‘America risks the return of the very fiscal and foreign policy perils that Walter Lippmann warned about almost a century ago.’
Further reading on Lippman’s work.
As the US was dragged into the two World Wars in the 20th Century, America since has overspent in foreign wars that has not benefitted them in their national interest. The American media and the Military Industrial Complex often work hand in hand to galvanise the public opinions and bang the war drums by hawkish politicians. This has cost America into trillion dollar debt figure and hundreds of thousands of dead American young soldiers.
After the events of September 11th, 2001. The Bush Administration announced a War on Terror and used the ‘Axis of Evil’ speech to garner support from the American masses shocked by the events that terrorised their minds. Dick Cheney the Vice President to President Bush a long time friend of the President, has had important ‘links’ with defence industries. After the damaging wars in Afghanistan and a failed overthrow of Saddam’s government in Iraq, it has been revealed Dick Cheney and his compatriots earned millions of dollars of weapons contracts that individual firms. Halliburton the company that Dick had direct connections with reportedly made $34 million in profit.
Since the end of the Cold War, the American debt has been exponentially increasing. During the reign of President Clinton, the US ran a large surplus in the budget. This caused an initial rise in debt levels. It rose exponentially during the Bush Administration to $10.6 trillion and rising further under Obama Administration to $19.9 trillion. This shows how the wars in the Middle East has caused America to overspend and run on a budget surplus for over a quarter of a century. At current rates under President Trump, it is about to reach $21 trillion.
By increasing debt the current generation of American politicians is stalling the inevitable collapse only to get larger and have a heavier toll on the future generation. Some commenters have described this as a murder of the future. As the defence spending started to incur large budget deficits under the Reagan Administration in the 1980s, which was regarded to be done in a controlled manner. But the following Administrations took it out of proportion by incurring unprecedented amounts of debts regardless of their political stance being a Democrat or a Republican.
Borrowing to pay for public capital projects that generate future payoffs greater than the amount borrowed makes sense as well. Dams and infrastructure can be examples, provided expected future value is high enough. But investment does not need to be recognisable capital projects. Borrowing for the defense buildup in the early 1980s under Ronald Reagan could be plausibly justified even on a cost-benefit basis: On the one hand, compare what the on-going cost of continuing the Cold War would have been with the cost of a one-time buildup in the U.S. military sufficient to force the Soviet Union’s capitulation. While we don’t know whether the long, expensive wars in Iraq and Afghanistan would have been fought if the Cold War had not ended, at the time, in the early 1980s, it seems at least a fair argument that the costly arms buildup of the 1980s paid dividends far into the future.
Although, as the extract above suggests the debt could have been far worse if the Cold War had continued, as was the case for the Soviets, their debt and financial was the reason for their downfall. No doubt the American’s would have faced a similar outcome if the Soviets persisted in the Cold War and incurring large budget surplus by overspending in defence. However, the American politicians and the military industrial complex had millions if not billions invested in the Cold War and profiting from it. After the end of the Cold War America was in search for a new adversary to continue its military-industrial complex. The war with Saddam was an attempt, then the 2001 downing of the World Trade Centre found a new adversary for the defence the Neo-Wahhabi/Salafist insurgents in faraway lands.
The Soviet was a far greater threat than these so-called Islamic Terrorist organisations. Yet, the Americans spend far more than they did during the Cold War. Practically until 2011, Russia posed no threat whatsoever to America, yet the spending of US military outdid itself from the Cold War era. After the American and EU sponsored coup in Ukraine brought about a vehement anti-Russian oligarchy in Kiev, Russia has started to challenge American hegemony once again in the Middle East as it can be seen in Syria and more recently Libya.
Now, what has this done to the home economy of the United States? Americans are in a larger debt than they have ever been in its history. The future generation of the US will suffer as a result of the current generations choices. America currently operates around 800 military bases across the globe. This takes a huge toll on the American economy, this is now being reflected as America has now met a direct economic opponent in China, soon India and many other developing countries will join the ranks to compete with the unparalleled success of the American economy which was partly due to the petrodollar arrangement. Furthermore, one of the main reasons for US economic performance the petrodollar arrangement with Saudi Arabian lead OPEC is coming to stand still point, it is yet to be seen if this will end. However, the dollar advantage of US is shrinking and their economic growth rates may indicate that to an extent.
800 bases around the world are higher than the ones operated by the British Empire the largest empire in modern history. The British Empire solely relied on the extraction of resources from the occupied land. While the US ’empire’ is not quite the same, the US backs the friendly governments to give them ‘security-insurance’ and that allows American firms to enter the country without much restriction. Often, America relies on covert, and strategic geopolitical plotting to keep the countries under its influence in check. Often used for misbehaving government is Regime Change, or sanctions, boycotts and or crashing their economy through sabotage as seen in Turkey recently when the Americans flooded the markets with Turkish bonds that brought the Turkish Lira (Turkish currency) down to a record low.
This security arrangement worked effectively during the Cold War era when the world perceived the threat of communism. The communist threat is now dead, it does not have a backing like it did during the Soviet times. Although China remains a communist state, China does not engage in the internal politics of other states by funding insurgencies and nor does modern Russia. The American security arrangement is now under serious questioning, especially, as the President of the French Republic Emmanuel Macron along with his German counterpart made somewhat of an announcement of a European Army directly challenges and questions the role of the US controlled NATO over Europe.
The US Empire is crumbling, at least according to various scholars and political commentators. The US has overspent itself and it cannot sustain its position as the key supporters of its hegemonic role in the global political arena are now starting to question its role. With developing countries finally unshackling itself from the colonial legacies are not to once again outperform the former colonists. The declining European states are questioning the role of the US to back it up to stay in the hierarchy it obtained through colonising vast majority of the globe. The rise of India, China, African, Middle-Eastern and Latin American countries are making the once hegemonic Europe and their guardian the United States into serious contention.
The 21st century is turning out to be the era of the multipolar world order. The rise of these once colonised countries is bringing structural changes to the unipolar world order. With this situation the American policymakers have two options, continue with its overreach of military and political influence over states. This will take America to ‘cook up a new Cold War’ – some argue this will be done with China, or some suggest this will be against Russia or further wars in the Middle East to keep the petrodollar arrangement alive. But from the current developments further American wars in the Middle East looks unlikely, but a political fallout or a direct confrontation with China and Russia still remains on the cards. This would once again ‘legitimise’ the American role of the ‘global police’. Also, this would give them an opportunity to take China out as a competition. It can be argued the Pentagon’s dream would be to overthrow the Chinese communist party and to install a ‘liberal democratic’ government in Beijing. The other option remains to cut down on defence spending and focus on its immediate neighbourhood and embrace the multipolar world order and put an end to its role as the ‘global police’.
From the current developments, it seems as if the US government and policymakers are opting for a direct, or, Cold War-like confrontation with China to keep its role as the global protectorate. However, China is growing fast and so are its key allies namely Russia and other countries who oppose the American role of the global protectorate like Iran, and various Latin American countries. There is still time for the American policymakers and their major allies i.e., Britain to make amends and accept its declining role for long-term peace. If the American bloc engages in competition with the rising East, there are high risks of large fallouts or further regional conflicts via proxy wars. This does not serve the world peace agenda that American policymakers claim to be invested in.
In conclusion, the time has come for the US to consider its role in the global arena. It can only maintain its position for some time, the military spending has taken a huge toll on its economy, the American economy is becoming uncompetitive compared to China. This will put the American future generations in jeopardy. The debt may be stalled in the near future, but it will come to haunt the generations who are not yet born. It must be taken into account what they do now will reflect on the future of the country and might very well affect the future of its unity as one Federation.