The mechanism proposed by Steiner was that there were certain changes that needed to be made, spiritual steps that needed to be taken, by Western Man in a fashion that was willed, conscious, explicit - and if such steps were not taken (and they were not taken) then the desired changes would appear in a distorted form as instincts post-hoc interpreted rationalistically...
I have edited parts the lecture to focus on the parts relating to what-turned-out-to-be the sexual revolution, now mainstream and dominant in the West - I have ruthlessly 'translated' some of Steiner's idiosyncratic terminology - so this is an interpretation as well as an edited version. Some of my comments are [in square brackets].
The whole lecture can (and should) be read here - but, be warned, it is difficult:
What if humanity on earth should persist in sleeping through the momentous spiritual revelation of the future?
Then the Angels would have to try different means of achieving what the pictures they weave in the consciousness of man are intended to achieve. If men do not allow this to be achieved in while they are awake, the Angels would, in this case, endeavour to fulfill their aims through their sleeping bodies.
Here lies the great danger for this age of the Consciousness Soul. [That is, the era in which consciousness, self-awareness, is intensified to the exclusion of contact with reality - the age of disenchantment, alienation, materialism.] This is what might still happen if, before the beginning of the third millennium, men were to refuse to turn to the spiritual life. The third millennium begins with the year 2000, so it is only a short time ahead of us.
But what would be the outcome if the Angels were obliged to perform this work without man himself participating, to carry it out during sleep? Firstly, something would be engendered in the sleeping human bodies and Man would meet with it on waking in the morning ... but then it would become instinct instead of conscious spiritual activity, and therefore baleful.
Certain instinctive knowledge will arise in human nature connected with the mystery of birth and conception, with sexual life as a whole; and this threatens to become baleful if the danger of which I have spoken takes effect.
The effect in the evolution of humanity would be that certain instincts connected with the sexual life would arise in a pernicious form instead of wholesomely, in clear waking consciousness.
These sexual instincts would not be mere aberrations, but would pass over into and configure the social life, would above all prevent men from unfolding brotherhood in any form whatever on the earth, and would rather induce them to rebel against it. This would be a matter of instinct.
So the crucial point lies ahead when either the path to the right can be taken — but that demands wakefulness — or the path to the left, which permits of sleep. But in that case instincts come on the scene — instincts of a fearful kind.
And what do you suppose the scientific experts will say when such instincts come into evidence? They will say that it is a natural and inevitable development in the evolution of humanity. But light cannot be shed on such matters by natural science, for whether men become angels or devils would be equally capable of explanation by scientific reasoning. Science will say the same in both cases: the later is the outcome of the earlier ...
Natural science will be totally blind to the event of which I have told you, for if men become half devils through their sexual instincts, science will as a matter of course regard this as a natural necessity. Scientifically, then, the matter is simply not capable of explanation, for whatever happens, everything can be explained by science.
Man would pride himself upon the growth of his instinctive knowledge of certain processes and substances and would experience such satisfaction in obeying certain aberrations of the sexual impulses that he would regard them as evidence of a particularly high development of superhumanity, of freedom from convention, of broad-mindedness!
In a certain respect, ugliness would be beauty and beauty, ugliness.
Yet, nothing of this would be perceived because it would all be regarded as natural necessity. But it would actually denote an aberration from the path which, in the nature of humanity itself, is prescribed for man's essential being.
Comment: In other words, our true destiny is for each of us deliberately, by choice, consciously and explicitly to make the next step in the evolution towards divine consciousness.
But if we do not make this choice and take this step (and we have-not done so in the past century since Steiner gave this lecture), then we will instead have...
What I find especially impressive about this prediction is that insight that the sexual aberrations would come to configure social life; and would be explained-away by 'science' as natural and inevitable developments: "Man would pride himself upon the growth of his instinctive knowledge of certain processes... and would experience... satisfaction in obeying certain aberrations of the sexual impulses"; and would see these as "evidence of a particularly high development of superhumanity, of freedom from convention, of broad-mindedness"; amounting to a mainstream societal adoption of value-inversion - "ugliness would be beauty and beauty, ugliness".
Well, we will have exactly what we actually do have: Steiner's prophecy regarding the sexual revolution has-been fulfilled; explicitly and to the last detail.