Generational Dynamics
	Forecasting America's Destiny ... and the World's
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Web Log - August, 2006

Corporate profit growth slowed substantially in second quarter

This may be the start of the long-term "mean reversion" cycle that readjusts corporate earnings substantially downward.

Wednesday's Commerce Dept. report on Gross Domestic Product shows that GDP growth was at 2.9%, down from 5.6% in the first quarter, though not by as much as economists had expected.

But the most important news in the report is the substantial drop in the growth of corporate profits, according to Steve Liesman, CNBC analyst.

"It's a dramatic decline, 2.1% versus 14.8% in the prior quarter," says Liesman.

(If you're looking for these numbers in the Commerce Dept. report referenced above, then go to Table 11 on page 13 in the PDF file for the report, and look for the line, "Profits after tax with inventory valuation and capital consumption adjustments.")

Steve Liesman (Source: CNBC)

"Here's what's important about this," he added. "In my days at the Wall Street Journal, I was following this number." He said that the changes in this number predicted the Nasdaq crash in 2000. "This series peaked out in 7/98, but the market went on [with the 1990s bubble] for another two years, with what turned out to be 'false profits,'" indicating that a lot of the claims of corporate profit in 1999 and 2000 were "made up figures."

He said that 2nd quarter fall to 2.1% indicates, along with the collapse of the housing bubble and changes in oil prices, that the stock market should start feeling negative effects. "Some portfolio managers trade on this number, and it's a bear signal for them when it starts to decline," he added.

In fact, the fall in corporate profits is a signal that's been expected for a long time.

As discussed last year in an article entitled, The 11% Solution: An article in Barron's says the stock market is very overvalued, analysis shows that corporate earnings have substantially exceeded historical averages for since 1995. Investors have been assuming that earnings would continue grow at the same historically high rate. As we explained in detail, this cannot happen. In fact, by the principle of "mean reversion," earnings are going to fall substantially, to historically low levels, for several years, in order to compensate for the years of historically high earnings. This will trigger a stock market crash similar to the one that began in 1929.

Thus, a substantial fall in corporate earnings growth is way overdue, and it now appears that it began in the second quarter.

Steve Liesman then became very somber, and said something very weird:

"If profits come down, you could make a decent argument for multiples coming up. It's all about ME (multiples expansion). Multiples have been in the 14-15 range. You could make an argument they should be in the 17-18 range. You guys out there have to work the numbers -- figure out what a lower profit outlook combined with perhaps a higher multiple might look like to stock values."

Let me explain what this statement means, and why it's so bizarre.

First, when he talks about "multiples," he's talking about price/earnings ratios, where the price of a stock can be measured in terms of number of multiples of the corporate earnings per share of stock. So, for example, if a corporation makes $1.00 in earnings per share of stock, and the price of the stock is $20.00 per share, then the price/earnings ratio is 20, and the price is a multiple of 20 times the earnings.

As I've written many times in the past, the trick to this computation is to compute the earnings per share. It's easy to compute the price of a share of stock -- just look it up in the newspaper. But corporate earnings can be measured in various ways: earnings in the last year (the most common method), average earnings in the last ten years, or "forward earnings" (analysts' estimates of next year's earnings).

There's a chart that appears on the bottom of the home page of this web site. It's automatically updated every week, and it shows the average price/earnings ratio for the S&P 500 stocks The chart for August 25 (last week) is as follows:

S&P 500 Price/Earnings ratio and S&P 500-stock Index as of 25-Aug-2006. (Source: MarketGauge ® by DataView, LLC)

As this chart shows, stocks have been way overpriced since 1997 (actually, since 1995), and that's another reason why stock prices will have to fall substantially.

But this chart also shows that the current average p/e ratio is NOT 14-15 as Steve Liesman claims, but is actually 17-18. Why the difference? That's because Liesman is using FORWARD earnings. He's using the assumed earnings for next year, computed by assuming that earnings will continue to grow at the same rate. As I've explained several times on this web site, this not only fraudulent, it's moronic. These people use forward earnings to compute p/e ratios, and then they compare that to historical averages using previous year's earnings. The result is a complete mismatch, designed to make the market appear better off than it is.

I hope when this is all over, a lot of these analysts and financial advisors and journalists are held to account in as punitive a way as possible. These people are using obviously incorrect data in order to make more money for themselves. I guess I shouldn't just pick on Steve Liesman, since he's just doing what everyone does. A financial advisor who told the truth would not have any clients willing to buy stocks, so the financial advisor wouldn't make any commissions; so financial advisors are financially motivated to lie, and this trick with the p/e ratios is one way they do it.

Now look at what Liesman says next: "You could make an argument they should be in the 17-18 range. You guys out there have to work the numbers -- figure out what a lower profit outlook combined with perhaps a higher multiple might look like to stock values."

He knows the consequences of falling profits -- that the stock market is going to tank. He just said, a minute earlier, that some portfolio managers trade on this number, meaning that when it goes down, they're going to sell.

He's advising these people to use even more fraudulent computations -- to modify the formulas in their models to accept higher multiples, or p/e ratios -- and so continue to support the overpriced stock market.

Well, I shouldn't keep getting worked up over this stuff. These analysts, journalists and advisors are just out for themselves, and they don't really care what they say.

From the point of view of Generational Dynamics, we're entering a new 1930s style Great Depression, as I've been reporting since 2002. Ten years of high corporate earnings have been based on stock market bubbles and other bubbles that have occurred during that period. Now that the housing bubble has burst, and the housing market is collapsing faster than economists expected, the "corporate earnings bubble" is set to collapse next. This is all related to the generational patterns triggered in the 1990s when the generation of senior financial managers with personal memory of the horrors of the 1930s Great Depression all disappeared (retired or died) all at once, leaving behind new generations (Boomers and Xers) with little or no instinctual ability recognize risky investments. The time is fast approaching when the bill for the last 12 years is coming due. (31-Aug-06) Permanent Link
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UN: Darfur became much worse "while we were watching Lebanon and Israel"

Amnesty International reports that Sudan's new military buildup is precursor to a "catastrophe"

Amnesty International warned on Monday that the build-up of Sudanese troops in Darfur could lead to a human rights catastrophe in the very near future, and urged the UN Security Council to take immediate action to protect the people of the region.

"Eyewitnesses in al-Fasher in North Darfur are telling us that Sudanese government military flights are flying in troops and arms on a daily basis," said Kate Gilmore, Amnesty International's Executive Deputy Secretary General, quoted in Amnesty International press release. "Displaced people in Darfur are absolutely terrified that the same soldiers that expelled them from their homes and villages may now be sent supposedly to protect them."

For three years, America has been leading the effort to convince the international community to deploy troops to stop the massive genocide. America has described the war as 'genocide.' The UN has cynically refused to do so, because doing so would obligate the UN to try to stop it.

Jan Egeland (Source: BBC)

In a BBC interview on Monday, UN Emergency Relief Coordinator Jan Egeland described the situation even more harshly. He was asked what has changed recently.

"What changed is that while we were all watching Lebanon and Israel, it became much worse in Darfur. ... We fear a massive increase in the fighting and the threat now of a major [Sudanese] government offensive that will bring all out war. And then we'll have to withdraw [humanitarian] operations, and 300 million people will not have their lifeline at the Kalma refugee camp."

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He said that another group had taken a survey at the Kalma refugee camp, and found that "several times more women are being raped, abused beated, as they go out courageously to collect firewoood, or to get food, or to get any necessities into their camp" as had been happening previously.

Readers of this web site should make an effort to understand what's going on in Darfur. From the point of view of Generational Dynamics, this is the only "generational crisis war" going on in the world right now, and this is the kind of war that the entire world is headed for.

Crisis wars are different from other kinds of war. Americans focus on the wars in Iraq, in Afghanistan, and lately, the war in Lebanon. These are non-crisis wars. They're fought according to the rules of "international law." I've never really understood how you can have laws that describe how you have a war. It's like saying that I'm allowed to kill my next-door neighbor, provided that I'm genteel about it, and don't make too much of a mess. It's always been weird to me.

But every nation has crisis wars. These are the worst kinds of wars, the genocidal wars. America has had crisis wars. In World War II the allies killed millions of civilians in Dresden and Tokyo with massive firebombs that leveled these cities almost instantly. The entire cities were set on fire, and people who weren't burned were suffocated, because the fires used up all the oxygen. And I'm not blaming the allies for this; every nation does it, and our enemies had tried to do worse to us.

Every crisis war ends with some kind of explosive event. In World War II, this event was literally explosive, as we use nuclear weapons on Japanese cities.

By the end of WW II, the American population's anger and even desire for revenge was palpable, especially because of news reports of Japanese' brutal treatment of American prisoners, including torture and beatings. Those emotions were captured and conveyed perfectly by President Harry Truman, in his famous speech on August 9, 1945, shortly after destroying the city of Hiroshima with an atomic bomb: "Having found the bomb we have used it. We have used it against those who attacked us without warning at Pearl Harbor, against those who have starved and beaten American prisoners of war, against those who have abandoned all pretense of obeying international laws of warfare. We have used it in order to shorten the agony of war, in order to save the lives of thousands and thousands of young Americans. We shall continue to use it until we completely destroy Japan's power to make war. Only a Japanese surrender will stop us."

Americans (and most of the world) have forgotten what crisis wars are like. To people today, this is a completely foreign concept. People today, at least Americans today, think of war as a kind of video game, where bombers drop pinpoint bombs on targets, and nobody gets hurt except for perhaps a little "collateral damage."

But the Darfur war is not a video game war. Nor were the wars in the Balkans and Rwanda in the 1990s, nor the Iran/Iraq and Syria/Lebanon wars of the 1980s, nor the Cambodia "killing fields" of the 1970s. These were crisis wars, but Americans have no understanding of them.

If Amnesty International and Jan Egeland are correct, then Sudan is planning a major new offensive in Darfur.

What kind of offensive will this be? Will this be the "explosive" event that will finally end the Darfur war? From the point of view of Generational Dynamics, it will be intellectually fascinating to watch; from the point of view of the people of Darfur, it will be a horror beyond belief. (29-Aug-06) Permanent Link
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Iran test fires submarine to surface missile in the massive "Blow of Zolfaqar" military games

Iran (like China) continues rapid militarization, while confrontation over nuclear development looms.

The spectacular missile test capped the first week of five weeks of massive war games exercises, involving thousands of teams of forces, and dozens of land and sea weapons systems, staged in 16 provinces around the country.

The war games will continue until the end of September. The name "Blow of Zolfaqar" refers to a significant Shiite military victory in the seventh century.

Iran appears to be emulating its major new ally, China, in rapidly increasing its military expenditures.

According to an Iranian naval spokesman, the war games bring "a message of peace and friendship" to Iran's neighbors.

"We intend to convey this message to our neighboring states that we can restore security in the region together," said the spokesman, Admiral Habib Sayyari. Sayyari's statement didn't indicate whether restoring security would be done with or without wiping Israel off the map.

Some military pundits, speaking on various news programs on Sunday, indicated that it wasn't certain that Iran was telling the truth in saying that it had successfully tested a submarine-to-land missile, but added that if it was successful, then it represented a significant increase in Iran's military capability.

In addition, Iran opened a brand-new plant for manufacturing nuclear fuel on Sunday. A spokesman said that Iran's nuclear program was peaceful. "We are not a threat to anyone – even the Zionist regime [Israel], which is a definite enemy for the people of the region," he said. With all this love and peace pouring out of Iran, no wonder the world is becoming such a wonderful place.

According to Israeli intelligence sources, Iran is rapidly rearming Hizbollah in preparation for a new war. These sources say that Kofi Annan and the United Nations are facilitating the rearming of Hizbollah. Originally, Israelis had hoped that the U.N.'s international forces would fill a buffer zone separating Hizbollah from Israel, and prevent Hizbollah from rearming; instead, according to the report, the U.N. forces will provide a "shield" for Hizbollah, allowing them to rearm without interference from Israel.

Israelis are becoming increasingly nervous, and convinced that the world will force Israel to "Go it alone" in a war with Iran.

They're convinced, no doubt correctly, that the U.N., Europe and America will do nothing to stop Iran's nuclear weapons development and other military development, and will also do nothing to stop Hizbollah from rearming.

From the point of view of Generational Dynamics, this national state of anxiety by the Israelis is typical of population entering a "generational crisis" era. Such a population becomes increasing anxious and panicky, and that's what leads to a new crisis war. It's very hard to get past the feeling that such a crisis war is getting very close now.

It's been getting increasingly clear, especially in the last year, that China is actively preparing for war with America, and will be allied with North Korea, Iran and Pakistan against America, India, Israel and the UK.

Since I wrote an article on this subject ten days ago, almost a dozen web site readers have asked me this question: How can I be so sure that Russia will be our ally. Why won't Russia and China be allied against us?

The first answer to this question is to ask, "Why would you even think that?" The Russians and Chinese have historically hated each other, and have had many wars in the last two millennia.

Most people who believe that Russia and China will be allied do so because they were allies in the 1950s, after both countries had adopted "Communism." In fact, the two forms of government had little in common except the name "Communism," and in the end the two forms of government were simply totalitarian dictatorships, enforced by the imprisonment, starvation, and slaughter of millions of citizens.

In fact, Russia and China didn't really like each other, despite their alliance in the 1950s, and by the 1960s many people believed that they were close to war.

Conflict risk level for next 6-12 months as of: 9-Feb-2006
W. Europe	1	Arab Israeli	3
Russia Caucasus	2	Kashmir	2
China	2	North Korea	2
Financial	3	Bird flu	3
Key: 1=Low risk 2=Med 3=High 4=Active

In addition, China and India are headed for war with each other, Pakistan and India are headed for war with each other (over Kashmir), Iran is supporting Muslim terrorists in the Caucasus (Chechnya and Dagestan), and Russia has a close relationship with India. So there's no possibility that Russia will be allied with China in the next world war. Furthermore, India used to be part of the British Empire and is still close to the UK, so India and Russia will be our allies.

From the point of view of Generational Dynamics, a "clash of civilizations" world war is approaching, and appears to be approaching rapidly. All that's needed is a trigger, and that's a chaotic event that could happen at any time. (28-Aug-06) Permanent Link
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Housing market is collapsing faster than economists expected

Both existing home and new home are falling much more sharply than pundits and analysts have predicted.

On Wednesday, the Realtor's trade group announced that July sales of previously-owned homes were down 4.1% from June and down 11.2% from July of last year. The fall from June to July was about 5 times as great as economists had predicted.

On Thursday, the Commerce Dept. announced (PDF) that July new home sales fell 4.3% from June, about 20% greater than economists had predicted, and down 22% from the same time last year.

As I've discussed a couple of times in the past, the "housing bubble" appears to have burst in October 2005. The housing market has been generally down since then.

Existing home sales and prices, seasonally adjusted, January 2003 to July 2006, showing effects of October 2005 bubble bursting. The "inventory" value is shown on the bottom graphs, both in numbers of units and in number of months backlog at current sales pace.

The above four graphs show the performance of existing home sales since 2003. You can see how the real estate bubble grew from the increasing sales of homes and the increasing prices of homes. In the lower graphs, you can see that sales were so brisk at the beginning of 2005 that inventory was way down; that's when price increases started accelerating.

The bubble appears to have burst in October 2005, when the housing inventory really shot up and sales went down. However, prices have NOT fallen substantially, indicating that sellers are still in a state of denial, and are hoping that the market will come back.

As the inventory continues to build up, the situation is right for a full-scale real-estate panic.

Here are the similar graphs for new home sales:

New home sales and prices, seasonally adjusted, January 2000 to July 2006, showing effects of October 2005 bubble bursting. The "inventory" value is shown on the bottom graphs, both in numbers of units and in number of months backlog at current sales pace.

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(12-Oct-06) Following the real estate bubble, the commodity bubble appears to be deflating: As real estate prices collapse, prices of oil, copper, sugar and other commodities reverse four years of record price increases.... (23-Sep-06) Corporate profit growth slowed substantially in second quarter: This may be the start of the long-term "mean reversion" cycle that readjusts corporate earnings substantially downward.... (31-Aug-06) Housing market is collapsing faster than economists expected: Both existing home and new home are falling much more sharply... (25-Aug-06) Speculations about a stock market panic and crash : Will there be a stock market panic next week, next month, or next year, and will it lead to a crash? We speculate on some possibilities. (31-May-2006) As stock markets melt down, the question is: Where's all the money going?: For the first time, analysts are debating whether the stock market is crashing.... (21-May-06) Housing prices continue to fall: Sales volume partially recovered, indicating that you can still sell, if you lower the price enough.... (28-Apr-06) India Sensex stock market reaches historic high in record time.: Startled analysts are debating whether the market is close to a crash.... (21-Apr-06) New home sales and prices fall dramatically four months in a row: This appears to confirm that the housing bubble burst four months ago.... (26-Mar-06) Trade deficit again worse than expected, reaches a fresh historic high: Related: US Treasury bond prices fall dramatically on news from Japan... (11-Mar-06) Sudden collapse of Iceland krona portends bursting of "carry trade" bubble: I don't normally write about international interest rates because... (27-Feb-06) New Fed Chairman Ben Bernanke gives predictable upbeat testimony to Congress: Pundits are smiling today, happy that they can understand "plain-speaking" Bernanke.... (17-Feb-06) China reports 2005 economy still overheated at 9.9% growth: Like a railroad train careening down the track out of control,... (26-Jan-06) Wall Street Journal's page one article on Bernanke contains the usual errors and omissions: Let me try and explain this a different way.... (8-Dec-05) Alan Greenspan gives another harsh doom and gloom speech: Saying that "the consequences for the U.S. economy of doing nothing could be severe,"... (4-Dec-05) Ben S. Bernanke: The man without agony : Bernanke and Greenspan are as different as night and day, despite what the pundits say. (29-Oct-2005) Fed Chairman Alan Greenspan says that the deficit is out of control: France's Finance Minister Thierry Breton quoted Greenspan... (25-Sep-05) Pimco's Bill Gross recommends selling all, buying only short-term Treasuries: Meanwhile, Morgan Stanley's Stephen Roach says, "The world as we know it must come to an end."... (18-Sep-05) Departing Fed Chairman Alan Greenspan sings schizophrenic swan song: Is the economy strong or is it in danger? Greenspan played both sides... (30-Aug-05) A new mystery: Why is the P/E ratio remaining constant?: If you look at the bottom of this web site's home page,... (11-Aug-05) The 11% Solution: An article in Barron's says the stock market is very overvalued : New research by analyst Adam Barth finds that average earnings over any 20-year period are surprisingly constant. (11-Jul-2005) The mysterious Baltic Dry Index reveals a great deal about the Chinese economy: China is causing wild volatility and turmoil in shipping, iron ore and steel prices,... (5-Jul-05) Alan Greenspan predicts major losses by hedge funds: But still says he doesn't have a clue why 10-year Treasury bond interest rates are falling.... (8-Jun-05) Fed Governor Ben Bernanke blames America's sky-high public debt on other nations: I'm normally wary of applying specific generational archetypes to individuals, but Bernanke is acting like a Baby Boomer.... (14-Mar-05) Alan Greenspan warns that global economic dangers are without historical precedent : In a speech on Friday, Greenspan buried a major change of position in a speech admitting that his assumptions about the economy for the last decade were wrong. (6-Feb-2005) Federal Reserve congratulates itself on jawboning policy: Fed says it propelled the economy upward merely by promising to keep interest rates low.... (17-Sep-04) Real estate is in an overpriced bubble all over the world: A study by investment bankers Morgan Stanley warns that the bubble will burst with devastating results.... (30-Jul-04)

Generally speaking, new home sales are a more accurate indicator than existing home sales, because new home sales are recorded when a contract is signed, while purchases of existing homes are calculated when the sale is closed, usually a month or two later.

Inventories of new homes have been going up, just like existing homes, but there's a difference in pricing: New home prices have been falling, because new homes are sold by construction firms that have a smaller emotional attachment to the homes they're selling.

Generational Dynamics has been predicting since 2002 that we're entering a new 1930s style Great Depression, most likely by the 2006-2007 time frame.

There is one essential item that's still missing: a good ol' fashioned stock market panic. As I described in my May 30 essay, "Speculations about a stock market panic and crash," we're overdue for a panic, and there's a 50-50 chance that one will occur this year, in the next few months. There are many things today that might trigger a panic, and one of those things is the rapidly increasing levels of new and existing home inventories.

Few people today have any idea what a panic is. The last panic occurred in America in 1987, but as I've described, this was a "false panic," since stocks were actually underpriced at that time.

The previous panic occurred in October 1929, when stocks were overpriced by a factor of more than 200% -- same as today.

If you have no idea what a panic is, I can only say that you'll know it when you see it. We've had a couple of close calls this year, but when a real panic occurs, you'll see a worldwide collapse of confidence in the markets, and a rapid increase in unemployment, homelessness, bankruptcies, and worldwide social instability. (25-Aug-06) Permanent Link
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A temporary online meeting place has been set up while the Fourth Turning forums are down

The Fourth Turning forums are often used to discuss generational issues, since the generational paradigm was developed by William Strauss and Neil Howe, and published in their 1995 book, The Fourth Turning: An American prophecy; What the cycles of history tell us about America's next rendezvous with destiny.

Strauss and Howe's historical analysis of contemporary diaries and histories for the last 600 years in England and America showed that six war cycles followed a common generational cycle. Generational Dynamics is built on their findings.

The Fourth Turning forums web site has been unavailable for the last few days, and one of the members has set up a temporary meeting place. It's a Yahoo group at this address:

http://groups.yahoo.com/group/4thturningrefugeecamp/

(I'm always loathe to recommend yahoo to anyone. The service is dishonest and shoddy. Whatever you do, don't ever give them a credit card number. If you buy a service from them, and it doesn't work -- which happens frequently -- then there's absolutely no customer service, but they'll still keep charging your credit card. If you absolutely have to give them a credit card number, then get a "virtual credit card number" from Citibank, since you can cancel it at any time.)

When the Fourth Turning forum is running again, you'll be able to find it at http://fourthturning.com/forum .

I personally contribute to many of the dicussions, but the two that are most relevant to this web site are:

• Objections to Generational Dynamics - for a discussion of Generational Dynamics theory.
• The Singularity - for a discussion of super-intelligent computers and the Singularity.

If you try these web pages today, you'll be redirected to an error page, since these system is still down. But they should be available soon. (25-Aug-06) Permanent Link
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Debate over civil war in Iraq rages over semantics

An actual crisis civil war in Iraq is impossible, but it's now embroiled in the November elections, and so nothing that's said has any meaning at all.

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I'm not going to go over all the arguments again, since I've done so many times on this web site. I'll just comment on some of the new twists and turns.

The debate has gone completely away from what the "real" definition of a civil war is into whether the term "civil war" can be redefined for political purposes. With suicide bombers and roadside bombs killing some 100 Iraqis a day, there's certainly plenty of room for politicians to make hay.

The simple answer is this: the violence going on today in Iraqi is being driven by money -- money from al-Qaeda on the Sunni side and from Iran on the Shiite side -- as I've previously explained in detail.

A real civil war is driven by the people -- by massive hatred between the groups supposedly at war. I've seen no evidence in the press that ordinary Iraqi Sunnis and Shiites hate each other; every story seems to indicate that they want to live together in peace.

If this were a real civil war, then ordinary Iraqi Sunnis and Shiites would want to kill each other. It's as simple as that, and nothing remotely like that is happening.

We have an actual crisis civil war going on today in Sudan, where government-sponsored Arab militias are slaughtering, starving and raping millions of non-Arab people in Darfur. Nothing like that is happening in Iraq.

Another recent real civil war was the Bosnian war in the 1990s. I'd like to repeat Amy Chua's description of this war, given in her book World on Fire: "In the Serbian concentration camps of the early 1990s, the women prisoners were raped over and over, many times a day, often with broken bottles, often together with their daughters. The men, if they were lucky, were beaten to death as their Serbian guards sang national anthems; if they were not so fortunate, they were castrated or, at gunpoint, forced to castrate their fellow prisoners, sometimes with their own teeth. In all, thousands were tortured and executed."

That's the kind of emotion we'd have to see to conclude that there's a civil war in Iraq.

But what we're seeing today is a debate of the political definition of civil war which, like so many things that politicians talk about, has absolutely nothing to do with reality. (23-Aug-06) Permanent Link
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Iran and Ahmadinejad are waiting for the Mahdi

Most people know about the belief by Christian fundamentalists about the Second Coming of Christ, and the fact that some Christians believe that the second coming is near.

However, what few Americans know is that Shi'ite Islam has a similar belief -- the Mahdaviat -- the belief that the Mahdi is coming to save mankind.

Iranian ideologues believe that the Islamist overthrow of Iran's secular government in 1979 was the sign that the Mahdi is coming soon.

Iranian President Mahmoud Ahmadinejad is one of those ideologues, and he said as much in his speech to the U.N. General Assembly on Sept. 17, 2005:

"From the beginning of time, humanity has longed for the day when justice, peace, equality and compassion envelop the world. All of us can contribute to the establishment of such a world. When that day comes, the ultimate promise of all Divine religions will be fulfilled with the emergence of a perfect human being who is heir to all prophets and pious men. He will lead the world to justice and absolute peace.

O mighty Lord, I pray to you to hasten the emergence of your last repository, the promised one, that perfect and pure human being, the one that will fill this world with justice and peace."

This is evidently a strongly held belief by Ahmadinejad, and it partially explains his single-minded devotion to the destruction of Israel.

Ironically, not all Iranians agree with Ahmadinejad's direction.

Now that the Lebanon war is over, at least for the time being, Iran is moving quickly to solidify Hizbollah's position in Lebanon.

Iran is pouring hundreds of millions of dollars into Hizbollah's coffers to be given away to Lebanese citizens whose homes were bombed during the war. In addition, Iran is huge quantities of weapons to Hizbollah, to replace those that were used or destroyed during the war.

But many Iranians are angered by the huge amounts of money being spent in Lebanon. The anger is especially severe in regions destroyed by the Iran/Iraq war of the 1980s, and by the huge earthquake hit Iran in 2003. Iranians are furious that money is being spent to rebuild Lebanon, but nothing is being spent to help these Iran regions rebuild.

From the point of view of Generational Dynamics, none of this is surprising. Like America in the 1960s and 1970s, when it was one generation past the end of World War II, Iran today is entering a "generational awakening" era, one generation past the Iran/Iraq war of the 1960s.

During the 1960s, America went through massive riots and demonstrations over racial issues, the Vietnam war, and other "individual rights." Every country goes through generational awakening eras at regular intervals, and when that happens the country moves in the direction of supporting individual rights, and away from national unity.

President Mahmoud Ahmadinejad of Iran(Source: Mardomyar.ir )

That's happening more and more in Iran today, as Iran becomes "a country at war with itself," according to one description. During such a period, there's always a "generation gap," where many young people reject the harsh compromises and restrictions imposed by the older generation to prevent the previous crisis war (in this case, the Iran/Iraq war) from ever happening again.

We already saw this last year, shortly after the election of Ahmadinejad, when college-age women started rioting in the streets for feminist rights. Women often lead the way during generational awakening periods, just as men tend to lead the way during generational crisis periods.

Although Hizbollah's evident public relations victory in Lebanon is widely praised in Iran and throughout the Muslim world, it has a cost, and we can expect to see increasing political turmoil over Ahmadinejad's policies, as he tests his belief that the Mahdi will be coming soon to save mankind. (22-Aug-06) Permanent Link
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Furious Chinese ambassador harshly threatens U.S. over Taiwan

BBC anchor Carrie Gracie must have really pissed off Sha Zukang, China's ambassador to the United Nations in Geneva, because he was shouting angrily, when he answered Gracie's questions during an interview, a portion of which was broadcast on Thursday. (The full interview can be heard online starting on Saturday.)

"The moment that Taiwan declares independence, supported by whomever, China will have no choice but to [use] whatever means available to my government," he said. "Nobody should have any illusions on that."

Interviewer Gracie said that there would be "a high price to pay" to have a war over a small island.

"You are right, you are right," he shouted. "I said 'any cost.' It's not a matter of how big Taiwan is, but for China, one INCH of the territory is more valuable than the LIVES of our people."

This warning is consistent with the warning that Chinese President Hu Jintao gave to President Bush last year.

It's also consistent with last year's warning given by top-level Chinese army officer General Zhu Chenghu if America interfered with Taiwan: "If the Americans are determined to interfere [then] we will be determined to respond. We . . . will prepare ourselves for the destruction of all of the cities east of Xian [a city in central China]. Of course the Americans will have to be prepared that hundreds . . . of cities will be destroyed by the Chinese."

I mention all this because I've had several conversations with people recently who thought that China would never risk a war with America, and even said that talking about it is hyperbole. One person said that Taiwan and China would never want to have a war, because it would be bad for business. Of course if that were true, then nobody would ever have any wars. In this case there's absolutely no doubt: If Taiwan moved toward independence, then China would make a military move on Taiwan, and America would come to Taiwan's defense, and there would be full-scale war.

From the point of view of Generational Dynamics, a major crisis war with China cannot be avoided, and probably sooner rather than later. Taiwan is only one of the reasons. Another reason is the growing tension between China and Japan, which is going to lead to a war that will draw America in. A third reason is North Korea, which is determined to reunite with South Korea under North Korean control; America would defend South Korea, and China would defend North Korea, once again leading to full-scale war.

Returning to the interview with Chinese Ambassador Sha, he was furious about something else too: the West's constant criticism of China for its rapid militarization, with double-digit budget increases for the last few years. This is extremely ominous, since there's no doubt that they're preparing for war with America, with huge investments in submarines and missiles.

Ambassador Sha was quite blunt: "It's better for the U.S. to shut up, keep quiet. That's much, much better."

He added, "China's population is 6 times or 5 times the United States. Why blame China? No. forget it. It's high time to shut up. It's a nation's sovereign right to do what is good for them. But don't tell us what's good for China. Thank you very much."

And thank you too, Mr. Sha.

From the point of view of Generational Dynamics, a war with China will occur with absolute certainty, as part of the approaching "clash of civilizations" world war. We're already beginning to see the outlines of the two sides.

Conflict risk level for next 6-12 months as of: 9-Feb-2006
W. Europe	1	Arab Israeli	3
Russia Caucasus	2	Kashmir	2
China	2	North Korea	2
Financial	3	Bird flu	3
Key: 1=Low risk 2=Med 3=High 4=Active

China has close military ties with Iran, Pakistan and North Korea, and these countries are all sharing missile and nuclear technology. These countries and their allies will form the new "axis" in the war, to fight against America, India, Russia and the UK and their allies.

The fury that was exhibited by a Chinese ambassador is quite startling, because we have to assume that his anger is part of the "message" that he wants to impart to the West. The message is this: "We're becoming increasingly impatient with humiliating remarks by the West and by the West's interference with Taiwan. We're not going to tolerate it much longer." This message fits in very well with Iran's plans, clearly expressed by Iran's charismatic leader Mahmoud Ahmadinejad, to wipe Israel off the map. (18-Aug-06) Permanent Link
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Jackie Chan selected by UNICEF to warn the world of bird flu

The movie star and martial arts expert will star in a public service announcement (PSA), according to the UNICEF press announcement.

Jackie Chan in bird flu PSA (Source: UNICEF)

In the one minute ad, Chan and six children use colorful origami birds to convey the message to stay away from sick and dead birds, especially chickens. It ends with, "But playing with paper birds is fine."

Highly pathenogenic H5N1 bird flu has continued to spread throughout Asia in both birds and humans. Bird flu appears to be endemic throughout Indonesia, where people are taking few precautions to prevent spreading. And among humans, there have been 57 H5N1 bird flu infections, of which 44 have been fatal. Last year, Indonesians were nearing panic as bird flu spread, but today, they seem to have accepted it as a permanent part of their lives.

Yesterday, China reported a fresh outbreak of bird flu, leading to the slaughter of over 200,000 fowl. The outbreak was the first in China since July 14 and the 38th reported among poultry nationwide since October last year.

As expected, the spread of bird flu has slowed since the end of Spring.

Last year at this time, bird flu was mostly confined to eastern Asia. But last winter, bird flu was spreading at lightning speed around globe. It moved west through China and into Russia, then into the Mideast and Europe, and finally into Africa.

Major flyways, bird flu status (Source: UN FAO)

The disease has spread rapidly among birds around the world. Ever since Spring 2005, when H5N1 was found to have infected birds at Lake Qinghaihu, the mid-China international meeting point and breeding ground for migratory birds, bird flu was poised to spread around the world. The Fall 2005 migration already spread it to west Asia, the Mideast, Europe and Africa within a few short months.

Miraculously, North America has escaped so far. It was expected to reach North America before summer, spread by migrating birds traveling from Africa along the Atlantic flyways. However, as far as is known, this hasn't happened.

(The reason for the uncertainty in the last sentence is because an infected bird may have reached North America, but died before spreading it, or only spread it to a small group of birds that haven't been discovered.)

Making the public service announcement with Jackie Chan is happening at exactly the right time, since the Fall migration will be starting up at the end of August. In the weeks and months that follow, hundreds of millions, perhaps billions of birds will migrate along the various flyways. It's more likely than not that bird flu will reach North America during the coming Fall and Winter season.

In the human bird flu cases in Indonesia, it appears all but certain that human to human transmission has been occurring, although such transmission is still very inefficient, requiring physical contact. This human to human transmission has been made possible by mutations in the H5N1 virus itself.

Conflict risk level for next 6-12 months as of: 9-Feb-2006
W. Europe	1	Arab Israeli	3
Russia Caucasus	2	Kashmir	2
China	2	North Korea	2
Financial	3	Bird flu	3
Key: 1=Low risk 2=Med 3=High 4=Active

The big concern is that further mutations in the virus will permit efficient human to human transmission, such as happens with "ordinary" human flu. In this case, there would a worldwide bird flu pandemic, resulting in tens or hundreds of millions of deaths, and a worldwide financial crisis.

I've been including "bird flu" as one of the items on my little conflict risk graphic because, although it's not a war by itself, it would undoubtedly quickly bring on a world war.

Meanwhile, iconoclastic flu researcher Dr. Henry Niman has used his Recombinomics web site to document cases of human to human transmission and mutations in the virus. Those who wish to follow the progress of the spread of bird flu should check out that web site.

Mainstream researchers disagree on when a worldwide bird flu epidemic is coming, but all agree that it's overdue, and could come at any time -- next week, next month, next year or thereafter. The time can't be predicted, but once it begins, it will spread around the world fairly quickly.

As I've said before, you and your family should prepare immediately for a possible pandemic. If human to human transmission became public next week on Monday, then by Tuesday all the shelves in grocery stores would be bare. If you stock up on food now, then you'll be sure to have what you need. Even if you think that you can beat the crowds to the grocery store, you should still stock up in advance. If you get your canned food after the panic begins, then you're depriving somebody else of food. But if you stock up in advance, then the shelves will be restocked, and you won't deprive someone else of food.

I once again strongly urge my readers to prepare for an H5N1 pandemic or for any kind of emergency (think of hurricane Katrina) by stocking up on food and water and currency and batteries for the entire household to live on for 2-3 months. This may cost a thousand dollars per person, but it's not wasted money since you can always eat the food later if no emergency occurs. Get canned or dried food that can last a long time in storage, and get a large container for storing water. Keep in mind that stored water becomes impure with time, so you'll also need some purifying tablets or bleach to kill bacteria in the water when the time comes. Finally, get whatever medicines you'll need to take care of yourself and your family for a long period of time. (17-Aug-06) Permanent Link
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Iranian President Mahmoud Ahmadinejad is a very charismatic leader

In his 60 Minutes interview, he was witty, charming, confident and deadly.

Mahmoud Ahmadinejad on 60 Minutes, 13-Aug-2006 (Source: CBS)

Mike Wallace joked with Iranian President Mahmoud Ahmadinejad, complimented him, sucked up to him -- all to get him to answer as many questions as possible.

Ahmadinejad didn't fall for any of it. He accepted the compliments as if he obviously deserved them, he ducked the suck-ups, he was forceful when he wanted to be forceful, and evasive when he wanted to be evasive. He totally charmed Wallace and the audience. Even speaking through an interpreter, he easily controlled the interview.

I've previously compared Ahmadinejad to President John F. Kennedy. Kennedy took office in 1960, one generation past World War II, as a young, charismatic leader of a new generation, with to lead with a new vision for America.

Ahmadinejad is the same, one generation past the genocidal Iran/Iraq crisis war of the 1980s. But Ahmadinejad's vision, of course, is to "wipe Israel off the map," and displace America as the leading superpower in the entire Mideast.

Ahmadinejad was at his most deadly when he gave the answer to the question of why he wanted to wipe Israel off the map. He says that the state of Israel was created because of alleged atrocities (the Holocaust) that Jews suffered in Europe.

Mahmoud Ahmadinejad on 60 Minutes, 13-Aug-2006 (Source: CBS)

"Well, if an atrocity was committed in Germany or Europe for that matter, why should the Palestinians answer for this?" he said. "They had no role to play in this. Why on the pretext of the Holocaust they have occupied Palestine? Millions of people have been made refugees. Thousands of people to-date have been killed, sir. Thousands of people have been put in prison. Well, at the very moment, a great war is raging because of that."

Wallace was clearly nettled by this response, as he asked Ahmadinejad to keep his answers concise. What a feeble response.

The fact is that this a very powerful argument: Why should Palestinians suffer, become refugees and be killed because of something that happened in Europe?

This argument can be answered by explaining what happened in Palestine in the 1800s and 1900s, and explaining how and why Palestine was partitioned in 1948, creating the state of Israel.

But that means that there's no answer to the argument. If you have to answer that argument with a 15 minute history lesson, then you've automatically lost the argument.

At the end of Ahmadinejad's answer given above, he says, "Well, at the very moment, a great war is raging because of that." He's referring, of course, to the Lebanese war, going on at this time.

The ceasefire is scheduled to go into effect at 1 am Eastern time. As I'm writing this article, on Sunday evening, nobody knows whether there really will be a ceasefire in a couple of hours, and if there is, how long it will hold. For most of you readers, by the time that you read this, you'll know the answer, but I don't at this time.

Both the Israeli and Hizbollah fighters have been firing artillery and rockets at each other. Both sides have escalated the fight in the last hours in order to gain as good a position as possible when/if the ceasefire takes place.

One part of the U.N. ceasefire resolution already seems doomed. A Lebanese cabinet meeting was postponed on Sunday because Hizbollah refused to agree to disarming. Unless Hizbollah's leaders change their minds (and why should they?), it will not be possible for the Lebanese army to move into the buffer zone.

This brings us back to Ahmadinejad and Iran. CNN is reporting that Iran has been giving $300 million per year to Hizbollah, though Iran claims that any money given is for social services, not weapons.

Whatever the military outcome of the Lebanese war, it's clear that the Ahmadinejad is clearly and indisputably the public relations winner, at least so far.

But Ahmadinejad clearly failed in one thing, at least so far: He had hoped to provoke the Palestinians in joining Hizbollah in the fight against Israel, but failed to do so.

True, the Palestinians are cheering Hizbollah and Ahmadinejad for standing up the Israelis, but that's all they're doing -- cheering. They're not fighting. That's because they want Hizbollah to do well, but not too well. The (Sunni) Arabs in general, and the Palestinians in particular, do not want (Shiite) Hizbollah and Iran to have too big a victory.

As I indicated before, in my lengthy analysis of the Lebanese war, from the point of view of Generational Dynamics, the single most important thing to be watching for is changes in attitudes and behaviors of the Palestinian people.

Without the Palestinians' involvement, the Lebanese war really does have no point, even for Iran. Iran, Ahmadinejad and Hizbollah have only objective -- wiping Israel off the map -- and they need the Palestinians to do that. By failing to provoke the Palestinians to war, Ahmadinejad failed in his major objective.

But the day is still young. A war between Jews and Arabs is coming, with absolutely certainty, for reasons that I've explained many times since 2003.

In order to motivate a war, politicians have to provide a justification to the people. And now we have a good idea what that justification will be: Why should Palestinians suffer, become refugees and be killed because of something that happened in Europe? (14-Aug-06) Permanent Link
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UN Security Council declares Lebanon peace while war expands

Israel, Lebanon and Hizbollah have promised to end the war on Monday.

It's a strange world when everyone celebrates a ceasefire, and the war gets worse than ever.

But that's what's been happening since Friday evening, when the United Nations Security council resolution was adopted unanimously.

Immediately afterwards, Israel substantially expanded its military assault, tripling its ground forces in Lebanon to as many as 30,000, and increased the rate of air strikes.

During the day Saturday, Israel, Lebanon and Hizbollah all reluctantly agreed to abide by the ceasefire, which is to take effect on Monday morning at 1 am, New York time.

Israel's intention in expanding its military assault was to get as much accomplished by Sunday evening as possible, before the ceasefire took effect, and to control as much territory in southern Lebanon as possible.

Here are the key points of the U.N. Security Council resolution:

• Hizbollah must immediately stop raining missiles on Israel.
• Israel must immediately end offensive military operations in Lebanon. This means that Israel reserves the right to continue "defensive" military operations if Hizbollah fires more missiles on Israel. Lebanon and the Arab League had wanted the resolution to require Israel to immediately withdraw all forces from southern Lebanon, but Israel refused, and also increased the tempo of air strikes on Lebanon infrastructure to make the point that the air strikes will continue if the Arabs continue to insist on this position.
• The United Nations will provide 15,000 peacekeepers to enforce the ceasefire. This is the creation of the "buffer zone" that I wrote about a few days ago. At that time, the plan was that the U.N. forces would be led by the French, though I expressed the view that the French would do all they could do avoid that. At any rate, the makeup of the U.N. peacekeeper force has now been left open, and the resolution requires that a decision be made within 30 days. Incidentally, Hizbollah was opposed to this clause, but received pressure from all sides to give in.
• In addition, the Lebanese army will deploy 15,000 troops to southern Lebanon, for a total of 30,000 troops in the buffer zone. Israel believes that the Lebanese army really supports Hizbollah, and doesn't trust it.
• Israel will withdraw troops as the U.N. international force is deployed. Lebanon, Hizbollah and the Arab League are furious about waiting so long, but it's the only condition under which Israel would agree to a ceasefire.

As I indicated before, in my analysis of the Lebanese war, from the point of view of Generational Dynamics, the two belligerents have been using sharply contrasting styles in the war.

Israel has been fighting in a "hot" crisis war style, furiously bombing infrastructure, calling up new reserves every day, confronting Hizbollah terrorists on their own soil, and now feeling very anxious about the U.N. peace deal.

Iran/Hizbollah terrorists have been fighting in a "cool" non-crisis war style, planning for six years, launching missiles from the comfort of home, manipulating and drawing in Israel, forcing them to kill civilians, and now methodically using the U.N. deal as a pawn to advance its longer-term strategy.

Either style might win, as I discussed in contrasting this war to the burgeoning civil war in Sri Lanka.

Many commentators have been claiming that Hizbollah has been winning the war, simply by surviving Israel's assault. In fact, a recent poll conducted in Israel indicates that Israelis still strongly support the war, but are questioning the conduct of the war. On the other hand, Israel itself has claimed that it's struck massive blows to Hizbollah.

It will be VERY interesting to see how all of this rolls out in the next week. There's only one thing we can be absolutely certain of: This ceasefire won't last. (13-Aug-06) Permanent Link
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Sophisticated plot to blow up 9 aircraft may be related to July 7, 2005, London subway bombings

First reports indicate that suspected perpetrators are believed to be British citizens of Pakistani origin, linked to al-Qaeda.

If the Pakistani origin is confirmed, it would hardly be a surprise, in view of what's come out in investigations following the July 7, 2005, London subway bombings.

There's a clear generation gap among Muslims in London. Many young Muslims, British citizens born of immigrants from Pakistan and other Muslim countries, grow up in the same homes as their parents, but in a completely different world nonetheless. To them, the British are responsible for the London subway bombings, because they're also responsible for the suffering of Muslim Palestinians, Muslims in Kashmir, and suffering Muslims elsewhere in the world. These young teen Muslims are taught these concepts in classes associated with London mosques. Kashmir is of particular importance to Pakistani immigrants, since the Kashmir region is disputed by (mostly Muslim) Pakistan and (mostly Hindu) India.

The London subway bombings were a shock to everyone, but no more so than to the people living in the same neighborhood of the bombers. One Muslim man told CNN that he was worried about the attitudes of his own children. "The bombers were just like us. And if they're just us, then more of them could be anywhere, couldn't they?"

However, teaching ideology isn't enough, as training is required. The four London subway bombers had recently visited Pakistan and received training from al-Qaeda.

The new terrorist plot is extremely sophisticated, and obviously required a great deal of training.

Based on information that Scotland Yard has released so far, the plot would blow up 9 planes in three waves, as follows: The suicide bombers would carry explosive liquids in soda bottles on to planes traveling from England to America. Three aircraft would explode nearly simultaneously in midair, and the wreckage would fall into the ocean, where the source of the explosives could not be identified. Then, a few days later, when things have calmed down, they would launch a second attack, and then perhaps a third attack a few days later.

Such a sophisticated attack would have required a fair amount of training and coordination. As details of the investigation come out, it will be of interest to see where the would-be bombers received both ideological and terrorist training.

From the point of view of Generational Dynamics, this incident provides further opportunity to investigate the dynamics that lead to terrorist acts and to crisis war.

By studying the stories behind terrorist acts of the last few years, as well as historical acts such as the development of anti-Jewish attitudes in 1930s Germany, we're developing what I call the "Hero / Parent / Prophet" model.

In brief, it works as follows: There's a group of "Prophets" that teenagers listen to; these are usually (but not always) elders, and they might be government officials, religious clerics, or even media personalities (like Jon Stewart of Comedy Central's Daily Show). Each of these prophets presents a different political philosophy to teenagers. Groups of teens select from among these alternative Prophet political philosophies in the same way that they might select a rock star or fashion item. Rebellious groups select political philosophies that provide for action against society, and the most extreme of these rebellious groups select political philosophies that call for terrorist acts and suicide bombings. These rebellious teen groups become "Heroes" by altruistic suicide (killing themselves for the good of the greater community). Do their parents have any influence? Yes, but in an unexpected manner: In a formula described by Hannah Arendt, they become Heroes by adopting "the attitudes and convictions of the bourgeoisie, cleansed of hypocrisy."

The development of this "Hero / Parent / Prophet" model is ongoing, but unfortunately the only person in the world working on it is yours truly. Anyone who has done or would like to do research in this area is invited to contact me. (10-Aug-06) Permanent Link
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Will there REALLY be French troops separating Israeli and Hizbollah forces?

Stranger things have happened, but I'll believe this only when I see it.

Israel's continued destruction of Lebanon's buildings, bridges and highways, and the mounting civilian deaths, have horrified people around the world.

Tens of thousands of Shiites have pro-Hizbollah riots in Bagdad, Iraq (Source: CNN)

Jordan's King Abdullah says that the Arab world has been so polarized that even if Hizbollah is destroyed, another similar group would pop up immediately.

On the other side, a daily rainstorm of hundreds of Hizbollah missiles have terrified millions of anxious Israelis, and displaced then from their homes or forced them to live in bomb proof shelters for three weeks so far.

Increasingly furious Israelis have believe that their country is fighting or its existence, as Hizbollah's main arms supplier, Iranian president Mahmoud Ahmadinejad, attending a summit of Muslim nations in Malaysia, said, "The real cure for the conflict is the elimination of the Zionist regime."

Both sides are escalating. Hizbollah's missiles have increased in power and volume, and Israel's air strikes have destroyed more of Lebanon's infrastructure.

So what's the solution?

Actually, everyone agrees on the solution: Move thousands of international troops into a buffer zone separating Hizbollah and Israeli troops, and have those troops enforce a peace between the two sides.

And everyone agrees that this has to be a tougher force than the U.N. force that's been in place since 1978 -- those people are just "peacekeepers," but they're just sitting around now dodging missiles, since there's no peace to be kept. This time the international forces have to be more than peacekeepers: they have to be peacemakers.

Fortunately, everyone seems to agree that American troops shouldn't be part of the international force. Normally, the unctuous U.N. diplomats like to demand that America solve every world problem, so that they (the diplomats) can sit back and criticize everything America does.

But this time everyone agrees that isn't an option. America is already fully committed in Iraq, and American troops would be considered to be too "pro-Israel" to be suitable.

So what's really hilarious is that it's France, the country with the most unctuous diplomats of all, that's being cornered into leading the international troops, mainly because of the close relationship that the French have had with Lebanon in the past.

And the American diplomats -- U.N. representative John Bolton and Secretary of State Condi Rice -- have been really sticking it to the French by saying repeatedly that they expect to have a complete agreement within "days, not weeks."

Needless to say, the French are sweating, and are doing their best to squirm out of this. The argument is that you have to have a ceasefire before you can send the international troops in, which is the usual way of doing such things.

But the Israelis won't agree to this, because they claim that Hizbollah will use the ceasefire as an opportunity to be re-armed by Hizbollah.

Israelis have agreed to this type of compromise before, but they're less likely to do so now because they're in a generational crisis period, which means that they're much less willing to compromise and contain problems than they were before. This is supported by the fact that polls show that over 80% of Israelis fully support the IDF (Israeli Defense Forces) actions, and don't want any ceasefire.

In fact, from the point of view of Generational Dynamics, we're seeing a two enemies fighting two different wars with each other:

• Lebanon is in a generational awakening era, so Hizbollah is fighting a non-crisis war. Hizbollah has planned for this war for six years, and is fighting it very methodically but without a lot of energy. Hizbollah's Hassan Nasrallah is willing to agree to a ceasefire because he can methodically work it into Hizbollah's strategy.
• Israel is in a generational crisis era, so Israel is fighting a crisis war. Israel also planned for this war, but is fighting it very energetically and passionately, sending thousands of its soldiers into Lebanon to face Hizbollah. A ceasefire would be very frustrating for Israel, since it would break their energy.

The Israelis are claiming that they're systematically destroying Hizbollah, and pundits with knowledge of the Israeli strategy are saying that they'll be able to destroy enough of Hizbollah so they can agree to a ceasefire within a couple of weeks.

On the other hand, Hizbollah's Hassan Nasrallah is claiming that Israel has not affected Hizbollah's capability at all. To prove it, the number of missiles per day landing in northern Israel has doubled in the last couple of days.

So for the purpose of doing Generational Dynamics research, watching the Lebanon war is very instructive. We should know within a few weeks which was more successful: The passionate crisis war strategy, or the methodical non-crisis war strategy.

No matter how it turns out, I'll believe French troops will head to Lebanon when I see it. (5-Aug-06) Permanent Link
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While world watches Lebanon, Sri Lanka goes to war

Tamil Tiger rebels have engaged Sri Lanka government forces in heavy fighting for 9 days now, with dozens of casualties, mostly civilian.

Indian subcontinent, with the island of Sri Lanka off the southern tip of India.

The major feature of the current hostilities is that the Tamil rebels have closed a sluice gate that provides water to 50,000 people. The Sri Lanka army has advanced to take control of the sluice gate, leading to the recent fighting. There's supposedly a peace agreement, signed in 2002, but a rebel leader has declared it to be void. However, the Sri Lanka government says that the agreement is still in force.

From the point of view of Generational Dynamics research, I've discussed three wars on this web site that are crisis wars or near-crisis wars.

Crisis wars are the worst wars that a society can endure. These wars are so bad and so genocidal that, when they end, the survivors decide to do everything possible to prevent their children or grandchildren from ever having to go through such a horrible experience. About 55-60 years later, when the generation of people who survived that war all disappear (retire or die), all at once, leaving behind the increasingly confrontational and risk-seeking generations born after the war, a new crisis war begins.

Generally speaking, a civil war is almost always a crisis war. Depending on the society, there may be low-level violence in the society between crisis wars, sometimes taking the form of terrorism.

Sometimes, terrorism begins right after the end of a crisis war by factions that are unhappy with the settlement. Or it begins during the chaos of the awakening era and continues in the form of low-level violence for decades, sometimes turning into a non-crisis civil war.

Often there's an uneasy "peace" settlement during the unraveling era, because both sides (the terrorists and the government) realize that things are getting very serious, and neither side wants a full-blown crisis war. This sets up an equilibrium that both sides can live with until further generational changes disturb the equilibrium enough to trigger a new crisis war. So, all in all, you can have several decades of on and off low-level violence, finally bursting into full scale crisis war.

This pattern has been playing out in different places today, and with the upsurge of the Sri Lanka and Lebanon wars, we have an opportunity to study how crisis wars come about.

• Darfur war -- civil war in Sudan. The Darfur genocide is a crisis civil war between black non-Arab Muslims in Darfur, (western Sudan) and lighter-skinned Arab Muslim government forces in northern Sudan. The Arab Muslim Janjaweed militias, agents of the Sudan government, have been killing the men and raping the women in Darfur, forcing the displacement of millions of people.

  Related Articles Darfur Genocide Darfur war takes a major turn, as Sudan expels aid groups.: Oxfam, CARE, Save the Children, and numerous other aid groups... (11-Mar-2009) Chad and Sudan may be close to a declaration of war: The peace agreement signed in March seems to be falling apart.... (18-Jun-2008) Sudan's Darfur war expands as Khartoum comes under attack by rebels: What were they thinking? everyone's asking. But it DOES make sense.... (14-May-2008) Ban Ki Moon blames Darfur genocide on global warming: Damn! He's blaming the Darfur crisis civil war on America!!... (19-Jun-07) Senator Joe Biden wants to move troops from Iraq to Darfur civil war: Saying on Meet the Press that we should remove troops from Iraqi "civil war,"... (29-Apr-07) President Bush gives Sudan "one last chance" to end Darfur genocide: But is Steven Spielberg aiding the genocide?... (19-Apr-07) Women's groups protest rape as a weapon of war in Darfur: As the civil war in Darfur continues to grow more violent,... (11-Dec-06) UN: Darfur became much worse "while we were watching Lebanon and Israel": Amnesty International reports that Sudan's new military buildup is precursor to a "catastrophe"... (29-Aug-06) UN declares that Darfur war was "not genocide," in the most sickeningly cynical story of the year: If mass murders and rapes and forced relocation of millions of people isn't genocide, then what is?... (01-Feb-05) Today's slow-motion genocide in Darfur recalls the lightning quick genocide in Rwanda in 1994: Why do these things always seem to happen in Africa? Understanding Africa's geography explains why. (22-Aug-2004) Jesse Jackson calls for sending American troops to Darfur: You see how it works? Everyone has a war they like.... (27-Jul-04) Darfur saga like depraved game of musical chairs: As I've said before, I've gotten good at turning off my own feelings of horror... (19-Jul-04) Darfur genocide: The UN is completely irrelevant: It was just three months ago that Kofi Annan said "never again," referring to the 1994 Rwanda genocide.... (28-Jun-04) Sri Lanka 14-Mar-10 News - Sri Lanka Tamils reject homeland: A German college student validates Generational Dynamics... (14-Mar-2010) Jubilant Sri Lanka celebrates, as President reaches out to the Tamils: But President Rajapaksa will need to follow words with actions.... (20-May-2009) Tamil Tigers surrender, ending the Sri Lanka crisis civil war: "We have decided to silence our guns. Our only regrets are... (17-May-2009) Tens of thousands of Tamil civilians flee fighting, in last days of Sri Lanka war: A "human avalanche" of refugees threatens to overwhelm internment camps.... (22-Apr-2009) Sri Lanka army ready for final assault on Tamil Tiger rebels: 1000 Tigers are trapped in a "safe zone" with 100,000 Tamil civilians.... (16-Apr-2009) Sri Lanka crisis civil war nears climax, as army captures Mullaittivu: An explosive battle among 300,000 civilians is feared.... (28-Jan-2009) Gaza war heads toward cease-fire, while violence surges in Sri Lanka: Thousands of civilians' lives are at risk by army attacking terrorists responsible for suicide bombings.... (19-Jan-2009) In Gaza and Sri Lanka, war slides into genocide.: Both wars are getting increasingly meaner and nastier.... (6-Jan-2009) Sri Lanka crisis war appears close to a genocidal climax.: There are two crisis wars in the world today: Darfur and Sri Lanka.... (27-Dec-2008) Sri Lanka government declares all out war against Tamil Tiger rebels: Sri Lanka has said it is formally withdrawing from a 2002 ceasefire agreement... (4-Jan-08) While world watches Lebanon, Sri Lanka goes to war: Tamil Tiger rebels have engaged Sri Lanka government forces in heavy fighting... (3-Aug-06) Massacre of civilians in Sri Lanka leading the way to a crisis war: From the point of view of Generational Dynamics, the gratuitous murder of civilians in a war... (18-Jun-06) Violence leading to Sri Lanka war is increasing: Tamil Tiger rebels are being blamed for a mine attack on a bus, killing 60 people including children.... (16-Jun-06) Sri Lanka appears close to war: A naval attack by Tamil Tiger rebels and government retaliation by air may spiral into full-scale war.... (12-May-06)

  (At the suggestion of a web site reader, I've changed the characterization of the two sides from "white Muslim versus black Muslim." Because of centuries of intermarriage, the two sides have become physically similar.)

  The Darfur conflict began in the 1980s with recurrent low-level violent clashes between Arab militias and village self-defense groups. In April 2004 a peace agreement was signed, but by June it was clear that the peace agreement had failed and that the war was increasing in intensity.

  At that time there were big get-togethers of high-level officials from the U.N. and from various countries, making official pronouncements that the violence must stop. (This happened shortly after the 10-year commemoration of the 1994 Rwanda genocide. At the commemoration, U.N. Secretary General Kofi Annan promised "Never again." I wrote at the time that the U.N. is completely irrelevant to the Darfur genocide, and that it would not be stopped until it's run its course.)

  A new peace deal was signed in May of 2006 but, as I recently wrote, the fighting in Darfur only increased since the peace deal.

  The fighting in Darfur is still characterized by massive slaughter, rape and starvation. The United Nations has done nothing about it, not even officially designating a "genocide," since that would obligate the U.N. to try to stop it. The United States has been alone in designing the Darfur war a genocide.

  This is a typical example of how crisis wars run. Many such wars were part of World War II, and so you can realize why no parent would ever want his children to have to go through such a war. That's why the Silent Generation, the generation that grew up during WW II, and were the nation's leaders in the 1990s, did everything they could to compromise and contain problems. But today the Silents have mostly disappeared, and the risk-seeking Boomer generation, born after the war, is leading us to a new "clash of civilizations" world war.

  When I describe the Darfur war to Boomers or Generation-Xers, they automatically assume that it can't happen any more in the "civilized world." They attribute it to something about the tribal nature of Africa or the warlike nature of Muslims. They forget that a similar war happened in white, cosmopolitan Bosnia in the 1990s.

  (It's worth mentioning again that the Iraqi insurgency is no crisis civil war, and there is absolutely no chance whatsoever that it will become one, as I've written many, many times.)

  Five years ago, there were no crisis wars going on in the world. Today, the Darfur war is in progress, and the Mideast and Sri Lanka wars are approaching full crisis war fury.

• Sri Lanka civil war. This war is fought between two ancient races: The Sinhalese (Buddhist) and the Tamils (Hindu). WW II was a crisis war for India and for Ceylon, the former name of Sri Lanka. There was relative peace on the island until 1976, when the Tamils began demanding a separate Tamil state, and formed a separatist group called the Liberation Tigers of Tamil Eelam (LTTE), or just "Tamil Tigers."

  A non-crisis civil war began in 1983, and the low-level violence continued until a peace treaty was signed in 2002. In the last few months, the peace treaty has been unraveling, and in the last couple of weeks it appears closer to a full-scale crisis civil war.

• Mideast War - Lebanon, Palestine, Israel. The Lebanon war between Israel and Hizbollah is quite different from the Sri Lanka situation, as I recently described in my lengthy analysis of this war.

  The war between Israel and Lebanon is not headed for a crisis war, because the Lebanese are in a generational awakening period, not a generational crisis period. That's because only one generation has passed since the Lebanese civil war of the 1980s.

  This is a very good example of the difference between crisis and non-crisis wars.

  The Israelis are very aggressive and energetic -- sending thousands of troops into Lebanon, and bombing much of the Lebanese infrastructure. This illustrates the energy with which a crisis war is waged.

  Hizbollah is not fighting with anything remotely like the same level of energy. They've been planning for this war for six years, and they're prepared with 10-15000 missiles that they launch from their homes. You don't see Hizbollah terrorists pouring into Northern Israel to rape and kill Israelis, which is what they'd be doing if they were in a crisis era.

  Is a country more likely to win a war in a crisis period or in an awakening period? It can go either way. America lost the Vietnam war in the 1960s-70s -- that was an awakening era war for America and a crisis war for the Vietnamese.

  On the other hand, when Napoleon invaded Russia in 1812, it was a crisis war for the French, but a non-crisis war for the Russians. Napoleon's army charged into Russia, expecting to meet the Russian army. But the Russians simply retreated from Moscow, and let the French occupy it without opposition. The French army lost discipline and fell apart.

  These two examples illustrate some of the differences. Crisis wars are more emotional and genocidal, and fought with a great deal of energy; but non-crisis wars are fought more systematically and carefully. Depending on circumstances, either side might win.

  What I've been watching for in the Mideast is a change in attitude between the Israelis and the Palestinians. I was thinking of this last Sunday during a news report that rioting Palestinians were wrecking the United Nations building in Gaza. The United Nations building? If the Palestinians were developing crisis war fury, they would be wrecking the barrier that the Israelis erected to separate Israel from the Palestinians.

  So there's still a great deal of restraint being shown on all sides in the Mideast war. That's not to say that people aren't being killed; but it is to say that it's not anywhere near the Darfur war yet, or even anywhere near the Sri Lanka war. Keep your eye on the attitudes that Israelis and Palestinians have for one another; as attitudes continue to exhibit more and more fury, the region will slide into a crisis war.

Conflict risk level for next 6-12 months as of: 9-Feb-2006
W. Europe	1	Arab Israeli	3
Russia Caucasus	2	Kashmir	2
China	2	North Korea	2
Financial	3	Bird flu	3
Key: 1=Low risk 2=Med 3=High 4=Active

From the point of view of Generational Dynamics, what's happening today is that there's a "gathering storm" of increasing violence in the world. Darfur is already in a crisis war, and both Sri Lanka and the Mideast are headed in that direction, with 100% certainly.

This is to illustrate again the concept of "chaotic attractor," in the sense of Chaos Theory. Political events are random, but in a generational crisis period, political events are "attracted" to war. This has been lucidly illustrated in the Mideast, where hardly a day has gone by in the last 18 months where political events haven't measureably brought the region closer and closer to war. The same thing is happening in Sri Lanka. As I predicted in May, 2003, when the "Mideast Roadmap to Peace" came out, the disappearance of Yasser Arafat and Ariel Sharon from the scene has removed the last major generational inhibitions to full-scale war. (3-Aug-06) Permanent Link
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