, governments are increasingly relying on foreign currency reserves. Since all societies now use paper money this is like the proverbial house of cards.

Printing paper money is fine, if you are printing it to replace torn or used paper money that needs replacement, or if you back it with gold or some other real value. But in July 1987 (on national TV news network) the government of Canada was reported to be printing money more than twice as much per person, with twice as much debt, per person, as the United States. All western governments have now printed far more money than they can back with tangible reserves.

When a government, the Canadian government, say, needs money to pay its bills, it can issue a series of bonds, long term or short term, or issue treasury bills - really government IOUs. They're not backed by anything other than the word of the government to repay the money to the lenders on maturity. But shortly before the maturity date the government may see it won't be able to repay these bonds and bills because the costs of its social programs keeps rising, so it creates new issues to have funds to pay off the old issues. Its income for the year is less than the expenses because it owes interest payments on these bonds and bills. Almost half its annual expense is now interest expense, so it increases the number of bonds and bills to cover the shortfall. The deficit it has for the year has to go somewhere so it's added to the national debt. But that increases the amount of interest it has to pay. Now it may find investors are less willing to buy the bonds and bills, so it has to increase the rates of interest it pays on the new issues to encourage people to invest in them.

The government cannot increase the interest rates it pays too far too quickly because the chartered banks who have to deal with the Bank of Canada, the Central Bank, then have to raise their rates. This means businesses and individuals borrowing from the banks have to pay more interest and so they tend to spend less on new vehicles, equipment, buildings, and so on. The economy starts to slow down, money moves more slowly, less revenue comes in for the government which is then either no better off or worse off.

The political party forming the government doesn't want to raise taxes to cover the increased expense because this may cause it to lose the next general election, and once in power any political party wants to stay there and enjoy the benefits.

Another solution for the government is to print more money. That's done by the Bank of Canada in this country. For 1998 (most recent results published) in round numbers for simplicity, and ignoring smaller items and more complicated wording, its balance sheet looks like this (in billions of dollars):


. . . . . . . . . . . . . . . . . . . . . . . . 1998 . . . . . .1997

Due from chartered banks . . . . .1. . . . . . . . .1

Treasury bills. . . . . . . . . . . . . . .10 . . . . . . . 14

Short term bonds. . . . . . . . . . . .10 . . . . . . . . 6

Long term bonds . . . . . . . . . . . .11 . . . . . . . . 9

Total assets . . . . . . . . . . . . . . . . 32 . . . . . . . 30


Currency. . . . . . . . . . . . . . . . . . .32 . . . . . . . 30

What this seems to tell us is that in 1998 there was a noticeable shift from short term to long term debt and a 2 billion dollar increase in printed currency.

It costs the Bank nothing to print money except printing costs (for designing, and subcontracting costs, or costs of equipment, employees, ink, paper, overhead, and so on), which means what it prints is virtually all profit.

The Central (government owned) Bank 'sells' the paper money to the chartered banks for face value of the currency. It can only 'sell' it to them if the banks need more currency and are willing to buy it, for example around Christmas time. Then the Central Bank may use some of these funds it has created out of paper to buy from the chartered banks some of their treasury bills or bonds or it can buy them from the government itself, in which case it has to pay the government in currency. That's why the Central Bank shows treasury bills and government bonds as its assets, and currency as a liability. It's a liability because if the Chartered banks want to turn in some of their currency to the Central Bank, they can, (say in January) and will get a credit in their account with the Central Bank.

All this is paper representing IOUs to show who owes what to whom. The Central Bank holds in effect nothing but paper in and paper out, said to be 'worth' so much and this is fine while the national economy is growing. But if the economy begins to shrink, then the value of this paper tumbles.

The Central Bank also has a yearly operating statement, in very simplified form it looks something like this (in billions of dollars):

Income (interest) . . . . . . .1.8

Expenses. . . . . . . . . . . . . .0.1

Profit . . . . . . . . . . . . . . . 1.7

Paid to the government. (1.7)

Retained earnings. . . . . . 0.0

That's why the Central Bank doesn't have any capital or retained earnings on its balance sheet. It pays its profit to the government. The interest was received mainly on the government bills and bonds it held.

Governments have habitually overspent. We certainly saw this to be the case with both Venice and Rome in their mature years. And governments devise various ways to create more funds, one popular way through the ages has been by putting more base metal into the coinage. In the 20th century AD a favourite way has been by setting up casinos and lotteries.

In British history most of us are familiar with the marital problems of Henry VIII and his various wives. Henry VIII was also a musician, a poet, a sportsman, and spent money freely. After Henry spent his father's treasury he hit upon the great idea of dissolving the monasteries. They were fairly dissolute by that time, had largely lost the intent of their original saintly purpose and were extremely wealthy. Henry VIII did it in proper fashion. The elderly monks were given life-time pensions and then all the fixed assets, wealth and lands of the monasteries were appropriated. This helped solve the deficit problem in the operation of government.

Now let's come to the present day and the government of Canada. The deficits in the last few years of the 1980s averaged over $30 billion dollars a year. And the change in government in 1984 did not significantly reduce this annual deficit below $30 billion dollars a year. There are about 30 million people in Canada. So that means that for every man woman child and infant in Canada the government every year over-spent more than one thousand dollars. In one year alone a family of four had as its share of the government overspending for that year more than four thousand dollars.

We have to remember that this overspending was taking place when the government was already printing money out of nothing, borrowing money, and operating monopolies. In 1999 the Ontario provincial debt was over $119 billion. The Federal or national debt was over $624 billion. This does not include 'crown corporations' whose accounts are kept separately. Ontario Hydro Electric, a provincial crown corporation alone owes more than $30 billion in debt. Taking into account all the ten provinces plus the debts of local municipalities and cities the total government debt is probably about a thousand billion dollars. But with only 30 million Canadians, this means that for every man woman child and infant in Canada the governments have run up debts of $33,000 each. In the last thirty years (to 1999) the federal government debt in Canada has risen from about $30 billion to over $624 billion. We're not alone in this. Most western nations are in a similar deficit position, but not so large, proportionately. We have to remember that the government already takes from us by taxation indirectly and directly at all levels of government about 50% or even over 50% of all that we earn.

If you or I were to run into debt in our own lives on this scale, we would immediately be bankrupt. And we shouldn't think that this can't happen to nations. A number of nations have had national bankruptcies, and some more than once.

France was bankrupt in 1720, 1753, 1792 and 1797. We can see that this economic turmoil is tied in with political revolution. Let's look at the 1797 national bankruptcy. The post-1789 revolutionary government issued assignats secured on land seized from the church. This currency, the assignats, could be used by a bearer to buy church land, at which time those assignats were supposed to be retired from circulation by the government, though they could continue in circulation as long as there was land left to be sold. Some people redeemed the notes for land, but the notes were re-issued after land was sold. As more money was needed to prepare for war and satisfy the population, the government kept on printing more notes, creating inflation. Next, prices kept rising, and the government kept printing more money. By 1796 it took 12,000 livres to equal a gold louis, which had once equalled one livre. Although half the church land was sold, the original issue of 400 million livres had climbed to 45.5 billion livres. So the government had resorted to printing paper money without backing. This is clearly a slippery slope, and it led to national bankruptcy.

The most classic case of overprinting money was in Germany at the end of World War I. Immense reparations were demanded by the victors, close to $70 billion. This demand had to be scaled down several times because the German government obviously simply could not pay this kind of amount. There has been considerable retrospective analysis by economists as to exactly what did happen to cause the German mark to collapse as it did. More and more money was printed faster and faster, so fast that at one stage, the backs could not be printed because the ink wasn't drying fast enough to keep up with production requirements. Debtors were chasing creditors, to pay them with now worthless money. Billion mark notes were printed by the end of the collapse of the currency. French troops occupied the Ruhr in January 1923, intending to enforce payment of reparations. The mark had been 20,000 to the dollar, but fell in the next nine months to 4.2 trillion to the dollar. The collapse ended in the next year because the government issued new currency at a trillion to one, and refused to print any more.

It remains something of a mystery how the government got into this predicament and how it was able to extricate itself so firmly.

Within 15 years of the total collapse of the German monetary system a new political order, the Nazi regime, had built a military power which soon overran the rest of continental Europe with remarkable ease and speed. So, after an economic collapse there can be a political revolution which releases great power in the society (as in the Napoleonic and Nazi eras) which shows that the inner strength of the society was there despite economic collapse.

In 1986 Brazil's inflation was said to be 800%. But what happens in hyperinflation, as in Brazil, is that an economic revolution is taking place. It means that the relationship of debtors and creditors in each case is changing and some people who were badly off become much better off and some people who were well off become much more poorly off or are financially ruined. Usually those with fixed incomes or investments (often the elderly) are the ones who suffer most, and those who are earning their income are much better off as wages keep rising.

The interesting thing from our point of view here is that in all the cases we've mentioned, despite economic collapse, all the people in those nations did not suddenly become wiped out. They had to continue to survive, to raise their children, to pay their bills, to earn a living. We can also see that in none of those cases has a society died. The death of Rome, and Inca society, was not economic but political, by military action, although both were incidentally stripped of their economic wealth by the invaders.


Is it possible to predict what an economy will do next, short term or long term?

A short term example is that Mutual Fund managers have habitually underperformed the U.S. or other present day nations' stock market indexes. All an index does is track the performance of a selected group of major stocks being traded. The solution for the Mutual Fund managers has been for their companies to float 'index funds.' With little attempt to manage, these funds merely track the stock market indexes and so generally outperform the managed funds.

A longer term example starts with the economy in Canada in 1958. It began slowing down. Inventories were building up, money was circulating more slowly, people were not paying their bills as promptly as they had been. How did this come about? The reason seemed to be that after WW2 there was a pent-up need by consumers for new equipment, goods and services, but this had largely been satisfied by 1958. Consumers were now more selective in what they bought, there were new, interesting and cheap products coming in from Pacific Rim states, in competition with local manufacture. This seemed quite similar to the situation after WW1. Then it took 11 years from the end of the war before the crash of 1929 and subsequent 'depression'.

It was 13 years since the end of WW2 in 1958.

There was a north American precedent in what the Americans called the 'Panic' of 1819, after the Napoleonic wars. These wars had been the scourge of Europe, but more a blessing for the neutral US, as WW2 was for neutral Sweden and Switzerland. US foreign trade had reached a peak of $138 m (million) in imports and $108 m in exports in 1807. By 1814 they had sunk to $13 m and $7 m. The US war of 1812 against Canada had at first caused a spurt in US domestic production but faced with a spirited Canadian defence the US finally abandoned the project and domestic industry suffered a decline. Only 4 new cotton factories were established in 1807 but 43 in 1814 and 15 in 1815. The number of banks in the north Atlantic states rose from 25 in 1811 to 111 in 1815. There was a great rise in prices, about 20-30% as the money supply expanded. Competition from European manufacturers increased after the end of the Napoleonic wars and import prices fell in one month in 1815 from an index of 231 to 178. The imports were even sold by auction rather than through suppliers.

Various US banks were issuing their own notes not backed by any tangible resources such as gold or specie (coins). The number of banks increased to 392 in 1818. Kentucky alone chartered 40 new banks in 1817-18. There was considerable land speculation as the country opened up westwards. Imports increasingly exceeded exports. The trade deficit was over $28 m in 1818. Speculators began turning in their bank notes to the banks which exchanged their notes for specie, then the speculators with the specie obtained other bank notes at a discount. The major coin circulating in the US, the Spanish silver dollar, began to trade at a premium of 4% by March 1818. Then the Bank of the US (the Central Bank) began importing specie at a heavy price. Next the debt for the Louisiana purchase fell due, most was owed abroad and had to be paid off in specie. The Central Bank is said to have actually precipitated the crisis of 1819 by calling on the state banks to redeem their heavy balances and notes held by the Central Bank. As a result this bank improved its own debt load ($22 m in 1818, $12 m in 1819, $10 m in 1820) at the expense of everyone else. By its contraction policy in 1821 it held specie of $8 m.

The state banks in debt to the Central Bank had to call in their loans to the public and reduce their notes. About $68 m in 1816 was about $45 m in 1820. There was a wave of bankruptcies throughout the country and a great scramble for a cash position. Inventories of goods were sold off at sacrifice prices. Real estate values and rents dropped. The index of staples fell from 169 in 1818 to 77 in 1819. Land sales dropped from 13.6 m to $1.3 m in 1821. There was large scale unemployment. In the Philadelphia manufacturing sector employment dropped from 9700 in 1815 to 2100 in 1819. In 1820 the secretary to the governor of Ohio wrote "the greatest part of our mercantile citizens are in a state of bankruptcy - the citizens of every class are uniformly delinquent in discharging even the most trifling of debts ."

But although the conditions seemed to be there, this is not what happened in Canada in 1958. Instead of prices dropping or collapsing to clear inventories, prices held firm and credit expanded. At first it was by independent organizations such as Diners Club and a number of small loan companies. As they ran out of funds interest rates for loans increased. The usual 1/3 down on a major purchase became 10% and later 5% or less. Next the chartered banks introduced Visa and Master Card and other financial institutions followed with increased credit creating an enormous expansion. Charges on overdue Visa and other credit accounts rose to almost 20% while the former 3 to 4% interest on bank savings accounts gradually declined to almost nil. This windfall enabled the chartered banks to write down or write off their non-performing loans to third world countries. They also had an opportunity to increase their reserves. By law their loans must be backed by no less than 12% in reserves. This means an increase in reserves of $12,000 paves the way for customer loan increases by another $100,000. The respite from falling prices enabled manufacturers and distributors to introduce 'just in time' inventory and 'critical path' systems to prevent another massive inventory build up.

The lesson from all this seems to be that movement of the economy is unpredictable and one should be wary of financial analysts and economists once they stop analyzing the past and begin to try to predict the future.

We began by asking what effect government economic policies have on the life cycle of societies. I think we can see that today government power has spread across the whole of each modern society, whatever the political system it operates by. The remarkable rapid rise of Nazi Germany after an economic collapse shows that subsequent to an economic downfall the resilience of the society is still there and ready to resume its interrupted existence depending on which phase of its life cycle it may be in.

It also seems that economic revolution is a forerunner of political revolution. Economic revolution causes great misery and some financial ruin, but there is bloodshed as well in political revolution, as in the French revolution of 1789, the Russian Bolshevist 'pograms' in the post 1917 revolutionary period, and the Nazi 'final solution' in the early 1940s.

I think perhaps the most important conclusion is that external sanctions or internal hyperinflation or national bankruptcies of governments or a government stop of currency payments, or a government going off the gold standard, or financial collapses of banks or other financial institutions, businesses or individuals, none of these economic changes in themselves cause the death of a society, although they may involve a transition from one phase to another.

. . . . . . . . . . . .

We may have found the economy is the lifeblood of a society, but lifeblood isn't the intelligent driving force. That's mind or spirit. We need the equivalent of mind or spirit for a society and its civilization. And that's what we'll look into in our next chapter.




We've found that neither war nor economic factors of themselves motivate a society. They are merely expressions of its behaviour. So what motivates this behaviour? There must be some kind of mind or spirit of a society driving it, within its civilization, and that's what we're going to look into now.


Each society has unique practical ideas to contribute to its civilization. In transportation technology, Britain provided the railway; the US gave us mass use of the car and plane; Germany, space rocketry. Each of these inventions has changed the face of the world.

Within a civilization societies are very imitative. No society can maintain a technological advantage for very long. Nuclear bomb knowhow has quickly proliferated.


Civilizations go through Ages, by which we mean all the societies in a civilization go through the same age more or less at the same time, each in their own way. Our Western civilization has now moved from the Industrial Age into the Space Age, and was previously in the Protestant Age and before that in the Feudal Age. It began in what I call the Unstructured Age. That Age was a ferment of the few remains of Roman society taken over by the Franks, Goths, Longobards, Vandals, and so on. Each Age solves the problems arising in its societies in a different way. These different ways of doing things develop into mind sets which are characteristic of the Age.

The Space Age is based on collectivism, science, electric power and computer and information technology. The more advanced it becomes, the more vulnerable it is to attack and destruction. For example, in warfare today, highly sophisticated and expensive equipment - say a navy frigate - can be destroyed by one missile. A tank or an aircraft can be demolished by a single small missile from a hand-held launcher.

The Feudal Age was far less wealthy than ours, an agrarian system based on land tenure and service with serfs 'attached' to the land. The Industrial Age was based on machinery, rents and wage earners. It arose through a new mind set created by a new belief - Protestantism - aided by the plague of the Black Death which broke the back of the land service tenure system through loss of serfs, and caused service to be increasingly commuted to rents, and the change from manuscript copying to printing of books.

Education in the Feudal Age was inexpensive, for example by the apprenticeship system within guilds or in monasteries. Great cathedrals and universities were constructed during the Feudal Age, so it would not be entirely true to say that education and culture were then at a very low ebb. But education in Canada today is typically taking about 2/3 of total revenue at the local government level and an additional 17% of total revenue at the provincial level. Yet the literacy rates and population percentage of trained professionals in Western societies including Canada, have fallen below the level for some Pacific rim states.

A new civilization, or even a new Age in the present Western civilization, with a different mind set may have a quite different way of inculcating it in its citizens than by schools and universities.

Punishment for criminals was very public and inexpensive in the Feudal Age. Those convicted of minor offences generally had hands and feet locked into 'stocks' on the streets and were usually spat upon or had rotten eggs or fruit thrown at them. Some more serious crimes resulted in branding or loss of a limb. The crimes deemed most serious, for example heresy against the Church, resulted in burning at a stake or beheading in a public place, or being hung, drawn and quartered. Today jailed inmates have access to radio, TV and movies and occasionally wreck the facilities. By 1998 costs were over $50,000 US a year for each inmate, and the judicial system is becoming a revolving door back to society again.

Policing in the Feudal Age was by restricting the movement of people to their own area and making 1 man in 10 responsible for conduct. The 'hundreds' reported to the shire reeve or sheriff. The policing for the Economic Summit of 7 world leaders in Toronto, Canada, in June 1988, a 3 day conference, cost over $5 million, 5,000 media people are said to have come to the city for the occasion. Total local cost of the event was reported as $20 million. Less wealthy societies solve these problems with different ideas in less expensive ways.


There are ideas not related to technology. These promote fundamental change and underlie the behaviour of the society towards its individuals. My own conclusion is that the rise of an idea to prominence in a society takes about 70 - 90- years as a ½ cycle to dominance, then another 70 - 90 years for decline, a total significant influence of about 140 - 180 years. Ideas that have longer spans are reinterpreted and become quite different afer each 140 - 180 year cycle. This cycling effect seems to tie in with changes from one generation to the next.

One form of fundamental idea is belief; an idea incapable of logical proof. I include ideologies and religions under this heading. Beliefs are usually held dogmatically, are fought over viciously, and can become decadent. Some of the most brutal wars in history have been fought over beliefs: the Crusades, the 30 year's war in Europe, the conquest of indigenous peoples in central and south America, the wars in and around Palestine. Some of the most vicious internal persecutions and struggles in societies have involved beliefs: the Inquisition, the massacre of the Hugenots, the fighting between Catholics and Protestants in Northern Ireland; differences in belief about slavery were involved in the American civil war.

An original thought has a life cycle and by diffusion is simplified into a shadow of its former self. I think today's ideas and beliefs are based on four main concepts:

1. Marxism (1848) is thought to have said that capitalism is evil and must go; the workers should have control; the government should pay for everything.

2. Darwinism (1859) is seen as the survival of the fittest and man evolving in nature as part of the animal world so that a Creator God is not necessary.

3. Freudian psychoanalysis (1900) has become permissiveness. We mustn't interfere with the behaviour of a child or we may adversely affect its development and create in it an emotional block. We mustn't be too hard on criminals, but must try to understand how they came to be what they are.

4. Einstein's theory of relativity (1905) is reduced to the idea that everything is relative, there are no more absolutes. This, combined with Darwinism is leading to the virtual discontinuance of belief in religion in our Western societies.

These are all travesties of the original work of these men. For example, Marx. I think he was, as we all are, a product of his Age, drawing ideas from Rousseau, Paine, Hegel, the French and American revolutions and the then new economic discipline of Adam Smith. What Marx saw, and Charles Dickens saw, was the appalling fact of 8 to 10 year old children working 10 hour days in factories and mines earning a pitiful income. Sometimes their parents were unable to find work. Marx, by the power of his thought in social philosophy, politics and economics, devised a new system. Basically Marx saw that the people who owned the factories and mines were causing the misery of these poor children and their parents. Therefore, if only the people who worked in the factories and mines could themselves control their workplaces the problem would be solved. Marx carried his thinking to a logical conclusion. Here are some direct quotes from the Communist Manifesto (1848):

"The history of all hitherto existing society is the history of class struggle"

"The modern bourgeois society that has sprouted from the ruins of feudal society has not done away with class antagonism... more and more two great hostile camps... bourgeoisie and proletariat."

"The bourgeoisie has torn away from the family its sentimental veil and has reduced the family relation to a mere money relation"

"The bourgeoisie compels all nations on pain of extinction, to adopt the bourgeois mode of production"

"Owing to the extensive use of machinery and to division of labour, the work of the proletarians has lost all individual character... Masses of labourers, crowded into the factory, are organized like soldiers ... not only are they slaves of the bourgeois class, and of the bourgeois state, they are daily and hourly enslaved by the machine..."

"No sooner is the exploitation of the labourer by the manufacturer, so far at an end, that he receives his wages in cash, than he is set upon by the other portions of the bourgeoisie, the landlord, the shopkeeper, the pawnbroker."

"The proletarian is without property, his relation to his wife and children has no longer anything in common with the bourgeois family relations..."

"The immediate aim of the Communists is ... overthrow of the bourgeois supremacy, conquest of political power by the proletariat "

"The French Revolution, for example, abolished feudal property in favour of bourgeois property. The distinguishing feature of Communism is not the abolition of property generally, but the abolition of bourgeois property. But modern bourgeois private property is the final and most complete expression of the system of producing and appropriating products that is based on class antagonisms, on the exploitation of the many by the few. In this sense, the theory of the Communists may be summed up in the single sentence. Abolition of private property."

"Abolition of the family! Even the most radical flare up at this infamous proposal of the Communists. On what foundation is the present family, the bourgeois family, based? On capital, on private gain... But this state of things finds its complement in the practical absence of the family among the proletarians, and in public prostitution."

"The bourgeois claptrap about the family and education, about the hallowed correlation of parent and child, becomes all the more disgusting, the more, by the action of modern industry, all family ties among the proletarians are torn asunder, and their children transformed into simple articles of commerce and instruments of labour."

" 'But you Communists would introduce community of women', scream the whole bourgeois in chorus. Our bourgeois, not content with having wives and daughters of their proletarians at their disposal, not to speak of common prostitutes, take the greatest pleasure in seducing each others wives. Bourgeois marriage is in reality a system of wives in common, and thus, at the most, what the Communists might possibly be reproached with is that they desire to introduce, in substitution for a hypocritically concealed, an openly legalized community of women."

"Working men of all countries, unite!"

If Marx were set down on earth today he would not be concerned with the working conditions of industrial workers in Western societies, a former problem which is largely solved. Presumably some other great social injustice would concern him.

Ideas cannot be confined within a society. The spread of the ideas of Karl Marx is an excellent example of ideas being seized by a competing society. Karl Marx was the son of a Jewish lawyer in Prussia, Germany, who with his entire family had become a Protestant. Karl Marx studied in the British Museum, and is buried in Highgate cemetery, in London, England. But his ideas did not establish power in either Germany or England. They came to power in Russia and China. Unfortunately he wrote in a spirit of confrontation and violence. This attribute was carried forward into the subsequent development of his views in societies.

What new ideas do we have since the time of those 4 men, Marx, Darwin, Freud and Einstein? Nothing very encouraging. For one, the Principle of Uncertainty. For another, the Big Bang theory. A world of political activism, international terrorism, ruthless religious fundamentalism and nuclear weapons seems to point more to anarchy and a dark age than to a golden age. In the last 70 to 90 years we have made great advances in science and technology, but not I think in the beliefs we live by, except our belief in science itself.


Societies are continually evolving new ideas and ways to do things. As a society grows old more and more abstract ideas and ways of doing things have been thought of and led on from one another in a sequence until the possibilities of new approaches become more limited and ways to innovate are more extreme and bizarre. Constructive impetus is lost because no new useful ways are found to develop. That's when decadence sets in.


Here's an example of how decadence seems to take root and grow in a society:

A telephone company employee was fired for alcoholism, being frequently drunk on the job. This dismissal was after remedial courses were paid for by the company and abandoned by the employee. He took his case to the local Labour Relations Board. As it is not a court but a tribunal, it can dispense with the common law rules of evidence, and has the power to enforce its decisions. In this case it ordered the employer to re-hire the worker and pay back wages for the entire period since he was fired. The company in its defence said that this man's work consisted of going into peoples' homes for equipment maintenance and it did not think it was right that the company should send an alcoholic into peoples' homes. The board thought this was not an adequate reason to deprive the man of his employment.

What interests me in this case is that the rights of the people into whose homes this man would now be going were not considered. Nor was the right of the company to maintain its standards and hire and fire people as it deemed in its best interests to maintain its service. Nor was the fact considered that if a person is not suited to employment in one company or business he or she has the right to go elsewhere and find more congenial employment. But the principles of this generation placed the rights of an individual who is detrimental to the society as taking precedence over the rights of those who are being more constructive in the society. I would suggest that this type of approach, this idea, this belief, goes back fundamentally to the current interpretation of the teachings of Freud and to some extent of Marx. Such a decision has a ripple effect on a society. That corporation will have to take this outcome into account in planning future policy. The tribunal decisions are widely published. Other corporations and business entities will have to take cognizance of this decision. I think it also shows a decline in the survival capacity of the society because there are always young aggressive societies 'out there' with command structures based on merit, prepared to overrun lethargic neighbours. Eventually this becomes part of the winding down of a society, it loses momentum, bogged down by the weight of its increasingly inefficient and impractical interpretation of ideas, and decadent interpretations of its beliefs.

That is why we found the colonization attempts of societies in the ascending or expansionist phase are likely to succeed and those of older societies are likely to fail, because the ideology behind them is in decline. We've also found that wars and economic dysfunctions don't terminate societies unless they're in the final stages of decay. What our test case of Venice seems to show is that when a society is unable to adjust to a changing environment by creating new solutions, but has wealth, it becomes an artistic paradise, then becomes introspective and decadent, loses touch with reality because it can no longer cope with its problems, and deteriorates until it is swept away by rising new societies. When there are no more rising societies to do that, and the entire spectrum of the civilization is in the inert condition, the civilization itself comes to an end and dies.

Next we will apply the theory to two contemporary societies that present some difficulties: Germany and Russia.





In chapter 5 we said Germany began with the Treaty of Verdun in 843 but was a difficult society to interpret. The formative and ascendancy periods end I suggest at about 1231 when Frederick II was Holy Roman Emperor, king of Germany, Sicily, Lombardy, Burgundy , and Jerusalem. But in 1231 the Privilege of Worms gave the various princes in Germany full rights of jurisdiction over their lands and they became practically independent rulers, while Denmark and Poland ceased to be vassal states. So, 843 to 1231 = 388 years, the formative and ascendency phases for Germany.

To judge by our study of Venice and Rome, next should come phase 3, the phase of expansion. What happened instead was that the 'Privilege' of 1231 caused a backward step and Germany degenerated it's said, into over 1,000 little principalities, though some larger ones remained. There's the complication of the Holy Roman Empire, discussed in chapter 5. That began with Otto the Great, a Saxon, chosen as a German king in 936. He was by far the greatest ruler in Europe in his day and in 962 was crowned by the Pope as Holy Roman Emperor. This title went with Germany until 1254. But by 1373 Charles of Moravia was Holy Roman Emperor, king of Germany, of Lombardy, of Burgundy, of Bohemia, which he enlarged, his son received Brandenburg, and he bought part of the upper Palatinate. So there was expansion for the first 140 years of Germany's phase 3.

The trouble with the German society is that it didn't go through what our theory would expect, expansion for up to 300 years or so after 1231. Instead it went through religious torment. John Huss of Bohemia was burned at the stake as a heretic in 1415 but Hussites won pitched battles in Germany until 1434. In 1517 Martin Luther nailed his 95 theses to a church door at Wittenberg, in Brandenburg, which later became the core of Prussia, in north Germany. Civil wars followed, knights and peasants were in revolt, and all through Germany people were declaring for Luther or the Pope. The mostly northern Protestants were just not going to be forced to become Catholics by the (mostly southern) Catholics, represented chiefly by Austria, then the leader of the Holy Roman Empire. Religious conflict and unrest went on intermittently until in 1618 the 30 years war broke out in Germany. By the end of this war 5 million Germans are said to have died and the population was reduced to 25 million. What happened in Germany is a sad commentary on the effects of beliefs on societies. Germany was devastated. Many villages were totally deserted, agriculture was almost at a standstill, large numbers of land workers had been killed or taken into various armies. Much livestock was destroyed, houses were burned down, industry and commerce had been ruined by the war. There was great inflation in Germany.

But in 1663 the Reichstag had been established in Regensburg. It included representatives of the 8 electors of the empire who were 3 German archbishops plus Bohemia, Saxony, Bavaria, Brandenberg, and the Palatinate of the Rhine. Later, Hanover was added. That was the first house. The second house of representatives came from the various princes, and the third house from the various free cities. So between 1231 and 1648 = 417 years, Germany had made good expansionist progress during the first 140 years or so, but then literally tore itself apart.

Does this mean Germany ceased to exist as a society? I think not for 2 reasons. First, it was Germans fighting Germans, although others joined in; it was civil war, which has occurred in almost every society, including the US, France, Britain, and Rome, without causing the death of a society. Secondly, the Holy Roman Empire existed throughout these troubles and was a German entity under Austria at the time. So the German period which we would expect to be expansionary, 1231 to 1648, was in fact a period under Austrian domination, but with religious civil wars dividing the German people.

In the next phase, phase 4 of this society, we should expect what we have called the phase of dominance, following on from expansion. But as we find that the expansion was cut short it is interesting to see what effect this stunted growth had on the next phase.

What happened was that instead of expansion continuing, the society was thrown back to the ascendancy phase again, and from 1648 to 1866 we see the rise of Brandenburg to become Prussia, to head a league of smaller German states, to survive, as did Austria, the Napoleonic period (which was fatal to Venice), and in 1866 Prussia defeated Austria and finally excluded it from Germany. The result seems to have been that Germany lost about 300 years. This can be seen from the extensive colonization around the world by Spain, Portugal, France, Britain, and the Netherlands, but not Germany, prior to the 1800s.

The expansionary phase resumed for Germany between 1866 and 1914. Prussia not only expanded locally to absorb the other German states except Austria, but having defeated the French society in a war in 1871, king William of Prussia had himself proclaimed German Emperor at Versailles near Paris in France after the victory. Between 1871 and 1914 Germany acquired an overseas empire in Africa, New Guinea, the Marshall Islands, Melanesia, and Kiao Chow in China. By 1907 the population of German colonies was about 12 million, the Kiel canal was built so that German ships could pass between the Baltic and North Sea, and Germany was building battleships twice as fast as Britain which at that time had the largest navy in the world.

So we can say for the period from 1648 to 1914 Germany had caught up into its expansionary phase (the 3rd phase) and by 1939 had entered its 4th phase, of dominance in which it was stopped short militarily by 1945. Since then it has continued by economic expansion and in the 21st century is the major force in the new European Union.

. . . . . . . . . .

Now we should look at the other problematic society on our list, Russia. We found in chapter 5 that Russia had its beginning in Novgorod in 862, controlled by Norsemen. These two peoples, Norse and Slavs were never directly within the ambit of Rome society as were all the Mediterranean rim societies and England. So the beginnings were different.

Kiev developed as a trading centre with Byzantium, and there was rivalry between Kiev, Novgorod and later Moscow, mentioned as early as 1117. But in 1240 Kiev was sacked by the 'Golden Horde' of Ghengis Khan, the Mongols. Later they sacked Moscow. They dominated the area and exacted tribute from 1240 to 1480. Ivan III (the Great) took over Novgorod in 1471 and then threw off the control of the Golden Horde. Russian frontiers were extended to the gulf of Finland and the Crimea. The territory was systematically organized.

The first phases for Russia, then, the formative and ascendancy phases, ran from about 862 to about 1471 = 609 years. This is a longer than average period, probably for two main reasons. First, that Russia is a vast country, which may slow the pace, and next, there was foreign ownership for about 240 years which apparently delayed the process. This delay was probably also responsible for holding the Russian society in the feudal age longer than the European societies further west. It was not until 1861 that feudal serfdom was abolished, making the serfs free men no longer 'bound' to the soil or having to work for the nobles. The French Revolution of 1789 had swept away feudalism in France. In Britain the peasants revolt in 1381 (after the plague of the Black Death) had broken the back of feudalism in Britain; feudal 'incidents' had been abolished by statute in 1660.

We would expect phase 3, the expansion phase, to follow, and it does. I would see this phase as running from about 1471 to 1867 = 396 years. In that time Russia took over parts of Finland, the whole of Estonia, had such organizing rulers as Peter the Great and Catherine the Great. Russia took part in the partition of Poland, and in the third one Poland disappeared altogether. Russia fought back the Turks, defeated Napoleon in their war of 1812. Moscow surrendered and Napoleon entered it but the inhabitants burned it. During its retreat in winter Napoleon's Grand Army was nearly annihilated. By 1814 the Russian armies were almost at the walls of Paris. By 1860 Russia had expanded eastward as far as Vladivostok, had secured part of the coast of Manchuria, and Russian authority reached as far as Korea. Russia now had 1/6 of the world's land surface. In 1867 Russia sold Alaska, not on its continent, to the US for $7.2 million.

Somewhere between 1867 and 1905, or even 1917, Russia changed into its 4th phase, which I have called the phase of dominance. So far Russia has achieved this in three main ways. By 1988, some 70 to 110 years into this phase Russia had established client states in the whole of eastern Europe by military means, and by ideological means into parts of the Caribbean, South America, Africa, the Near and Far East. It was the first society to send a man into 'space' and had in 1988 ten times the space satellite program of the US and was one of the two greatest military powers on this planet. All this despite having lost about 20 million of its people to invasion by the Germans in WW2. In that war the US homeland was neither bombed nor invaded.

The reforms of Soviet Secretary Mikhail Gorbachev came about 140 years after the Communist Manifesto of 1848 and 70 years after the Russian Bolshevik revolution, which fits well with the patterns we are describing. The subsequent collapse of the USSR is also interesting to us because it was precipitated by a crowd of 100,000 at Leipzig, in the part of Germany under USSR control. The crowd systematically destroyed the files and records of the secret police, and in effect told their Russian masters that they had had enough, and this was the end of being shot at for trying to escape over the Berlin wall to west Germany, and being regimented in poverty and suppression in the name of Communism and the teachings of Karl Marx.

Russia now has a temporary setback, because its ideological system did not work well, and did not provide a more utopian society as expected. It is now in the process of rebuilding and restructuring its economy and political system of operating. Because it went straight from serfdom and Czarist dictatorship to Communism, Russia society only had its first democratic experience beginning after the collapse of the USSR, 200 years later than France, and 300 years later than Britain. The example of 19th century Germany suggests that it will attempt to catch up at a frantic pace once its internal stability and a new system of ideas have been established.

The important concept we are trying to understand here is how to recognize the different phases societies go through, how they are driven to express themselves in the process, and how other societies, their contemporaries, can find acceptable ways for them to adjust their relationships with one another so that violence, bloodshed, war, and devastation can be avoided or kept to a minimum.

It was thought necessary to comment on these two more difficult cases to verify that they did in some way conform to the general pattern of societal development and decline being outlined. It is not proposed to go around the various other existing societies in the world to analyze their situations based on the interpretations already discussed. Many of them are more straightforward and follow more easily the phases and life cycle we have described and exemplified. This is not meant to be a definitive study. It is meant to be an introduction which others may wish to pursue further. In the final chapter we will look at Western civilization itself and return to the original question: Is our civilization dying?




Let it be clear that I make no attempt to predict the future of societies or civilizations. If experts in stock market trading cannot even predict the next day's rise or fall of the price of stocks and bonds it would be foolish to think one could predict the future of an entire civilization. But we can at least explore some possibilities.

We know that civilizations can and do die. We see their skeletal remains lying broken on the ground in various places around the world. We have a general sense of how long they survived. Thousands of years. The Mediterranean civilization lasted close to 5,000 years and the Stone civilization about 5,000 years before that. Our civilization is close to 2,000 years old, so it has a long way to go yet by these criteria, unless it is snuffed out by an earth crossing asteroid such as Hermes which missed earth by only twice the earth - moon distance. By celestial standards that is very, very close.

But there is a phenomenon going on even beyond the scale of civilizations, and that is the life cycle of the human race. If we look at the phylogeny of various species on a time scale of geologic proportions we see they have a minimal beginning, expand over time, have a dominant position on earth, and then shrink back to next to nothing again or die out completely. These species spans are said to be very long indeed. For example:

Labyrinthodonts. . . .About 105 million years to extinction

Dinosaurs. . . . . . . . .About 150 million years to extinction

Trilobytes. . . . . . . . .About 360 million years to extinction

Yet we're also told that probably over 95% of all species that have existed on this planet are now extinct. Many species have been wiped out by celestial events such as we've just described.

We can notice something similar in the evolving of our present human race which is probably not much over 100,000 years old; about 15 million if you include all the ape-like hominids. If you want to include apes (anthropoids) it's about 52 million years and including monkeys (simians) you could push it back to about 68 million years. Even that is quite short on a phylogenic time scale. We are so different from these hominids, apes and monkeys that there seems to be more to it than natural evolution from them to us (see my The Immortals and From Chimps to Humans?). These other creatures are knowledgeable specialists in the means for survival in a relatively small land area. There is no evidence that any of them, from monkeys to hominids, have ever turned their attention to the sky above. It seems unlikely that even the most sagacious monkey, ape or hominid has ever contemplated voyaging into space which humans seem driven to do. But however old as a species you choose to say we are, there is little doubt that we have now reached our stage of dominance among species on this planet.

Somewhere about the time of the beginning of the first civilization we have identified, the Stone civilization, there must have been some dramatic climate change which caused the end of the last ice age and the rising of sea levels around the world by several hundred feet. At the present time there appears to be no generally accepted scientific explanation for this event. From the re-shaped earth after this catastrophe arose the Stone civilization. Its use of mighty blocks of stone for building purposes may represent a period of time when earthquakes and aftershocks were more frequent and climatic conditions more severe than they are now.

Of more interest to us as individuals is not the life time of the human race, or even Western civilization itself, but the future of the societies we live in, forming our civilization. They have shorter life spans than civilizations, because they all have to live and die within their one civilization and don't all flourish at once. Within our very recent system of societies and civilizations the nature of societies is expanding as Age succeeds Age. A new type of society has come into existence predicated on the nature of the defunct Rome society, the last great society of the previous Mediterranean civilization. This new type of society now in existence is what I would call a Continental Society. The expansion and colonization by these societies has been primarily occupied with consolidating their existing territories across their own continents. Examples are Canada, the US, Russia, China, India, Australia, the European Union. They are so large that they have internal problems with language differences, differences of customs, religions, races, even severe climate differences, all within their own borders.

SOCIETY. . . . . . . . . . . . . . .LAND AREA IN SQUARE MILES

Russia. . . . . . . . . . . . . . . . . . . . . . .6,593,391

Canada. . . . . . . . . . . . . . . . . . . . . ..3,851,809

China. . . . . . . . . . . . . . . . . . . . . . ..3,691,502

U.S.A. . . . . . . . . . . . . . . . . . . . . . ..3,615,212

Australia. . . . . . . . . . . . . . . . . . . . .2,967,909

India. . . . . . . . . . . . . . . . . . . . . . . . 1,229,215

European Union. . . . . . . . . . . . . . .Under 1 million

The first four of these Continental Societies are so huge that by my calculations all the land area of the European Union nations could be placed in just two of ten provinces of Canada (Ontario and Quebec) with about 15,000 square miles to spare.

Another phenomenon is the outcome of the natural tendency of a society to expand beyond its borders. Since this world is now more or less filled up with people, and there is an inherent urge to expand, Russia, the US and the European Union, with some assistance from Japan, are sending out robotic space probes and have established human presence in earth orbiting satellites and way stations, plus a US human visit to the nearest planetary body, earth's moon. Numerous unmanned satellites orbit the earth for various purposes. Psychologically, Western civilization societies have prepared themselves for space travel and what may be found beyond this planet. TV programs such as the original Star Trek and its various successors and Space films have explored endless possibilities of space travel and exploration. For this to happen it will be necessary to break the 'light barrier' just as the 'sound barrier' was broken in the 20th century with aircraft that can now travel at 6 times the speed of sound. Western civilization in its next Age may come to know the solar system as a previous (Protestant) Age did the planet's continents and oceans.

With reasonable human care our Western civilization should have several thousand years to go yet, barring climatic or celestial accidents. Whether or not our civilization is dying is not a problem. It will die eventually, as all life dies, including every one of us. The Mediterranean civilization was not founded by Rome, its last great society. As far as we know the first were the Sumerian and Egyptian societies. Egyptian territory even had three different societies rise and fall during the Mediterranean civilization. The Western societies that rose at the beginning of this present Western civilization will be most unlikely to survive until its end, unless it is cut short by some catastrophe. China may well be the next society to rise to dominance, probably followed by India, then perhaps South America. Australia, and Africa, unless Africa is to be the founding society of the next new civilization. Of serious concern is that we need to understand much more about how the societies in which we exist go through their life cycles within the civilization. We have around us different societies of different ages. For example, we have shown that Germany and Russia are younger in development than France and Britain.

On a small scale we saw Venice fought with Genoa for 150 years, but eventually they were both absorbed in a united Italy. In the same way France and Britain fought in Europe from 1066 to 1815, including a hundred years' war, and fought in and for their colonial empires around the world as well. But from then on all that changed. Both societies are quite elderly and concerned to defend their few remaining possessions and heritage. Britain and France fought together against Russia in the Crimea in the 19th century. They fought together against Germany in WW1 and again in WW2 in the 20th century. Since then they have co-operated to produce a commercial aircraft that is the fastest, most accident free, (and most expensive to travel by) in the world, the Concorde. And they have created a land link by joint effort, the Chunnel. France is already absorbed into the larger European Union and Britain will probably find it necessary to join more explicitly than it has already. France is fighting a rearguard action to protect and preserve its language, while Britain is trying to protect its position as a financial market centre which it does not want to surrender to the Union.

We as individuals live out our microscopic lives within societies and in the process help make them what they are. We tend to think of all the societies living today including our own as contemporaries, but in fact we live in a world and a civilization where societies are as varied in age as a family with children, parents and grandparents all living together in one house at the same time. The needs of the different age groups of the family of societies living in our Western civilization are quite different. We need better understanding as to what these needs are before we can live together with more security.

In my youth I had always thought of life as proceeding along with effort rewarded with some success and the society around me providing reasonable security and opportunity for progress. Now that I have had considerable life experience, lived in England, the US and Canada, studied various periods in history, societies and civilizations, my message is different. Most of human life for many people has been a miserable condition. In the short space of 50 years during the second half of the 20th century, without a world war, there were ordinary people trying to live out their lives in Afghanistan, the Kurds in Iraq and Turkey, people in Hungary, Bosnia, Kosovo, Korea, Yucatan, Peru, Bangladesh, Rwanda, Sierra Leone, Sudan, South Africa, Palestine, Kuwait, the Falkland Islands, East Timor, Chechnya, Northern Ireland, Northern Spain, Montserrat, Mozambique, or living near Chernobyl. Expect poor quality, self-centred, corrupt government, excessive taxation, war, civil commotion, injustice in the courts, greed, selfishness and persecution, economic depressions, epidemics, plagues and incurable diseases, drought, famine, devastating floods, forest fires, tornadoes, earthquakes, tidal waves, volcanic eruptions and the occasional world war. When you find something else, more pleasurable, be thankful and rejoice inwardly. It may not last.

Carthage, which died so young, was to a considerable extent killed off not by the Romans, but by its own religion which became decadent. At first sacrifices of animals were made to the gods, in the usual way for that time. But then the priests began telling the ruling class that greater sacrifices were needed to pacify the gods who had caused defeat in war. So in times of trouble it came about by degrees that eventually the fairest children of the noblest families were deemed most fit for the greatest sacrifices. Gradually the finest stock of leadership in Carthage was destroyed by perversion of its religion. Similar misguided practices may have caused the downfall of Mayan society. I would call this behaviour decadent. We should beware of decadence. Decadence can kill a society by corruption of the principles that made it great.



Here is an excerpt from The Decline and Fall of the Roman Empire, by Edward Gibbon (1737-1794). It comes from volume III of the 1905 Methuen seven volume edition, pages 429-30. Gibbon tells us that the time is during the 440s AD and Attila, King of the Huns and a Scourge of God, had increased his tribute from the eastern empire of the Romans at Byzantium (now Istanbul and before that Constantinople). It had been seven hundred pounds of gold annually, now increased to two thousand one hundred, plus the immediate payment of six thousand pounds of gold to defray the expenses or to expiate the guilt of the war. The unfortunate Eastern 'Emperor' more in name than reality, had to agree to this. He sent an embassy several hundred miles to the headquarters of Attila, north of the Danube, and fortunately for us, one of the leaders was the historian Priscus. Here's how Gibbon tells us what happened next:

The historian Priscus, whose embassy is a course of curious instruction, was accosted, in the camp of Attila, by a stranger, who saluted him in the Greek language, but whose dress and figure displayed the appearance of a wealthy Scythian. In the siege of Viminacium, he had lost, according to his own account, his fortune and his liberty; he became the slave of Onegesius; but his faithful services, against the Romans and the Acatzires, had gradually raised him to the rank of the native Huns; to whom he was attached by the domestic pledges of a new wife and several children. The spoils of war had restored and improved his private property; he was admitted to the table of his former lord; and the apostate Greek blessed the hour of his captivity, since it had been the introduction to an happy and independent state; which he held by the honourable tenure of military service.

This reflection naturally produced a dispute on the advantages, and defects, of the Roman government, which was severely arraigned by the apostate, and defended by Priscus in a prolix and feeble declamation. The freedman of Onegesius exposed, in true and lively colours, the vices of a declining empire, of which he had so long been the victim; the cruel absurdity of the Roman princes, unable to protect their subjects against the public enemy, unwilling to trust them with arms for their own defence; the intolerable weight of taxes, rendered still more oppressive by the intricate or arbitrary modes of collection; the obscurity of numerous and contradictory laws; the tedious and expensive forms of judicial proceedings; the partial administration of justice; and the universal corruption, which increased the influence of the rich, and aggravated the misfortunes of the poor.


The bibliography/reading list comprises over 1,500 books and academic journal articles, not considered appropriate to include here.


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