Americans cannot seem to adjust to the glaring fact that US hegemony is going down the drain; that America cannot get all that it wants or wishes for in todays world even if it is still the most dominant military power. In the 1980s, the British historian Paul Kennedy wrote a prescient book, The Rise and Fall of the Great Powers, where he chronicled the trajectories of powers like the Roman Empire, the Hapsburg Empire, and the British Empire. He noted a similar pattern and coined a term--imperial overstretch--to account for the inevitable decline after the peak of power. Imperial over-stretch is the mismatch between imperial capacity and imperial ambitions. When capacity lags behind, decline sets in. Why should the US be exempt? When the US reneged from its Bretton Woods commitments in 1971 with the Nixon shokku, talk about the decline of US hegemony started. In international relations theory, hegemonic stability theorists opined that US hegemony will be undermined in a relative sense since a benevolent US helped its erstwhile enemies--Germany and Japan--and its war-damaged allies in Western Europe to recover economically. What these guys gloss over is that all this help is good for American interests. One, it is good for its fight against the Soviet Union because its anti-Soviet allies are stronger and are not fertile for Soviet subversion or propaganda. Second, it is good for American business. Restored economies abroad represent robust markets for American companies. Why did American companies become transnational if not for the post-World War II economic recovery of the capitalist world? Even Levis jeans and Marlboro cigarettes became coveted goods in Moscow and St. Petersburg? Others correctly pointed out that the US can get away with its broken promises since the US dollar is the worlds money. We can but accept the US dollar and make it part of our international reserves. In fact, British IR theorist Susan Strange referred to the myth of lost US hegemony in the late 1970s. All this talk while the world was changing. The capitalist world plunged into a stagflation in the late 70s and early 80s after the rise of the oil prices in the mid-70s. Finance capital got strengthened by the influx of petro-dollars into Western and Japanese banks. Whatever ground gained by the Third World countries during the 70s got lost during the debt crisis of the 80s. Only South Korea survived and emerged stronger from its foreign debt woes. The US started becoming soft during this period. It de-industrialized and relied on trading partners for its consumer goods. Toyota, Sony, and soon Hyundai became household names in America. My favorite American running shoe brand, Brooks, disappeared. I cannot purchase a pair of New Balance running shoes that is manufactured in the US. When I started going to the US in the 1980s, I cannot purchase any consumer good that is manufactured in the US itself. Economists will say it is inevitable because US wages are very high. And that it makes sense to relocate production overseas--eventually to China. I thought economists styled themselves as physicists? Apparently like Lord Jon Snow, they know nothing. Nothing of physics at all! They have not heard of the law of action and equal and opposite reaction? My eye! As the US de-industrialized, American industrial workers started losing their jobs. Or they started financing their life through credit. While the going is good, all will be fine. Unfortunately, a hyper-financialized economy is not immune to crisis and shocks. The Black Monday of 1987. The dot crash of the 1990s. The SLA crisis. The junk bond crisis. The crash of the home mortgage market. The phenom of NINJA loans. The fall of Lehman Brothers. And now the current crisis. And for the first time, US treasury bills, the gold standard of all financial instruments of all time, lost its AAA+ rating. Meanwhile, US allies in Europe are struggling with economic woes of their own. Since then, the US has to deal with an unemployment rate that plateaued at 8% through-out the Obama presidency. Last June 2014, it inched up to 6% but American economists point to an inevitable trade-off--higher prices. So Americans have to contend with higher prices of consumer goods, transport, and housing while so many of them are still homeless and out of work. The most ominous sign is the failure of the American political class to achieved bipartisan consensus. It is almost a sure sign that a power is in decline if its house is not in order. American strength was then based on unity at home. Americans are divided bitterly by a person and what he represents or does not represent--President Barack Obama. Many Americans believe he is not American; that he is a Muslim and that he is African. These Americans tend to forget that US is the land of immigrants and is strong because of it. Many cannot accept him simply because of his skin color. The Republican Party is mangled by the emergence of the Tea Party. But for all their fulminations, neither the Tea Party or Republican Party cannot defeat Obama since 2008. And they do not have a viable candidate for 2016. Should Hillary Clinton win the presidency, all stripes of conservatives will have a hey-day attacking the first female US president. I dont see the emergence of bi-partisan consensus in the US up to 2020. If a Republican gets into the White House, there is no guarantee since it will be the turn of the Democrats to gripe. With its house in strife, with its economy in disarray, with its allies burdened with problems of their own, who thinks US decline is a fluke? Not unless a case can built that China and Russia and India will make all kinds of strategic blunders and that their economies are similarly house of cards.
Posted on: Sat, 12 Jul 2014 03:36:32 +0000
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