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Giuliano Taverna

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The Rise and fall of the American empire.
« on: July 16, 2009, 10:39:46 am »
The Rise and fall of the American empire.

How neo liberal economists and neo conservatives foreign policy advocates destroyed the American empire, and how we can save it.

By Giuliano Theodore Taverna

Since the collapse of the soviet union, America has been the worlds sole global superpower. In that space of time the process of globalization has begun to erode borders, nations, cultures, ethnicities, and national sovereignty. This march of Globalization has been maintained and expanded by two main ideologies that have dominated Washington up until the present. Neo conservatism, and neo liberalism. The former being a foreign policy position, the later an economic position. Neo liberalism is an economic theory that places emphasis on the easing of trade by eliminating Tariffs, Regulations, Certain standards, laws, legislation and regulatory measures, and Restrictions on capital flows and investment. Neo conservatism is a foreign policy theory that places emphasis on unilateral preemptive military action to precipitate regime change and to maintain the current global order. In a break from traditional interventionism they are less concerned about multilateralism and internationalism and place more emphasis on the role of the US and its key allies rather than on the entire global consensus. In this essay I will describe what they have done, and what the effects were, good and bad. And I will explain their merits, flaws, and how they must be reformed in order to save the world order they have been created by, sought to preserve and expand, and have counter intuitively put at risk.

Neo cons fighting the good fight... by themselves.

On March 6th, 1991 President George Herbert Walker Bush declared, "there is the very real prospect of a new world order. In the words of Winston Churchill, a "world order" in which "the principles of justice and fair play ... protect the weak against the strong ..." A world where the United Nations, freed from cold war stalemate, is poised to fulfill the historic vision of its founders. A world in which freedom and respect for human rights find a home among all nations." After his victory in the first Gulf war in which UN forces lead by the united states defended the nation of Kuwait from the forces of Saddam Hussein. This was a war not fought in the direct national interest but for a concept known as preemption. Saddam was not a threat in 1990 to anyone excluding the tiny oil rich nation of Kuwait, moreover Saddam was more than willing to offer the united states and its allies all the cheep oil they wished for in exchange for giving him a free hand to build a new Babylonian empire in the fertile crescent. However the prospect of a war prone dictatorship controlling the middle eastern oil reserves was something the western nations refused to tolerate. In the aftermath of the invasion Saddam remained in power and president Bush called for the people of Iraq to "rise up" Saddam responded with a brutal crackdown that involved the conventional slaughter of dissidents, and the chemical annihilation of minorities with mustard gas. Unwilling to engage in regime change directly, the administration meekly allowed Saddam to repress the uprising remaining in power for the next decade. A long costly anti insurgency and nation building was avoided, but at what moral and strategic cost?

On April 28th 1999 President William Clinton called on the nation to support his war in Yugoslavia, in which communist strongman Slobodan Melosovitch instigated an ethnic cleansing of Muslim minorities in Bosnia. The UN in its typically inept fashion spent the days in bars drinking with the Serbian troops as their compatriots rounded up and liquidated millions of Bosnians. After the shameless ineptitude of the UN, the US in its typical readiness to act, but unwillingness to risk its own troops and thus public opinion about the conflict started an aerial campaign that prevented US casualties, but instead of targeting Serbian troops, simply bombed Serbian cities killing hundreds of civilians. The eventual outcome of the war was an averted genocide and the new states of Slovenia, Croatia, Bosnia, Montenegro, Serbia, and Macedonia successfully seceding from the genocidal Yugoslav regime. Yet again the new world order of George W.H. Bush motivated the US to go to war, not to protect its own interests, but to protect "the weak from the strong"

On May 1, 2003 president George Bush declared victory over Saddam Hussein's regime in Iraq, and indeed he was justified in declaring victory over the regime his father had defeated years earlier. However what he did not anticipate, which might very well be the reason his father George Herbert Walker Bush declined to actually topple the regime, was the growing insurgency that would soon turn Bush's victory speech, into a metaphor for the failures of neo conservatism, and the policies of the new world order. Its easy for a superpower to topple the regimes of rouge states, but its far more difficult and indeed many would argue impossible for that same superpower to defeat an insurgency and to "bring democracy to countries that historically have not had it."

The conclusion we have to draw from the conflicts we have fought is that in the absence of soviet union that had previously dominated the middle east, and eastern Europe, states that had previously been kept in check by the Red superpower were free to engage in their own ambitions, which in turn motivated the remaining superpower to step in to fill the power vacuum. However, their unwillingness to risk their own troops, take decisive action, and their na´vetÚ in tacking action, time after time marred their success and prompted nay sayers to attack the fundamental basis of their motivation. Many who decry interventionist war claim "its not our business" and to the extent to which massacres on the other side of the world don't effect the average American they are right. However the long term effects of ethnic conflict and empire building have almost always precipitated lager wars between conventional nation states, and the existence of non state terrorist networks have a parasitic relationship to modern nation states and threaten globalization itself which is the basis of the modern world order. So to that extent it is very much in our interest to prevent the spread of these groups, the proliferation of weapons, both conventional and otherwise, and the continued existence of traditional rouge nation states that support them.

Ultimately only with united action along multi lateral fronts with long term commitments to both manpower, funds, and resources, can nation states truly effect regime change and defeat insurgencies and dismantle terrorist networks which threaten directly, and indirectly all nation states on earth. Moreover there needs to be a public drive precipitated by an honest, direct, and effective appeal for this action by the leaders of the nations. The unwillingness of George Herbert Walker Bush to commit troops to assist the uprising he inspired allowed Saddam to commit a brutal suppression and retain power passing the buck to a future president coincidentally named Bush. The unwillingness of un member nations to commit their troops to decisive action allowed a genocide to take place right in front of un forces while they simply sat back and drank with the people committing the genocide. The unwillingness of Bill Clinton to risk public opinion with US casualties motivated a foolish aerial bombing campaign which only succeeded in creating an international incident that set back US Russian relations for years to come, only when American did commit ground forces was the crisis averted. Finally a vague association between Saddam Hussein and terrorism, or the unsubstantiated threat of WMD's was in retrospect insufficient justification for the war, and fatally undermined the war and the credibility of its supporters to the benefit of the enemy.

Neo libs, economic liberalization without social progression. 

Since the presidency of Ronald Reagan the economic doctrine of low taxes, deregulation, and the "invisible hand of the market" have become the defacto basis of the "Washington consensus" as well as the belief that western economies would always outstrip Asian market communism by virtue of the social liberties that spur innovation and prevent crony capitalism as seen in china from destabilizing the market. However a number of policies enacted over the years, have achieved precisely the opposite of what they were intended to do. Create a world where an increasingly fiscally untenable and economically regressive west is forced to borrow from an increasingly economically prosperous capital rich east.

The basis of economic investment has always been savings, however attempts to ease regulations for banking, and loan making has allowed what former federal reserve chairmen Alen Greenspan dubbed "irrational exuberance" in other words the assumption that financial products were worth much more than they actually where. Which given the inevitable economic correction would mean a dramatic destruction of wealth. This was exacerbated by the corrupt policies of large corporations such as Enron, which is the archetypical case of long term fraudulent activity polluting the financial market. The proliferation of toxic assets in the banking system would eventually lead to the massive unraveling by major firms in the financial sector leading to the massive credit crunch that resulted in an almost complete halt in capital investment, the basis of the capitalist economy as we know it. The steps to stop this have resulted in a massive deficit only financial by the issuing of bonds. It is in this way that what was once the worlds largest creditor has become one of the worlds largest debtors.

Elected on a campaign slogan as clear as it was well received, "read my lips, no new taxes" VP George Herbert Walker Bush succeeded his popular successor Reagan as the 41st president of the United states. In his inaugural address President Bush described "a kinder gentler nation" Indeed Bush together with congressional democrats increased unemployment benefits, renewed environmental commitments, and passed civil rights legislation. However at a time of economic recession he was faced with a decision on how to balance the budget that would come to haunt every president since. Whether to issue American bonds on the bond market i.e. increase the national debt and thus the yearly interest payments on that debt or simply raise taxes.

President Bush was wise enough to chose the least of all evils to the delight of his democratic opposition and raise taxes, in spite of the outrage of his republican base who wanted the impossible, a forth option which was a spending cut. This policy would doom the Bush administration, President Bush sat only one term losing the 1992 election to Bill Clinton largely due to republican disaffection regarding Bush and his broken promise.

After a long campaign of wooing the middle class president Bill Clinton succeeded Gorge Bush as the first democratic president since the failed regime of Jimmy Carter. His message was no new taxes on the middle class, new taxes on the rich, and a more liberal America. However an economic recession and renewed welfare commitments prompted Bill Clinton to make good on his promise to tax the rich, and protect the middle class... the problem? Many unhappy people woke up one morning to find that they were "rich" according to Bill Clinton, and as a result the middle class was taxed down to the 250,000 a year level. This decision was later reversed under the Newt Gingridge lead republican dominated congress, in which taxes were lowered, regulations were eased, and welfare was reformed, (dramatically reducing cost and offsetting the tax cuts and then some) all of these things spurred what came to be known as the Clinton surplus. Apparently A democratic executive branch is only fiscally responsible with a republican legislature, and as we saw with Bush 41, visa versa.

On December 8th 1993 Bill Clinton signed the north American free trade agreement which was intended to improve the economies of America, Canada, and Mexico by eliminating protectionism in trade. And while this has been a debatable success, it has had unintended consequences that put its benefits in doubt. As a result of American regulations many companies chose to outsource labor to Mexico further eroding American domestic manufacturing and farming. While the process of free trade can and does have benefits, when it occurs between a nation with high impositions on its business, and a nation with virtually non or even incentives on business, it creates a zero sum game in which one nation slowly consumes the economy of the other, and production shifts to the lower tax, lower regulation environment which is the natural result of market forces. The assumption that the invisible hand of the market would bring us all to a new age of prosperity was of little consequence to the factory workers and farmers now getting buy on unemployment rations even as they are teased with a "made in Mexico sticker" attached to a number of their goods. This same dilemma pervades our dealings with a number of third world continues, and disturbingly our largest creditor China who hold a massive trade surplus which they then use to loan us money to fund our consumption of their goods. Thus increasing our debt, their revenue, and maintaining an uneasy and unsustainable symbiotic relationship that Harvard University professor Niall Fergusson has dubbed, "chimerica"

In the 2000 election the future 43rd president of the united states George Walker Bush ran on two platforms, a humble foreign policy, (which would be totally forgotten in the aftermath of 9-11) and a term coined at around this time as "compassionate conservatism" or welfare based on conservative principles. Indeed on December 16th, 2003 president Bush declared "every American should own their own home" as he signed the "American dream down payment act, which pressured lenders to approve sub prime loans. This was part of the "ownership society" a compassionate conservative tenant that held welfare was fundamentally flawed because it was a collective system that ignored individual responsibility. Instead of granting collective people benefits, he instead attempted to help them on an individual basis, by easing their ability to buy a house, reforming social security, Medicare, creating medicate, and a number of other domestic programs which for a time improved the quality of life for many lower class Americans, particularly minorities (which ironically did not change their irrational bias regarding republicans.) However it also increased government spending. At the same time president Bush increased across the board tax cuts. This combination of lower taxes and higher spending, an odd perversion of the fiscally conservative maxim of lower taxes and lower spending, achieved what would be the obvious predictable result, but what was lost on the person signing the legislation into law, president bush, was a sizable budget gap. Again he was forced to make a decision between borrowing and taxation.

In this George Bush chose the worst option, borrowing money by issuing bonds. The result of this decision was a growing yearly deficit, and a collectively massive increase of our national debt, and thus our national debt obligations.  But this policy had an even greater consequence, it popularly discredited the notion of fiscal conservatism which was erroneously identified as the Bush policy of borrow and spend by ignorant socialist partisans. While nothing about the Bush administration could be qualified as fiscally conservative, this connection stuck.  President Bush was also a committed free trader, and while as I have noted this policy has benefits, it also carries a significant and fundamental problem. an uneven playing field leads to uneven trading in a free trade environment. By adding Latin American countries to the list, and working with the WTO to continue trade with Asian countries. The trade deficit reached an all time high, and outsourcing precipitated a dramatic loss of employment for thousands of Americans around the nation. More and more populist movements ranging from the socialists to the fascist began to attack outsourcing and the "evil corporations and corrupt politicians" for allowing it. Totally ignoring the lessons of history which tell us that the Smoot-Hawley Tariff Act was the single most devastating cause of the great depression, they advocate a return to tariffs and buy American provisions.

On January 20, 2009 the 44th American president Barrack Obama was inaugurated. He ran on a campaign laced with conservative appeals to tax cuts and fiscal responsibility, partisan saber rattling about the failures of the republicans and the Bush administration, class warfare appeals to attack the rich with confiscatory taxation, and populist appeals to attack outsourcing and even renegotiate nafta.

Much of this would later be forgotten in the first few months of his administration, in which we called for the biggest spending bill in American history, and the largest projected deficit in American history to combat what he cynically called, "the economy I inherited from president Bush." In spite of the platform on which he ran, Obama has used his political popularity to push what in many cases amounts to a 180 degree turn on his campaign rhetoric. The cap and trade, and healthcare provisions include taxes that will effect the middle class, below the mark he identified as either 25,000, or 20,000 a year, seemingly no action on the issue of trade, and an attitude towards business that can better be described as left wing crony capitalism than anything resembling traditional progressive populism. GE, the parent company of Obama biased media outlets MSNBC, CNN, and others stand to profit extensively on cap and trade, and green energy policies. And backroom meetings with Coal executives mimic the much maligned meetings of a similar nature that occurred under the Bush administration.

Ultimately we can conclude the following from the neo liberal policies. In regards to trade unilateral action towards or away from tariffs will lead to disastrous economic results, we cannot have free trade with countries that lack minimum wage, safety regulations, and collective bargaining by unions. However we can't unilaterally initiate tariffs without creating a trade war. Therefore the obvious remedy is to work with the WTO to impose a union of worker friendly regulated economies, that can forced nations that have no such regulations to adopt them for free trade. This way free trade will be balanced with an equal playing field, and better condition for the working class who suffer above all the consequences of our current trading policy, and would suffer most the result of the most publicized alternative.

In regards to fiscal policy, as I have mentioned we are limited to the borrow and spend model or the tax and spend model. The former being worse than the latter. However as I have implied there is actually a third option that I consider impossible in the current political climate, that is to spend less.

Why might we ask is it impossible to make our government run more cost effectively? After all businesses in the private sector are always finding innovative ways to cut cost and at the same time improve the quality of their goods and services... The problem lies with the inherent difference between the public and private sector. The later works around the profit motive which makes it the incentive to get the most returns for the smallest investment, the former however works on the principle of popularity, how can one create a policy that makes the least amount of people unhappy. This is the source of the dreaded special interest angle of our political process. Pressure groups form to block reforms that would disaffect them even on a temporary short term basis. So it behooves the average politician to pass any meaningful reforms even if they would benefits these same special interests in the long term. While there are rare exceptions thanks to a sadly diminished class of honest far thinking statesmen,  the majority view of our government today is that its better to spend more money, than it is to risk alienating special interest groups by passing the necessary reforms to create a sustainable economy. Rather than making government run better, we simply make it bigger, increasing the cost, while at the same time allowing the quality of its goods and services to diminish.

So in conclusion as our troops fight an unpopular war of attrition on the frontiers of our hegemony, and as our government fights an equally unpopular war on the current recession we have to ask ourselves, have we learned anything from the mistakes we have made? Considering the serious limits to our commitment in war, and our lack of interest in meaningful reform and progress in economic and government matters. I have to conclude that we have not, and while there is still a chance to save our position in the world, it is slipping away every day that the current administration pursue its fiscally irresponsible agenda, and its half hearted publicly demoralized commitment to foreign policy.
« Last Edit: July 19, 2009, 05:42:22 pm by Giuliano Taverna »
"It is the duty of a good shepherd to shear his sheep, not to skin them." Tiberius Caesar

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