Joel Kotkin

At the turn of the century, America’s biggest advantage was its relatively vibrant demographics. In sharp contrast with its major competitors — the E.U., Russia, China, Japan — the United States had maintained a far higher birthrate and rate of population growth.

About two in three Americans do not think what’s good for Wall Street is good for America, according to the 2012 Harris poll, but do think people who work there are less “honest and moral than other people,” and don’t “deserve to make the kind of money they earn.” Confidence in banks is at a record low, according to Gallup, as they’ve suffered the steepest fall in esteem of any American institution over the past decade.

It’s a commonplace among pundits and economic developers that smart people flock to “smart” places like sparrows to Capistrano. Reflecting the conventional wisdom, The New York Times recently opined that “college graduates gravitate to places with many other college graduates and the atmosphere that creates.”

For nearly a generation, pundits, academics and journalists have written off suburbia. They predict that the future lies in the cities, with more Americans living in smaller spaces such as the micro-apartments of 300 square feet or less that New York and San Francisco are considering changing their building laws to allow.

Move over, Iraq. Tribal politics have arrived at home.

It’s not like our tribes will arm themselves, but American politics is developing a disturbing resemblance to Mesopotamia’s ever-feuding Sunnis, Shiites, and Kurds as the 2012 election rapidly devolves into a power struggle between irreconcilable factions rather than a healthy debate among citizens.

The blame here falls in large part on President Barack Obama, who after four years of economic lethargy needs to recast the election as anything other than what it naturally is: a referendum on the incumbent and the state of the nation.

This year’s presidential election is fast becoming an ode to diminished expectations. Neither candidate is advancing a reasonable refutation of the conventional wisdom that America is in the grips of a “new normal” — an era of low growth, persistently high unemployment and less upward mobility, particularly for the working class.

Today’s youth, both here and abroad, have been screwed by their parents’ fiscal profligacy and economic mismanagement. Neil Howe, a leading generational theorist, cites the “greed, shortsightedness, and blind partisanship” of the boomers, of whom he is one, for having “brought the global economy to its knees.”

In an election pivoting on jobs, energy could be the issue that comes back to haunt Barack Obama and the Democratic Party as the cultural and ideological schism between energy-producing Republican states and energy-dependent Democratic ones widens.

When we think of places with high salaries, big metro areas like New York, Los Angeles or San Francisco are usually the first to spring to mind. Or cities with the biggest concentrations of educated workers, such as Boston.

President Obama’s recent “do it myself” immigration reform plan, predictably dissed by conservatives and nativists, reveals just how clueless the nation’s leaders are about demographics. Monday’s Supreme Court ruling on Arizona’s immigration crackdown also broke down along predictable lines, with both parties claiming ideological victories.

Yet the heated debates are missing the reality of immigration and its role in America’s future. In reality America needs more immigrants, but with a somewhat different mix.

Barack Obama’s political base always has been more “creative class” than working class—and his policies have favored that base, seeming to cater to energized issue and identity constituencies including African-Americans, Hispanics, gays, and greens, often at the expense of blue-collar workers.

They may not win their first championship against Miami’s evil empire, but the Oklahoma City Thunder have helped to put a spotlight on what may well be the most surprising success story of 21st century America: the revival of the Great Plains. Once widely dismissed as the ultimate in flyover country, the Plains states have outperformed the national average for the past decade by virtually every key measure of vitality — from population, income and GDP growth to unemployment — and show no sign of slowing down.

When Jerry Brown was elected governor for a third time in 2010, there was widespread hope that he would repair the state’s crumbling and dysfunctional political edifice. But instead of becoming a Californian Mikhail Gorbachev, he has turned out to be something more resembling Konstantin Chernenko or Yuri Andropov, an aged hegemon desperately trying to save a dying system.

Facebook‘s botched IPO reflects not only the weakness of the stock market, but a systemic misunderstanding of where the true value of technology lies. A website that, due to superior funding and media hype, allows people to do what they were already doing — connecting on the Internet — does not inherently drive broad economic growth, even if it mints a few high-profile billionaires.

In Madrid you see them on the streets, jobless, aimless, often bearing college degrees but working as cabbies, baristas, street performers, or—more often—not at all. In Spain as in Greece, nearly half of the adults under 25 don’t work.

Call them the screwed generation, the victims of expansive welfare states and the massive structural debt charged by their parents. In virtually every developed country, and increasingly in developing ones, they include not only the usual victims, the undereducated and recent immigrants, but also the college-educated.