Author Neil Howe On Americas Looming Civic Transformation

TITLE: Author Neil Howe on America’s Looming Civic Transformation | WSJ CHANNEL: WSJ Events DATE: 2026-05-29 ---TRANSCRIPT--- You have one of the most bold predictions of any guest here and it’s this. In the coming years the country will undergo a crisis that will fundamentally reset society. Tell us why you see this coming.

Well, that’s uh seeing it coming. Yeah, we we and our dates really haven’t changed very much. Bill and I wrote our first book Generations back in 1991. Mhm. Um and that’s back when the oldest Millennials were about 8 years old. That’s right. And of course among the things that you’re famous for is coining the term the Millennial generation. can blame me. [laughter] But getting back to the crisis. And and and then 1997 that was the fourth turning and then most recently and we always imagined this happening in the mid-2020s to the early 2030s. And the the idea was is that if you look at the long span of American history in particular but even increasingly countries around the world you notice that they have these enormous civic transformations born out of conflict that occur about once every long human life. We see that in American history. We had a a period of enormous riot and rebellion associated with the glorious revolution in the late 17th century about a lifetime later we had the American Revolution. A lifetime later we had the Civil War. A lifetime later the Great Depression, New Deal and World War II. And a lifetime later here we are, right? This is driven by generational change. Some generations are really good at creating order and institutional stability out of chaos. Other generations are pretty good at running it down. [laughter] And we’re in the running down phase right now, right? And you can see now increasingly we talk about transformational leaders. We talk about leaders of creative destruction. And the increasing tendency around the world, because around the world we’re dealing with leaders who are you know, senior leaders who are born after World War II. I mean, if you look at Narendra Modi and and Xi Jinping, and you look at all these leaders who were born after World War II, they all tend to be autocratic, ethnocentric autocrats. And they are leading their societies into what I think is conflict. I mean, a grievance-based conflict against, you know, an oppressive world order that that is you know, that they need to resist. But we see this again and again historically. And by the way, I would just because we’re on this theme about broad patterns, roughly halfway in between these civic transformations, when we reorganize what America is constitutionally, politically, our infrastructure, and what we are as a national community, about halfway in between these, we have our great awakenings. It’s when we don’t we don’t so much refashion the external world, we refashion the internal world. Our values, our language, our religion. And many historians, many social historians call the period of the late ’60s and ’70s America’s fourth or fifth great awakening. Because we number the awakenings. That’s the convenient thing in American history. You know, that first great awakening, second great. But it it depending on when you you want to start your first awakening with John Winthrop back in the 1630s, or with Jonathan Edwards back in the late 1730s, uh that pattern also follows. So, this was a time at which, you know, my generation, young, was uh tearing down institutions, uh uh society apart, regrowing individualism in America, getting rid of the middle class. Uh Boomers hated the middle class. Um you know, the all all those pink boxes all made out of ticky-tacky, they all look just the same. I talked to Millennials today and they say, “All these little houses, you know, all pink and you say they sound wonderful. Where do we get them?” You know, and and they they’re unavailable. Boomers got rid of them and we got rid of them in the process of creating a much more unequal society because Boomers think that different strokes for different folks. Everyone should just sort of go their own way. Boomers were uninterested in society as an integral community unit. And it’s the rediscovery of community which is the fundamental function of the conflict. And then let me get this last point and then you can go on. I know you have a next question. I have so many questions. Okay, but the last point is is that all sociologists agree. Since sociology ever started back in the late 19th century with with Durkheim and Weber and Tönnies and all these particularly Germans right, they all agreed that community grows out of conflict. Us versus them. And we found that again and again American history. People look back and they see, “Gee, the late 1940s and 1950s when we had such a sense of community, everyone trusted the system, everyone left their doors open.” Well, you think that had something to do with the fact that they came after a decade and a half of incredible conflict around the world. And and that’s I think that’s a great point to turn to what happens next because as you’ve as you’ve written in your in your in your two books on the fourth turning, the period we’re in now is setting the stage for this upheaval. So, what do you predict? You’ve talked about the time frame. At some point this major upheaval you predict is going to come either this decade or maybe early in the 20th early to mid in the 2030s. What’s it going to be? Like what is the thing? Is it conflict? Is it Well, typically disruption of Yeah, typically it’s one of three things, but it’s usually more than one all on top of each other, right? It’s great power war historically. Uh it’s political collapse, that is to say civil war. We’ve We’ve had both great power war and civil war in our history. I should say. Um and it’s um uh market market uh crash, right? Financial crash. A financial market Yes. Financial market crash, which is very often triggered by those other two, but of course it can happen on its own as certainly uh it did in 1929. Uh that was, you know, that that was from peak to trough, that was nearly 90% decline. I could say it’s That’s a market crash. So Now, that can occur autonomously. That can simply occur simply because the market is extremely overvalued. And uh it’s a it’s a, you know, chaotic system, so something disturbs it and it overshoots on the way down, right? Um that often has happened historically due to tech innovations. The big tech innovation in the 1920s, well, there were several, but the big one probably uh was radio. Mhm. Uh if you would invested in RCA you would have done very, very well in the 1920s, but you would have lost a 99% of that value between 1920 and 1910

And you wouldn’t have gotten that value back if you had held RCA until 1986. You would have just gotten the value back without inflation when it was finally sold, I think to GE. Most of the radio uh firms completely went under. And we see that pattern again and again historically, too, right? These are huge investment surges, market booms. It does transform our economy. It does transform our society, but not without this huge, you know, boom and bust in the market. It could happen autonomously. And in America, it’s never been tied A market crash has never really been tied to um uh war. Uh partly because uh every time our big wars break out, the Civil War and the World War II, uh markets were undervalued. Markets were undervalued uh in in 1940 and 1941. Uh although I will say the the big market crash that did happen in in World War II occurred in May and June of 1940, when the S&P went down by about 35% and then it went down by about another 15% with Pearl Harbor. Well, that that’s pretty big, right? Those two together. But it wasn’t catastrophic because market values were already depressed by the Depression. You know what I mean? It We had already had our collapse, right?

You’re talking about tech, though. I think the question on everybody’s mind, cuz for those of us who’ve been at the session since yesterday, there’s a lot of conversation about the disruption of AI. So, I think the question is is AI going to be the cause of the crisis? No. Why? Well, because as I say, the the the big drivers of crisis are political collapse and and great power war. Which which I think a lot another thing on folks’ minds is, you know, we we’re in uh very unusual political times. A very um uh bold president that we have uh with a disruptive agenda. Bold. [laughter] I like that word. Good. I like that. Okay. You’re definitely a journalist. [laughter] So, is the Trump presidency going to be what causes the crisis? Well, a Trump presidency is going to be a a a necessary but not sufficient condition. Is Is that a good answer to the question? [laughter] Tell me more. Uh well, meaning that other things will happen on top of it. I mean, it will be other nations, too, that want to push the envelope, right, on getting what they want. You have a world now in which you have um a number of countries uh they’re dictatorships, and they all believe that the world isn’t giving them anything close to their due. And that is a setup for a crisis. We had that in the 1930s, obviously, right? When much of Europe turned fascist. And you had all these countries that believed they were owed so much more than they had, right? The sense of grievance. And we certainly see that in great powers around the world today, you know, we we I mean, you know, you look at Iran. I mean, they want to be back to where they were. Persia was always a great empire. What happened to Persia? You know what I mean? And you you go back, and it’s everywhere around the world, right? Even countries that probably won’t matter very much. You know, that Turkey wants to be, you know, the neo-Ottomanism. They want to be like the Ottomans. Uh Hungary wants to be back with a greater Hungary. Israel wants to be greater Israel. You have it around the world today. You look at India and Narendra Modi, there’s a Hindutva. You know, what could what could Buddhism be, you know, this muscular and and glorious and Everywhere around the around the world you see this. This is part of the identity politics grown large, right? We all just think we’re so great. Why don’t we have more? And and you look at that, you know, you know, make America great again. But you You around the world, and it’s every country wants to be great again. I mean if if you don’t think this is a setup for conflict, I’m not sure what is. Let’s talk about timing, too. What is your best guess at this point for when this crisis will unfold? I have no idea. I mean I have no idea particularly, but I I do think that that the late 2020s and and immediately beginning the 2030s is is a good I mean, you know, we have Davidson window that’s closing, right? This is Admiral Davidson. He was the he was the head of Indopac.com, you know, Indo-Pacific Command back in

And he was the one who first announced that Xi Jinping wanted to be ready for the invasion of Taiwan by 2027. Hey, 2027 it’s coming right up, by the way.

Right around the corner. [gasps] But I mean this is the closing of the Davidson window. That’s what it was called in the military, right? And so everyone in Indo Indopac.com and these these these exercises that they have around Taiwan are becoming bigger and bigger and bigger. And now the commanders of Indopac are basically saying, we can’t differentiate anymore between an actual invasion and these because these exercises now involve, you know, a thousand ships and you know, a tremendous number of aircraft. So I’m just saying, look, I mean now 2027 China should be able to invade. Well, that doesn’t mean that necessarily invade at that time, right? And I’m sure they’re going to look at you know, the the right time. But I have no doubt that Xi Jinping regards that as absolutely essential to what he wants to do while he’s still president. And he he probably has one more term. Um I think what will be decisive for him will be any sign that the United States is more effectively tending to its national security needs. I think that will be a sign for him to go faster. Right now if it looks like America’s I don’t getting rid of all their missile inventory in the Middle East, that may be a good sign to hold off. You know, there’s the old saying never never disturb your opponent when he’s busy, you know, injuring himself. [laughter] Um But the point is is that is that he he’s patient, right? And and I and I’m sure Putin is patient, you know, with regard to Europe. But you look at the Eastern European countries, they’re terrified. I I’ve for the new book I’m writing I’ve been looking at some of the opinion polls now in Poland and it’s like half the polls say that, you know, they’re they’re afraid of war and another 30% said they’re really afraid of war. You know, it’s that kind of thing and they’re they’re right there, right? And they’re spending like crazy on their defense. I mean, they’re putting in these berms, they’re putting in land mines. I mean, they And if you’re a Pole, you have long memories, right? Unlike Americans, we’ve never been occupied, invaded, right? In our entire history. And except for except for the South after the World War, we have no idea what any of this means. I want to personalize this a little bit for folks because I think one of the more interesting things about your research is that you found that when these histories when history unfolds like this, it’s driven by these recurring generational archetypes. So each generation, of course, is really influenced by the part of the cycle, the historical cycle, they grew up in. So for instance, I’m a I’m a Gen Xer, I’m a late Gen Xer. Um how did the events of my upbringing influence the role that I’ll play when the next crisis happens? Well, Gen Xers, they were you know, throwaway kids, right? No one really cared about you. [laughter] And we’re tougher for it. And you’re tougher for it. So, you say every Um, do we have How many Gen Xers do we have out there? Okay, thank you. How many How many baby boomers do we have out there? Okay. Oh, come on. Neil’s a baby boomer. What about millennials? We’ve got a good cohort of millennials. Do we have any Gen Z out there? All right, good. Okay, so Gen X we’re throwaways. What about the baby boomers? So, let’s talk about Gen X a little Let’s talk about Gen X. And give them some attention. Because God knows they’ve never had much attention. [laughter] Here’s another thing that’s interesting about Gen X, by the way. Um, when we coined the millennial generation, that was in 1991. Mhm. That was a year before Doug Coupland’s book came out called Gen X. So, here’s the ultimate problem. If If all you Gen Xers out there don’t feel abused enough already, just consider this. The generation after you was named before you were. [laughter] I mean Yeah, enough said. You don’t have to say anything else. Um But what what will we do in the reset? Cuz we have a specific role we’ll play. Well, you know, you talk about Gen Xers and what define them, you know, everything from survivor shows, reality shows, all this stuff. And you look at We now have a cabinet of Gen Xers, right? I mean, Trump’s cabinet. And they’re all tweeting each other like, you know, you know, Europe is pathetic, you know. And it’s all in capital letters, you know. This is Gen X now running our country. And And we should have seen it coming because we already knew what they what they were like in the 1990s. Now they’re just aged into power. And they’re they’re all into, you know They’re They’re all into, um, telling it brutally like it is. You look at Pete Hegseth, you know, he’s all about lethality. Let’s call it the Department of War. Well, tell it like it is. You know what I mean? Don’t don’t sugarcoat it. What about the role that the millennials will play? Well, millennials, it’s it’s their role to bring back community. And I think on the other side of the crisis, that will be their responsibility. In fact, coming together as a community um will be what they need to do to get us through this. You saw the same generational lineup, by the way, in the Great Depression World War II. Who was the midlife generation, the hard knocks generation that sort of led the troops in World War II? The the George Pattons, the Omar Bradleys, they were all part of the lost generation, which was also a throwaway generation, right? It was back when kids were run over by streetcars. No one really cared. Um we had a huge wave of child protective legislation that came in right around 1910. And we had this huge wave of construction of schools in America, particularly high schools. That was all for the new GI generation. They were just too young to serve in World War I. The the lost generation, they were the World War I type, you know, the Hemingway, Fitzgerald, right? Those came after. They were much more idealistic. They believed much more in community. They voted overwhelmingly for the Democratic Party in in um you know, after the crash. Um they were the first generation of African-Americans to vote for the Democratic Party, no longer for the Republican, obviously. African-Americans always voted for the Republican president party of Lincoln, after all, right? So, this was a huge shift. And it was very much the generation that represented the CIO, the the you know, Congress of Industrial Industrial Organization, that the new wave of of unionization, the GI Bill, the increasing community orientation of the New Deal that came out of World War II that rewarded that generation. I mean, it gave them subsidized housing, it gave them uh uh uh subsidies to go to college, to go to vocational school. Um it was going to be a very different environment, right? They were the generation that took us through the crisis that we succeeded, we got out of there very successfully, and they were the generation that was rewarded. No one really rewarded the Lost Generation. As I remember it, you know, Truman left the White House, and he didn’t even have a pension back then. He rode his old jalopy back to Missouri. He was really worried about his future. Um and back then, you know, the ex-presidents didn’t like lend their names to uh you know, meme coins and stuff. It’s a very different era. I want to talk a little bit more about the future because, you know, in reading your work, it does seem like there’s a reason for optimism for the future as much as um there’s some dire aspects to the what could happen in the next couple of years. How will the country be better off after this turning? Community. Community. That’s number one. Uh much less inequality. Inequality always goes down after a fourth turning. That’s one of the cardinal traits. And by the way, in our last fourth turning, the late 1940s-1950s, he saw an enormous reduction in the Gini coefficient in America. I mean, it started going down in the 1930s a little bit. Rich people were getting wiped out. It went down much more during World War II, largely due to inflation, which wiped out all the bond holders, right? Um and then we had a much stronger middle class. It actually didn’t reach its nadir until the late 1960s when boomers are coming of age. Uh so when boomers are coming of age, it was maximum equality in America. That’s when the middle class was huge. I think I mentioned at the beginning of this that boomers hated the middle class because it was so strong. It was all pleasant valley Sunday, you know, charcoal burning everywhere. I mean, this is the kind of thing the lyrics that boomers remember. So they they wanted to steer the country in a different direction and they succeeded, right? So that is going to change. I think authority will change. People will actually follow authority. They always do after a great crisis. Yeah. And you remember in the 19 late 40s and 50s, I mean, amazingly, everyone wanted to do what the doctor in the white coat told them to do, you know? Um So so that will come back as well as a new focus on the long term. I think the other thing that character If you look after the Civil War, during and just after the Civil War, we made these huge long-term investments, you know, we built things like the Brooklyn Bridge and the Transcontinental Railroad and all that. And we made these these enormous investments in waterworks and and various, you know, long-term investments. You find the same thing after World War II where we were so engaged with enormous long-term infrastructure. We’re going to do the same thing. I would say today we are a very present focused. Uh you know, what? Obviously. I mean, you know, look at look at the deficit. Look at Look at America’s net indebtedness to foreigners. It’s about 100% of GDP, you know, either our federal debt or our indebtedness to foreigners and we’re running up the tab really fast right now. And the point is this completely unsustainable. Most Americans hate it. They don’t understand why our political system can’t give us anything better. Uh but that changes. Right Right now, the reason no one’s doing anything better, I’ll tell you why. It’s because right now, the only thing that matters is winning for the two political tribes. And you can see in our two political tribes how we’re learn relearning community. This is where we’re learning community. Red zone, blue zone. And I better get to the voting booth. We have the highest voter participation rates in America today than we’ve had in 100 years. Well, in a lot of ways, that’s a good thing. It’s a good thing, and it shows we’ve become more tribal. I If I don’t vote, there’s not going to be an America anymore because the other side’s going to win. That’s how everyone feels. We’re already in that community conflict mode that I talked about. Right now, domestically in America. I mean, look at this this gerrymander fight. Pretty soon, if this goes on for a couple of years, and we’ve seen this recent you know, the Voting Rights Act was eliminated, right? We see what that’s going to do in the South. We’re going to have almost no We’re going to have no Democrats from the South. We’re going to have no Republicans from the Northeast or the West Coast. So, Congress has become even more regional than the country as a whole. And the country as a whole is self-sorting into red and blue camps. Certainly is. I know people have questions, so I want to take a minute to go to the audience for their questions. Right there. With all the doomsday scenarios that you just laid out for us, thank you. What’s in What’s in your portfolio? Like, where are you investing? They’re not doomsday. We just heard that all the ways in which this country’s going to get better on the other side. By the way, and I’ll get to the portfolio in just a second, but but I do want to say when we came out with the the the fourth turning in 1997 and it was kind of you know late in the Clinton era. We were coming out of the Asian flu and things are looking better, right? And everyone said, “Oh, it’s such a doom and gloom book. We got to have all this huge crisis out there.” This recent book I did the fourth turning is here which came out in 19 in 2023 at the opposite reaction for readers. You actually think there’s something good on the other side. What makes you so rosy? You know, what why are you so optimistic? And I think that’s important because when you think of fourth turning, what I’m talking about is being gloomy. Let me ask you all this. What can be as gloomy as an indefinite continuation of the trends you see today in American society? People growing ever more hopeless, the division between haves and have-nots becoming ever greater, people thinking increasingly that America is just a name. It doesn’t exist as a national community. What could be more gloom I mean that is the ultimate gloom. Just take current trends put them on extension indefinitely and this is why cyclical dynamics in history are actually a good thing, right? So tell us about the portfolio. Uh you know, look uh part of it is that uh we expect the next 10 years to obviously be very different from the last 40. And that already distinguishes us from probably 98% of other ETFs that are out there, right? Uh but obviously we we tend to be uh at least in the long equity part of our portfolio, we’re long in the kinds of things that that that people are avoiding right now. This is infrastructure, industrials, defense, so national security, personal security. All of those themes are big. Energy, obviously, that’s good doing they have right now. Um and and I’d say the other aspect of it is because for turnings always climax with inflation. Every case that’s occurred. And here’s the thing to remember about inflation. When when your country is in danger and you need to move resources really fast because of present danger, inflation is not a problem, it’s a solution. And I think we have to remember historically, we’ve had huge inflation every one of these crises in the past. And that’s partly how we finance things. And it’s partly how you take from the people who have and give to the new You’re right. You got industries to finance, you got soldiers to pay for whatever’s happening, you need to get them resources now. Well, you just inflate and last time I looked, most government bonds were not indexed. Boom. That’s a solution. You see what I mean? So, we are not long in bonds. Certainly not index bonds. So, we we generally tend to be short in bonds and what in our portfolio takes the place of the 60/40, you know, equity bond mix is commodities and commodity futures. And since we started the fund around Thanksgiving, that’s also done very well. So, you know, that’s and and and we do think that’s a great long-term positioning. I would say in addition, we also have some uh uh uh you know, through derivatives, we do some some tail edge tail edging on the downside, you know, in case when you wake up one of these days, the market’s down by 10%. Uh we tend to be a little bit protected that way. Most funds aren’t. I don’t know if that’s a quick overview. It is. And I unfortunately ran out of time for more questions. Um but I’ll I’ll I’ll end it on this. What other reason, you know, in a nutshell, what other reason do you see to be optimistic about the future in America? Uh you know, I’m I’m incredibly optimistic in America. I just think here’s the thing that everyone looks around and they say, you know, these these autocrats do so well. You know, these autocrats have long-term future. These autocrat Whatever they want, they can do. You know what I mean? And democracy, we seem so helpless. We seem so befuddled and so on. But, I’ll tell you that in a crisis, I would rather be in a democracy like America than any other country. Uh democracies excel in crisis. Why? Because an autocrat has to look at two things. They have to look at their enemy. They have to look at their own people at the same time. And they’re not sure which to be more afraid of, right? A democracy, everyone is on the same page. And they rise to the occasion. And this is what I meant You could look at so many examples through history. But, a good example would be in World War II. Interestingly, Germany and and and many of the Axis powers, Germany is a great example, didn’t go into wartime mobilization when it came to production until the fall of 1943. And the war was practically over by then. It was too late. Why? Because Hitler didn’t dare ramp up production too much because he was afraid of what the German people might think. In Britain, they went on 24/7 production of you know, the the the Spitfires and the Hurricanes at the beginning of 1940. And they never stopped. In other words, they were totally on board because they were a democracy. We forget that democracies have hidden powers. And they they excel in a crisis.