Wednesday, May 2, 2012

Time to Start Thinking: America in the Age of Descent

It is election year in America.

The Presidential candidates will expound upon American exceptionalism; indeed incumbent Barrack Obama has reportedly been influenced by Robert Kagan's "Not Fade Away: The myth of American decline"

Are American elites so divorced from the reality of everyday life, the struggles of a diminishing middle class, the gutting of a dismembered working class, and a consumption based economic model that is stonewalled thanks to private debt deleveraging that they buy such drivel with gusto? Perhaps. Ultimately, sustainable military power derives from economic power. Empires learn this the hard way.

For a counterpoint to Kagan's view, consider listening to Doug Henwood's interview with Edward Luce. You can listen to it here. (The Luce interview begins at 30:30)

It is not so much a riposte to Kagan's neoconservative dreamscape as it is a shot across the bow to remember history. This blog warned about the inevitability of descent due to the tough choices facing the global hegemon in 2010 in Age of Empires: Waning towards a Fiscal Straitjacket

That Fiscal Straitjacket to which I alluded to in 2012 has taken the form a Fiscal Cliff in 2013: for a view on what that entails after the election hoopla is over read this piece by Morgan Stanley and the accompanying slides .

1 comment:

  1. Not a pretty picture. The estimated 2013 budget deficit of 6% (as a % of GDP) is bad enough by historical standards, but the real problem is the massive existing debt load and the enormous projected increase in debt. By 2029, there will be around 70 million baby boomers collecting a $1,000 cheque each month for as long as they live. That is $70 billion dollars a month in social security payments that will be added to government expenditures.