World View: Cyprus Nears Collapse After EU Issues Ultimatum

This morning's key headlines from

  • Barack Obama and the 'Mideast Roadmap to Peace'
  • Cognitive dissonance and the 'Mideast Roadmap to Peace'
  • Cyprus nears collapse after EU issues an ultimatum

Barack Obama and the 'Mideast Roadmap to Peace'

Palestinians protest Obama's visit to Ramallah on Thursday (Getty)
Palestinians protest Obama's visit to Ramallah on Thursday (Getty)

We're close to a very important ten-year anniversary that nobody is going to remember but me: On May 1, it's the tenth anniversary of President George Bush's "Mideast Roadmap to Peace." I remember it because I wrote my first major Generational Dynamics prediction at that time, explaining why the Roadmap could not succeed. (See "Mideast Roadmap - Will it bring peace?" from 2003)

Listening to President Obama in Jerusalem on Wednesday and in Ramallah on Thursday, it might as well have been George W. Bush. I don't believe that there was a single thing that I heard that was substantively different from anything that I would have heard if Bush were still President.

In particular, Obama had a major reversal in rhetoric regarding settlements. In the past, he's called for an end to West Bank settlements. Today, he said only that settlements were an area of disagreement that would be solved only when the core issues were resolved -- and the core issues were creating a contiguous state of Palestine, and security for Israel.

I did hear some pro-Obama commentators spin this as a "turning point" in Mideast peace, which is absurd. There was exactly the same bubbly spin after Bush revealed his Roadmap to Peace. But the most bubbly time was when Yasser Arafat died in November, 2004. The pundits, as well as President Bush, believed that Arafat had been the only person standing in the way of Mideast peace, and there were grins all around, in the belief that Mideast peace was near. The grins turned into ebullience when Mahmoud Abbas was elected as Palestinian leader. Ariel Sharon was also ebullient, and agreed for Israel to withdraw from Gaza. You know the rest. There was no Mideast peace, and there have been three regional wars since then.

To the contrary, a number of Palestinians were protesting President Obama's visit to Ramallah. Some are quoted as saying that President Obama is worse than President Bush because Obama had raised everyone's hopes with the Cairo speech in 2009, but has done nothing since then.

Obama made numerous absurd promises when he was running in 2008. He said, "This was the moment when the rise of the oceans began to slow and our planet began to heal." He said he would be guided by facts, not like President Bush, who was guided by ideology and ignored facts. He would cure global warming, close Guantanamo, become friendly with Iran and North Korea, bring a two-state solution to Palestinians and Israelis, beat the Taliban and al-Qaeda, end the financial crisis, reflate the real estate and stock market bubbles and provide universal health care. He has not yet achieved a single one of these objectives, and many of them are total failures.

I was not critical of Obama during the 2008 campaign, because I assumed that his promises were the usual fatuous nonsense typical of all politicians, and I expected him to become more sensible once the election ended, assuming he won. But I was shocked when he doubled down on his predictions after he won. What this showed was that he actually believed the absurd promises he was making. McClatchy

Cognitive dissonance and the 'Mideast Roadmap to Peace'

The term "cognitive dissonance" refers to the mental problems that occur when deeply held beliefs are contradicted by real life events. The literature contains numerous examples of what happens. Some of the most dramatic examples are Christians who adopt the belief that Jesus Christ will return to earth on a certain day, and then have to deal with the reality when it doesn't happen.

For example, suppose a group of people believe that Jesus Christ will return on July 1, and that true believers will go to heaven, and the rest will die. They give their possessions away, and gather on a mountaintop, waiting for the return. July 2 comes, and they're still on the mountaintop, waiting. At that point, research has shown that they don't abandon their previous beliefs, but they double down on them and adapt them -- they go out and become proselytizers. Where previously they had kept their beliefs secret, and they now claim that God has decided to give the world one more chance, and only believers will survive.

This concept is important in Generational Dynamics theory, because cognitive dissonance becomes the dominant psychological factor during a generational Crisis era. After a generational Crisis era ends (such as the end of WW II), everyone is pretty much united and realistic about how the world works. Decades later, when the next crisis era begins, there are opposing political camps that hold ideologies as strong as those of the religious fanatics who gather on the mountaintop. They invest in stocks or make other personal life commitments based on their ideological beliefs. As shocks begin to occur (financial collapses, regional wars, and other generational "regeneracy" events), all of these core ideological beliefs are challenged, causing cognitive dissonance.

A country is in a real crisis at this time, because the war is combined with the mental conflicts that can almost paralyze many people, including many leaders. One story that always sticks in my mind is that when Hitler's Nazis invaded Russia, Stalin went into such a state of shock that he was unable to function for a few weeks, allowing Hitler to gain valuable time.

President Obama has shown flexibility so far, as one after another of his core ideological beliefs have been destroyed by world events. His reversal on Israeli settlements is a good example of that.

Inflation rate surges after Nixon imposes wage-price controls on August 15, 1971 (
Inflation rate surges after Nixon imposes wage-price controls on August 15, 1971 (

There is one major example left: Obamacare. I condemned this proposal when it was first made because it was a repeat of President Nixon's wage-price controls, which were an economic disaster. Nixon's wage-price controls were supposed to reduce inflation, but instead inflation surged to historically high levels under the controls. Obamacare was supposed to reduce health care costs, but instead health care costs are already surging to historically high levels. Obamacare is shaping up to be as much of an economic disaster as Nixon's wage-price controls. Obama is thoroughly committed to seeing Obamacare implemented. The typical cognitive dissonance behavioral pattern indicates that he will do anything that he has the power to do to force Obamacare to be implemented.

I've said hundreds of times that it's a basic principle of Generational Dynamics that great events of history are not determined by politicians or political policy or ideology. They're determined by generational trends that are completely out of control of politicians. The generational trends that I've been writing about for years are all coming to pass, and there's nothing that Barack Obama or any other politician can do to stop them. NPR

Cyprus nears collapse after EU issues an ultimatum

The generational trends that I've been writing about for Europe are also unstoppable. Cyprus's government is preparing for the worst, after the EU issued an ultimatum requiring Cyprus to raise 5.8 billion euros by Monday, or face banking collapse when the European Central Bank cuts off all liquidity to Cypriot banks. The original "Plan A" proposal, now rejected, would have levied taxes on both small and large bank depositors. Cyprus has begged Russia for bailout money, but that avenue now appears closed. In a new "Plan B" proposal on Thursday, the government proposed to parliament a "solidarity fund" that would bundle state assets, including future gas revenues, as the basis for an emergency bond issue, likened by JP Morgan to "a national fire sale." Russia is considering the possibility of of investing in the fund, either taking ownership of the banks, or buying rights to offshore gas and oil fields. It's going to be a very tense weekend, and a lot of people are saying that Cyprus might leave the euro on Monday. Reuters

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