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It is also vital to consider not the difference between 1990 and 2011, but the difference between the 1950s and 1960s and the 21st century. This is where the difference in the meaning of middle class becomes most apparent.

In the 1950s and 1960s, the median income allowed you to live with a single earner -- normally the husband, with the wife typically working as homemaker -- and roughly three children. It permitted the purchase of modest tract housing, one late model car and an older one. It allowed a driving vacation somewhere and, with care, some savings as well. I know this because my family was lower-middle class, and this is how we lived, and I know many others in my generation who had the same background. It was not an easy life and many luxuries were denied us, but it wasn't a bad life at all.

Someone earning the median income today might just pull this off, but it wouldn't be easy. Assuming that he did not have college loans to pay off but did have two car loans to pay totaling $700 a month, and that he could buy food, clothing and cover his utilities for $1,200 a month, he would have $1,400 a month for mortgage, real estate taxes and insurance, plus some funds for fixing the air conditioner and dishwasher.

At a 5 percent mortgage rate, that would allow him to buy a house in the $200,000 range. He would get a refund back on his taxes from deductions but that would go to pay credit card bills he had from Christmas presents and emergencies. It could be done, but not easily and with great difficulty in major metropolitan areas. And if his employer didn't cover health insurance, that $4,000-5,000 for three or four people would severely limit his expenses. And of course, he would have to have $20,000-40,000 for a down payment and closing costs on his home. There would be little else left over for a week at the seashore with the kids.

I should pause and mention that this was one of the fundamental causes of the 2007-2008 subprime lending crisis. People below the median took out loans with deferred interest with the expectation that their incomes would continue the rise that was traditional since World War II.

American history was always filled with the assumption that upward mobility was possible. The Midwest and West opened land that could be exploited, and the massive industrialization in the late 19th and early 20th centuries opened opportunities. There was a systemic expectation of upward mobility built into American culture and reality.

The Great Depression was a shock to the system, and it wasn't solved by the New Deal, nor even by World War II alone. The next drive for upward mobility came from post-war programs for veterans, of whom there were more than 10 million. These programs were instrumental in creating post-industrial America, by creating a class of suburban professionals. There were three programs that were critical:

The GI Bill, which allowed veterans to go to college after the war, becoming professionals frequently several notches above their parents.

The part of the GI Bill that provided federally guaranteed mortgages to veterans, allowing low and no down payment mortgages and low interest rates to graduates of publicly funded universities.

The federally funded Interstate Highway System, which made access to land close to but outside of cities easier, enabling both the dispersal of populations on inexpensive land (which made single-family houses possible) and, later, the dispersal of business to the suburbs.

there was consensus around the moral propriety of the programs.

the rise of the double-income family corresponded with the decline of the middle class.

But there was, I think, the crisis of the modern corporation.

Over the course of time, the culture of the corporation diverged from the realities, as corporate productivity lagged behind costs and the corporations became more and more dysfunctional and ultimately unsupportable.

In addition, the corporations ceased focusing on doing one thing well and instead became conglomerates, with a management frequently unable to keep up with the complexity of multiple lines of business.

Everything was being reinvented. Huge amounts of money, managed by people whose specialty was re-engineering companies, were deployed. The choice was between total failure and radical change. From the point of view of the individual worker, this frequently meant the same thing: unemployment.

This is where the disjuncture occurred. From the point of view of the investor, they had saved the corporation from total meltdown by redesigning it. From the point of view of the workers, some retained the jobs that they would have lost, while others lost the jobs they would have lost anyway. But the important thing is not the subjective bitterness of those who lost their jobs, but something more complex.

As the permanent corporate jobs declined, more people were starting over. Some of them were starting over every few years as the agile corporation grew more efficient and needed fewer employees. That meant that if they got new jobs it would not be at the munificent corporate pay rate but at near entry-level rates in the small companies that were now the growth engine.

As these companies failed, were bought or shifted direction, they would lose their jobs and start over again. Wages didn't rise for them and for long periods they might be unemployed, never to get a job again in their now obsolete fields, and certainly not working at a company for the next 20 years.

American society on the whole was never egalitarian. It always accepted that there would be substantial differences in wages and wealth. Indeed, progress was in some ways driven by a desire to emulate the wealthy. There was also the expectation that while others received far more, the entire wealth structure would rise in tandem. It was also understood that, because of skill or luck, others would lose.

What we are facing now is a structural shift, in which the middle class' center, not because of laziness or stupidity, is shifting downward in terms of standard of living. It is a structural shift that is rooted in social change (the breakdown of the conventional family) and economic change (the decline of traditional corporations and the creation of corporate agility that places individual workers at a massive disadvantage).

The inherent crisis rests in an increasingly efficient economy and a population that can't consume what is produced because it can't afford the products. This has happened numerous times in history, but the United States, excepting the Great Depression, was the counterexample.

In political debates, someone must be blamed. In reality, these processes are beyond even the government's ability to control. On one hand, the traditional corporation was beneficial to the workers until it collapsed under the burden of its costs. On the other hand, the efficiencies created threaten to undermine consumption by weakening the effective demand among half of society.

The United States was built on the assumption that a rising tide lifts all ships. That has not been the case for the past generation, and there is no indication that this socio-economic reality will change any time soon.

If we move to a system where half of the country is either stagnant or losing ground while the other half is surging, the social fabric of the United States is at risk, and with it the massive global power the United States has accumulated.

The left would argue that the solution is for laws to transfer wealth from the rich to the middle class. That would increase consumption but, depending on the scope, would threaten the amount of capital available to investment by the transfer itself and by eliminating incentives to invest. You can't invest what you don't have, and you won't accept the risk of investment if the payoff is transferred away from you.

The right will argue that allowing the free market to function will fix the problem.

In other words, it may give more efficiency on the whole and grow the economy as a whole, but by itself it doesn't guarantee how wealth is distributed.

The GI Bill was designed to limit unemployment among returning serviceman; it inadvertently created a professional class of college graduates.

The VA loan was designed to stimulate the construction industry; it created the basis for suburban home ownership.

The Interstate Highway System was meant to move troops rapidly in the event of war; it created a new pattern of land use that was suburbia.

The United States has been a fortunate country, with solutions frequently emerging in unexpected ways.

It would seem to me that unless the United States gets lucky again, its global dominance is in jeopardy. Considering its history, the United States can expect to get lucky again, but it usually gets lucky when it is frightened.

And at this point it isn't frightened but angry, believing that if only its own solutions were employed, this problem and all others would go away.

Dozens of states have been considering legislation that would make it illegal to discriminate against the long-term unemployed. Some proposals would even allow unsuccessful applicants to sue under the same discrimination laws that apply to race or gender bias.

The Obama administration, for its part, has proposed a few other ideas, including training programs and tax credits for businesses that hire the long-term unemployed. (The latter were even included in the American Jobs Act that Republicans blocked in Congress.)

With those caveats, I do consider waxing unemployment precipitated in part by automation an extremely likely near-term future scenario.

In rough strokes, the story of machines displacing and immiserating skilled workers reiterates the very genesis of capitalist modernity.

In contrast with the Neo-Luddites of today, the nineteenth-century Luddites expressed no desire to terminate civilization but instead fiercely defended their economic interests against capitalist competition that would reduce them dependent wage labor.

Despite the lack of even basic computers – much less artificial intelligence – some radicals in the nineteenth century already proposed that necessary labor could be reduced to a few hours per day.

The later Technocracy movement made automation the core of their analysis, argued it would cause mass unemployment, and promoted a society of equally distributed abundance managed by technical experts.

As concise distillation of the desires described above, the following passage for Oscar Wilde's “The Soul of Man under Socialism” poetically proclaims a techno-utopian position years before the dawn of twentieth century

Even manufacturing still requires vast human labor at the moment. Living and working conditions for many twenty-first-century factory workers aren't meaningfully better than over a hundred years ago. State-socialist attempts at rationally planned industrial development have had dubious material benefits while inflicting intense environmental damage and human suffering.

Our current circumstances suggest automation of at least basic physical tasks will keep advancing; lights-out factories already exist. The prospect of robots replacing humans at the majority of present-day jobs appears genuinely plausible if far from certain.

I favor the latter.

Social relations would become profoundly altered if – consistent with Wilde's utopian vision – each individual had independent access to basic necessities and comforts without having to toil.

When it comes to post-scarcity, the differences between libertarians and anarchists like myself blur.

Barring nanotech genies who grant unlimited wishes, I assess community control of the means of production as my desired arrangement. With proper political mobilization, robotization may allow for prosperous self-sufficient or largely self-sufficient communities.

Although the life of any single worker means little or nothing to them, they cannot annihilate the working class without doing the same to their own privilege. Robots change this. Human obsolescence could spell doom for the masses. If structural dynamics drive behavior, a powerful enough group of elites might simply liquidate the unruly hordes of no-longer-need labors.

I want to give automated utopia an honest try, but I also desire fertile landbases for my primitivist comrades. As personally enamored as I am with the transhumanist path, I encourage and endeavor to practice a revolutionary pluralism that respects meaningful diversity.

By taking advantage of new decentralized technologies and living as cheaply as possible, people might be able to increasingly just opt out of capitalism and consumerism entirely.

All resources become the common heritage of all of the inhabitants, not just a select few.” This arrangement is made possible by aggressive use of advanced technologies to create an abundance of resources and thereby negate the need for any sort of rationing.

put money directly in people’s hands so they can spend it and keep the market economy going. The main difference is that instead of making the income unconditional, Ford advocates doling out money according to an incentive scheme that encourages behavior society desires.

if we can find a way to directly upgrade human minds—such as through the use of brain-computer interfaces—then workers would be able to keep pace with technological change and readily adapt to new jobs and industries as quickly as they crop up.

they push for a series of common sense policy fixes, such as fixing education to better prepare people for STEM fields or reforming the patent system to mitigate drags on innovation.

Therefore we should try to accelerate technological progress by whatever means necessary so that we can make the painful transition as short as possible—much like tearing off a bandaid.

Yes, there will be less jobs available, and certainly people’s incomes will suffer, but technology will simultaneously bring down the cost of living at a fast enough rate that people will survive just fine without the need for government invention or economic restructuring.

Once AGI arrives we will have much bigger issues to contend with, such as will the human race survive being displaced as the most intelligent beings on planet Earth?

The French government understood that the only way to achieve lasting and sustainable economic growth in France was by ensuring a stable peace with Germany.

Its immediate goal was to create a customs union, which would eliminate trade restrictions between member states and establish a common external tariff for trade with the rest of the world.

It would also seek the consolidation of a common market, to allow the free movement of people, goods, capital and services.

Finally, it would seek the progressive coordination of social and fiscal policies among its members.

The rationale behind the European Communities was that if countries gave up sovereignty in specific areas, over time a greater amount of national prerogatives would be transferred to the supranational institutions.

In other words, the process of European integration would progressively weaken the nation-state and its strategic interests.

However, the remarkable growth of the European project did not bring about the abolishment of the nation-state that many analysts predicted.

EU institutions tend to generate their own agendas, which often go against the national strategies of some member states. As a result, the clash between national and supranational interests is often unavoidable.

This friction did not begin with the current economic crisis. In 1965, the French government withdrew its representation in the European Commission in protest of a plan that would give more power to Brussels in the management of the Common Agricultural Policy. To resolve the crisis, the Europeans reached an agreement under which a de facto veto power was given to member states on issues that were considered crucial to national interests. This agreement (commonly known as the Luxembourg Compromise) was designed to protect the intergovernmental nature of the European Communities and virtually froze the process of supranational integration in the 1970s and 1980s, until the Single European Act in 1986 introduced new mechanisms for qualified majority voting.

On top of the traditional tensions between national governments and supranational institutions, in times of crisis member states also tend to distrust each other.

Governments must find a balance between their foreign policy objectives, pressure from the European Union and their desire to be re-elected -- which means decisions that may make sense for the future of the European Union (such as fiscal consolidation efforts) would probably not be made if governments consider them too unpopular among voters.

Other institutions, such as constitutional courts, often threaten to block decisions accepted by national parliaments. The recent investigation by the German constitutional court on the validity of the European Stability Mechanism and the decision by the Portuguese constitutional court to block some austerity measures promoted by Brussels and implemented by Lisbon are examples of this situation.

The deep unemployment crisis in the eurozone adds yet another complication to this problem. The European elites are still largely pro-European, and most of the voters in the eurozone want to keep the euro. But with the European Union's promise of economic prosperity weakening, its members have begun to rethink their strategies. Fidelity for the European project is not unbreakable. Nor is it strong enough to support an indefinite period of extremely high unemployment.

Non-eurozone countries in Central and Eastern Europe have also begun to think of a more independent foreign policy. They remain formally aligned with the European Union and NATO, but the pursuit of closer ties with Russia is no longer taboo. And for most of them, joining the eurozone is no longer a priority.

Like most economies in Mediterranean Europe, France's has lost competitiveness since the creation of the euro, and the common currency has led to a constant trade deficit with Germany. France will seek to change its relationship with Germany without breaking it (as Paris is still interested in containing Berlin), but Paris is increasingly aware that the European project should be remodeled.

The Germans are interested in preserving their alliance with France and protecting the currency union because it benefits its exports to its neighbors and out of fear of the immeasurable financial consequences of a breakup of the eurozone.

Europe's main challenge will be to prevent these frictions from paralyzing the bloc. The European Union will also face the test of mitigating the alienation of its eastern members and closing the gap between eurozone and non-eurozone countries. In the meantime, Brussels and national governments will have to find ways to alleviate the bloc's corrosive unemployment crisis before it leads to dangerous levels of social unrest. In all these challenges, the European Union is running a race against time.

In the long term, Germany and France will have to begin discussions for reforming European treaties. EU institutions and member states simply are reaching the limits of what they can do in the bloc's current institutional framework.

In the early 1800′s, nine out of ten Americans worked in agriculture—now it’s around 2%. At its peak, about a third of the US population was employed in manufacturing—now it’s less than 10%. How many decades until the figures are similar for the information-processing tasks that typify rich countries’ post-industrial economies?

To see how the internet has disproportionately affected the jobs of people who process information, check out the gray bars dipping below the 0% line on the chart, below. (I’ve adapted this chart to show just the types of employment that lost jobs in the US during the great recession. Every other category continued to add jobs or was nearly flat.)

Here’s another clue about what’s been going on in the past ten years. “Return on capital” measures the return firms get when they spend money on capital goods like robots, factories, software—anything aside from people. (If this were a graph of return on people hired, it would be called “Return on labor”.)

Notice: the only industry where the return on capital is as great as manufacturing is “other industries”—a grab bag which includes all the service and information industries, as well as entertainment, health care and education. In short, you don’t have to be a tech company for investing in technology to be worthwhile.

One thing all our machines have accomplished, and especially the internet, is the ability to reproduce and distribute good work in record time. Barring market distortions like monopolies, the best software, media, business processes and, increasingly, hardware, can be copied and sold seemingly everywhere at once. This benefits “superstars”—the most skilled engineers or content creators. And it benefits the consumer, who can expect a higher average quality of goods.

“Certainly the labor market has never been better for very highly-educated workers in the United States, and when I say never, I mean never,” MIT labor economist David Autor told American Public Media’s Marketplace.

The other winners in this scenario are anyone who owns capital.

Computers are more disruptive than, say, the looms smashed by the Luddites, because they are “general-purpose technologies” noted Peter Linert, an economist at University of Californa-Davis.

In March 2009, Amazon acquired Kiva Systems, a warehouse robotics and automation company. In partnership with a company called Quiet Logistics, Kiva’s combination of mobile shelving and robots has already automated a warehouse in Andover, Massachusetts.

From 2000 to 2007, in the years leading up to the great recession, GDP and productivity in the US grew faster than at any point since the 1960s, but job creation did not keep pace.

Especially in the past ten years, economists have seen a reversal of what they call “the great compression“—that period from the second world war through the 1970s when, in the US at least, more people were crowded into the ranks of the middle class than ever before.

Indeed, some have argued that as technology aids the gutting of the middle class, it destroys the very market required to sustain it—that we’ll see “less of the type of innovation we associate with Steve Jobs, and more of the type you would find at Goldman Sachs.”

So how do we deal with this trend? The possible solutions to the problems of disruption by thinking machines are beyond the scope of this piece. As I’ve mentioned in other pieces published at Quartz, there are plenty of optimists ready to declare that the rise of the machines will ultimately enable higher standards of living, or at least forms of unemployment as foreign to us as “big data scientist” would be to a scribe of the 17th century.

This is me. I don't want to maximise income. I want to maximise autonomy and time for unremunerative but satisfying creative work. Reihan Salam has written provocatively on the subject of threshold earners, in addition to introducing me to David Roberts' related idea of "the medium chill".

as Ronald Inglehart has documented, the achievement of high levels of widespread material well-being has precipitated a momentous shift toward "post-materialist" values across the entire developed world.

Whatever our level of education, if unemployment benefits and odd jobs add up to enough to keep us above a socially acceptable material threshold, we will not be in a hurry to accept any available employment, no matter how unpleasant or unsuitable.  

So, yeah, I'd like to see wage subsidies and a 4% inflation target. But I'd also like to see a shift away from economic policy that pushes us so insistently into the "employee" role. What does the government call you if you are working but not on somebody's payroll with social security and Medicare taxes automatically deducted from your wages? Self-employed!

But I don't want to be a tiny business that hires me. I don't want to be my own boss. I don't want to be a boss at all, or to have one. I just want to work and get paid for it, on terms agreeable to the parties involved.

Change will be primarily violent in nature -- and thus harder to miss -- in the Middle East.

The United States is also not immune to change. In this generational shift, and all the tumult that comes with it, Washington will be forced to learn the value of restraint in balance-of-power politics, preferring to lean on regional partners and encourage strategic competition as a way of preserving its own power.

The Arab world is moving uncomfortably between two eras. The post-World War II era, in which Arab dictatorships and monarchies supplanted colonial rule, is now roughly blending with -- or in some cases outright colliding with -- a fractured landscape of long-repressed Islamist forces.

This dynamic will be particularly visible in the northern Levant region this year as Syria and Lebanon continue coming apart. From Stratfor's perspective, the regime in Syria has already fallen and is giving way to a familiar state of warlordism, where militias and clan interests reign supreme. There is no longer a political entity capable of wielding control over the entirety of Syrian territory, nor will there be for some time.

once Syrian President Bashar al Assad is removed from power, whether through a negotiated deal or by force, the Sunni forces will fragment along ideological, ethnic and geographic lines, with Salafist-jihadist forces battling against a more politically minded Muslim Brotherhood and secular Sunnis.

As their grip over Aleppo slips, Alawite forces will try to hold Damascus while preparing a mass retreat to their coastal enclave. The battle for Damascus could extend beyond the scope of this forecast.

The potential use of chemical weapons by Alawite forces in a state of desperation could accelerate the unraveling of the region; a U.S.-led coalition would have to assemble in haste to contain the chemical weapons threat.

The growing disparity in the U.S. and Iranian negotiating positions will largely relegate Iran to the role of regional spoiler. So long as Iran can create pain for its regional adversaries, it can slow its own descent.

Iraq remains Iran's primary regional imperative, however. The momentum building among Sunni forces in Syria will eventually spill into Iraq and challenge Shiite dominance.

Iran's presidential elections in June will reveal the declining relevancy of the clerical elite and the populist faction embodied by outgoing President Mahmoud Ahmadinejad. This creates a political void for the Revolutionary Guard to fill. The Supreme Leader Ayatollah Ali Khamenei will try to check the Corps' growing influence by bolstering rival military and security agencies and backing a less controversial and more politically malleable ally from the pragmatic conservative camp for the presidency.

In Egypt, the military will adapt to an emerging Islamist political order. The military will remain the ultimate arbiter of the state and will rely on a number of factors -- including a fragmented judiciary, the military's economic leverage, a divided Islamist political landscape and the military's foreign relationships -- to check the Muslim Brotherhood.

Jordan, the oft-overlooked casualty of the Arab Spring, will continue to destabilize quietly and slowly in 2013

Israel and Turkey are both greatly affected by the shifting political dynamics of the Arab world, but both have little means to influence the change. The two former allies will continue exploring ways to restore a quiet working relationship under these new regional stresses, but a public restoration of diplomatic ties is less likely.

Israel will struggle internally over how to adapt to a new regional framework in which the reliability of old working partners is called into question.

Turkey sees an opportunity in the rise of Islamist forces in the Arab world but Ankara's limited influences restrain its actions beyond Turkish borders.

A more aggressive Saudi role in Syria will aggravate the civil war and create competition with other regional stakeholders, including Turkey, Qatar and Jordan.

In 2012, the European Union took numerous steps to mitigate the financial impact of its ongoing crisis.

First, the European crisis is fundamentally a crisis of competitiveness.

Second, the crisis has a political aspect. The European Union is not a federation but a collection of nation-states bound together by international treaties.

Third, the European crisis is threatening the social stability in some countries, especially in the eurozone's periphery.

In 2013, the two largest economies of the eurozone (Germany and France) will face low growth or even stagnation. This will have negative effects across Europe.

The conspicuous divide between the ruling elite and the populations of the periphery will be a key element in 2013, and some governments could fall. But even if opposition parties take power, they will face the same constraints as the governments that preceded them. In other words, a change in politicians will not bring a substantial change in policies regarding the European Union.

The only country in the eurozone periphery that has scheduled elections is Italy (in February). If the next Italian government fails to achieve political stability and apply economic reforms, the increased market pressure on Italy will make Rome more likely to require financial assistance from Brussels.

Because of the fundamental contradictions in the national interests and foreign policy strategies of the EU member states, the European crisis will continue generating political and economic divisions in the Continent in 2013.

Outside the eurozone, the United Kingdom will seek to protect its sovereignty and renegotiate its status within the European Union. But London will not leave the European Union in 2013.

Domestic Issues After the political tumult of 2012, Russia will face another year of anti-Kremlin protests, tensions among various political factions and ethnic groups, crackdowns and government reshuffles. Overall, the political tensions will remain manageable and will not pose a serious challenge to Moscow's control.

Russia has made significant progress recently in re-establishing influence in its former Soviet periphery.

Russia's relationship with Ukraine could be its most important connection in the former Soviet Union in 2013. Russia has been pursuing integration with Ukraine, primarily by taking over its natural gas transit infrastructure and calling on Kiev to join the Customs Union.

Georgia will be Russia's main concern in the Caucasus in 2013. With the political emergence of billionaire tycoon Bidzina Ivanishvili and his Georgian Dream movement, Russia's position in the country strengthened at the expense of the anti-Russian camp of Georgian President Mikhail Saakashvili.

In the past year, Russia has changed its tactics toward Europe to preserve its presence and leverage for the future. Russia's primary link to Europe is the Europeans' dependence on Russia's large energy supplies, which Moscow knows will be threatened when more non-Russian supplies become available.

The United States and Russia will continue sparring over trade matters, negotiations for a new nuclear arms treaty and Russia's role in Iran and Syria. Stratfor does not expect major changes from Washington or Moscow that would break the gridlock in negotiations on these issues.

The low-level violence and instability that occurred throughout Central Asia in 2012 will continue in 2013.

Three things will shape events in East Asia in 2013: Beijing's struggle to maintain social and political stability amid lower economic growth rates; China's accelerating military modernization and increasingly aggressive moves to secure its territorial and economic interests in the region; and varied efforts by other regional players, including the United States, to adapt to China's changes. 

In 2013, the Chinese economy will continue the gradual, painful process of moving away from high export-driven growth and toward a model that is more sustainable in the long run.

But barring another global financial meltdown on the scale of 2008-2009, China's coastal manufacturing economy will not collapse outright. The decline will be gradual.

The ongoing, gradual eclipse of coastal China as a hub of global manufacturing over the next several years will lead to higher unemployment and social dislocation as more of China's 250 million-strong migrant labor force returns inland in search of work. 

Shadow banking is by no means new in China. But it has grown significantly in the past few years from the geographically isolated informal loan markets of coastal cities to a complex network of semi-legal entities that provides between 12 and 30 trillion yuan (between $1.9 trillion and $4.8 trillion) in credit -- at interest rates of 20-36 percent -- to thousands of struggling small businesses nationwide.

The Party's growing sense of insecurity -- both internally and with regard to the social consequences of China's economic transition -- likely will be reflected in continued censorship of online social platforms like Weibo, crackdowns on religious or other groups perceived as threatening, and the Chinese military's growing assertiveness over China's interests in the South and East China seas and Southeast Asia.

The decline of low-end coastal manufacturing in China will present enormous opportunities for Southeast Asian countries like Indonesia, Vietnam, the Philippines and potentially Myanmar -- all of whom will continue to push strongly for foreign investment not only into natural resources and raw materials industries but also into developing better urban, transport, power generation and materials processing infrastructure.

Meanwhile, Vietnam and the Philippines -- China's most vocal opponents in Southeast Asia -- will continue to push for greater integration among members of the Association of Southeast Asian Nations and for U.S. business and military engagement in the region.

The Coming U.S. Withdrawal from Afghanistan Ahead of the 2014 drawdown of U.S. troops from Afghanistan, efforts will intensify to negotiate a settlement that gives the Taliban a place in a new government.

The negotiations will face numerous obstacles this year. There will be an upsurge in violence -- both in terms of officially sanctioned attacks designed to gain advantage on the negotiating table and spoiler attacks by Taliban elements allied with al Qaeda on both sides of the Afghan-Pakistani border.

Washington's intention to reduce its presence in the region will spur regional actors to fill the void. Pakistan will increase its interactions with Russia, Central Asia and Iran to prepare for a post-U.S. Afghanistan.

India will also turn its attention eastward, where the United States is quietly trying to forge a coalition of regional partners to keep a check on China in the Indo-Pacific basin. Myanmar in particular will be an active battleground for influence this year.

Preparing for a Post-Chavez Venezuela After a year of successful campaigning for re-election, Venezuelan President Hugo Chavez is in questionable health. Although the ultimate outcome of December's medical treatment for the ailing leader is unpredictable, Chavez's decision to name Vice President Nicolas Maduro as a political successor at the end of 2012 indicates that there is significant concern for his ability to remain in power.

Although it remains possible that Chavez will stay in power through the year, for Maduro to capitalize on Chavez's recent political gains, elections may need to be called sooner rather than later, regardless of Chavez's immediate health status.

Throughout 2013, Colombia will continue the incremental process of negotiating an end to the conflict with the Revolutionary Armed Forces of Colombia, known by its Spanish acronym FARC.

This will be a year of significant transition for Mexico. Policy issues that were bottled up by intra-party competition in the waning years of the National Action Party's administration have begun coming to the fore and will dominate 2013. These include socio-political issues like education, tax and pension reform.

In Portugal, the Secretary of State for Emigrant Communities recently said that up to 240,000 people (roughly 2 percent of the nation's population) have left the country since 2011, due in large part to unemployment and economic contraction.

Independent of their ideological orientation, most EU governments have applied the austerity policies proposed by the European Union and the International Monetary Fund. The traditional parties' lack of alternatives to austerity has generated a growing unease among local populations.

Such crises of legitimacy are often accompanied by an increase in euroscepticism, since many of these new parties blend anti-establishment rhetoric with opposition to the European Union or Germany's leadership of the bloc.

First, political uncertainty often generates instability in the financial markets.

Second, and perhaps most important, the economic crisis creates an environment conducive to the growth of extremist political views, both from the left and from the right.

We kind of made a bargain, a social contract, in the 20th century that even if jobs were pleasant people could still get paid for them. Because otherwise we would have had a massive unemployment. And so to my mind, the right question to ask is, why are we abandoning that bargain that worked so well? When did "we" make this "bargain" and, honestly, what is he talking about? There was no such bargain made. Jobs have nothing to do with whether they are "pleasant." And we didn't create jobs to avoid unemployment. We created jobs because there was demand for work, meaning there was demand for products and services, just as there still is today.

This is the broken window fallacy exploded exponentially for a digital era. It seems to assume that the only "payment" is monetary. That is, if you do something for free online -- share a video or a photo, like a link, listen to a song -- that you're somehow getting screwed because some company gets that info and you're not getting paid.

A token few will find success on Kickstarter or YouTube, while overall wealth is ever more concentrated and social mobility rots. Social media sharers can make all the noise they want, but they forfeit the real wealth and clout needed to be politically powerful. Real wealth and clout instead concentrate ever more on the shrinking island occupied by elites who run the most powerful computers.

It's as if Lanier is talking about a mythical past that never existed to make some point about the future. But all of the evidence suggests that more people are now able to make use of these tools to create new incomes and new opportunities to make money, while in the past you had to wait for some gatekeeper.

Dear parents or legal guardians of ___________ As you may be aware, your daughter is one of ______ children in your neighborhood who recently applied for a jointly operated StreetApp® of the category “Lemonade Stand.”

Too often, conservatives dupe themselves. They wrap themselves in closed information systems based upon pretend information. In this closed information system, banks can collapse without injuring the rest of the economy, tax cuts always pay for themselves and Congressional earmarks cause the federal budget deficit. Even the market collapse has not shaken some conservatives out of their closed information system. It enfolded them more closely within it. This is how to understand the Glenn Beck phenomenon.

Meanwhile, Republican officeholders who want to explain why they acted to prevent the collapse of the U.S. banking system can get no hearing from voters seized with certainty that a bank collapse would have done no harm to ordinary people.

the intellectual right accords a deference to the wants and wishes of the financial industry that is seldom accorded to agriculture, manufacturing, transport or retailing.

But it’s not always true that what’s good for Goldman Sachs is good for the economy, or vice versa. Nor is what “the markets” want the same as what free-market economics require.

During the recession of 1981-82, Democratic politicians demanded that a Republican president set a balanced budget as his top priority. Ronald Reagan disregarded this advice. He held firm to his tax cuts: once the economy returned to prosperity, there would be time then to deal with the deficit. Today, the positions are reversed.

eading voices in the Republican Party have convinced themselves that the country is on the verge of hyperinflation — a Weimar moment, says Glenn Beck. But if fiscal stimulus leads to socialism, and quantitative easing leads to Nazism, what on earth are we supposed to do? Cut the budget? But we won’t do that either! On Sean Hannity’s radio show, the Republican House leader John Boehner announced just before the election that one of his first priorities would be the repeal of the Obama Medicare cuts.

Social Security, unemployment insurance and other benefits were designed as anti-Depression defenses, “automatic stabilizers” as economists called them.

Those who denounce unemployment insurance as an invitation to idleness in an economy where there are at least five job seekers for every available job are not just hardening their hearts against distress. They are rejecting the teachings of Milton Friedman, who emphasized the value of automatic stabilizers fully as much as John Maynard Keynes ever did.

Non-Tea Party Americans may marvel that any group can think of itself as egalitarian when its main political goals are to cut off government assistance to the poorest and reduce taxes for the richest.

The U.S. political system is not a parliamentary system. Power is usually divided. The system is sustained by habits of cooperation, accepted limits on the use of power, implicit restraints on the use of rhetoric.

In the past several days Egypt has not witnessed a popular revolution but a carefully managed succession by the military.

It must be recognized that the succession crisis in Egypt was playing out between the country’s military elite and Mubarak well before protests began in Egypt on Jan. 25.

Though Tunisia had some domestic pro-democracy groups before unrest began in December 2010, Tunisia saw one of the region’s more organic uprisings.

The ouster of Ben Ali and his family and a reshuffling of the government for now have calmed most of the unrest. A sense of normalcy is gradually returning as Tunisians look ahead to as-yet unscheduled elections due sometime in 2011.

In all likelihood, Tunisia will end up with another government dominated by many of the former Ben Ali elites, albeit with a democratic face.

While the civil unrest will continue to capture the cameras’ attention, the real struggle in Algeria is not playing out in the streets. A power struggle has long been under way between the country’s increasingly embattled president, Abdel Aziz Bouteflika, and the head of the Military Directorate of Intelligence and Security (DRS), Gen. Mohamed “Toufik” Mediene.

Not by coincidence, one of the main organizers of the demonstrations, Saeed Saidi (a Berber) is known to be on excellent terms with Mediene, also a Berber. The call for Berber rights — Berbers make up roughly one-third of the Algerian population — has been one of the leading drivers of the demonstrations thus far.

Now, however, a recently-created Facebook group known as “Moroccans for Change” has called for a nationwide protest Feb. 20, something the government of King Mohammed VI has responded to by meeting with opposition parties and promising to speed up the pace of economic, social and political reforms.

In one of its main demands, the opposition has called for a new constitution that would strip power from the monarchy and from the network of state and business elites known as the Makhzen.

In sum, the planned demonstrations in Morocco are illustrations of opportunism as opposed to a serious potential popular uprising — much less regime change.

King Abdullah II acted quickly to pre-empt major civil unrest in the country by handing out millions of dollars in subsidies and by forming a new government.

Bahrain was the first among Persian Gulf countries to witness significant demonstrations, and protesters clashed with riot police early on. After two days of demonstrations led by Shiite opposition groups, a heavy crackdown was launched on Pearl Square in the heart of Manama late Feb. 16 on mostly Shiite protesters who were camping overnight.

The ruling Sunni family may be a minority in the Shiite-majority country, but some 54 percent of the population is made up of foreign guest workers, who are notably not taking part in the demonstrations.

Poor socio-economic conditions, high youth unemployment (around 26 percent) and disillusionment with the regime are all notable factors in the development of Iran’s opposition movement, but as STRATFOR stressed in 2009, the primarily youth-driven, middle- and upper-class opposition in Tehran is not representative of the wider population, a significant portion of which is supportive of Iranian President Mahmoud Ahmadinejad.

The civil unrest in Libya is unlikely to pose a meaningful threat to the regime, but it could impact the country’s ongoing power-struggle between Gadhafi’s two sons.

In attempt to take the steam out of the political opposition, Saleh has announced that he will not run for re-election in 2013, and that he would do away with pending amendments that would have abolished presidential term limits.

Soon after the unrest in Egypt broke out, Syrian opposition youth activists (most of whom are based outside the country) attempted to organize their own “Day of Rage” via social media to challenge the al Assad regime.

Some have accused Prime Minister Viktor Orban of trying to emulate a man named Miklos Horthy, who ruled Hungary before and during World War II.

It has become a metaphor for the country today, and Hungarians are divided with earnest passion on an old man long dead.

Horthy ruled a country that was small and weak. Its population was 9.3 million in 1940. Horthy's goal was to preserve its sovereignty in the face of the rising power of Adolf Hitler and Josef Stalin. Caught between the two -- and by this I mean that both prized Hungary for its strategic position in the Carpathian Basin -- Hungary had few options.

Horthy's strategy meant a great deal to the Jews. He was likely no more anti-Semitic than any member of his class had to be. He might not hire a Jew, but he wasn't going to kill one. This was different from the new style of anti-Semitism introduced by Hitler, which required mass murder.

Thousands were killed early on, and anti-Jewish laws were passed. But thousands are not hundreds of thousands or millions, and in that time and place it was a huge distinction.

Horthy conceded no more than he had to, but what he had to do he did. Some say it was opportunism, others mere cowardice of chance. Whatever it was, while it lasted, Hungary was not like Poland or even France. The Jews were not handed over to the Germans.

Horthy fell from his tightrope on March 19, 1944. Realizing Germany was losing the war, Horthy made peace overtures to the Soviets. They were coming anyway, so he might as well welcome them.

Hitler, of course, discovered this and occupied Hungary

Horthy signed off on this. But that signature, as he pointed out, was meaningless. The Germans were there, they could do as they wanted, and his signature was a meaningless act that spared his sons' lives.

My parents were grateful to Horthy. For them, without him, the Holocaust would have come to Hungary years earlier. He did not crush the Hungarian Nazis, but he kept them at bay. He did not turn on Hitler, but he kept him at bay.

This is the old argument about Horthy, and in fact, in Hungary there is a raging argument about Horthy's role that is really about Orban. Is Orban, like Horthy, doing the least he can to avoid a worse catastrophe, or is he secretly encouraging Jobbik and hastening disaster?

Orban sees the European Union as a massive failure. The great depression in Mediterranean Europe, contrasted with German prosperity, is simply the repeat of an old game.

Hungary is in the east, in the borderland between the European Peninsula and Russia. The Ukrainian crisis indicates that the tension in the region is nearing a flashpoint. He must guide Hungary somewhere.

There is little support from Hungary's west, other than mostly hollow warnings. He knows that the Germans will not risk their prosperity to help stabilize the Hungarian economy or its strategic position.

Nor does he expect the Americans to arrive suddenly and save the day.

The Ukrainian crisis can only be understood in terms of the failure of the European Union. Germany is doing well, but it isn't particularly willing to take risks. The rest of northern Europe has experienced significant unemployment, but it is Mediterranean Europe that has been devastated by unemployment. The European financial crisis has morphed into the European social crisis, and that social crisis has political consequences.

The contrast between the euphoric promises of the European Union and the more meager realities has created movements that are challenging not only membership in the European Union but also the principle of the bloc

Compound this with the re-emergence of a Russian threat to the east, and everyone on Ukraine's border begins asking who is coming to help them. The fragmentation of Europe nationally and socially weakens Europe to the point of irrelevance. This is where the failure of the European Union and the hollowing out of NATO become important. Europe has failed economically. If it also fails militarily, then what does it all matter? Europe is back where it started, and so is Hungary.

To his left are the Europeanists, who see all his actions as a repudiation of liberal democracy. On the right is a fascist party that won 20 percent in the last election. Between these two forces, Hungary could tear itself apart. It is in precisely this situation that Weimar Germany failed.

Orban knows what Horthy did as well. Hungary, going up against both Germany and Russia, needs to be very subtle. Hungary is already facing Germany's policy toward liberal integration within the European Union, which fundamentally contradicts Hungary's concept of an independent state economy.

This is not what the Germans want to see.

I think Orban anticipated this as he saw the European Union flounder earlier in the decade. He saw the fragmentation and the rise of bitterness on all sides. He constructed a regime that appalled the left, which thought that without Orban, it would all return to the way it was before, rather than realizing that it might open the door to the further right. He constructed a regime that would limit the right's sense of exclusion without giving it real power.

if the United States enters the fray, it will not happen soon, and it will be even later before its role is decisive.

For Horthy, the international pressure finally overwhelmed him, and the German occupation led to a catastrophe that unleashed the right, devastated the Jews and led to a Russian invasion and occupation that lasted half a century. But how many lives did Horthy save by collaborating with Germany? He bought time, if nothing else.

Orban isn't Horthy by any means, but their situations are similar. Hungary is a country of enormous cultivation and fury. It is surrounded by disappointments that can become dangers. Europe is not what it promised it would be. Russia is not what Europeans expected it to be. Within and without the country, the best Orban can do is balance, and those who balance survive but are frequently reviled.