Many historians will say that the U.S. empire began secular decline starting around 1968 with the peak in that era's stock market, the technological gains of the space race, and the ebullient social mood of the late '60s. Still others, will say 1973 was a pivotal year with the ramp down in Vietnam, the abandonment of the gold standard and the peak in inflation adjusted median wages (for men). Meanwhile, the Elliot Wave folks peg the year 2000 as the nominal top, viewing the '70s as a retracement and the past 30 years as a blow-off top in social mood and the financial markets. If nothing else, clearly the past 30 years was a grotesque amplification of excesses sponsored by unrestrained Central Bank credit inflation - a consumption binge on steroids.
Some may contest my view that any one event could cause the U.S. to lose its global hegemony, but the signs are overwhelmingly abundant at this juncture. The U.S. empire is sustained merely by debt and the ongoing willingness of its creditors to sustain ever-increasing borrowing. With the inevitable collapse of the credit markets, support for the U.S. military industrial complex will be commensurately impaired.
Instead of merely stating where the U.S. went off track, let's first review the key factors that made the U.S. powerful in the first place:
Instead of merely stating where the U.S. went off track, let's first review the key factors that made the U.S. powerful in the first place:
1) An open culture and society with strong personal freedoms
2) A culture that valued and respected hard work, honesty and thrift
3) An Isolationist and/or Neutral foreign policy
4) A culture of innovation and entrepreneurship
Historians and Tea Party zealots will fill in the details on the above, but from my viewpoint these were the primary factors that differentiated the U.S. Being a Canadian living in the U.S., I view point number 4, innovation and entrepreneurship as being the differentiating factor. Americans have always been more entrepreneurial and enterprising than their Canadian cousins which is why in my opinion Canada never became a superpower. Aside from that, Canada has roughly the same immigration policy, legal system, abundant natural resources, and historical background. The good news is that the U.S. still has many exceptionally gifted entrepreneurs and innovators, however, the U.S. has essentially wholesale abandoned the other three key factors. In other words, excelling in one out of four factors is not going to maintain U.S. "exceptionalism". Just the fact that so many phony right wingers feel the need to wear their U.S. flag pins and extol U.S. exceptionalism at every turn, is somewhat less than exceptional.
What went wrong:
1) An open culture and society with strong personal freedoms
Somehow the U.S. went from being an increasingly open and immigrant-friendly nation, to now essentially devolving into an increasingly xenophobic and paranoid nation. The historical factors that made the U.S. attractive to well-qualified immigrants are becoming increasingly diminished. Case in point, one would think that a person of colour in this day and age should not feel alienated in a typical small U.S. town; however, being "off white" myself, I can tell you that's not the case. 9/11 caused a major sea change in how Americans view the rest of the world. In the aftermath of the attack, I had a hill billy stalk me in a Home Depot, ostensibly because I was going to hijack some gardening supplies. And then there's the freak who just killed a bunch of Sikhs because he was too inbred to realize that Sikhs and Muslims are totally different religions and cultures. Those who want more insight into the state of culture in America's "heartland" should read "Deer Hunting With Jesus". The 9/11 attack itself was a major factor in the decline of the U.S. as empire. It proved to the world and America's enemies that the big guy can't take a punch. Let's be objective, somewhere around ~3,000 people died that day which is about the same number of African children who die every day by breakfast time. By going way overboard and launching two military blunders that have depleted the U.S. Treasury, the U.S. went out of its way to vindicate the terrorists that died that day. The terrorists could not have asked for a better outcome than the one the morons in Washington handed them on a silver platter.
And of course, following the principles of Shock Doctrine, the Bush Administration took full advantage of 9/11 to erode American civil liberties and begin moving the U.S. in the direction of a paranoid police state. That devolution of personal freedoms continued under Obama of course, who is no less a puppet of special interest groups. In other words, those Americans who believe that America's personal freedoms are "exceptional" relative to other nations, need to spend a little more time travelling and a little less time at Nascar.
2) A culture that valued and respected hard work, honesty and thrift
This blog is mostly dedicated to the myriad ways that the American Idiocracy squandered it's economic advantage. The Americans of today are resting on their laurels and living in the past off of the hard work of previous generations. The current generation(s) stood on the shoulders of giants and assumed that being a great nation was merely a slogan that need to be repeated ad infinitum, while other countries did the heavy lifting. Worse yet, the U.S. no longer values or rewards hard work. Contrary to Romney's 47% "dependency" assertion, the hardest working Americans get paid the least. Suffice to say that when your "best and brightest" are trading pieces of paper back and forth in a zero sum game making million dollar salaries even as the minimum wage stands at $7/hour, you can assume that your best days as a nation are behind you. And as far as honesty goes, as I wrote recently, bullshit is the last bull market. Americans have a high tolerance for being lied to which is good, because they are lied to constantly i.e. by glassy eyed politicians and corporate-owned infotainers. Unfortunately having a very high tolerance for being lied to is not a source of competitive advantage. And lastly of course, thrift speaks for itself. Like all Western nations the U.S. is bankrupt, except the majority can no longer do basic math so they haven't figured it out yet. The U.S. is now a Ponzi borrower which means it has to keep borrowing to meet the debt service on previous borrowings. Any attempt to rein in the deficit will tank the economy and reduce tax receipts, which is why the morons who run the U.S. are so worried about the "fiscal cliff". Thirty years ago the U.S. was the largest creditor nation in the world, today it's the largest debtor nation - that's what three decades of Neocon-based supply side policies buys you. So ironically, the pseudo-patriot Neocons achieved what the Soviets never could accomplish - the hobbling of the U.S. empire. And the only difference right now between the U.S. and Europe debt-wise is that the dollar is the reserve currency which allows U.S. policy-makers to borrow themselves into oblivion. That will be the epitaph for the U.S. - "Here lies the U.S. It had a reserve currency which allowed politicians to borrow the country into oblivion. So they did."
3) An Isolationist and/or Neutral foreign policy
I could fill pages on this topic. I recently asserted that America's foreign policy this past decade was about as coherent as a frathouse game of Risk on a Friday night. Interminable wars of occupation with no exit strategy, depleting the treasury, buying oil from terrorist sponsoring states etc. However, the most egregious blunder was becoming economically dependent upon a fascist state that shares none of the same values or goals as the U.S. The U.S. now relies upon China for much of its technology and for financing its ongoing debt. Without China's ongoing sponsorship the U.S. military will be dwindled to a shadow of its former self. The other ludicrous policy is continued reliance on foreign oil. Despite the pollyannas who would tell us that fracking means the end to all foreign energy reliance, the CIA factbook indicates that the U.S. still imports 55% of its oil from foreign sources (and no it doesn't all come from Canada). Let's review - the U.S. reached peak oil output in 1970 from which point forward it became a net importer of oil. That means this generation has had 40 years to improve its strategic position by adopting alternative sources of energy, and yet has stalled and obfuscated at the behest of energy industry special interest groups. These two issues alone show the depth of incompetence and corruption of U.S. policy-makers at this juncture.
4) A culture of innovation and entrepreneurship
I said at the top that the U.S. still retains an edge on innovation and entrepreneurship. It's in the country's DNA. That said, in recent years, more and more innovation has been outsourced to foreign nations, leaving the U.S. with significantly diminished advantage in engineering-intensive innovation. Therefore, I would posit that the U.S. needs to focus more resources on engineering-based innovation and less resources on innovating junk food and junk culture. While I am on that subject, I can't say much about a society willing to stuff its own kids full of toxic waste junk food, all under the corporate-sponsored premise of "consumer choice". And suffice to say that any thought of the U.S. getting up off the inevitable mat, is wishful thinking so long as three quarters of the population is doing its level best to eat itself to death.
Where to From Here
All assessments of national potential obviously involve relative comparisons. I am not saying that there is another country waiting in the wings to usurp America's superpower dominance, because clearly if the U.S. economy collapses then China will collapse along with it. And no one can say whether or how long it would take for the U.S. to address these core issues and regain its mantle of greatness. Clearly I am skeptical that the Baby Boomer generation which did the most to impair America's greatness will suddenly reverse course and become the generation to restore the nation. As I said recently, the overwhelming preoccupation of the aged Baby Boomers is to maintain status quo at all costs. Ron Paul was the only candidate during this current election cycle who embraced a return to these basic principles, but he was shunted aside as if he didn't even exist. Obama merely holds the line for the gains made by the extreme right during Bush's presidency. And Romney at this late juncture is still intending to plough ahead with the right wing agenda. His main platform is to increase defense spending from 3% of GDP to 4% which would crowd out many other social programs, including food stamps i.e. at a time when they are most needed. And like Bush, somehow he has conned a substantial part of the middle class into voting against their own interest. But he is the fool of ages, if he assumes that the sheeple at large will remain steeped in their American Idol sponsored food coma, forever. Lastly, I am sure most outside of the U.S. don't believe that this country deserves a restoration of power, even if one could obtain, given its abject moral decline. Of course history will be the final arbiter, but given that no great power has regained its mantle of power following a major downfall, the odds are not good.
So with that said, and given that nature abhors a vaccuum, similar to the Fall of Rome, if the U.S. falls, then anarchy will likely reign globally. Whereas, the Fall of Rome yielded the Dark Ages, a U.S. fall would yield the Nuclear-armed Dark Ages. Which would set us up for full attainment of the Confucian Curse:
"May You Live In Interesting Times"
3) An Isolationist and/or Neutral foreign policy
I could fill pages on this topic. I recently asserted that America's foreign policy this past decade was about as coherent as a frathouse game of Risk on a Friday night. Interminable wars of occupation with no exit strategy, depleting the treasury, buying oil from terrorist sponsoring states etc. However, the most egregious blunder was becoming economically dependent upon a fascist state that shares none of the same values or goals as the U.S. The U.S. now relies upon China for much of its technology and for financing its ongoing debt. Without China's ongoing sponsorship the U.S. military will be dwindled to a shadow of its former self. The other ludicrous policy is continued reliance on foreign oil. Despite the pollyannas who would tell us that fracking means the end to all foreign energy reliance, the CIA factbook indicates that the U.S. still imports 55% of its oil from foreign sources (and no it doesn't all come from Canada). Let's review - the U.S. reached peak oil output in 1970 from which point forward it became a net importer of oil. That means this generation has had 40 years to improve its strategic position by adopting alternative sources of energy, and yet has stalled and obfuscated at the behest of energy industry special interest groups. These two issues alone show the depth of incompetence and corruption of U.S. policy-makers at this juncture.
4) A culture of innovation and entrepreneurship
I said at the top that the U.S. still retains an edge on innovation and entrepreneurship. It's in the country's DNA. That said, in recent years, more and more innovation has been outsourced to foreign nations, leaving the U.S. with significantly diminished advantage in engineering-intensive innovation. Therefore, I would posit that the U.S. needs to focus more resources on engineering-based innovation and less resources on innovating junk food and junk culture. While I am on that subject, I can't say much about a society willing to stuff its own kids full of toxic waste junk food, all under the corporate-sponsored premise of "consumer choice". And suffice to say that any thought of the U.S. getting up off the inevitable mat, is wishful thinking so long as three quarters of the population is doing its level best to eat itself to death.
Where to From Here
All assessments of national potential obviously involve relative comparisons. I am not saying that there is another country waiting in the wings to usurp America's superpower dominance, because clearly if the U.S. economy collapses then China will collapse along with it. And no one can say whether or how long it would take for the U.S. to address these core issues and regain its mantle of greatness. Clearly I am skeptical that the Baby Boomer generation which did the most to impair America's greatness will suddenly reverse course and become the generation to restore the nation. As I said recently, the overwhelming preoccupation of the aged Baby Boomers is to maintain status quo at all costs. Ron Paul was the only candidate during this current election cycle who embraced a return to these basic principles, but he was shunted aside as if he didn't even exist. Obama merely holds the line for the gains made by the extreme right during Bush's presidency. And Romney at this late juncture is still intending to plough ahead with the right wing agenda. His main platform is to increase defense spending from 3% of GDP to 4% which would crowd out many other social programs, including food stamps i.e. at a time when they are most needed. And like Bush, somehow he has conned a substantial part of the middle class into voting against their own interest. But he is the fool of ages, if he assumes that the sheeple at large will remain steeped in their American Idol sponsored food coma, forever. Lastly, I am sure most outside of the U.S. don't believe that this country deserves a restoration of power, even if one could obtain, given its abject moral decline. Of course history will be the final arbiter, but given that no great power has regained its mantle of power following a major downfall, the odds are not good.
So with that said, and given that nature abhors a vaccuum, similar to the Fall of Rome, if the U.S. falls, then anarchy will likely reign globally. Whereas, the Fall of Rome yielded the Dark Ages, a U.S. fall would yield the Nuclear-armed Dark Ages. Which would set us up for full attainment of the Confucian Curse:
"May You Live In Interesting Times"
p.s. There are those who would say it's a fool's errand to predict history in real time. Those will be the people who are wiped out in the days to come.
