I am hearing the same comment a lot lately:
“America is divided”
It’s a strange thing for me to hear because if you study the history of America we’ve pretty much never been united. Yeah, we call it the UNITED States of America and there have certainly been moments of turmoil where we banded together uniquely and kicked the shit out of foreign threats. But aside from a few unique moments our history is mostly one of disunity.
America was founded by people who embraced disunity. They left the United Kingdom to form their own small nation states. These nation states were extremely skeptical of unity. They deeply wanted to maintain their disunity. They even banded together briefly to defend this disunity against an attempt at reunion by the United Kingdom. Then, when they successfully defended this disunity they created a Constitutional Republic which explicitly defended the country from too much unity. Then they banded together several more times to fight Native Americans, Mexicans, French and anyone else who encroached on their potential disunity (or, more appropriately, the new nation states that were formed in the name of disunity). They even turned on eachother for a brief Civil War to fight for state rights and disunity. Disunity is the story of America.
Conflict, competition and disunity are at the heart of the formation of the United States. This is a country that has always been divided. It has thrived because it is divided. But the world of old is not the world of new. And the new world is one where disunity is speeding down a one way track headed for a conflict with unity. At a macro level there is no avoiding some degree of unity. The world’s population is growing, technology is making the world a smaller place and hyperglobalization is the natural result of these two enormous trends. No person is an island in this world because that island is connected by boats, planes, sound waves, radio waves, internet connections, common borders, etc. And make no mistake, that trend is headed in one direction because the world’s population is only getting bigger and new technologies will continue to make this world a very, very small place.
Our political division is nothing new. We’ve been MUCH more divided than we are today. And I am certain that America will thrive despite the current political division. In fact, we will probably thrive because of it. But America is confronted with a much more difficult reality – in a world of hyperglobalization it is irrational to assume that disunity can be maintained in its current or previous form. There are just too many macro forces pushing against it. This is the problem of our time. It will shape the political and economic trends that we see for my entire lifetime and beyond. And these trends will only become exacerbated over time.
Mr. Roche is the Founder and Chief Investment Officer of Discipline Funds.Discipline Funds is a low fee financial advisory firm with a focus on helping people be more disciplined with their finances.
He is also the author of Pragmatic Capitalism: What Every Investor Needs to Understand About Money and Finance, Understanding the Modern Monetary System and Understanding Modern Portfolio Construction.