Reason #4 The 4th Turning

Why I moved my business from Utah to Costa Rica Reason #4

Reason #4 The 4th Turning

Generations have impacts that last years, decades, and even centuries. 

This is true in terms of families as well as nations.

Success is often the result of generations building on one another, and the results are not seen in the lifetime of those who made the sacrifices.

One generation can also destroy the work of many generations. 

I want to briefly highlight the last time Costa Rica was amid a 4th Turning Crisis (1940s).

First, let me give a very brief overview of the theory of the 4th turning.

Neil Howe & William Strauss published “The Fourth Turning” in 1996. The book encapsulates a theory that generations create rhythms in history that can be measured. 

These rhythms are organized into 4 cycles. 

• 1st Turning High

• 2nd Turning Awakening

• 3rd Turning Unraveling 

• 4th Turning Crisis

These cycles are not mathematical measurements. Instead, they are created through social dynamics. 

I would argue they are also largely influenced by credit-related economic developments, which links this cycle to Ray Dalio’s Long-Term Debt Cycle.

All four turnings are encapsulated in a human life cycle of 80-100 years. 

The 4th Turning is a pivotal moment in society as institutions established during previous 1st Turning Highs are brought into the light of scrutiny. 

This time is often one of political upheaval and risk. 

It’s an opportunity for societies to come together and solve problems for future generations, but if not handled correctly, it can set a society back for decades, if not longer. (Think of the South after the Civil War)

Examples of these periods in US history are 

1. The American Revolution

2. The Civil War

3. The Great Depression

It’s important to note that these crisis moments can take many forms. For example, the Civil War had moments when the odds of the United States survival were low, while the Great Depression never saw the risks of the end of the United States as a union. 

They can be extreme or very mild. 

Costa Rica Revolution 1948

In the 1940s, Costa Rica's political scene was dominated by Rafael Angel Calderón

He served as President from 1940 to 1944. Due to a constitutional ban on consecutive reelection, Calderón's party nominated Teodoro Picado for the 1944 election. Picado, seen as Calderón's puppet, often used military force to maintain order, leading to street violence and a tarnished military image. 

As violence escalated, opposition supporters armed themselves, and the police resorted to threats of gunfire.

Widespread disgust with the government's actions peaked at the Huelga de Brazos Caídos, a seven-day strike by business owners that halted commerce. 

Calderón supporters and communist demonstrators responded by looting businesses and intimidating participants. 

By the strike's end, police and military presence made San José appear like a war zone.

José Figueres Ferrer, a Costa Rican businessman, was exiled to Mexico in 1942 after being seized in the middle of a radio broadcast in which he was criticizing President Calderón.

Figueres returned to Costa Rica after Picado's election in 1944. Believing that the 1944 election was corrupt, he formed alliances with other opposition leaders and began preparing for conflict by secretly training a small militia. 

In the 1948 election, Calderón ran again against Otilio Ulate. There was an open fear of possible election interference. 

To alleviate these concerns, Picado's government, for the first time in Costa Rican history, placed the election under the control of an independent electoral tribunal.

Ulate won the 1948 election by 10,000 votes, but Calderon's Victory Block Party secured more legislative seats than Ulate's National Union Party. 

Calderón refused to accept the defeat.

Calderón then petitioned the legislature, in which his party had a majority, to nullify the results, citing fraud. The legislative assembly, controlled by Calderón's supporters, voted to annul the election. 

President Picado (the current president), influenced by Calderón, declared Ulate's victory fraudulent and refused to step down. 

On the day the government annulled the elections, police surrounded the home of Dr. Carlos Luis Valverde, the acting campaign manager for Ulate, where Ulate was also present.

Shots were fired, resulting in Valverde's death. Ulate escaped but was later captured and imprisoned.

These events gave Figueres the opening he had been preparing years for. 

On March 12, 1948, word reached San Jose that a band of revolutionaries led by José Figueres Ferrer had taken over the town of San Isidro del General, South of San Jose.

The following civil war resulted in 2000 deaths. 

Figueres quickly gained the upper hand, and the different political groups involved decided to push for a settlement. 

In just 6 weeks, the conflict was over.

Those loyal to Calderón aimed to maintain their legal status and influence in organized labor. Figueres' conservative and business allies, who supported Ulate, wanted him to become President without relying on military force. Meanwhile, the Social Democrats sought to pave the way for establishing a new social democratic order.

On May 1, 1948, the Figueres-Ulate Pact was signed. This pact allowed Figueres to govern for 18 months without a legislature before transferring power to Otilio Ulate. Although this pact was unnecessary, as Figueres had complete military control, it demonstrated his commitment to democracy. 

Figueres consolidated Calderón’s social reforms and introduced his own, including 

• granting women's suffrage

• full citizenship for blacks 

• ended the standing army

• established presidential term limits

• created an independent Electoral Tribunal 

During this time, Figueres reallocated all funds previously used by the military to national education and energy infrastructure.

After 18 months, Figueres honored the pact and stepped down, ensuring Ulate, the democratically elected leader, took office. 

While these times in history are very confusing when determining who was right or wrong, what matters most is whether the country comes together and cooperates to build a better future for the following generations. 

It is clear that Costa Rica formed a quality foundation after this crisis period, and its citizens are now reaping the benefits.

In neighboring countries like Guatemala, El Salvador, Honduras, and Nicaragua, they continually suffered political instability. 

Costa Ricans, on the other hand, now had stability and access to education, which has allowed them to progress much further. 

In future posts, I’ll highlight some of the big benefits of this successful 4th turning and subsequent 1st turning in Costa Rica.

While Costa Rica suffered from the Great Financial Crisis, they have been significantly more stable politically than we have in the United States. 

This political stability has attracted me and many others to Costa Rica.

In comparison, El Salvador is currently wrapping up what seems to have been a 4th turning and transitioning well into a 1st turning high. They are unified behind Nayib Bukele and solving many of their foundational problems. 

I believe they are on their way to a very prosperous future, but I feel more comfortable investing first in a country like Costa Rica, which has had a much longer period of stability. I believe they will have easier access to credit and a larger influx of digital nomads. 

Let me finalize this post with a prayer.

The United States is clearly heading toward the climax of its latest 4th Turning. 

While I have no idea how our crisis will turn out, I think it’s important to stay vigilant.

Let’s focus on future generations rather than our own needs. If we do, I believe we will find the answers. 

May God Bless America