The End of the American Century

"Occupy Wall Street" Interpreted for China

2011-10-24T11:33:00.006-04:00

Today's issue of Wen Hui Daily in Shanghai includes a long interview with me on the Occupy Wall Street movement. The editors approached me on this topic because of the Chinese publication of my book The End of the American Century. The interview is interesting as much for the nature of their questions as for my own responses (though the latter did tie in very closely to important themes in my book).

Almost all of my responses seem to have been translated verbatim. However, the editors did exclude two items:

1) My reference (in answer "A3") to the 1980 Solidarity movement and the overthrow of the communist government in Poland.

2) The last question (16) and answer, which addressed Obama's commitment to social justice and a reference to Martin Luther King's statement that “the arc of the moral universe is long, but it bends towards justice.”

A link to the original Chinese publication is here.

My original English language responses to their questions appears below.

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Q1:The Occupy Wall Street movement is an event of global political life and social life. How to define this campaign? Is it a carnival, as Zizek worried about? or a media show? or a social movement to fight against financial oligopolies and to protest injustice?

A1. Occupy Wall Street is difficult to define because at this stage it is so amorphous, decentralized, and unfocussed. I would say it is an incipient social movement that captures a widespread sentiment in the United States against inequality and corporate greed, excess and corruption. Like many social movements, it has started out small, but has grown quickly, in terms of number, diversity of participants, and geographic scope. What started in New York has now spread to many US cities, and even to other countries.

But it would be a mistake to view these protests as a major political force, at least at this point. The protestors in New York number only about 1000 on any given day. On most days the Wall Street protests do not even make the front page of the daily newspaper in my city of Indianapolis.

You asked about Slavoj Zizek—the Slovenian Marxist philosopher who joined the protesters this week. But he is almost completely unknown in the United States, except perhaps by a relatively few intellectuals. His appearance at the Wall Street protests was not mentioned in most American news reports.

Nevertheless, I do believe that Occupy Wall Street is potentially very important in the U.S. It is focusing attention on inequality—a problem that has gotten very little attention in this country, but is, in my mind, at the heart of the serious economic, social and political problems the U.S. is now encountering. Wealth and income inequality in the U.S. are at the highest levels in 70 years—since the Great Depression—and are higher than in any other industrialized democratic state.

Q2. Some people think that liberalism in the pursuit of efficiency and profit has dominated the world for more than half a century, and the hands of the history should go to the side of fairness and justice. Do you agree with this? Will this movement really bring new social imagination to the world?

A2. I agree that neo-liberalism has dominated the world for more than half a century, but this is because the United States has been the dominant global power in that period, and the U.S. has demonstrated, exhibited and promoted this model of economic and political development. And it cannot be denied that the American model of capitalism and democracy has been both broadly appealing around the world, and highly successful in many parts of it. The fifty years following World War II were ones of unprecedented growth in global wealth and welfare—much of that fueled by the astounding growth of the economy, consumption, and prosperity in the United States.

But there was a dark underside to that economic growth, which became increasingly evident and problematic in the 1970s, and has accelerated since then. Increasing prosperity in the United States camouflaged a widening rich-poor gap in this country, and globally. Excessive consumption led to a proliferation of debt, both by governments and households. In the pursuit of profits and consumer goods, we increasingly neglected social goods: education, health care, infrastructure, and the environment. All of these are in serious difficulties now.

So in a sense, it is now time to right the balance, and to put more emphasis on fairness, justice and equality. These have always been central to the American ideal, and the American Dream, but have taken a back seat in recent years. I believe this is one of the principal concerns animating the Occupy Wall Street Movement.

Q3. We noticed that many people compare this movement to the events of 1968. But obviously, the Occupy Wall Street movement lacks clear leadership, lacks clear political pursuit, and also lacks a schedule, and a particular solution. Will all of these weaken its real strength?

A3. There are some similarities of the current movement with those of 1968 which, like the Wall Street protest, began mostly with young people. Comparisons could also be made to the recent Tahrir Square protests in Egypt; civil rights protests in the American South in the 1950s and 1960s; and the “velvet revolutions” in Eastern Europe in 1989. I think there are also intriguing similarities to the 1980 strikes in Poland, which quickly mushroomed into the “Solidarity” movement which came to topple the communist government in that country in 1989. (One of my own research specialties is Poland, where I spent much time in the 1980s).

It is true that the lack of leadership, focus and specific demands of the Wall Street movement diminishes its potential impact and power. Maybe these will cause it to collapse. But many of these other social movements mentioned above were also essentially leaderless, at least at first. The demands of some of them—including the student movements of the 1960s, and the Tahrir Square demonstrations—were quite diffuse and general. But all of those earlier movements, like this one, touched a nerve in the broader society, and in the end made significant, even revolutionary, changes in society.

Q4. The two political parties hold different attitudes towards the movement. On the Democratic side many people have shown understanding and sympathy towards the movement. The Republicans are opposite, saying the demonstration was "a battle with the wrong goal". So will these different attitudes lead the protests to be used by different political forces in different ways?

A4. It is true that the Wall Street Movement has been embraced by most Democratic politicians and pundits, and rejected or ridiculed by most Republican ones. However, I do believe the Occupy Wall Street movement has the potential to attract supporters across the political spectrum, from left to right. Let me offer two explanations for this reasoning.

First, public opinion surveys show a substantial majority of Americans have a favorable view of the Wall Street protests. A Time Magazine poll this week shows 54% viewing the protests favorably, and only 23% unfavorably. In contrast, only 27% still have a favorable view of the Tea Party movement. Another poll by NBC and the Wall Street Journal found that 37% of the respondents “tend to support” the Wall Street movement, while only 18% “tend to oppose” it. As I mentioned earlier, I think the Wall Street movement has touched a nerve in American society, and therefore has the potential to become much bigger.

Second, I would argue that there is actually a good deal of common ground and overlap between Occupy Wall Street and the Tea Party. While they are rooted in different segments of the population, and have different agendas, both movements are populist and anti-establishment, and both are reacting against the concentration and abuse of power, and the perceived neglect of average Americans. While I am sure many Tea Partiers are skeptical, and even hostile, toward the “hippies” protesting on Wall Street, I suspect that many of them would agree with the Wall Street Occupation complaints about government policies that favor the rich, the government’s bank bailouts, and the influence of money in the political system.

Q5. Protesting the greedy of Wall Street appears to be the most direct appeal of this campaign. But wasn't it Wall Street financial innovations that brought the United States to gain the leading position in nearly 20 years of global technological and financial competition?

A5. In my view, “financial innovation” contributed almost nothing to the growth of the U.S. economy in recent years. In fact, quite the opposite is true. The awe-inspiring postwar growth of the American economy, and of U.S. global power and influence, was rooted in a combination of explosive manufacturing growth, technological innovation, rapid growth in the standard of living and consumption, rapid increases in productivity, and the expansion of global trade. Banks and financial institutions were important tools in all of this, but it was their security and stability that was most important for these developments, rather than any financial innovations.

Indeed, the rapid growth of the financial services sector of the American economy in the last twenty years is a principal cause of our current economic crisis, and of America’s domestic and international decline. Over the last two decades, manufacturing has steadily declined as a share of the American economy, while financial services have steadily increased. But financial services, per se, contribute almost nothing to the economy. They just move money around. They are based on, and primarily depend on, the accumulation of debt. Banks and mortgage companies encouraged American consumers to take out loans, even when it was unwise for them to do so, because those institutions made money on such transactions.

In 2008, it suddenly became clear that this large sector of our economy was essentially a hollow shell. But because it was so large, the biggest financial institutions—like AIG, Citigroup, and Bank of America—could not be allowed to fail, for fear that the whole economy would collapse. Thus the government bailouts.

Yet now, just a few years later, many of these institutions are thriving again, and their CEOs are receiving compensation packages worth tens of millions of dollars. Meanwhile, unemployment remains mired at 9%, and the average worker in the U.S. is earning no more, in real [i.e. adjusted for inflation] terms, than he or she was twenty years ago.

This is one of the main grievances of the Wall Street Occupiers. Indeed, it angers most Americans.

Q6. After the outbreak of financial crisis, the appeal to reform the financial industry is very high, Obama also argued for increased financial control to win the election, but after he came into power why is it so hard for him to put into practice the regulation of the financial industry?

A6. President Obama did manage to steer through Congress a major reform of the financial regulatory system, the “Dodd-Frank Wall Street Reform and Consumer Protection Act,” in the summer of 2010. This act included the creation of a Consumer Financial Protection Bureau, which eliminates many of the worst practices of banks and credit card companies, which had helped drive so many consumers into debt. The Dodd-Frank bill was passed when the Democrats controlled both houses of Congress. Since the 2010 Congressional elections, which gave the Republicans control of the House of Representatives, any new initiatives in this direction have been defeated by Republicans, who oppose almost any efforts to strengthen the role of government.

Q7. The financial system has become the solid structure of modern society. Many economists think the campaign should not alter this basic framework. Is it because of this that global politicians and thinkers have not been able to put forward an effective alternative when confronting the real world?

A7. As I mentioned before, I disagree with this characterization of the financial system being the core of the modern economy. Banks and financial institutions are an essential tool for the development of modern economies. But their primary role is to provide stability and security so economic transactions and trade can operate smoothly.

The problem is that the financial services sector became a major independent actor in generating wealth based on moving money around, often through complex and obtuse financial instruments like hedge funds and credit default swaps. Many financial institutions became so wrapped up in this money-making sideshow that they undermined their primary purpose of providing stability and security to consumers, investors, producers, and governments.

Q8. People may feel that the government has been hijacked by entrenched politicians and financial oligarchs and increasingly polarized by the two parties. Even President Obama has said that he would rather the country lose than his rivals win [sic?]. For this, will the "occupation Wall Street" movement become helpless in facing this "institutional predicament"?

A8. It is true that money plays a huge and detrimental role in the American political system. Lobbies and moneyed interests play a disproportionate role in elections and policy-making, to the detriment of ordinary citizens. This is one of the complaints of Occupy Wall Street—though it is also of concern to populists on the right, like the Tea Party.

The polarization of politics, and the unwillingness of politicians to compromise, is also hurting the country, and inhibiting efforts to deal with the huge problems we are confronting. I think, though, that the poisoned political atmosphere, as well as the emergence of radical populist movements on both the right and the left, are a predictable response to the protracted economic crisis that we find ourselves in. People’s jobs, homes, standard of living, and economic security are all in jeopardy, and this causes fear and anxiety. Normal politics, and political compromise, are hard to come by in such an atmosphere.

Q9. In the end of the American century, you said, "American exceptionalism" makes Americans believe that poverty and wealth are due to the individual’s faults or achievements, and has nothing to do with the system. Will the campaign lead people’s thinking to the level of the system?

A9. In a big international public opinion survey that I directed some years ago, we found that Americans, more than any other country that we sampled, were more likely to believe that an individual’s wealth or poverty was due largely to his/her own talents or work, rather than to the economic or social system. Americans tend to believe that if a person works hard, he or she will succeed, and that anyone can become rich and successful, even those from disadvantaged backgrounds.

But in fact, there is less social and economic mobility in the U.S. than there was a generation ago. Increases in poverty and inequality over the last several decades are both a cause and a result of this. Children in poor neighborhoods (especially in cities) often go to poor schools, and are more likely to be exposed to drugs and violence. This poses enormous obstacles to achieving a good education, which is essential for success in the work force.

As I mentioned before, I think the major accomplishment of the Occupy Wall Street movement, so far, has been to focus attention on and raise awareness of the issues of economic and social inequality in the United States. As people confront this issue, they will begin to learn more about the systemic aspects of inequality. Mainstream news sources like Time Magazine and The New York Times are increasingly addressing issues of poverty, wealth and inequality. At least in part this is a response to the Occupy Wall Street movement.

Q10. Many young people participate in the "occupation" movement, and US young people have always been defined by their "generation:" the youth after the first world war was called the "lost generation;" and after the second world war was called the collapse generation. Will this one be called the awakening generation because of the "occupation" movement ?

A10. While the Wall Street movement began mostly with young people, it has now spread and grown and become more diverse. The issues that they raise affect almost everyone: witness the growing popularity of the slogan “We are the 99%.” So I do not think that this is primarily a generational revolution, like the ones of 1968. In the U.S. the richest 1% receive about 20% of the country’s income, and control about a third of its wealth--more than the amount possessed by the "bottom" 90% of the population.

Q11. The new media, which takes Wall Street financial innovation as its driving force to develop, such as FACEBOOK, TWITTER, has played an important role in the campaign,. Is this a great irony?

A11. I do not see it so much as an irony, as a function of modern society. Social movements and revolutions have speeded up, like everything else in modern life. Social media and electronic communications facilitated this in Tunisia and Cairo, and are doing so now in the U.S. and elsewhere.

Q12. the participants of this movement also wrote many slogan in Chinese. Is this behavior art of consumerism, or does it show that China provides some dimensions of their thinking?

A12. There are many signs, posters and slogans carried by the protesters, and a very few of these are in Chinese, which has received much coverage in the Chinese media. But I do not think that there is much, if any, Chinese connection

Q13. Winter is coming, so what do you see as the outcome of this movement? What’s the best situation or the worst case outcome？

A13. Bad weather is likely to put a damper on the movement, or at least the most visible manifestation of it—the actual “occupation” of Liberty Square in New York City. But we have already seen the expansion of the movement to many other cities and countries, so it seems to me that the movement has gained some traction, and I doubt that it will disappear anytime soon. If it is to develop as a true social movement, it will need some organizational structure to carry it over. This will be one of the early tests of its staying power. There were some indications of this potential this weekend, when it was reported that Occupy Wall Street has collected some $300,000 through fundraising.

Q14. In "The End of the American Century, you expressed some pessimism about the future of the US. But we also see that American technology, military and finance are still in leading positions globally. For example, the annual global university rankings show that American universities still leads the way in the world. This is one important symbol showing continuing US competitive advantage in comprehensive national strength. So is the view, perhaps, not so pessimistic?

A14. In my book, I argued that the United States has lost its leading or dominant position in almost every area: social, economic, political and international. I present data showing this decline, both compared to our own past, and compared to other countries. I argued that the exploding growth of debt was particularly problematic for the United States, and that the country was destined for a sustained and deep economic downturn. It will no longer be the dominant economic, military and global power that it was in the fifty years following World War II.

At the same time, this does not mean that the U.S. is disappearing as a rich and powerful country. Even if we returned to the standard of living we had in the 1970s, we would still be one of the most prosperous nations on earth. The U.S. model of democracy, and its ideals of liberty, equality and justice, have sustained the country through many crises, and remain a source of inspiration for people all over the globe.

What this means for the U.S., in my view, is that the country will have to adjust to a different global environment—one requiring cooperation rather than dominance—and to an era of reduced growth, reduced spending, and reduced expectations. This is a psychological adjustment, more than anything else, but for that reason all the more difficult to achieve! So far, we have not met that challenge very well.

Q15. You would be on the left flank of United States intellectuals. Be are intellectuals like you the majority or minority in mainstream American society?

A15. The sorts of things I write and say—in particular the notion that the U.S. is no longer #1 in many areas, is threatening to many people. Americans are generally optimistic, proud, and upbeat, and they do not like to hear, and often refuse to hear, messages that are less positive. But I think more and more “intellectuals” are beginning to recognize that the U.S. is in serious trouble, and this is trickling out to the general public. Occupy Wall Street is one manifestation of this.

Q16. Could you introduce an international justice plan under your leadership?

A16. It would be nice, but I am not in a position to do so! I believe that the election of Barack Obama was the best we could do in striving to achieve more justice, both domestic and international. Unfortunately, he was elected in the midst of an economic crisis that will not soon disappear. But I often take heart from the frequently repeated words of Martin Luther King: “the arc of the moral universe is long, but it bends towards justice.”

Cluster Bombs Used by Libya--and by the U.S.

2011-04-16T17:41:00.003-04:00

The New York Times has a front-page story today on how "Qaddafi is using cluster bombs in civilian areas." This is an atrocity and a tragedy, of course, but it is difficult for the U.S. to raise much of a fuss about it, because U.S. armed forces have also used cluster bombs in Iraq, Afghanistan, and Yemen. There is an international treaty--the Convention on Cluster Munitions--that bans the stockpiling and use of such weapons, but the U.S. is one of the few countries that has not signed the treaty. Fifty-six countries have ratified the Convention, and another 52 have signed but not yet ratified it. Among those that have not signed it are Israel, Pakistan, Libya....and the United States.

Chapter 6 of The End of the American Century, on "Abandoning International Order," documents the refusal of the U.S. government to sign dozens of international treaties and conventions that almost every other country in the world has adopted. It is this unilateralism and exceptionalism that has withered America's stature and moral authority in the world, and is one of the factors that makes it difficult for the U.S. to resume the leadership it held for so long in the postwar period.

Zakaria on American Decline

2011-03-23T11:16:00.013-04:00

The cover of Time magazine's March 14 issue features a piece by Fareed Zakaria, entitled "Yes, America Is In Decline." The inside story carries a less emphatic title: "Are America's Best Days Behind Us?" The article demonstrates how far Zakaria has come since his book (The Post American World) and mine (The End of the American Century) were first published in 2008. At that time, Zakaria viewed global changes as mostly coming from "The Rise of the Rest" rather than American decline. My book focussed on domestic American decline as the root of the problem, in combination with the rise of other global powers. I pointed out our differences at the time in a posting here on "Zakaria's Optimism."

Zakaria's story is accompanied by a graphic design (by Joe Magee) depicting the US flag falling apart--remarkably similar, I must say, to the cover design of my own book, with the U.S. flag in a vortex.

One can hardly call Zakaria's latest essay optimistic. That issue of Time presents a host of statistics and rankings, showing how poorly the US fares compared to both our past, and to other countries. The US ranks #10 in the world on the "Prosperity Index." We rank 6th in higher education enrollment; 11th in R&D spending; 27th in life expectancy; 31st in "Adequate food and shelter;" and 84th in the world on the domestic savings rate. (My book showed that, even in 2008, the US was falling behind on all of these measures).

Zakaria finds it especially unsettling that "Americans seem unable to grasp the magnitude of the challenges that face us. Despite the hyped talk of China's rise, most Americans operate on the assumption that the U.S. is still No. 1."

He concludes with the observation that we have to recognize our problems before we can adequately address them.

"For most of our history, we have become rich while remaining restless. Rather than resting on our laurels, we have feared getting fat and lazy. And that has been our greatest strength. In the past, worrying about decline has helped us avert that very condition. Let's hope it does so today."

This was the same overall message of my book.

The same issue of Time also includes a counterpoint article called "Don't Bet Against the United States."

What is the most beautiful music in YOUR country?

2011-03-06T22:40:00.003-05:00

As a pleasant diversion from the travails of The End of the American Century, I have created a new blog "The World's Most Beautiful Music" to debate and discuss this question: what is the most beautiful piece of symphonic music ever created in each country of the world? We've started out with the United States (Gershwin, Copland or Barber?), China, Zimbabwe and--the toughest one of all--Germany (Beethoven, Bach, Haydn, Wagner...or Mozart [is he German?]). Join the conversation, offer your suggestions, and vote!

Der Spiegel on "A Superpower in Decline"

2010-12-01T13:01:00.006-05:00

Sometimes the most clear-eyed analysis of the United States comes from outside the country, and this may be especially true in these times when so many Americans are frightened and angry about the way things are going. Germany's weekly newsmagazine Der Spiegel has published a long and thoughtful piece about the United States, entitled "A Superpower in Decline: Is the American Dream Over?" which reflects and updates many of the themes I raised in The End of the American Century.

For those who would dismiss Spiegel's analysis as biased, left-wing, or "socialist," I should point out that the magazine is generally considered to have a conservative (and capitalist!) slant. It is enlightening, and a little sobering, to read an intelligent analysis of our problems from outside the cauldron of contemporary U.S. politics.

Below are a few excerpts from the Spiegel article, though I would encourage everyone to read the whole thing.

• America has long been a country of limitless possibility. But the dream has now become a nightmare for many. The US is now realizing just how fragile its success has become -- and how bitter its reality. Should the superpower not find a way out of crisis, it could spell trouble ahead for the global economy.

• Americans have lived beyond their means for decades. It was a culture long defined by a mantra of entitlement, one that promised opportunities for all while ignoring the risks.

• The country is reacting strangely irrationally to the loss of its importance -- it is a reaction characterized primarily by rage. Significant portions of America simply want to return to a supposedly idyllic past.

• The rich keep getting richer, with the top 0.1 percent of income earners making more money than the 120 million people at the bottom of the income scale.

• Since the beginning of the millennium, no new jobs are being created on balance, because the US economy has undergone structural change. Companies are dominated by investors interested only in the kinds of quick and large profits that can be achieved by reducing the workforce.

• In 1978, the average income for men in the United States was $45,879. In 2007, it was $45,113, adjusted for inflation.

• How strong is the cement holding together a society that manically declares any social thinking to be socialist?

• The United States of 2010 is a country that has become paralyzed and inhibited by allowing itself to be distracted by things that are, in reality, not a threat: homosexuality, Mexicans, Democratic Majority Leader Nancy Pelosi, health care reform and Obama.

Can US Education Be Fixed?

2010-08-24T16:19:00.005-04:00

The following is an email I received from Lloyd Eskildson, about the failures of US education, especially in comparison with other wealthy countries.
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Your book is 'spot on' as the British would say, except for one aspect - needing more money for education. What is needed instead is much greater respect for education and increased parental/pupil motivation. Unfortunately, the resulting potential job attractiveness (also a motivator) would largely be negated by the much lower wage rates in Asia; at least this would cure the functional illiteracy issue. Though I have never taken an 'education course' nor do I have an education degree, I have had a strong interest in education for 30+ years, and have served as consultant to and Chief Deputy at the Maricopa County School Supt. Office. Following are some comments I made regarding a January, 2010 "U.S. News/World Report" that was trying to be optimistic.
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The bulk of this issue focuses on efforts to improve U.S. education. Contents include part of President Obama's plan (encouraging a longer school day and school year), D.C. schools' efforts to abandon teacher tenure and implement merit pay, New Orleans becoming the only major city with a majority of pupils in charter schools, and a major 'No Child Left Behind' (NCLB) mistake (allowing states to choose their own standards, invariably low). The issue also highlights the provocative question, "Will School Reform Fail?" on its front cover.

The answer, unfortunately, is "Yes - just like all the prior school reform efforts." But first, some background, starting with good news. 1)The "U.S. News and World Report" does not mention increased funding as a need. This follows decades of an emphasis on steadily increased inflation-adjusted funding/pupil (up about 250% in 30 years), with very little if anything to show in the way of improved pupil outcomes - especially at the high-school graduate level. Unfortunately, we have wasted trillions of dollars getting to this point, and continue doing so. 2)President Obama's efforts to extend the school day and year are on the right track. The late Professor Harold Stevenson (Univ. of Michigan) spent years researching differences between U.S. schools and those in China, Japan, and Taiwan. Each of the three nations spends a much smaller proportion of GDP on education, while their upper-level pupils consistently outscore ours. Stevenson found that Asian pupils spent almost 50% more time/week in class and had a school year about one-third longer. (Many Asian pupils also enroll in additional week-end and evening private schooling.) Similarly, years ago I found that the highest-scoring Arizona 3rd-grade readers were consistently located in the same small, farming community - the 'secret' was their teacher spent much more time on reading than others; unfortunately, this effort was not sustained in higher grades and the higher achievement faded as the pupils aged. Regardless, when Professor Stevenson presented his findings at a symposium that I helped organize, educators in attendance downplayed, belittled, and ignored his findings. 3)Studies have repeatedly found that high goals lead to higher achievement - in all areas of life. Hopefully, the NCLB mistake of allowing educators to assign themselves self-defeating low-goals (avoid accountability), will be quickly corrected now that it has been recognized.

Now, the relatively bad news. 1)U.S. educators are not likely to extend the school day and school year to come close to matching the efforts of pupils in the Far East - despite President Obama's imprimatur. 2)Education vouchers, school choice, and charter schools are major components of current reform efforts. All are based on the belief that schools competing for pupils will outperform those that do not. Makes sense, and there is some encouraging evidence. However, Stanford's Center for Research on Education Outcomes (CREDO) reported (6/15/09) that, 'in the aggregate, students in charter schools (are) not faring as well as students in traditional public schools.' Readers might be tempted to dismiss this finding as economic heresy; however, it is actually an invaluable piece of evidence. 2)The late Professor James Coleman (Univ. of Chicago) conducted one of the largest education studies in history, involving over 150,000 pupils, and intended to demonstrate that minority pupils were short-changed. Instead, Coleman found there was more variation in pupil achievement within schools than between schools - ergo, differences between U.S. schools were not the main key to success! Coleman's findings were derived from sophisticated statistical analysis. However, this major finding has been obvious for decades -sizable and sustained differences in pupil achievement exist between various ethnic and socio-economic groups. Instead of recognizing, celebrating (where appropriate), and acting upon those differences, we pretend they don't exist. When I went to school it was no secret that pupils of Asian and Jewish heritage performed, on average, much better than the rest of us. The rest of us survived a lack of special attention and got over it. Similarly, it's obvious today that minorities, in general, do much worse than most - in both dropout rates and academic achievement. How is this caused by, or to be cured by, the schools?

Coleman's finding is consistent with CREDOs. What's more, both findings are consistent with another of Stevenson's - that Asian parents (and pupils) were much more concerned about and involved with their children's' schooling than their American counterparts. Seemingly, American educators have been inadvertently functioning as education's worst enemies - constantly emphasizing the need for more money and new programs has implicitly downplayed the key role of parental and pupil motivation. Asian societies maximize those motivations through high-stakes college entrance examinations; conversely, the U.S. further reduces these motivations by trying to make it easier for graduates to attend college (already 67%, though about one-half drop out - up from one-fifth in the 1960s) through greater funding for aid and scholarships.

Finally, the really bad news. Education reform has been tried and failed for more decades than even I can recall. We've lurched back and forth from group instruction to individualized instruction, team-teaching to individual teacher teaching, bilingual instruction to English immersion, large schools to small schools, special education to mainstreaming, norm-referenced to criterion-referenced testing, New Math to higher-order thinking to rote drills, ability grouping to not, raising standards to building self-esteem through lower standards, more homework to less, reading instruction via phonics vs. whole language, cultural literacy to multiculturalism to values-free education, peer tutoring to teaching assistants, teacher-directed vs. child-centered, site-based management vs. leadership accountability, public school assignments by residence to open enrollment, vouchers, and charter schools, basic schools vs. 'regular' schools, etc. En route, we've also added kindergarten and pre-school (some areas), teacher professionalization, computers and the Internet, rebuilt and upgraded facilities, reduced class size, added specialists and supervisors, driven out competitive games in P.E., increased time-on-task (until we forgot about it), added compensatory education (Title I), Head Start, and gifted education, increased teacher pay to where it exceeds that of most private school teachers, raised additional monies through special tax programs, bake sales, book sales, and carnivals, and even mentioned parental involvement from time to time.

For what? Dropout rates, and achievement levels for those graduating are about where they were years ago. Its been like Lucie, Charlie Brown, and the football - over and over. The really good news is that Stevenson also found that U.S. children began school with higher achievement levels than their Far East competitors. We've had great educators - Jaime Escalante (Los Angeles), Marva Collins (Chicago), Mike Feinberg and Dave Levin (KIPP), Seymour Fliegel (Harlem), almost all those who taught at my high school (Wheaton High - '59), as well as innumerable successors today. But they can't do it on their own. We just need to forget about education fads, face reality, and demand more - starting with ourselves.

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My (DSM) response to this was as follows:

Thanks so much for this thoughtful essay. I agree with most of what you say, and especially your focus on the problem of parental involvement (or lack thereof) and student motivation. In my mind, though, the main reason for this in the US, compared to the other countries you mention, is simply the much higher incidence of poverty in this country. Poverty creates so many obstacles to effective education that no "fix" of the educational system is likely to work--as you point out.

Without Reform, Health Care Costs Will Skyrocket

2010-03-01T10:58:00.007-05:00

Rising health care costs will overwhelm the American economy and the American consumer, without an overhaul of the system. This is the conclusion of most health policy analysts, as well as a new study by the Commonwealth Fund, as reported in "The Cost of Doing Nothing" in the New York Times last Sunday.

"Health policy analysts and economists of nearly every ideological persuasion" agree that "the unrelenting rise in medical costs is likely to wreak havoc within the system and beyond it, and pretty much everyone will be affected, directly or indirectly," says the Times.

Karen Davis of the Commonwealth Fund, a nonprofit health care research group, contends that things will hardly stay the same if we do nothing: "in fact, what we will have is a substantial deterioration of what we have."

The Fund analyzed the potential cost savings of past proposals on health care reform, and concluded that all of them would have resulted in a much lighter burden on the economy than we now pay. Health care now absorbs about 18% of GDP in the US--far higher than any other country in the world. (The figure is about half that in other industrialized countries). If the Clinton health care reform had been implemented, according the Fund's analysis, health care would absorb only 14% of GDP. If earlier plans by Carter and Nixon had been, the figure would be about 11%. (See the chart at the NYT site, and above).

The Fund study also estimated that the typical price of health insurance for a family is likely to double in the next decade, from about $13,000 a year, to $24,000. Health insurance premiums as a percentage of median family incomes grew from 11% in 1999 to 18% in 2007, and are expected to grow to 24% by 2020.

These kinds of costs will further erode economic growth in the United States; they will impede U.S. global competitiveness; and they will bankrupt American families and the U.S. government.

The perilous state of the American health care system is one of the key components of the decline of the U.S., both domestically and internationally, and urgently needs correction. One only wishes the members of Congress could put aside narrow self-interest and petty politics, and seriously confront the issue.

For more on the U.S. health care system, see my earlier post "U.S. Health Care Compares Badly to Others" or click on the "Health Care" label on the right side of the page.

Student Debt: A Growing Crisis

2010-01-26T14:02:00.005-05:00

Caleb Hamman
chamman@butler.edu

Lately, with health care reform taking Washington’s center stage and Supreme Court cases and special elections filling the remainder, efforts to combat what is too often perceived as a “smaller issue” have gone widely overlooked. I am referring to the issue of student debt—one that, if left unchecked, will prove to be a potent driver of US decline.

The most recent action to address the issue is H.R. 3221, or the Student Aid and Fiscal Responsibility Act. The legislation would attempt to mitigate student’s exploding debt levels by reducing the role of private companies in servicing government loans. This would allow the government to cut back on subsidies to private firms and to give the resulting funds back to students, primarily in the form of Pell Grants to those from low income households.

The House passed H.R. 3221 last September, and the Senate is expected to take up companion legislation soon. Considering the current state of student borrowing, they should avoid delay.

According to the Project on Student Debt, nearly two-thirds of American students graduating from four-year colleges are indebted. For those who owe, the average amount exceeds $23,000. To put things in perspective, only 58 percent of American students were indebted upon graduation in 1996, and, on average, they owed only $13,200. (Note that all figures in this post are in current dollars.)

The historical trend is less than comforting. In 2008, The National Center for Public Policy and Higher Education (NCPPHE) found that the price of college tuition had increased by 439 percent since the 1980s, tripling the rise of family income over the same period and even surpassing the much maligned growth of health care expenses.

This explosion of student debt bodes ill for the United States, obviously because it jeopardizes American accessibility to higher education.

Students can only borrow so much—there will inevitably be a breaking point. Indeed, the NCPPHE’s study finds that “the continuation of trends of the last quarter century would place higher education beyond the reach of most Americans and would greatly exacerbate the debt burdens of those who do enroll.”

If large numbers of Americans become excluded from higher education, a multitude of problems are sure to follow.

From the callous perspective of economics, exclusion promises a poorly trained workforce, a risk for American competitiveness abroad.

From the perspective of politics, uneducated citizens threaten to summon the plagues of the Bush administration: susceptibleness to propaganda, disregard for global warming—all of the problems outlined by Dr. Mason in chapter four of The End of the American Century.

And, not least in importance, from the human perspective, an inaccessible system of higher education constitutes a certain path to lives of lessened potential for finding fulfillment and beauty.

Tragically, these are merely problems faced by those who are excluded from higher education.

Those actually able to attend colleges and universities face another set of obstacles. Not the least of these is the increasing likelihood of graduating with a mountain of debt, thus aggravating the already considerably problem of a heavily indebted citizenry, a topic discussed by Dr. Mason in his analysis of economic decline.

Stepping back, the growing necessity for student borrowing in the United States can be viewed as part of larger inequality trends. As shown in The End of the American Century, the United States has become exceptional among wealthy states in its high levels of economic inequality and in its relative failure to implement policies that would rectify the situation. If college continues to become increasingly unaffordable, education threatens to become a privilege afforded only to the wealthy. Not only will this provide a tragic demarcation of class along lines of knowledge (similar to an equally tragic demarcation of class along lines of health); rather, an exclusive system of education will also assist in keeping poor people poor and in keeping wealthy people wealthy. In other words, higher education will not simply distinguish class structures—it will help solidify them.

These are just a few of many reasons demanding student debt be brought under control.

Current proposals for reform should be passed and signed as soon as possible. And if we are serious about fixing this mess, we cannot stop there.

Has the Supreme Court Legitimized Armed Insurrection?

2010-01-21T13:20:00.003-05:00

The scary idea of insurrectionism may have been given a boost by the Supreme Court, according to a new and disturbing book by Joshua Horwitz and Casey Anderson, entitled Guns, Democracy and the Insurrectionist Idea, published by the University of Michigan Press. They argue that in the landmark Heller v. D.C. case of 2008, the majority ruling went far beyond the individual gun rights argument and opened the door to the (previously radical fringe) “insurrectionist” argument that citizens have a right to arm themselves to counter government tyranny. The authors make a strong case that this has potential to undermine Constitutional government, the rule of law, and democracy itself.

I raised similar concerns in chapter 3 of The End of the American Century, on the “Torn Social Fabric,” one important component of which was the huge number of violent crimes in the U.S., and the concomitant prevalence of some 200 million privately owned firearms. There, I raised particular concern about the minority of gun owners who believe that gun ownership provides an extra check on the government itself. As I wrote there ( p. 58):

“They see the Second Amendment to the Constitution as an implicit right of armed Americans to forcibly overthrow the federal government if they view it as tyrannical. It is hard to imagine any constitutional document, especially one with so many democratic checks and balances built into it, providing for its own violent overthrow. But many Americans seem to believe this—yet another reason why the United States is increasingly seen around the world as swimming against the tide of modern civilization.”

Horwitz and Anderson note that when they began writing their book several years ago, this insurrectionist idea was considered marginal, radical, and probably even treasonous. (Article III of the Constitution, in fact, considers levying war against the United States to be treason.) But the Supreme Court’s ruling in the D.C. case has given the insurrectionist idea more stature and respectability, and brought it into the mainstream. Horwitz and Anderson believe that this is a very dangerous precedent, potentially giving cover to those who would forcefully overthrow the U.S. government.

I share their concerns, and believe these concerns have become even more germane in the polarized and radicalized atmosphere of the last few years. Fox News stirs up hatred of the government, and calls into question its very legitimacy. The election of Barack Obama, ironically, has emboldened racists and bigots of all stripes, and led to a huge spike in the number of threats of violence against the President and the government itself.

In their conclusion, Horwitz and Anderson urge that “the Insurrectionist idea should be vigorously challenged by citizens in the court of public opinion and now, after Heller, in courts of law as well.” Among their recommendations for action is “occupying the common ground” with the majority of gun owners who are not Insurrectionists. In my mind, this solution is part of a broader need in the United States—for Americans to find the middle ground, and to isolate and marginalize those who preach hate, violence and intolerance.

Jon Stewart Gives John Yoo a Free Pass

2010-01-13T13:21:00.004-05:00

Jon Stewart hosted John Yoo on "The Daily Show" this week, and essentially gave the guy a free pass.

As Deputy Assistant Attorney General in 2003, John Yoo was the author of the infamous "torture memo" which argued that torture was allowable if the physical pain was anything less than "death, organ failure, or the permanent impairment of a significant bodily function." This memo, signed by Yoo, is available at the website of the ACLU at this link. In a debate in 2006 with Notre Dame professor Doug Cassell, Yoo apparently justified even the torture of children, in this exchange:

Cassel: If the President deems that he’s got to torture somebody, including by crushing the testicles of the person’s child, there is no law that can stop him?
Yoo: No treaty.
Cassel: Also no law by Congress. That is what you wrote in the August 2002 memo.
Yoo: I think it depends on why the President thinks he needs to do that.

Torture is explicitly prohibited by the Geneva Conventions; the 1984 Convention Against Torture; the 1948 Universal Declaration of Human Rights; the International Covenant on Civil and Human Rights; and the American Convention on Human Rights. Most scholars also believe torture violates the U.S. Constitution’s prohibition on “cruel and unusual punishment.”

Jon didn't raise any of these issues with Yoo.

Last spring week, a Spanish court opened a criminal investigation against Bush administration officials, including John Yoo,for violating international law in providing the legal framework for the U.S. government’s use of torture. (See my previous post on this).

By almost any measure, the decisions of Yoo and his superiors were legally incompetent. At the very least, their recommendations, and the decisions taken by President Bush, were violations of international law. They come close to crimes against humanity. They should be brought to account in this country, under American law. But Yoo, far from facing indictments in the U.S. continues to teach at one of the most prestigious law schools in the U.S., and continues to find a hearing for his views in the pages of the New York Times and the Wall Street Journal.

Shameful.

And we expect more from Jon Stewart!

Cutting Education Budgets Further Weakens the U.S.

2010-01-08T15:04:00.003-05:00

Indiana, like most states, is facing a budget crisis, and Governor Mitch Daniels (President Bush’s former Budget Director) recently proposed cutting $300 million from K-12 education budgets—3.5% of the total. This came on the heels of some searing stories in the Indianapolis Star about the dismal state of public schools in the city.

The Governor argued that he “had no choice.” But I am always wary when someone makes that assertion. We always have choices. The issue is priorities, not a lack of choice. Indiana had no difficulty, for example, raising $720 million to build a new professional football stadium.

Money alone will not solve the problems of public education in Indiana, or in the U.S. But inadequate funding is one of the problems, and budget cuts will simply exacerbate those problems. One reason that the U.S. is falling behind globally in education, and why Indiana is lagging nationally, is because of low levels of funding for education. According to U.N. figures, the U.S. ranks 45th among the countries of the world in public spending on education, as a proportion of the economy. Among the 50 states Indiana ranks #33 in per capita expenses for K-12 education (U.S. Census Bureau data).

It should be no wonder, then, that our schools perform so poorly compared to others, both globally and nationally. The high school graduation rate in Indiana is 73%, placing us in the bottom half of the 50 states. Even worse, Indianapolis ranks dead last among the nation’s 50 largest cities in high school graduation rates

Our spending on education is low, in large part because our state revenues are low. While there has been a big hullabaloo about property taxes in the state, they are overall low compared to other states. As a proportion of household income, they rank 34th among the 50 states. Indiana’s income tax rate is also low, especially given the “flat” rate of 3.4%. Most states have “bracketed” tax rates (as for federal income taxes), which require wealthy people to pay a higher rate than poor people. Almost all such states have top brackets above 5% of income.

So we are getting what we pay for. We have low taxes, low funding for public education, and poor schools. One choice—a necessary one in my view—is to raise taxes, especially on those who can most afford it, and begin providing funding that the schools deserve. We have choices.

U.S. #1 in Cumulative Carbon Emissions

2009-12-20T14:18:00.004-05:00

This is why the developing countries are unhappy about U.S. insistence that they cut THEIR carbon emissions!.

See scientist James Hansen's Newsweek article on "Power Failure: Politicians Are Fiddling While the Planet Burns" where he writes that "Planet earth is in imminent peril." We now have evidence, he continues "that continued exploitation of all fossil fuels on Earth threatens not only the other millions of species on the planet but also the survival of humanity itself--and the timetable is shorter than we thought."

While Hansen supported the election of Barack Obama, he now believes that in terms of climate change, "President Obama does not get it" and that he and his advisers have caved to pressure from monied interests.

"Civil resistance may be our best hope," he concludes.

The 21st Century, Multipolarity, and Education

2009-12-13T12:25:00.003-05:00

The following email from Gaston Younger provides an interesting perspective on America's global reputation, the rise of other powers (especially in Asia) and the poor state of U.S. public education. As you will see from his emails, Younger lived in both Vietnam and France before coming to the U.S., where he served 20 years with the U.S. Army.
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I just read you book "The end of the American century" and find it very fascinating but yet a gloomy, unpleasant realistic outcome for our country if our elected public officials do not take into consideration the serious situations (financial, economic & educational) facing the US.

I was born in French Indochina & I can attest to the facts on my vacation trip to Vietnam and the surrounding countries of the former French colonial empire that China has replaced both France & the US as the preeminent global power in that part of the world. We should all welcome the new era of multipolar world; however American citizens should definitely demand from their government on both local & federal levels to invest more financial resources in public education if we are to compete successfully with the new rising powers; S Korea, India, China, Brazil.

After the disastrous eight years of the Bush regime & a total lock on power by a fanatical, right wing Taliban GOP controlled US Congress from 1994 until 2006, our country image abroad has dramatically deteriorated. It is incumbent upon informed citizens to urge their elected public officials to take implement immediate actions in the areas of k12 public education & environmental friendly green energy if we are to pull our country out of this economic fiasco.

........................
After receiving this email, I responded to Gaston, asking him about his own background, and this is his reply:

I was born in Vietnam from a mixed French-Vietnamese ancestry, left Vietnam in '67 for France where I continued my studies & came to the States in '73. I graduated from high school in New Orleans & joined the US Army for the next 20 years as a linguist (French & Arabic). I was stationed mostly throughout the Middle East, did couple tours on the DMZ in Korea & one tour in Germany. I was selected by the Army to attend DLI(Defense Language Institute) where I graduated top 5% in my Arabic class.

I was fortunate to have a throughout French education in my childhood in Indochina. The French educational system is second to none in Western Europe. It emphasizes primarily on the rich tradition of French literature. All kids memorize at an early age "les fables de La Fontaine"by Jean de La Fontaine, the classical works by Victor Hugo, Moliere, Guy De Maupassant, Honore de Balzac, Emile Zola, Albert Camus, Anatole France, Gustave Flaubert.

Thinking about Vietnam in the 20th century, I am saddened by the critical mistakes made by the French government in 1945, when it refused to recognize Ho Chi Minh declaration of independence; however France recognized Laos independence four years after the end of WW2. Did you know Ho Chi Minh actually admired the US? It is unfortunate the cold war allowed many demagogues particularly US Senator Joe McCarthy and many more in the Truman & Eisenhower administrations to demonize Ho Chi Minh & portrayed him a a Soviet stooge or harboring pro-Chinese sentiment while Vietnam has deep mistrust of its northern neighbors for thousand years & lets not forget it was the same Ho Chi Minh who organized the guerrilla warfare against the imperial Japanese Army occupying French Indochina while working closely with the OSS.
Like many Vietnamese, I have a deep admiration for French culture, literature, cuisine, music.

I share many of your political ideas. I worked in 2004 for John Kerry but I was disheartened by the election results, I still could not understand the reasons 58 million Americans voted for a demagogue from the red state of Texas considering his shady personal character & many policies implemented by his administration will definitely affect our country for years to come. I wore the Army uniform for 20 years with pride, but the prisoner sexual abuse at Abu Graibh made me sick to my stomach & soiled our country image throughout the world, I will never forgive this rogue Bush regime for destroying our military, ruined our country image abroad.

The midterm election in 2006 & President Obama successful election in 2008 finally gave us some hope to turn this country around, although it may be a little bit too late. The damage (fiscal policy mismanagement, unilateral foreign policy) has been done.

Obama's Peace Prize, and U.S. Power, as Seen From India

2009-12-10T12:01:00.005-05:00

The Nobel Committee's selection of President Obama for the Peace Prize is a recognition of the reality that U.S. power rests "not in its weapons or in its armies, but in the syncretic values of the American people." This is the view of India's M.D. Nalapat, a Professor of Geopolitics at Manipal University. Professor Nalapat's essay, "Peace, Not War, the Best Strategy" appears on the webpage of the China-U.S. Friendship Exchange as part of a dialogue on the themes of my book on The End of the American Century.

This response to Nalapat's essay appears on that same site this month.

It is both enlightening and refreshing to hear about the U.S. role in the world from a thoughtful critic outside the U.S., like India's Professor M.D. Nalapat. He points to the past tendency of the U.S. to rely on ''military and economic muscle to seek 'compromises' that are in fact surrenders by the other side.'' I believe those views are widespread in the world, though quite different from the way most Americans perceive their role in the world. It is difficult for Americans to hear the voices and opinions of others, because we are so used to thinking of ourselves as the world's best, and the most admirable. Kishore Mahbubani, the author of The New Asian Hemisphere, thinks Americans are blind to their own shortcomings, and basically unable ''to listen to other voices on the planet.'' In an increasingly globalized and interconnected world, this is one big factor in America's declining global power, influence, and effectiveness.

Mr. Nalapat views the great strength of the U.S. resting in its ''syncretic values'' and its openness to innovation and immigration. Indeed, I would agree that immigration, and the power of assimilation and adaptation, have been an important element of this country's history and development. Immigrants have provided both an energetic workforce and a vital source of creativity, innovation, and invention. The election of Barack Obama, an African-American with a multi-ethnic heritage, seems a confirmation of this admirable national trait.

However, this American advantage may also be eroding, and even becoming problematic. In the U.S. now, there is growing anti-immigrant sentiment, and one would expect this to increase as the economic downturn continues to bite. While the United States has (almost) always welcomed others to our shores, we have not usually treated them very well once they get here. Hispanics and other minorities, for example, experience much higher levels of poverty and unemployment than Whites, and are much more likely to be stuck with poor schools and inadequate health care.

The U.S. is still a global leader in science, technology and innovation, but even in these areas, the country is losing some of its edge. Over the last two decades, the U.S. has steadily lost its overwhelming global dominance in the production of both patents and scientific journal articles. The decline of American schools has taken a toll on science education, too, with American students often coming in dead last on international tests and competitions in science and math. China produces four times as many engineers as the United States. As other countries like China and India gear up technologically, it seems likely that talented and creative people are more likely to stay at home, or return home after taking some education in the United States.

Of course the U.S. remains a major global player in science, technology and innovation. But its ''American Century'' dominance in this area, as in so many others, is on the wane in the face of both domestic decline and the ''rise of the rest.'' Similar to Joseph Nye's emphasis on culture, Madhav Nalapat stresses the ''arts and sciences'' as a powerful tool for the U.S., especially in its interaction with China. And this is where I most differ with Dr. Nalapat. While culture and scientific exchanges are important, they can not substitute for the much more overwhelming influence of trade and economics. This is where China (and the EU, and India) are really gaining, and where the U.S. is particularly vulnerable. It is the growing economic might and confidence of these powers, and others that will most challenge the dominance of the United States.

Joseph Nye on American Power in the 21st Century

2009-12-05T10:23:00.004-05:00

Harvard Professor Joseph Nye's work, especially his book Soft Power has much influenced my own thinking, and figures prominently in The End of the American Century. His ideas have directly or indirectly influenced the Obama administration, as reflected in Secretary Clinton's use of the term ''smart power.'' Both the rhetoric and actions of the Obama administration add substance to the concept.

Professor Nye's essay, "American Power in the 21st Century," is featured on the website of the China-U.S. Friendship Exchange, as a "comment" on my own "dialogue" there about The End of the American Century. This response to Nye's essay appears on that same site this month.

Professor Nye has long argued that power is multidimensional, that military power is increasingly irrelevant or dysfunctional, and that achieving foreign policy goals now rests on persuasion and cooperation as much as anything. I agree with him on all of this, and his marvelous formulation in this essay that ''on many transnational issues, empowering others can help to accomplish one's own goals.''

But I disagree with him that ''American power in the twenty-first century is not one of decline'' and the difference lies mostly in how we view America's domestic record. In Soft Power, Nye identifies many elements of American soft power, including its economy, culture, values, and global image. But as I show in my book, the U.S. has lost ground in virtually every domain of such soft power, while also losing strength and credibility with its military power and its global reputation. Meanwhile, other regions or powers, like China, the EU, India and others have gained global soft power influence, often at the expense of the U.S.

The U.S. economy and standard of living, since World War II a source of envy and admiration worldwide, is no longer much of a model or aspiration for others. Its astounding growth over the last two decades, it turns out, was a hollow shell, built on ballooning levels of household and government debt. The current economic downturn-still not finished by a long shot-is bringing the United States back to a more ''natural'' economic position, much lower than before. Even before the current crash, by many measures more meaningful than GDP/capita-like quality of life indices-the U.S. was nowhere near the top of the global list.

While growing the economy, based mostly on increased consumption, the U.S. neglected health care, education, investments, R&D, and infrastructure, and allowed increased levels of poverty and inequality. On all of those measures, the U.S. fares poorly in comparison to other developed countries.

Global opinion surveys conducted by Pew, BBC and others show little enthusiasm in other countries for ''American-style democracy,'' for American ways of doing business, or for the spread of U.S. ideas and customs. Though global opinion about the U.S. has improved somewhat with the election of President Obama, far more people worldwide continue to see U.S. influence on the world as ''mostly negative'' rather than ''mostly positive.'' On this scale, among 15 countries, the U.S. ranks 10th, below Germany, Britain, Japan and China, according to a recent BBC poll.

While American culture remains popular in many places (though not, by all means, all), it is difficult to see how global infatuation with ''Desperate Housewives'' can help solve problems like terrorism or global warming. As Professor Nye notes in his first paragraph, even some of our closest allies now believe the era of U.S. global leadership is over. Even more emphatic assertions of that belief have come from leaders in China, Brazil, Peru, Iran and elsewhere.

American decline is not necessarily a bad thing, though, given the increasing interconnectedness of countries and global issues. It will be easier for the United States to interact cooperatively with other countries-and for them to deal with Washington-if the U.S. is not so dominant and domineering. President Obama has adopted a much more conciliatory and modest approach to other countries-viz. his speeches in Ankara and Cairo-and this befits a country that has less reason to crow about its superiority and exceptionalism. As Professor Nye points out, most of the big issues facing the U.S., and the rest of the world, are not susceptible to the application of power by a single country. More things are ''outside the control of even the most powerful state.''

The United States is certainly in decline, both in absolute terms, and relative to other countries. But it will remain an important and influential power, especially if it continues to adopt a less arrogant, more cooperative approach to the rest of the world.

Dick Armey: Fostering Hate with Deliberate Lies

2009-12-03T14:00:00.002-05:00

I was absolutely stunned to read this quotation from Dick Armey, the former House Republican leader, in a speech he gave recently in North Carolina:

"Nearly every important office in Washington, D.C., today is occupied by someone with an aggressive dislike for our heritage, our freedom, our history and our Constitution."

It is inconceivable that Armey, who worked so long in Washington, actually believes this. Could he actually come up with some names of people that fit in that category? Probably not. So one can only conclude that Armey deliberately lied when he said this to a crowd of supporters in Hickory, N.C.

Since retiring from the House in 2003 has worked as a lobbyist for a big law firm, while also serving as chairman of a conservative nonprofit called FreedomWorks, which is opposed to "big government." A story on him, and how he "has taken his politics and ideas to the right-wing protest movement," appeared in the November 8 issue of the New York Times Magazine.

Later, in discussing the health care reform with a reporter, he admitted that he did not believe some of the extreme charges--for example, about "death panels"--but said that "if people want to believe that, it's O.K. with me."

This is demagoguery, fear- and hate-mongering that has no place in the U.S. political arena, though it is increasingly dominating and poisoning the political process, and American democracy. Armey should be ashamed of himself; instead, he seems to revel in the way his provocative lies stirs up the political pot.

President Obama called attention to this phenomenon in his Afghanistan speech on Wednesday night, where he called for a return to the spirit and values that unite us as Americans:

"we, as a country, cannot sustain our leadership, nor navigate the momentous challenges of our time, if we allow ourselves to be split asunder by the same rancor and cynicism and partisanship that has in recent times poisoned our national discourse."

"I refuse to accept," the President continued, "the notion that we cannot summon that unity again. I believe with every fiber of my being that we -- as Americans -- can still come together behind a common purpose. For our values are not simply words written into parchment -- they are a creed that calls us together, and that has carried us through the darkest of storms as one nation, as one people."

We can disagree about policies, and the role of government, and the rights of the individual vs. the needs of the community. That is all part of the political process. But we need to speak out against, and call to account, people like Dick Armey and Glenn Beck who deliberately lie and deliberately foster hate and division.

Global Debt Comparison

2009-11-16T11:11:00.010-05:00

Britain's Economist magazine online has a very interesting and useful interactive map on global debt, showing the public debt levels of most countries in the world. One can slide the tabs to look at past years, or projections for future years. Pop up graphics also show public debt per capita and as a percentage of GDP.

A striking feature of the global map is that it is mostly the wealthy countries (North America, Europe and Japan) that have the highest debt levels worldwide. Some of the online commentary on this phenomenon point out that many of these countries are actually in worse shape than the U.S., in terms of government debt levels.

My friend and colleague Jeff Payne (who this semester is teaching a course using The End of the American Century as one of the texts), called my attention to this Economist site, and made the following observation:

It seems the US is indeed taking out extreme debt over the recession, but not in the same level of GDP as many other developed countries. So, among the most developed nations, we are not the worst - do not know if that is anything to celebrate. Yet, in relation to your research program I wonder what this means...is the American experiment exhausted, or is the entire Western world in that same situation?

My response would be that yes, most of the Western world has government debt problems. I see the U.S. situation as far more dire, though, for the following reason. Most of those other countries accumulated their debts while financing government programs that supported health care, social welfare, education, infrastructure and the environment. Most other wealthy countries are far ahead of the U.S. in all those dimensions, as I point out in my book. The U.S., in contrast, accumulated our huge debts largely by financing consumption and military spending. All the while, U.S. health care and education languished, poverty and inequality increased, the environment and infrastructure deteriorated. So at the starting gate of the new global order, the U.S. is way behind the rest of the developed world, and too broke to catch up.

Reality and Hope in the Obama Era

2009-11-12T14:08:00.010-05:00

What follows is the first page from the new epilogue of the paperback edition of The End of the American Century, entitled "Reality and Hope in the Obama Era."

“What is required of us now is a new era of responsibility -- a recognition, on the part of every American, that we have duties to ourselves, our nation and the world." --President Barack Obama, January 20, 2009

Much has changed, for better and for worse, since the hardbound edition of this book first went to press in early 2008. Indeed, the publication of the book in October of that year coincided with both the exhilarating finale of the 2008 presidential elections, and the meltdown of the U.S. economy. The election of Barack Obama fulfilled the first criterion of the “best-case scenario” that I posed in Chapter 10: new political leadership. Both for who he is and what he says, Obama provides the best possible hope of restoring some of America’s domestic health and international reputation, after the catastrophic lost decade of the George W. Bush administration. President Obama wants to fix the many American problems enumerated in this book—health care, education, infrastructure, the environment among them—and in the first months of his administration had already initiated policies and legislation to do so. He also pledged from the outset to withdraw U.S. forces from Iraq, to abide by international law, and to be more cooperative and multilateral in dealing with other countries.

On the other hand, as I cautioned even for the best case scenario, new leadership will not reverse or solve the problems of American decline. The problems facing this country are so systemic and deep seated—most of them long-preceding the Bush administration—that even radical changes will have only minimal impact on the trajectory of America’s decline. Furthermore, the debt-induced economic crisis that I presaged at the end of Chapter 1 is already well underway. Much of the country’s economic growth of the last twenty years was fueled by government and consumer debt, creating a giant country-sized Ponzi scheme that was bound to implode. President Obama’s well-intentioned and necessary—but enormous-- spending plans to fix things will only hugely inflate the country’s already unprecedented levels of debt. It is difficult to see how the country will extricate itself from this mess. Certainly the time frame is many years, perhaps a decade or more, and not the cheerful predictions of most economists and politicians that we will be out of the woods in a few months or years.

On the international scene, the events of the last year have been a good-news, bad-news story. The election of an African-American as President of the United States gave a huge boost to this country’s international reputation. Obama’s message of hope, reconciliation, humility and multilateralism was welcomed all across the globe, and promised to allay—at least somewhat—the ill will fostered by the Bush administration’s arrogance and belligerence. However, during America’s lost decade, much of the rest of the world had moved on, and beyond, the United States. Almost nowhere is the country still viewed as the “city on the hill” to be followed and emulated. Increasingly, foreign leaders and their populations have dismissed, criticized or mocked the U.S. and its policies. This tendency has accelerated as the rest of the world has had to bear the brunt of America’s economic and financial mismanagement. When the Chinese Prime Minister, for example, complained about “the unsustainable model of development characterized by prolonged low savings and high consumption,” there was no question which country he was referring to.

The End of the American Century Published in Paperbound

2009-11-12T12:37:00.008-05:00

The End of the American Century is now available in paperback, with a newly added epilogue on the Obama Presidency, entitled "Reality and Hope in the Obama Era." (See the next post for the first page of the epilogue). The book is available from the publisher at the link at the top of this page, and also from Amazon, Barnes & Noble, etc.

(For readers who purchased the hardbound edition, and would like to see the epilogue, send me an email and I will provide you with that chapter.)

Dialogue and Forum on "The End of the American Century"

2009-11-03T11:34:00.010-05:00

An extended "dialogue" on the themes of The End of the American Century has been posted on the website of the China-U.S. Friendship Exchange at this link. The interview with me was conducted by the organization's founder and president, Dr. Sheng-Wei Wang, who is based in Hong Kong. The interview focuses especially on America's changing global role and its relationship with China.

This November issue of the China-U.S. Friendship blog also includes two other essays on themes related to my book: "American Power in the 21st Century" by Harvard's Joseph Nye (author of Soft Power); and "Peace, Not War, the Best Strategy," by Professor of Geopolitics Madhav Das Nalapat at the Manipal Academy of Higher Education in India. Those two essays are accessible at this link.

My responses to those two essays will appear in the next (December) issue of China-U.S. Friendship.com.

Kolko's "The World in Crisis"

2009-09-30T10:43:00.007-04:00

The American revisionist historian Gabriel Kolko has published a new book, The World in Crisis, with a subtitle that is the same as my book, The End of the American Century. The book is a collection of essays, written since 2004, most of which have appeared in print or online though often, according to the author, revised and updated for this publication. The common theme is "the decline of American power, the limits of its military technology, and the end of a century in which the United States had the pretension to lead the world." (p. 3).

These themes are similar to those of my own book, and Kolko concludes, as I do, that America's "century of domination is now ending." But there are substantial differences as well. First of all, while Kolko's first two chapters address America's financial crisis, the clear focus of the book is on America's foreign policy and global role. In The End of the American Century, I see the roots of America's decline as much in the domestic arena as in the global one, though they are closely linked. Secondly, Kolko sees the decline of American power beginning very early--as early as the Korean War in the 1950s, whereas I see the decline beginning in the 1970s, and mostly as a result of domestic factors: especially growing consumerism, individualism, poverty, inequality and debt.

Kolko's book is World in Crisis: The End of the American Century, published by Pluto Press in 2009.

U.S. Health Care Compares Badly to Others

2009-09-23T14:54:00.017-04:00

In his address to Congress last week, President Obama decried the failures of the American health care system, and pointed out how poorly it fares in comparison to other wealthy countries. Millions of people in this country do not have health insurance and can’t afford necessary medical care. Tens of thousands die each year from lack of such access. We are “the only wealthy nation that allows such hardship for millions of its people,” observed the President.

The sorry and disgraceful state of the American system of health care is documented in The End of the American Century (pp. 48-53), and was also the subject of a post I made on this blog a year ago (US Ranks Low on Health Care). Since then, there is a mounting pile of evidence documenting how badly America fares in health care, on multiple dimensions. This is true both in terms of general overall statistics, like infant mortality, maternal mortality, and average lifespan (reported by organizations like the World Health Organization and the United Nations), but also in more specialized areas, like survival rates for disease, patient access to physicians, and public satisfaction with health care in different countries.

The highly regarded Commonwealth Fund, for example, conducts periodic studies of such issues, comparing the United States to other wealthy countries. One such study on patient access to primary-care physicians found that Americans wait longer to see their doctors than patients in Britain, Germany, Australia, or New Zealand, Holland or France—all countries with strong public-health systems. Almost a quarter of Americans reported waiting six days or more for an appointment, compared to just 14% in the UK and 18% in France, for example.

Another study on “preventable deaths” found the U.S. ranking dead last of the 19 countries in the study. These are deaths that could have been prevented with timely and effective health care--which of course is often unavailable to millions of American citizens. The U.S. ranking on this scale actually declined from 1997 to 2003, from 15th place to 19th place. Number one in the ranking? France.

Yet another study compared five-year survival rates for various diseases in the U.S. Canada, Australia, New Zealand, and England—all of whom spend far less on health care than the U.S. Of the five diseases, on only one of them (breast cancer) did the U.S. have the best five-year survival rates.

The veteran journalist T.R. Reid has just published a new book, The Healing of America, in which he compares health care systems around the world. In a summary of the book in Newsweek ("No Country for Sick Men"), Reid observes that in health care:

“The United States is the odd man out among the world’s advanced, free-market democracies. All the other industrialized democracies guarantee health care for everybody—young or old, sick or well, rich or poor, native or immigrant. The U.S.A., the world’s richest and most powerful nation, is the only advanced country that has never made a commitment to provide medical care to everyone who needs it.”

Consequently, according to Reid,

“about 22,000 of our fellow Americans die each year of treatable diseases because they lack insurance and can’t afford a doctor.”

Many Americans express concern about the “rationing” of health care in a government-supported system. But has Reid observes, the U.S. already rations health care. It is “rationing care by wealth.” While this may seem natural to Americans, he says, “to the rest of the developed world, it looks immoral.”

The immorality of this is particularly callous in its effects on children. A study from the National Center for Health Statistics reports that poor children are 3.6 times more likely to have poor health than children from affluent families. As I point out in my book, “The United States is the only developed country in the world where children suffer poor health and die simply because their parents are poor or unemployed.” (p. 52).

One also hears concern in the current debates about the potential costs of a system of universal health care—legitimate concerns in the face of unprecedented government deficits and debt. But the U.S. already has the most expensive health care system in the world, no matter how you measure it. As a share of GDP (2006), health care constituted over 15% in the U.S., compared to 11% in France, 10% in Canada and 8% in England—all of them with universal coverage for their citizens (OECD). On a per-capita basis, the U.S. also outspends every other country in the world, by a long shot.

Many Americans assume that the largely private medical care in the U.S. is more efficient, less bureaucratic and less costly than the government-run programs in other countries. In fact, administrative costs in the U.S. are higher in for-profit hospitals than in public ones, and overall administrative costs are higher in the U.S. than in countries with government-run programs. Compared to other countries, the U.S. also comes up high on administrative costs in health care. A 2003 study in the New England Journal of Medicine estimates that administrative costs absorbed 31 cents of every health care dollar in the U.S. compared to only 17 cents in Canada, which has a universal health insurance plan paid for by the government.

By all of these statistical measures, the U.S. health care system looks bad. But what it really comes down to is not statistical comparisons but fairness, compassion and justice. And the outcome of health care reform will depend as much on these American values more than anything else. President Obama himself recognized this in his address to Congress, where he appealed to the “large-heartedness” in the American character—“that concern and regard for the plight of others.”

“It, too, is part of the American character -- our ability to stand in other people's shoes; a recognition that we are all in this together, and when fortune turns against one of us, others are there to lend a helping hand; a belief that in this country, hard work and responsibility should be rewarded by some measure of security and fair play; and an acknowledgment that sometimes government has to step in to help deliver on that promise.”

Much of the opposition to health care reform has come from people who are worried about how the changes will affect themselves and their families. Perhaps this self-interest is normal, and part of human nature. But our fate and health as a country is as much dependent on the health and safety of others as it is on our own. Re-establishing a sense of community and common purpose—and of the American tradition of large-heartedness—is an essential ingredient in the prescription for the ailing American health care system--and in restoring the United States as a great power.

Can We Cut Defense Spending to Pay for Health Care and Education?

2009-09-16T10:22:00.007-04:00

I received the following email, from a retired medical school professor, raising the question of budget priorities, and whether we might be able to help pay for health care reform and/or education by reductions in the military budget. My response follows the letter:

Professor Mason:

I've been reading your book, "The End of the American Century," these past
several days and am finding it very readable and informative, albeit a bit
depressing. I'm a biomedical scientist by training and trade (and a fellow
academic and resident of Indianapolis; see below), and am much in need of an
uncomplicated, understandable discussion of economic principles. Your book
meets those criteria very well and I appreciate having it available.

Now to my question. Since retiring from the university, I've enjoyed engaging
in online "discussions" of issues political from time to time. Most
recently, during a discussion of how we might pay for health care reform, I
innocently -- and sincerely -- suggested that we might consider closing a
few of our military bases around the world. I've read Chalmers Johnson's
trilogy on the American empire and am quite sympathetic to the view that
we've way overspent on the military. In any case, my opponent dismissed my
suggestion as naïve and irrelevant by citing government figures
(http://www.truthandpolitics.org/military-relative-size.php)showing that military spending--as a percentage of GDP--is a mere 3.7% of GDP and has
actually declined in recent years. His point, of course, which was not
supported by any data, was that domestic social spending far outstrips
military spending. I find this notion preposterous but I'm puzzled by the
data he cited. Should I surmise that the percentage spent on, say,
education, is several times less than 3.7%? Or is this rendering of the data
simply misleading? Can you help me to sort this matter out?

Thanks. I'm sorry to trouble you with this question, but you DID manage to
get me to pick up and read your book...

Regards,

Lynn R. Willis

-----------------------------------
Dear Lynn,

Nice to "meet" you and thanks for reading my book, and for the compliment.

On the question of defense spending, it is true that it is a relatively small share of GDP. But in terms of spending priorities--the question you are addressing--I think the more appropriate comparison is defense spending as a proportion of the budget, not the GDP. In the TruthandPolitics page you mentioned, if you scroll down to Graph 2 (Defense Spending as a Percentage of Discretionary Spending), you will see that defense spending is about half of the entire "discretionary" budget of the U.S. government. So defense constitutes more than all other categories COMBINED, and is far more than that spent for education, welfare, etc. "Discretionary" spending refers to those categories that Congress has some authority over, as opposed to "Mandatory" programs (funds already committed) for Social Security, Medicare, Medicaid, Debt Interest, etc.

You can get a better sense of this if you look at a discretionary spending pie chart, or for a more authoritative and detailed source, look at the actual federal budget summary at:
http://www.whitehouse.gov/omb/assets/fy2010_new_era/Summary_Tables2.pdf

There, you will see (Table S-3) that for 2009, the Defense Department budget is $666 billion, and ALL other programs get only $613 billion. Education (Table S-7), gets a mere $41 billion.

Incidentally, US defense spending also makes up about half of all defense spending in the world, so the U.S. outspends virtually all other countries combined.

So I agree with your point that a small cut in the defense budget could make a huge difference in some of these other programs, including education and health care.

-----------

Other comments welcome!

The Bankruptcy of American Economics

2009-09-10T17:55:00.010-04:00

It is not just the American economy that is bankrupt, but the profession of economics as well. It is partly the interaction of these two that has led to the collapse of the American economy and the huge economic hole we find ourselves in.

Paul Krugman provides a devastating critique of his own profession in the Sept. 6 New York Times Magazine , in an essay entitled “How Did Economists Get it So Wrong?” Krugman, a Princeton economist, New York Times columnist and Nobel prize winner, believes that

American economics, as a field “got in trouble because economists were seduced by the vision of a perfect, frictionless market system.”

The profession was blind to the possibility of catastrophic failures in a market economy, he asserts.

In a June lecture at the London School of Economics, Krugman argued that most

macroeconomics of the past 30 years was “spectacularly useless at best, and positively harmful at worst.”

Others besides Krugman are dissecting the economics field, and finding serious problems with it. Britain’s influential Economist magazine had a cover story (7/18) on “Modern Economic Theory: Where it Went wrong—and how the crisis is changing it.” They quote the LSE’s Willem Buiter saying that a training in modern macroeconomics was “a severe handicap” at the onset of the financial crisis. The main problem was that in many macroeconomic models, insolvencies simply cannot occur.
So much for those models.

The problem of economics is even worse, I think, because the discipline has been so intolerant of dissenting views. Modern economic theory is as much an ideology as anything else, with a faith in the market that ignores both reality and those who challenge the dominant paradigm. As the New York Times put it in a story last March:

“For years, economists who have challenged free market theory have been the Rodney Dangerfields of the profession. Often ignored or belittled because they questioned the orthodoxy, they say, they have been shut out of many economics departments and the most prestigious economics journals. They got no respect.”

I saw this firsthand at my university a decade ago, when we were attempting to create a department of economics within the college of liberal arts and sciences. I was on the search committee to hire an economics professor to begin building that program. But it soon became clear that there was a basic inconsistency between the goals of the liberal arts curriculum—free inquiry, critical thinking, competing ideas—and that of the economics profession. The candidates we considered most interesting , with provocative ideas and wide-ranging interests, were largely outcasts in their own discipline, which favored narrow specialties, and strict adherence to the free market ideology. “They got no respect” from the economics discipline, so didn’t have the necessary credentials, and couldn’t be hired. Eventually, the university gave up on trying to create an economics department in the liberal arts college.

Not only is the narrow ideology of modern American economics inconsistent with the traditions of critical thinking, it has proved totally incompetent at predicting the crisis, or figuring out how to get out of it. There are a few exceptions, like Paul Krugman, Yale’s Robert Schiller, and Columbia’s Joseph Stiglitz—all Nobel laureates—and some economics writers like the New York Times’ David Leonhardt. But until now, most of them have been voices in the wilderness, trying unsuccessfully to point out the problems of mounting debt, growing inequality, and neglect of economic and social infrastructure.

President Obama , I believe, recognizes the problems and is trying to remedy them, but he is caught in a vise between huge accumulated needs of the U.S.—for example in health care and education—and the unprecedented level of government and consumer debt.

From an outsider’s perspective—that of a non-economist—it seems to me that the problem is pretty obvious and simple, and the solution is equally obvious and simple, but horribly painful. The problem is that for a generation, American government and citizens have both been living well beyond their means, borrowing to pay for the plethora of consumer goods most of us enjoy. But in the meantime, we have neglected the poor, the schools, the health care system, infrastructure, the environment, and most of the rest of the world. We have lots of goodies, but the society is ailing, and we have passed the buck to the next generation.

The painful solution is that Americans will have to spend and consume less, pay more in taxes, and be prepared for a long-term contraction in the economy. There is evidence of this already, with people finally beginning to save, and to practice “consumer thrift.” But more saving and less spending simply contributes to a contraction of the economy. Banks, retailers, the service and entertainment industry have all depended on people borrowing to spend. As this changes, all these industries will decline, and the economy will decline.

Most American economists, including those with the President, are predicting an imminent end to the recession, and a relatively quick economic recovery. So far, virtually all such predictions have proved overly optimistic and wrong. I think those predictions are based on flawed economic models, and do not account for the depths of the hole we have dug ourselves into. We are in for a very long slog.

While I agree with President Obama and Professor Krugman on most things, I disagree with them that the solution is more spending, by government and consumers, to prime the economy. What we need now is belt-tightening, and a return to a more modest standard of living—perhaps comparable to what we had in the 1970s. This will entail a continuing and severe contraction of the U.S. economy, to return to equilibrium. In the long run, though, it will be best for both the U.S. and the rest of the world.

But you won’t hear this from many economists

Entering A Systemic Revolution

2009-08-26T12:27:00.005-04:00

The collapse of the United States as the global hegemon constitutes a “systemic revolution” that will transform both the U.S. and the rest of the globe. Such a revolution is different from “normal” political revolutions, which entail an overthrow of the government. A systemic revolution ushers in even broader and more enduring changes in economy, society and culture, and it also transcends national boundaries, affecting other countries and the global system itself. It is a global paradigm shift, and we are right smack in the middle of it.

This is the opening paragraph of my article "Entering a Systemic Revolution" which appears in the online journal Logos: A Journal of Modern Society and Culture (volume 8, issue 2). The article can be accessed here through my Selected Works page.

The article is a revised version of a lecture I gave in March at a conference on "The Past and Future of Revolutions" at Northeastern Illinois University.

In the article, I compare the current global situation to previous "systemic revolutions", among them the French Revolution of 1789, the Industrial Revolution, the Darwinian Revolution, and the anti-communist revolutions of 1989. Like those epochal changes, the domestic and international decline of the U.S. will affect both the United States and the rest of the world, and will bring fundamental and global changes in politics, economics, culture, and ideology.

Ovation, Inc.: Speakers on Issues That Matter

2009-08-17T12:31:00.004-04:00

I am now involved in a speaker's agency, Ovation, Inc., that is "a small but highly selective agency representing an array of affordable speakers addressing pressing issues of our time." Many of the issues raised in The End of the American Century, and on this blog, are topics available for lectures, classes, workshops, etc. by me and other experts on the Ovation roster. Take a look at the site at www.ovationagency.com.

Can America Fail?

2009-08-17T11:10:00.005-04:00

In its spring 2009 issue, The Wilson Quarterly featured a series of articles entitled "Decline or Renewal?" addressing the "scenarios for postcrisis America." The lead article, "Can America Fail?" was written by Kishore Mahbubani of the National University of Singapore, and the author of The New Asian Hemisphere: The Irresistible Shift of Global Power to the East (2009). The subtitle of that article is "A sympathetic critic issues a wake-up call for an America mired in groupthink and blind to its own shortcomings" which, in my mind, is also a pretty accurate description of yours truly!

Mahbubani believes that the U.S. has been "engulfed by a culture of individual irresponsibility" and sees many of the country's policies as deeply injurious to the rest of the world. Our policies on the Middle East, the invasion of Iraq, our double standard on nuclear proliferation, and our policies (or lack of them) on global warming "have injured the 6.5 billion other people who inhabit the world." Mahbubani thinks Americans need to be able to see our country the way others see us, to recognize and address our own shortcomings, and to be prepared to work harder, consumer less, and--especially--to sacrifice.

The two other essays in the Wilson Quarterly are a counterpoint to Mahbubani's article, but also illustrate exactly the problem Mahbubani addresses: Americans "mired in groupthink" and blind to their own shortcomings. The article by Tyler Cowen, Professor of Economics at George Mason University, asserts (without any evidence provided) that "today, the rest of the world is looking to the United States to pull it out of a recession." He also asserts, astoundingly, that the current financial crisis "has underscored the continuing strength of American global influence." Equally questionable, and more fodder for Mahbubani's observations, is Arthur Herman's assertion that "America is still the most innovative and creative economy in the world."

The editors of The Wilson Quarterly invited me to submit a response to these three articles, and a version of the following appeared in their "Letters" section in the Summer 2009 issue (page 6).

.............................
On the question of U.S. decline, Kishore Mahbubani hits the nail on the head by pointing to the inability of American thinkers and policy-makers “to listen to other voices on the planet.” Indeed, his point is illustrated by the contributions by others in the same issue who seem to assume that other countries want the U.S. to lead and who believe that the American economy is still the most dynamic in the world.

If one simply asks other people in the world what they think, these casual assumptions wither away. Global opinion surveys conducted by Pew, BBC and others show little enthusiasm in other countries for “American-style democracy,” for American ways of doing business, or for the spread of U.S. ideas and customs. Though global opinion about the U.S. has improved somewhat with the election of President Obama, far more people worldwide continue to see U.S. influence on the world as “mostly negative” rather than “mostly positive.” On this scale, among 15 countries, the U.S. ranks 10th, below Germany, Britain, Japan and China, according to a recent BBC poll.

It is difficult to see how the U.S. economy could be seen as so vital, innovative and creative at a time when the core parts of it are collapsing under the weight of innovative stagnation and stupefying levels of incompetence, greed, corruption. Manufacturing has steadily declined as a component of GDP, replaced increasingly by financial services. The U.S. does not actually produce much any more. Now the financial sector has proven a hollow shell, after fostering and encouraging record levels of both consumer spending and debt. This can no longer be sustained, so the U.S. economy is bound to decline, and probably by a lot. As Professor Mahbubani astutely points out, “the time has come for Americans to spend less and work harder.”

New Global Powers Emerge From Crisis: Shanghai Daily Interview

2009-07-27T16:10:00.009-04:00

I was interviewed in Shanghai by Joyce Pan for The Shanghai Daily, an English-language newspaper in China's largest city. Entitled "New Global Powers Emerge From Crisis," the interview focussed on the impact of America's economic crisis on China and other "rising powers." On the same page is an interview with French actress Isabelle Huppert, which should add to the number of hits that this blog gets!

Shanghai Daily Interview

American Values Contextualize Decline

2009-07-26T11:57:00.010-04:00

Caleb Hamman
chamman@butler.edu

Amidst national debate on healthcare, foreign policy, and economics, with news outlets devoting coverage to pundits, officials, and political processes, it is easy to overlook the role of the American citizen in shaping public policy—the popular culpability in US decline.

To the extent American democracy functions democratically (see my earlier post and EAC chapter five), public opinion is an important variable in the furthering or the mitigating of growing challenges. Troubling trends in the American psyche are among the results of the newest study released by the World Values Survey.

The research, spanning more than fifty countries during the past four years, shows considerable divergence between American and world opinion on issues of importance.

Reaffirming The End of the American Century correlation between religious fundamentalism and rejection of science, the survey found that Americans were nearly twice as likely as non-Americans to be active in churches or religious organizations; simultaneously, Americans were 11 percent less likely to consider global warming “very serious” and three times more likely to consider it “not serious at all.”

Gaps also existed in attitude toward security and conflict resolution, reflecting a continued embrace of “hard power” in American political thought, with Americans placing more confidence in the military than non-Americans and placing less confidence in international organizations like the United Nations.

By far, the biggest gulfs between US and global attitude were in the area of economic policy. Here, Americans were much more likely than others to be tolerant of inequality, to disfavor government intervention in the economy, and to believe in the wealth-accumulating potential of hard work and individualism.

The contrast of attitude was particularly striking between the United States and the fifteen European countries surveyed. Europeans were almost twice as likely as Americans to strongly agree that incomes should be made more equal. They were also more likely to view circumstantial factors like luck and wealth as important to getting ahead, and they were much more likely to consider economic redistribution an “essential characteristic of democracy.”

Perhaps the most poignant aspect of the survey results is that they highlight an American disregard for problems the United States is uniquely victim to. Among advanced, industrialized countries, US levels of economic inequality and economic immobility are among those of the worst (see post referenced above, this post, and EAC chapter two). Despite the myriad social and political consequences of US economic problems, Americans appear remarkably misinformed and unconcerned. Meanwhile, the egalitarian measures used elsewhere to alleviate economic ills are revealed by the survey to be anathema in American thought, underscoring the difficulties faced by the current administration in its efforts to restructure the economics of health, taxation, and market regulation.

In discussion of issues like these, and in wider discussions about the rise and fall of international powers, the role of the public consciousness should not be overlooked, for particularly in democracies, popular attitude not only shapes the spectrum of debate, but is itself shaped by the institutions of policy and reform.

Russia Hosts and Promotes Emerging Power Groups

2009-06-22T16:29:00.012-04:00

This month, Russia hosted back-to-back meetings of two organizations representing “emerging powers” on the global scene. The first of the two, both held in Yekaterinburg, was a meeting of the heads of state of the Shanghai Cooperation Organization, which is made up of Russia, China and the four central Asian states (and former Soviet republics) of Kazakhstan, Uzbekistan, Tajikistan and Kyrgyzstan. In 2006, Iran, India, Pakistan and Mongolia were inducted as observer states and expected to become full members soon. The presidents of the four observer countries, including Mahmoud Ahmadinejad of Iran, were all in attendance at the Yekaterinburg meeting. (When the U.S. originally applied for observer status at the SCO, it was turned down).

As I mention in Chapter 9 (“America’s New Rivals”), the SCO is nominally an alliance of “good neighborliness and friendly cooperation” but many observers see it as a counterbalance to NATO and perhaps to the EU. In 2003, Chinese Premier Wen Jiabao proposed a long-term goal of turning the organization into a free trade area, reminiscent of the early phases of the EU.

The alliance already includes countries occupying three-fifths of the Eurasian landmass, and an expansion that would bring together China, Russia, India and Iran would be an imposing global force. Furthermore, it would bring together some of the world’s major oil reserves in Iran, Russia and the Caspian Sea. Some analysts see a strategic and economic effort among these countries to reduce the U.S. hold on the region’s energy resources. China and India, as the world’s fastest-growing energy consumers, may want to secure central Asia’s energy resources for their own economies. Iran and Russia, two of the world’s largest energy suppliers, want to reduce their dependence on sales to the West.

The idea of challenging Western (and especially U.S.) global dominance was evident in the communiqué from the meeting—The Yekaterinburg Declaration—which proclaimed that

“the tendency towards true multipolarity is irreversible. There is a growing significance of the regional aspect in settling global problems.”

Russia’s long-expressed opposition to “unilateralism” and “unipolarity” is a not-so-subtle swipe at the United States. Moscow’s preference for alternate configurations was evident in a second meeting in Yekaterinburg, right after the SCO assembly. This was the inaugural summit of the so-called “BRIC” countries—the emerging economic powers of Brazil, Russia, India and China. Russian president Dmitry Medvedev was perhaps guilty of hyperbole in calling the summit “the epicenter of world politics” but there is no doubt this is a formidable foursome. According to The Economist, the BRIC’s share of world output leapt from 16% in 2000 to 22% last year. For the last decade, GDP growth in the BRICs has outpaced that of the world, and of emerging and developing economies (see The Economist charts above). These four countries alone control about 40 percent of global currency reserves.

During the summit, the leaders talked about assuming more say in global policy-making; reforming the International Monetary Fund; and a plan to switch some of their foreign currency reserves out of dollars and into IMF bonds (an idea which is also the subject of much discussion in China). As the New York Times observed, the BRIC summit was

“intended to underscore the rising economic clout of these four major developing countries and their demand for a greater voice in the world. And Russia, the group’s host and ideological provocateur, is especially interested in using the summit to fire a shot across Washington’s bow.”

Why is "The End of the American Century" Important to China?

2009-06-19T20:14:00.005-04:00

Professor Ni Lexiong, who was the lead translator for The End of the American Century, has written this note, in Chinese, on how he came to know about the book and why he thought it should be translated and published in Chinese. The financial crisis, he writes, makes it even more urgent that people in China read the book.

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《美国世纪的终结》译后记

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2009-4-20 12:55:34 倪乐雄　来源：易文网

2008年11月中旬，上海大学历史系徐有威教授告知，他的朋友、美国巴特勒大学政治系韩孝荣教授向他推荐了梅森教授最新出版的《美国世纪的终结》，我很快与梅森先生取得了联系，得知这本书刚出版几个星期，在美国已产生一定影响。书中一些观点虽然也在各种文章中能够见到，但如此全面、深入、系统地探讨美国的衰落，并且观点十分鲜明的专著却鲜有见到，梅森教授的著作可谓弥补了这一缺憾。
在这本书里，梅森教授从一个宏观的视野描绘了美国正在历史性地衰退的图景。其理论依据是保罗·肯尼迪关于“帝国过度扩张导致衰退”的观点，这种观点提供的历史模式是：一个帝国为扩张和维持自己的势力范围，必然会把国力消耗在巨大的军事投入上，从而使国家首先陷入经济衰退，继而不可避免地导致政治和军事上的衰退。肯尼迪认为任何历史上的大国都无法回避这一模式，包括美国。梅森教授所做的工作就是试图证明今天的美国已经进入“帝国衰退的历史模式”，他的研究思路是沿着“国防开支——赤字”和“债务——经济危机——社会全面危机和衰退”这样走下来的。
美国“次贷危机”迅速引发了世界经济大危机，对目前和未来将产生重大影响，在这种时刻将此书译成中文，介绍给国内读者很有必要。因为今天的中国和美国似乎都已不由自主地来到了历史转折点上，秉性刚直的梅森教授非常了解自己的国家，并有独到的细致观察和慎密分析。他判定美国的历史性衰退已经不可避免地来到了，而且就是现在，美国政府和人民必须做好调整心态和姿态的准备。这一预言家式的断言，无论将来能否验证，都值得我们关注。
此书的翻译得到上海辞书出版社上官消波副总编和吴雅仙女士的鼎力支持，在征得梅森教授意见和上海辞书出版社同意后，立即开始了本书的翻译工作。具体分工是：倪乐雄序言、中文版序、导言、第1章，孙运峰第2章、第3章，南琳第4章，陈道银第5章，赵雅丹第6章、第10章，熊曙光第7章，王立中第8章，周晓华第9章。孙运峰负责全书的统稿和部分校对，吴雅仙女士负责本书译稿的校订和编辑工作。
此书的出版也得到渥太华中国事务研究院(The China Research Institute of Ottawa)和姜留义女士的支持，在此表示感谢。

倪乐雄
2009年2月18日于上海寓中

Federal Debt Approaches 100% of GDP

2009-06-11T12:10:00.000-04:00

Even when The End of the American Century went to press in early 2008, the U.S. federal debt was reaching alarming levels, and was a central element of my forecasts of U.S. economic decline. At that point, the White House's Office of Management and Budget projected the gross federal debt to expand to $10.6 trillion by 2009, constituting 72% of GDP.

Since then, the federal red ink has become a tidal wave. The OMB now expects the debt at the end of this year to be $12.7 trillion, and to expand to over $15 trillion by 2011, which would then be (at 97% of GDP) almost as large as the entire economy (see chart).

David Leonhardt of the New York Times, one of the few economists to have been tracking and raising concerns about the deficits, writes that erasing the deficits "will be one of the great political issues of the coming decade." In his article "Sea of Red Ink" in the June 10 issue, he reports on a New York Times analysis of the composition of the debt accumulation over the last decade, "with the aim of understanding how the federal government came to be far deeper in debt than it has been since the years just after World War II."

The analysis finds that the growth in the federal debt since 2001 comes from four main sources. The first, the business cycle (especially the 2001 recession and the current downturn) is the largest component, accounting for 37%. Another 33% of the recent debt comes from legislation signed by President Bush, including his tax cuts. Another 20% derives from President Obama's continuation of several Bush policies, including spending on the Iraq War and the Wall Street bailouts. Only about 10% comes from new Obama policies, including the stimulus bill, and news spending on health care, education, energy and other areas.

Leonhardt sees little hope that the Obama administration can reduce or eliminate the deficits with "pay-as-you-go" government spending plans. The solution, he writes, "is no mystery" and involves inevitable tax increases and government spending cuts. These are political tinderboxes, of course, and pose a huge challenge to President Obama's leadership skills.

The End of the American Century, Global Change and China

2009-06-09T11:07:00.006-04:00

The following is a slightly edited version of my lecture in Shanghai on May 9 on "The End of the American Century, Global Change and China." The lecture was accompanied by a powerpoint presentation with much of the data and evidence I referred to, and the lecture was translated simultaneously into Chinese (see previous post on details of the forum).
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Perhaps it is no accident that the first translation of The End of the American Century is into Chinese, since China is the most prominent “rising power” mentioned in a book that is primarily directed at the decline of the one power that has been dominant for the last half-century. The role of China is also important because of the huge and growing size of the Chinese economy, and the multifaceted interdependence of China and the United States. In my book, I see raw military power as increasingly irrelevant both for the United States and for other countries, as the biggest problems the world is facing—climate change, environmental deterioration, pandemic disease, poverty, terrorism, etc.—are simply not susceptible to military solutions. Addressing those problems requires international cooperation. Such cooperation also facilitates trade and economic growth, which are keys to reducing the poverty and inequality that provide the breeding ground for discontent and violence.

I understand that most of you are involved in business, trade or finance in various capacities, so I will focus my remarks today on economic issues, at least those in the United States. Given the scope and speed of the global financial collapse, economic issues are, indeed, on the minds of just about everyone. The U.S. economy is a core aspect of my treatment of the decline of the U.S. as a global power—but it is by no means the only one. And while I do, necessarily, devote a lot of attention to economics, I am myself a political scientist rather than economist. What I do in my book, and want to do here, is to look at the varied and interrelated dimensions of U.S. decline. Because it is the symbiosis of all these aspects of U.S. and global change that makes the current situation so distinctive, even unique. Many analysts in the U.S. see the current economic predicament of the country to be similar to those of other economic downturns in recent decades. I believe the combination of U.S. economic, social and political decay, and the simultaneous rise of other countries in the world—like China—means a much different outcome and future for the United States.

For those of you who have not yet read my book, let me provide a summary of the overall approach. Keep in mind that the English version of my book went to press in early 2008, well before the ongoing economic collapse of the United States, and appeared in English in the fall, just as the scale of the catastrophe was unfolding. The essential argument of my book is that the U.S. has come to the end of its long period of economic affluence and global dominance. Most Americans—even, at last, the experts!—are starting to see the handwriting on the wall now, as we see collapsing around us the stock market, housing markets, job markets, banks, manufacturing, retail stores and news media. These are all interrelated, and driven by longer term problems that pressed against us before President Obama, and even before the disastrous administration of George W. Bush. The 20th Century, often called “The American Century” had already come to a close before the awful terrorist attacks of September 11.

America’s decline is a result of three convergent and interrelated phenomena: the deterioration of the U.S. itself—especially in the economic realm but in many other respects as well; the increasing influence of other global powers; and the changed nature of global interactions. The decade-long convergence of all three of these phenomena marks a global shift of historic proportions, and one that defines a much different place in the world for the United States and its citizens.

The central aspects of U.S. decline is economic. The federal government, the state governments, and most households have been living beyond their means for a generation, and the result is unprecedented levels of government, household, mortgage and consumer debt. Americans citizens spend and consume more than they earn, and the United States as a whole consumes more than it produces. This has posed a burden on the rest of the world that is unsustainable in the long run. I will come back to these economic issues in a few minutes.

The U.S. has also fallen behind other countries in many other areas where we flourished during The American Century. The educational system, once considered the world’s best, now ranks near the bottom among developed countries. Health care shows the worst results, on average, of any of the countries of the Organization for Economic Cooperation and Development (OECD). The U.S. has higher poverty rates, more violence, and greater inequality than almost any other OECD country. Our roads, highways, bridges and dams—most built near the beginning of the American Century—are decrepit and in need of major investments. Even the country’s vaunted political system, tarnished by private interests, money and low levels of political participation, is no longer a model for emulation much of anywhere in the world.
While the U.S. has been on a long slide, both with our domestic health and our international reputation, other countries and regions have been moving ahead, and gaining confidence and clout. China is now the world’s workshop, and has the fastest sustained economic growth of any country in history. The European Union has brought together 27 countries into a peaceful and healthy community—an economic bloc bigger than the U.S. and with many countries more successful than the U.S. in providing health care, education and welfare to their citizens. Many other countries are increasingly prosperous, confident and assertive, to the point of challenging U.S. dominance in their own parts of the globe.

In addition, globalization has changed the rules of the game. Labor and capital move more easily around the world, making it more difficult for the U.S.—or any government—to control economic development. Organizations that span national borders—international and non-governmental organizations, multinational corporations, terrorist groups--are for good or ill challenging the power and influence of countries. All of this make global politics more complex, and less subject to the influence of single nation-states, especially go-it-alone ones as the U.S. has been for the last eight years.

President Obama is making noble efforts to bolster America’s global reputation and reverse its decline, but in my view, it is too little and too late. The rest of the world has already caught up or caught on, and is not much interested in the U.S. resuming its global leadership. Furthermore, what the world needs now, in confronting problems--of global warming, pollution, nuclear proliferation, terrorism, poverty and epidemic disease—is cooperation and compromise rather than “leadership.”

In my book, I buttress all of these assertions by using data, showing both trend data over time in the U.S., and data comparing the U.S. to other wealthy countries. In both kinds of comparisons the US does not fare very well. Let’s look at some of these figures, focusing on the economic ones.

The End of the American Century can be seen as a descendant of the 1985 book by the Yale historian Paul Kennedy, The Rise and Fall of the Great Powers. Kennedy studied the big empires of the past—Rome, Britain, Spain, among others—and concluded that each of them foundered on what he called “imperial overstretch.” This is the tendency for big powers to become so “stretched” by foreign ventures, expansion or wars that they end up bankrupting themselves at home, leading to social and economic decay. Kennedy predicted in the mid-1980s that the same thing would happen to the Soviet Union, and even hinted that the U.S. was also vulnerable to the problem of imperial overstretch and debt. When he published that book in 1985, the U.S. federal debt was about 45% of the economy (GDP), which Kennedy said was historically unprecedented for any large power in peacetime. The only exception was France on the eve of the French Revolution.

But look what happened in the two decades after the publication of Kennedy’s book. The US federal debt mushroomed from less than half of GDP to over two-thirds of GDP. The problem escalated with the administration of G.W. Bush, who sharply increased defense spending for the wars in Iraq and Afghanistan, while simultaneously cutting income taxes. When I wrote my book in 2007-2008, I thought the size of the debt was alarming, as it approached $10 trillion. But then the financial crisis hit the United States, the stock market collapsed (by half), unemployment skyrocketed, and Congress and the President approved huge financial bailout plans that sent the federal debt even higher. The federal budget of the new Obama administration, calling for huge new spending on education, health care, infrastructure and the environment (all vitally needed but terribly expensive), is sending the federal debt burdens to levels unseen since World War II. Within a few years, even according to the President’s optimistic assumptions, the gross federal debt will reach 100% of the size of the economy. I should point out that these huge debt levels do not even include the “unfunded liabilities” for Social Security and Medicare, which would add another $45 trillion. The government has put aside no money to pay for retirement and health care benefits for senior citizens, who will increase greatly in numbers as the “baby boomers” begins retiring in the next few years.

The federal government debt, though, is only one aspect of the multiple levels of indebtedness in the United States. Another aspect of this is the trade deficit. For most of the years since World War II, the U.S. maintained a rough balance of exports and imports. But during the 1990s, as imports soared and exports declined, the trade balance got seriously out of whack, reaching records levels in both absolute terms and as a percent of GDP. The huge increase in imports, many of them from China, helped the U.S. standard of living, but was not matched by similar productivity, output or exports from the US.

A third aspect of US debt—what some called the “triple deficit”—is household and consumer debt. Over the last two decades, Americans have built up record levels of consumer debt. The household savings rate (savings as a percent of household income) have always been relatively low in the US compared to other countries, but in the last twenty years have declined sharply. By 2005, this number had dipped below zero for the first time since the Great Depression. Most Americans have saved almost nothing for their retirement years, at a time when most employers are no longer providing retirement pensions for their employees. This presages a sharp decline in the standard of living, and dramatic increases in poverty, as the population ages. On this dimension too, the US compares unfavorably with most other wealthy countries.

The American propensity to spend rather than save is partly a culture phenomenon—the strong strain of materialism in U.S. culture—but also partly due to the increasing influence of the financial services sector in the U.S. in recent years. Manufacturing has declined steadily as a share of GDP in the U.S. The U.S. doesn’t actually produce much any more. Increasingly, manufacturing has been replaced by financial services. Banks and mortgage companies make money by getting people to borrow, and therefore go into debt. One small but telling example of this is the dozens of credit card offers that most Americans get in the mail. I get several such offers a week, for example. But so do many of my students, most of whom have no income at all! As a consequence, credit card debt is at a record high, and the average household has about $10,000 in credit card debt. Consumer and household debt overall totals about $13 trillion—the size of the entire U.S. economy.

The bottom line is that the U.S. has become a consumer society, consuming far more than we produce or earn, and this can not be sustained. Consumption accounts for almost three-quarters of GDP in the US—a record for any large economy in modern history. As we have seen, much of that consumption is fueled by debt. Americans will have to save more and spend less. This will entail a substantial contraction in the U.S. economy, as workers are laid off and consumer spending declines. Unfortunately, this will also mean a decline in tax revenues, just at the time when government spending is increasing. The U.S. stock market has already declined by 50% since its highs of 2008. The economy as a whole is shrinking, at the fastest rate since the Great Depression. Most economists think that this economic decline will bottom out fairly soon, and that the worst is over. But given the problems I have mentioned, I think it is possible that the US GDP could contract by as much as one-third—roughly the same decline that the U.S. experienced during the height of the Great Depression in 1929-1933. It took the U.S. economy about 4 years to recover from that decline.

U.S. economic decline is just one element—albeit an important one—of the diminishing U.S. power, influence and reputation in the world. Global surveys show little enthusiasm around the world now for “American-style” democracy, for the American way of doing business, or for the spread of US customs and ideas. People in most countries think it would be better if another country rivaled the U.S. in military power. And a recent BBC poll of people in 21 countries found many more believing that the U.S. role in the world was “mostly negative” rather than “mostly positive.” China ranked slightly ahead of the U.S. on this question.

At the same time that U.S. power and influence is diminishing, some other countries are growing stronger, more confident and more assertive. Possible rivals for influence with the U.S. include the “BRIC” countries—Brazil, Russia, India and China—and also the European Union, which now includes 27 countries with a population and GNP larger than that of the United States. The “rising” BRIC countries have had very fast rates of economic growth in recent years and, at least until the economic crisis this year, were expected to perform even better in the near future. By another measure, the growth in stock market value, these rising powers are also outpacing the U.S. The U.S. stock market grew exceptionally fast from 2002-2007, rising at an average rate of about 15% per year. But each of the BRIC countries experienced stock market growth at least twice that of the U.S. in those years. As a percent of the world’s total stock market, the U.S. share has shrunk by almost half over the last thirty years.

Perhaps even more astonishing is the declining relative influence of U.S. banks, a phenomenon accelerated, of course, by the collapse of so many financial institutions in the U.S. Measured by market capitalization, a year ago four of the largest banks in the world were American. Now only two are. And four of the top ten are now Chinese!

These changes in the U.S. and the rest of the world signal a fundamental transformation of global politics and economics, and will require adjustments by people and governments alike around the world. For the United States and its citizens, these changes will be particularly wrenching. The U.S. economy will decline—probably by a lot, as will the standard of living in the U.S. For Americans used to a rising tide of affluence and spending, this will be a difficult adjustment. And it will also be difficult for Americans, psychologically, to deal with our diminished stature in the globe. Many changes are necessary to help restore America’s economic, social and political health. It seems to me that President Obama is cognizant of these needs, and is moving amazingly rapidly to address them. But the task is a difficult one, and a long-term one.

I am not really in a position to suggest what will happen, or should happen, in China. That is for you to decide, not me! But I was told me you would be interested in how I see all of this affecting China, so let me just mention a few things. First, of all, as should be obvious from my presentation, it seems to me that China is going to have to rely less on the U.S. market for helping fuel China’s economic growth. Americans will simply have to spend less, which means buying less of China’s many exports. It would seem that this would require, and offer the opportunity, for Chinese manufacturers to focus more on the domestic Chinese market, which will inevitably improve the standard of living of people in China. (This is an argument also made by Paul Krugman during his recent visit to China).

Even so, the U.S. and China both need each other for the economic health and development of both countries. And the rest of the world needs these two big powers to cooperate in solving global issues of trade, the environment, poverty, terrorism, nuclear proliferation, etc. So the interdependence of the two countries should continue and increase. China’s growing economy and international influence comes with increasing global responsibilities along these lines as well. China, for example, has now surpassed the United States as the leading emitter of carbon gasses that contribute to global warming. In my mind, global warming is the single greatest threat to the globe, and it requires serious work and attention. The problem can not be solved without the participation and cooperation of the U.S. and China.

Due to what has happened in the U.S., in China, and in the global community, China should by now certainly be considered an equal partner with the U.S. and other big powers in helping to shape this new global environment. I believe, from what your leaders say, that China is ready to play a bigger role in the world. And with a new, enlightened leadership in Washington, I am hoping the feelings will be mutual.

"The End of the American Century" Sparks Interest in China

2009-05-28T12:42:00.008-04:00

A Chinese translation of The End of the American Century was published in China in April, just five months after the book appeared in the United States (see earlier post on publication details). The editors at Shanghai Lexicographical Publishing House told me that they translated and produced the book in record time, because they considered it a "hot topic." At the National Book Fair in Jinan, according to the publisher, the book attracted a good deal of interest, and reached #3 on the publisher's sales ranking.

A conference related to the book's title was held at the Shanghai Exhibition Center on May 9, and I was invited to give the opening address, along with a number of prominent Chinese academics. The event was held in the Center's "Friendship Hall" (see photo) which seated over 1000 people. But the turnout was unexpectedly large, and a separate room, with sound piped in, was set up for the spillover. The organizers estimated the total audience at over 1300. While some of the audience were students and professors, most were businesspeople, investors and clients of a financial securities company that was one of the sponsors of the event. So they were especially interested in the U.S. and global financial crisis, and how that will affect the U.S., China, and Sino-U.S. relations.

From questions posed by the audience, and in conversations I had with academics, journalists and financiers, the reactions to my thesis of U.S. decline was decidedly mixed, and surprisingly similar to the range of responses here in the U.S. Some agreed that the U.S. was in serious straits. Others felt that the U.S. would remain (or even should remain) the world's dominant power. Some felt that it was China's turn to take a more prominent role in global politics and economics.

Shanghai itself provides a stunning example of how far and fast China has grown. I last visited the city 20 years ago, when most of the street traffic was bicycles, and before any of the magnificent skyscrapers had risen on the other side of the river from the Bund. Now the city center is as gleaming and modern as any I have seen anywhere in the world. The many downtown shopping malls, modern and airy, are filled with outlets of the most popular (and most expensive!) Western chains. The city's two airports are modern, efficient architectural beauties. The subways and trains are clean, comfortable and efficient. The world's first commercially operating "Maglev" train (magnetic levitation) connects Pudong airport to the city center, reaching a mind-blowing speed of 250 mph. The only real problem in the city, to my mind, is the street traffic, with the chaotic and dangerous competition of taxis, cars, motorbikes, bicycles and pedestrians (more on this in a later post).

In later posts, I will post more information on the Shanghai conference, with the text of my own lecture there, and information about the other presenters at the meeting.

A Welcome Spotlight on Women's Welfare

2009-05-20T18:25:00.009-04:00

Caleb Hamman
chamman@butler.edu

When President Barack Obama spoke at the University of Notre Dame’s commencement ceremony Sunday, much of his focus was devoted to women. In the weeks before his arrival, there had been considerable upheaval at the Catholic university due to Obama’s support for abortion rights, a position opposed by the Church.

The abortion debate aside, in a time when gender inequality continues to plague the United States, it is reassuring to see attention being given to women’s issues. Currently, the United Nations ranks U.S. gender development 16th in the world—a ranking exacerbated by George W. Bush’s eight years in office. His administration’s first attacks on women began early and abroad.

Immediately after coming to Washington, the Bush administration instituted a “global gag rule” on foreign organizations receiving U.S. aid. Under threat of defunding, the order explicitly forbade clinics from providing women with abortion counseling or operations, even if they wished to use their own money for the services.

The next summer, the Bush administration halted potential U.S. ratification of the Convention of all Forms of Discrimination Against Women. Although 185 countries have ratified the treaty, the United States—like Iran, Sudan and Somalia—is not one of them.

Soon after, the Bush administration cut off $34 million from a U.N. fund providing women around the world with birth control, sex education and maternal health care. It also began a fierce attack against the newly formed International criminal court—an organization promising historical gains in holding war criminals accountable for sex crimes against women.

The previous eight years also saw a decline in the welfare of women within the United States. In Dec. 2008, a national crime report was released revealing that the latter years of the Bush administration oversaw a 25 percent increase in sexual violence and a 42 percent increase in domestic violence. Soon after the report’s release, the White House imposed a new rule on Health and Human services making it more difficult for women to obtain basic healthcare or birth control.

Because women in the United States are disproportionately poor, the Bush administration’s unceasing attacks on social programs and progressive taxes effectively constituted an assualt on women's economic welfare. Accompanying Bush’s policy programs were overt threats to veto any sort of equal pay for equal work legislation.

Throughout its eight years in office, the Bush administration showed clear disdain for its campaign promise that “W stands for women.” As a result, the welfare of women in the U.S. has stagnated relative to that of other advanced, industrialized societies.

The Obama administration has taken some valuable steps to put the U.S. back on track toward gender equality. In January, Obama rescinded Bush’s “global gag” policy. A few days later, he signed the Lilly Ledbetter Fair Pay Act which advanced the campaign for ending gender discrimination in income.

Although efforts such as those of the Obama administration are valuable, they will need to be sustained and furthered if gender inequality is to be removed from the vortex of U.S. decline.

Immobility Furthering Decline

2009-05-08T09:54:00.006-04:00

Caleb Hamman

chamman@butler.edu

In a time of financial turmoil and drastic inequality, one would hope the American Dream to be functioning well. This notion, that hard work will bring success to anyone in the United States, has always been central to America’s ideological fabric. Despite such tradition, recent research suggests a need to reevaluate the accuracy of the American Dream.

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Ongoing work at the Economic Mobility Project (EMP) has been attempting to do just that. A nonpartisan effort funded by the Pew Charitable Trusts, EMP has been conducting the most detailed research of U.S. economic mobility to date. Its findings, thoroughly concerning, strongly reinforce the arguments of The End of the American Century.

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Using longitudinal income data, EMP researchers find the United States to be a more class stratified society than commonly believed. Despite the popularity of “rags to riches” notions, the EMP finds that, on average, children born into the poorest fifth of households have only a 6 percent chance of making it to the top income quintile. Conversely, 42 percent will remain in the poorest group. More than six in ten of these impoverished children never become even middleclass.

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Similar mobility barriers exist at the top. While 39 percent of children born into the richest income quintile will remain there, only 9 percent will fall to the bottom. EMP finds remnants of mobility remains in the middleclass, although even these children are more likely to fall into poverty than they are to rise to wealth.

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The project’s findings are particularly disturbing in the areas of gender and race. Women, already suffering multifaceted disparity with men, are also less mobile than their male counterparts. Compared to these, it is considerably harder for women born into poor families to become wealthy. Similarly, it is also easier for wealthy women to become poor.

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The racial contrast is even starker. Black children are half as likely as their white counterparts to move from extreme poverty to extreme wealth. Simultaneously, black children born into the bottom income bracket are almost twice as likely as white children to remain there. Incredibly, EMP finds that nearly three in four middleclass black children will fall into poverty—a condition tremendously difficult for them to escape.

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As such findings suggest, the American Dream is not as dynamic as many believe it to be. In fact, U.S. mobility levels are actually lower than those of many developed countries. As the EMP reports, the two major international comparisons to date have placed U.S. mobility levels either last or second-to-last among nations analyzed (which have included mostly Western Europe and Scandinavia). As EMP’s authors put, “the view that America is ‘the land of opportunity’ doesn’t entirely square with the facts.”

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In light of the numerous economic, political, and social issues contributing to U.S. decline, the discovery of immobility is particularly troubling. As Americans become more economically and politically unequal, the stakes of socioeconomic outcomes continue to rise. That these outcomes are out of the hands of many is more than a contributor to The End of the American Century—it is an issue of fundamental fairness and a contradiction of one of America’s most cherished ideals.

Global Views of US Improve, But Still Negative

2009-04-30T09:07:00.005-04:00

A BBC poll of citizens of 21 countries shows that the global image of the U.S. has improved slightly in the last year, but is still largely negative. Far more countries (12) have predominantly negative views of the U.S. than have predominantly positive views (6). On average, across all countries, positive views of the U.S. have increased over the last year from 35% to 40%, but those are still outweighed by the negative views (43%, down from 47%). Respondents in each country were asked if they felt "the following countries are having a mainly positive or mainly negative influence on the world."

Negative feelings about U.S. influence were particularly strong among America's closest neighbors and allies. In the UK, 45% thought U.S. influence was mostly negative; France, 53%; Mexico 54%; Canada 55%; Spain 56%; and Germany 65%. In a ranking of all the countries in the survey, Germany was viewed as having the most positive influence, whereas the U.S. ranked 10th on the list, just below China.

Another BBC poll of 17 countries showed an overwhelming majority--67%--believing that the election of President Obama "will lead to improved relations between the United States and the rest of the world."

These polls were conducted between November 21, 2008 and February 1, 2009.

The BBC polls confirm that there has been some softening of global views about the U.S., at least partially due to President Obama. But they also reveal the persistence, depth and breadth of animosity to the U.S., and how far the U.S. has to go to recover from the damage to the country's reputation. As I suggested in The End of the American Century, the decline of the U.S. and its reputation was deep-seated, and preceded the Bush administration. George W. Bush made things far worse, but new leadership in D.C.--even a very positive influence like Barack Obama--can not easily or quickly restore America's reputation, or its global leadership.

Shanghai Conference on "The End of the American Century"

2009-04-28T20:00:00.007-04:00

A one-day conference on The End of the American Century and related themes will be held in Shanghai on May 9, in connection with the publication of the Chinese version of my book by the Shanghai Lexicographical Publishing House. I will make a presentation on the theme of my book.

Other presenters include Professor Ni Lexiong, the principal translator of The End of the American Century; Professor Tang Xiaosong of Guangdong University; and Mr. Ma Guoshou, the Director of the Allwin Economic Institute in Hong Kong.

Topics of presentation include: Is this The End of the American century?; U.S. national strategy and Sino-U.S. relations; the U.S. dollar, global monetary issues and China's future wealth; and sea power and the pattern of global interactions.

The seminar will be held at the Shanghai Friendship Hall, 1333 West Nanjing Road, on Saturday, May 9, from 12:30 to 5:00 p.m.

(Look for a future post with a link to the Chinese site about this event).

Obama in Ankara: Re-setting US Relations with the Muslim World

2009-04-25T19:41:00.008-04:00

President Obama has taken deliberate and high-profile initiatives to mend U.S. relations with the Arab and Muslim world. In the first months of his presidency, he welcomed Jordan’s King Abdullah II to Washington, where he endorsed the “two-state” solution to the Israel-Palestine issue—a proposal long favored by the Arab states. He met with Saudi King Abdullah in London during the G20 Summit, causing a media stir when he bowed to the king, as is customary and respectful with royalty.

Most importantly, he delivered a major address in April to the parliament in Turkey, declaring that “the United States is not, and will never be, at war with Islam.” But he went even further, recognizing the richness and influence of Islam, and promising that the U.S. would listen, even when it did not agree:

“I also want to be clear that America's relationship with the Muslim community, the Muslim world, cannot, and will not, just be based upon opposition to terrorism. We seek broader engagement based on mutual interest and mutual respect. We will listen carefully, we will bridge misunderstandings, and we will seek common ground. We will be respectful, even when we do not agree. We will convey our deep appreciation for the Islamic faith, which has done so much over the centuries to shape the world -- including in my own country. The United States has been enriched by Muslim Americans. Many other Americans have Muslims in their families or have lived in a Muslim-majority country -- I know, because I am one of them.”

This is an extraordinary and important passage, in numerous ways, and encapsulates much of the new orientation and policies of the Obama administration, and not just toward the Arab world. First of all, it is diminishing the centrality in U.S. policy of the war on terrorism—which has so distorted American policies, priorities and values.

Secondly, the speech emphasizes “broader engagement” with the Muslim world, which is both necessary and inevitable, given the size—over one billion—and growing influence of the global Muslim population. The President’s approach to Islam is not just tolerant, but respectful and appreciative of the faith, which has done so much to “shape the world” and which, Obama could have added, has much in common with both Christianity and Judaism.

The President emphasized his intent to listen to others, even when there is disagreement. This fits in with his frequent references to the importance of a great power to recognize past errors, to temper hubris, and to approach other peoples with humility. Such a change from the previous administration could hardly be more dramatic, and has been noted around the world. The Egyptian Foreign Minister said that “Obama’s speech is the first and significant step for easing the tension between the Muslim world and the United States.”

Finally, the President’s personal touch at the end of that passage sent an important signal, both to the global community and to his own citizens, that we are all part of one human community. It was a risky political statement, for it would antagonize and alienate some Americans. But it was also a courageous one—identifying himself with what some consider to be the enemy—and calling on his compatriots for tolerance and understanding.

A Moment of Awe and Joy: Susan Boyle

2009-04-20T22:49:00.007-04:00

This blog, and my book, have been pretty unremitting in relaying downbeat news and analysis. So I thought it would not hurt to post a story, and some links, that will bring a joyful lump in the throat to even the most hard-bitten of politicos and wonks.

I am often the last to learn about current fads and popular culture, so I stumbled across the story of Susan Boyle in Saturday's New York Times: Unlikely Singer is YouTube Sensation. If you are one of the few remaining sentients unaware of Susan, as I was, I suggest you first read the story, and then go to YouTube to hear her rendition of "I Dreamed a Dream."

Susan Boyle is a 47 year old, unemployed, unmarried church volunteer from tiny Blackburn, Scotland, who competed in the "Britain's Got Talent" show. Both her performance, and the reaction of the glamorous judges, is something to behold. As the writer Letty Cottin Pogrebin wrote in the Huffington Post, the audience and judges "were initially blinded by entrenched stereotypes of age, class, gender and Western beauty standards. . . until her book was opened and everybody saw what was inside."

Read the story, then watch the video at this link.

You might also want to follow this with the video of the other performance mentioned in the Times article, a soaring rendition of Puccini's "Nessum dorma" by Welsh cellphone salesman Paul Potts. It is at this link.

Bartels Finds Declining Equality and Influence

2009-04-20T20:32:00.010-04:00

Caleb Hamman

chamman@butler.edu

Economic and political inequality are among the most significant aspects of U.S. decline. Both topics are the focus of the most recent work of Princeton Political Scientist Larry Bartels, Unequal Democracy: The Political Economy of the New Gilded Age. In his book, Bartels sets out to analyze the political causes and consequences of economic inequality, arguing that these are both substantial and urgently relevant to alleviating injustice.

Naturally, Bartels begins by assessing the extent to which economic inequality exists in the United States. After detailed review of current literature and government data, Bartels offers findings very much in line with those of The End of the American Century, essentially that “current levels of inequality rival those of the Roaring Twenties,” making it fitting to speak of a “New Gilded Age” or a “retrogression of historic scope.” As Mason points out, this sort of inequality can lead to monstrous disparities, such as CEOs making more than 500 times their average employee, and has effectively caused the United States to become more unequal than “any advanced industrialized country.”

Like The End of the American Century, Bartels finds that current inequality is not a recent phenomenon, but has been growing sharply since the 1970s. Although this observation is generally accepted, Bartels then goes on to make a less mainstream claim—that increasing economic inequality is a largely a result of public policy. While Bartels readily concedes that economic factors like globalization and technology have contributed to inequality, he staunchly refuses to attribute the entire dynamic to arcane “market forces” or inculpable “economic realities.” Rather, a significant role is played by political intervention, an idea Mason also highlights by discussing issues like the “elimination of the federal welfare system” and the “stagnation of the minimum wage.”

Bartels goes one step further. He argues that U.S. economic inequality is “profoundly shaped by partisan politics”—specifically that “middleclass and poor families” have “fared much worse under Republican presidents than they have under Democratic presidents.” This is not necessarily a novel notion, but rarely has it been supported by such detailed analysis. Using exclusively Census Bureau data and controlling for non-partisan variables such as international crisis, Bartels conclusively demonstrates that the incomes of most have grown at substantially higher rates under Democratic presidents than under their Republican counterparts.

After illustrating his findings with three chapter-length case studies, Bartels turns to his second major point—the political consequences of inequality. Here, his research is particularly disturbing. In calculating the recent responsiveness of U.S. Senators to their constituents, Bartels finds that:

Senators’ roll call votes were quite responsive to the ideological views of their middle- and high-income constituents. In contrast, the views of low-income constituents had no discernible impact on the voting behavior of the senators…the statistical results are quite consistent in suggesting that the opinions of constituents in the bottom third of the income distribution were utterly irrelevant.

Examining the potential causes of this mass political exclusion, Bartels finds that “biases” in “senators’ responsiveness to rich and poor constituents are not primarily due to differences between rich and poor constituents in turnout, political knowledge, or contacting.” Rather, “the data are consistent with the hypothesis that senators represented their campaign contributors to the exclusion of other constituents.” As Mason puts it, “When people do not…contribute to political campaigns, they are less likely to be listened to by legislators or policymakers, and their interests are less likely to be taken into account in the political process.”

In analyzing the totality of his findings, Bartels delivers a particularly sobering assessment:

In Aristotle’s terms, our political system seems to be functioning not as a 'democracy,' but as an 'oligarchy.' If we insist on flattering ourselves by referring to is as a democracy, we should be clear that is a starkly unequal democracy.

Despite such foreboding, Bartels attempts to end with a more hopeful thought: Since inequality has been largely been brought about by conscious political action, there seems to be potential for prescriptive change. As Bartels puts it, “We can make these choices.” But as Mason points out, we are quickly running out of time.

"The End of the American Century" on Kindle!

2009-04-15T14:06:00.003-04:00

The End of the American Century is now available electronically on "Kindle" from Amazon.com. I myself am still a little skeptical of this method of reading books, but even so I think it is cool! And the price is right!

How Torture Hurts and Weakens the U.S.

2009-04-09T20:15:00.003-04:00

Mark Danner is our contemporary Diogenes, searching (often vainly) for the honest man and using dogged empiricism to establish the truth. His focus in recent years has been on the U.S. use of torture and his latest report, in the New York Review of Books, is "The Red Cross Torture Report: What It Means."

As a followup to my recent post on the Spanish court considering criminal charges against U.S. officials for the justification and use of torture, I offer these two quotations about the effects of U.S. torture on our values and our security.

The first is from President Obama, in an interview on 60 Minutes:

I mean, the fact of the matter is after all these years how many convictions actually came out of Guantánamo? How many terrorists have actually been brought to justice under the philosophy that is being promoted by Vice President Cheney? It hasn’t made us safer. What it has been is a great advertisement for anti-American sentiment. Which means that there is constant effective recruitment of Arab fighters and Muslim fighters against US interests all around the world.... The whole premise of Guantánamo promoted by Vice President Cheney was that somehow the American system of justice was not up to the task of dealing with these terrorists.... Are we going to just keep on going until the entire Muslim world and Arab world despises us? Do we think that’s really going to make us safer?

And Danner's response to Obama's sentiments:

This is as clear and concise a summary of the damage wrought by torture as one is likely to get. Torture has undermined the United States’ reputation for respecting and following the law and thus has crippled its political influence. By torturing, the United States has wounded itself and helped its enemies in what is in the end an inherently political war—a war, that is, in which the critical target to be conquered is the allegiances and attitudes of young Muslims. And by torturing prisoners, many of whom were implicated in committing great crimes against Americans, the United States has made it impossible to render justice on those criminals, instead sentencing them—and the country itself—to an endless limbo of injustice. That limbo stands as a kind of worldwide advertisement for the costs of the US reversion to torture, whose power President Obama has tried to reduce by announcing that he will close Guantánamo.

Canadian Perspectives on "The End of the American Century"

2009-04-09T18:57:00.005-04:00

Perhaps it is not so surprising that I have gotten more reactions to my book from outside the U.S. than inside it--especially from Canada. I have been interviewed on Canadian national television and radio, and have received more emails about the book from Canada than from any other country (including the U.S.).

The following is a recent email from Ann Ridyard from Montreal, who is a retired manager with a manufacturing company. Her thoughts, I venture to say, reflect those of many from north of the border. She gave me permission to post this, with her name. My responses to her points are indicated in brackets [].

-------------
Dr. Mason,

I finished reading your superb book The End of the American Century recently
and I wanted to write to thank you for publishing such a well-documented and
interesting book. You put into words all my thoughts and observations
concerning life in America at the beginning of this century.

As a Canadian living in Montreal, I feel that I received better information
from non-U.S. based media outlets than you did in the USA during the Bush
years. I was elated when Mr. Obama was elected as the new President, his
arrival could not have arrived at a better time.

I would like to offer a few comments.

1- Chapter 8, the World Sours on the US: I believe that most people felt
that the first Bush presidency was stolen from Al Gore. Furthermore, Bush
was still an unknown quantity. However, when Bush was re-elected for a
second term after the invasion of Iraq and the discovery not of weapons of
mass destruction but rather the discovery of Bush/Cheney lies, most
non-Americans were astounded and that caused the 'souring' to extend to the
American people at large.

[I had a similar response, Ann. I thought it was bad enough that this playboy millionaire was elected in the first place. It was his re-election in 2004 that prompted my writing of this book. See my earlier post on "The End of America's Shame")]

2- Military service was obligatory for many years and obeying a superior
officer was drummed into the population. This respect and blind obedience
to authority could be a reason why the people believe the president no
matter what.

[I am also astounded by the tendency of the public--and the media--to blindly accept whatever the president has to say. But I don't think obligatory military service explains this, since the military draft in the U.S. was ended in 1973. In my view, which I discuss in my book, it is the poor state of public education in the U.S., which erodes the ability of Americans to think critically about public affairs, and to effectively evaluate data and evidence]

3- This is just a thought, but could it be that keeping a large segment of
the population in poverty assures that there will always be an ample supply
of soldiers?

[I do not think there is any conspiracy here to stimulate the flow of young people into the military by keeping people poor. But I do think that the high rates of poverty, and the poor career prospects for many young people, does lead them into the military]

4- I believe that the G.W. Bush presidency came as close to a disguised
dictatorship as it could get. It is fortunate that the presidency is
limited to two terms, if not for that, I think Bush would have tried to
steal it another time. We all breathe easier now that Mr. Obama is
president.

[I agree! G.W. Bush, with his abuse of executive authority and of fundamental human and Constitutional rights--especially habeas corpus--took us farther away from democratic politics than we have been in many generations. Obama is, indeed, a breath of fresh air!]

Once again, thank you for your fine book, I have recommended it to family
and friends. I continue to read and reflect on your comments posted on the
'endoftheamericancentury' website.

Yours truly,

Ann Ridyard

China Now Has Top 3 Banks in World

2009-04-06T14:34:00.006-04:00

China now has the three largest banks in the world, measured by market capitalization. This is a stunning change, and yet another indicator of China's rapid emergence as a global economic power. According to a New York Times article, three years ago, China did not have a single bank among the world's top 20. Now it has the top three and four of the top ten.

The United States, due in part to the banking and financial crisis, has dropped considerably in global banking. In 2006, the U.S. had 7 of the top 20 banks, including the top 2. Now it has just 3 of the top 20 and the largest, Morgan Stanley, is rated fifth.

If banking is so crucial to market economies--as Americans are constantly being reminded that it is--then the decline of US banks, in combination with the rise of Chinese ones, provides another example of the relative decline of the United States.

Furthermore, it seems that the Chinese economy, and its banking system, is in position to weather the storm of the global financial and economic meltdown. Most of the big banks in the West lost 20% or more of market value in the first two months of 2009. In China, the top two banks lost only 3% and 8% in value, respectively and the third largest, the Bank of China, actually increased by 5%.

As the New York Times notes, while most of the world is in financial collapse, "China's economy has suddenly become too big--and too healthy, expected to grow by at least 6.3 percent this year--for the rest of the world to ignore."

Kenneth Lieberthal, a Brookings Institution scholar who oversaw White House Asia policy from 1998 to 2000, sees China as one of the first countries to emerge from the current crisis and one of the very few countries that will emerge from it "without having high levels of government debt."

Lecture on the Rising Powers and the Decline of the US

2009-04-06T10:51:00.006-04:00

On April 1, I gave a lecture on "The Rising Powers and the Decline of the U.S." as part of the Foreign Policy Association's "Great Decisions" series, sponsored by the Mid-North Shepherd's Center in Indianapolis. A video of this presentation (50 minutes) including pictures of the slides in my powerpoint presentation, is viewable at this link. (You might want to fast-forward through the first few minutes, where we struggled with the microphones and audio!).

The End of the American Century Appears in Chinese

2009-04-05T16:34:00.010-04:00

Welcome to the Chinese readers of The End of the American Century! I hope some of you will visit this site, and contribute to it.

The book has just appeared in Chinese, published by the Shanghai Lexicographical Publishing House, and translated by Professor Ni Lexiong and Sun Yunfeng of the Shanghai University of Political Science and Law.

(See my 4/28 post on Shanghai Conference on The End of the American Century)

Further information and some Chinese reviews and commentary on the book are available (in Chinese) at this link.

Spanish Court Questions U.S. Use of Torture

2009-04-02T18:11:00.007-04:00

Last week, a Spanish court took the first steps in opening a criminal investigation against Bush administration officials for violating international law in providing the legal framework for the U.S. government’s use of torture. Among those the court is expected to indict are former Attorney General Alberto Gonzales and former Justice Department lawyer John Yoo, who is now a professor at the University of California at Berkeley.

John Yoo was the author of the so-called “torture memos” which justified the use of torture and argued that the U.S. should ignore the Geneva Conventions, which explicitly prohibit torture.

The United States is a party to the Geneva Conventions, and also to the 1984 Convention Against Torture, which is binding on 145 countries, including the U.S. Torture is explicitly prohibited in numerous other international treaties, including the 1948 Universal Declaration of Human Rights; the International Covenant on Civil and Human Rights; and the American Convention on Human Rights. Most scholars also believe torture violates the U.S. Constitution’s prohibition on “cruel and unusual punishment.”

So there is plenty of legal precedent to assert that Gonzales, Yoo and other Bush administration officials—probably even the president himself-- were in violation of international law.

The Spanish initiative comes on the heels of two damaging new reports on the Bush administration’s use of torture. The Justice Department’s Office of Professional Responsibility is investigating whether the legal advice of Yoo and others “was consistent with the professional standards that apply to Department of Justice attorneys,” according to Newsweek. If Attorney General Holder accepts the report, it could be forwarded to state bar associations for possible disciplinary action.

An even more damning report by the International Red Cross on the treatment of prisoners at Guantanamo has been brought to light by Mark Danner, in a short article in the New York Times and a longer one in The New York Review of Books. The Red Cross reports—basically verbatim accounts of interviews with Guantanamo prisoners—makes absolutely clear, according to Danner, “that the United States tortured prisoners and that the Bush administration, including the president himself, explicitly and aggressively denied that fact.”

Danner concludes, as I have done in The End of the American Century, that the U.S. use of torture not only eroded our own values, but further poisoned the global reputation of the U.S. and stimulated the recruitment of terrorists around the globe. The decision to torture, writes Danner,

“harmed American interests by destroying the democratic and Constitutional reputation of the United States, undermining its liberal sympathizers in the Muslim world, and helping materially in the recruitment of young Muslims to the extremist cause. By deciding to torture, we freely chose to embrace the caricature they had made of us.”

Of course it was not just at Abu Ghraib and Guantanamo that prisoners were tortured. Jane Mayer, author of The Dark Side: The Inside Story of How the War on Terror Turned Into a War on American Ideals, convincingly shows that the use of torture was a central tool in the battle against terrorism. Even though President Bush denounced the use of torture, the tactics he denounced were exactly the same as those he had authorized and encouraged in the extensive worldwide network of secret prisons set up to hold and interrogate suspected terrorists. As the distinguished historian Alan Brinkley wrote in a review of The Dark Side:

"it would be difficult to find any precedent in American history for the scale, brutality and illegality of the torture and degradation inflicted on detainees over the last six years; and it would be even harder to image a set of policies more likely to increase the dangers facing the United States and the world.”

By almost any measure, the decisions of Yoo and Gonzales were legally incompetent. At the very least, their recommendations, and the decisions taken by President Bush, were violations of international law. They come close to crimes against humanity. They should be brought to account in this country, under American law. But Yoo, far from facing indictments in the U.S. continues to teach at one of the most prestigious law schools in the U.S., and continues to find a hearing for his views in the pages of the New York Times and the Wall Street Journal.

Perhaps it will take a European court, in the end, to have him, and other Bush officials, account for their decisions. For a Spanish court to indict them will be largely symbolic, of course, since the U.S. is unlikely to extradite them to Spain. But symbols are important. And one of the most important symbols of all was President Obama’s categorical assertion, in the first weeks of his presidency, that

“under my administration, the U.S. does not torture.”

Andrew Bacevich on The Limits of U.S. Power

2009-03-28T11:15:00.007-04:00

Andrew Bacevich’s book The Limits of Power: The End of American Exceptionalism, has much in common with my own book The End of the American Century but is, if anything, even more pessimistic about the outlook for the United States. Bacevich, a retired military officer and currently professor of history and international relations at Boston University, recently visited Butler as part of the Drew Brahos lecture series.

The Limits of Power sees three interrelated crises afflicting the U.S.: the crisis of profligacy; the political crisis; and the military crisis. The guiding ideological light in his book is the early 20th century American theologian, Reinhold Niebuhr (who I also quote in my book). During the Cold War, Niebuhr complained about U.S. tendency to hubris and sanctimony, which Bacevich views as even more prevalent now, becoming “the paramount expressions of American statecraft.”

As Bacevich sees it, our failures abroad (including especially the Iraq War) are a function of our unending consumer appetites at home. “The collective capacity of our domestic political economy to satisfy those appetites has not kept pace with demand. As a result, sustaining our pursuit of life, liberty and happiness at home requires increasingly that Americans look beyond our borders. Whether the issue at hand is oil, credit, or the availability of cheap consumer goods, we expect the world to accommodate the American way of life.”

“Centered on consumption and individual autonomy, the exercise of freedom is contributing to the gradual erosion of our national power.”

The Iraq War is just the latest step in the gradual erosion of U.S. power, weakening us both externally and internally as we refuse to face up to our own problems. He includes a wonderfully revealing quote from Defense Secretary Donald Rumsfeld from October 2001:

“We have two choices. Either we change the way we live, or we change the way they live. We choose the latter.”

Bacevich is scathingly critical of the American political system, which he sees broken and corrupted by an imperial presidency, a “feckless” Congress, and an incompetent national security structure. Our democracy has been hijacked, he says, by a political elite who “have a vested interest in perpetuating the crises that provide the source of their power.”

These are powerful charges and surprisingly radical, coming from someone who has been part of the establishment and who considers himself a conservative. When Butler faculty and students met with him over breakfast, we raised the question of whether the capitalist system itself was broken, given the arguments he made in his book and his lecture. However, even though he sees little hope for any kind of economic or political recovery in the U.S., Bacevich maintains a firm commitment to capitalism and democracy. Many of us found this to be paradoxical. If the system is broken and can’t be fixed, shouldn’t we be searching for some alternative?

The Limits of Power is a powerful and sobering analysis and critique of the American prospect. The message is similar to that of my book, though there are differences. Bacevich focuses more on the U.S. itself, whereas I link what is happening in the U.S. with broader international and global trends. While both of us decry American consumerism, he focuses more on the cultural (and even spiritual) aspects of this, while I spend more time on the economic and social consequences of it. Neither one of us is terribly optimistic about the outcome, but the last pages of my book offer some inklings of hope, whereas the last paragraph of The Limits of Power is thoroughly downbeat. He quotes, once again, Niebuhr to the effect that social orders inevitably destroy themselves in an effort to prove they are indestructible. “Clinging doggedly to the conviction that the rules to which other nations must submit don’t apply,” concludes Bacevich,

“Americans appear determined to affirm Niebuhr’s axiom of willful self destruction.”

The Limits of Power: The End of American Exceptionalism (American Empire Project)

The Middle Kingdom Reasserts Itself

2009-03-25T16:28:00.007-04:00

China has also suffered from America's economic meltdown, but the country's leaders continue to assert themselves on the global stage, both economically and politically. Some Chinese even see the problems in the U.S. as an opportunity for China to fill the void being left by the U.S.

The latest example of China's new confidence is a remarkable story buried on page A5 of this Tuesday's New York Times--"China Urges New Reserve to Replace the Dollar."

"In another indication that China is growing increasingly concerned about holding huge dollar reserves, the head of its central bank has called for the eventual creation of a new international currency reserve to replace the dollar."

The official argued that a new currency reserve system controlled by the International Monetary Fund would be "more stable and economically viable."

As the Times observes, "the proposal suggests that China is preparing to assume a more influential role in the world."

This is a theme I develop in The End of the American Century, where I describe China's opposition to "hegemonic" and "unipolar" power politics--code words for U.S. domination--and the country's growing efforts to promote its "soft power" influence in Asia, Africa, and elsewhere. The "peaceful rise" of China is supported by the population as well: in a 2003 poll in the country, 40 percent picked China as "the most prominent country in the world."

As London's Economist observes in its cover story on "How China Sees the World," "there is a sense in Beijing that the reassertion of the Middle Kingdom's global ascendancy is at hand." Prime Minister Wen "no longer sticks to the script that china is a humble player in world affairs" and now talks of China as "a great power."

The main reason for the proposal for a new international currency is China's growing concern about the safety and stability of its own vast holdings of the U.S. currency. China holds an estimated $1 trillion in U.S. government debt, the world's largest holdings. Earlier this month, the Chinese prime minister, Wen Jiabao, publicly expressed concern about the "safety" of these investments and asked the Obama administration for assurances that these securities would maintain their value.
(See the New York Times story "China's Premier Seeks Guarantee from U.S. on Debt").
Last January, Mr. Wen criticized the "unsustainable model of development characterized by prolonged low savings and high consumption." There was no question about which country he was referring to.

When Premier Wen hosted Secretary of State Hillary Clinton in Beijing in February, it was clear that this was a meeting of equal, sovereign states. Next month, at the meeting of the "G20" economic powers in London, the most important business will be that between Presidents Barack Obama and Hu Jintao. The Middle Kingdom is back.

Leonhardt rebuts Sorkin on AIG Pay

2009-03-19T10:30:00.002-04:00

As an addendum to my previous post, the day after Andrew Sorkin's New York Times column defending executive bonuses ("The Case for Bonuses"), the much more astute and sensible NYT economics columnist, David Leonhardt, published a piece entitled "Paying Workers More To Fix Their Own Mess." While Leonhardt did not specifically mention Sorkin's column, he did quote from it, and it is clearly a response and counterpoint to Sorkin's nonsensical defense of big bonuses for incompetent executives. As I have suggested before, Leonhardt is one of the few economics writers who seems to understand the depth and breadth of the current economic crisis.

The "Brainiacs" and "Talent" at AIG

2009-03-18T14:24:00.002-04:00

Washington is finally catching on to why people are so upset with these million dollar bonuses for executives who drove their companies into the ground and swindled American taxpayers. But Wall Street apparently still doesn't quite understand the fuss, and the folks there continue to make the argument that these bonuses are necessary to "attract and retain talent." This "talent" are the greedy, immoral,short-sighted scoundrels who bankrupt their own companies, stole the retirement funds of million of Americans and drove the global economy to the brink of depression. Some talent.

The most stupefying assertion of this ridiculous argument about talent comes in the form of a New York Times column by Andrew Ross Sorkin, entitled "The Case for Bonuses at A.I.G."

Sorkin writes that "as unpalatable as it seems, taxpayers need to keep some of these braniacs in their seats" so they can help fix the mess they made and "to prevent them from turning against the company."

Braniacs at A.I.G.?????? These "braniacs" are colossal blunderers and incompetents, just like most of the CEOs at the other companies that went bankrupt based on hugely risky and irresponsibly stupid investment decisions.

Edward M. Liddy, the new (supposedly improved) CEO of A.I.G., perpetuates this shibboleth:

"We cannot attract and retain the best and brightest talent to lead and staff" the company "if employees believe that their compensation is subject to continued and arbitrary adjustment by the U.S. Treasury."

This argument about attracting and retaining talent has two major problems. First, it is clear by now that such a strategy did not work. Big money didn't attract talent, but greed. And selfish greed doesn't benefit much of anybody except those few who practice it.

Second, if multimillion dollar payouts are necessary to attract "talent," then how do you explain the influx of very talented, dedicated, public-spirited people into the federal government, especially with the new Obama administration? Washington is inundated by people, young and not-so-young, wanting to hitch their stars to a noble vision and public service. How many of them are being offered million dollar salaries? None.

So let THEM take over administration of these discredited and disgraced financial institutions.

Obama Defends Domestic Surveillance

2009-03-16T19:18:00.008-04:00

Caleb Hamman
chamman@butler.edu

As described in chapter five of The End of the American Century, undemocratic trends in the U.S. political system are having immense effect in furthering American decline.

The Bush II administration deserves substantial culpability. Decider & Co. scissored the democratic fabric as they exacerbated economic inequality, infringed upon the rights of American citizens, and ruled by fiat decrees issued from a hierarchical decision-making structure.

Conversely, the Obama administration has brought about some welcome developments. A grassroots presidential campaign, an end to torture, and a more transparent governing style are some recent democratizing measures that bode well for the U.S. political system.

Still, other actions have been less than reassuring. Among the most ominous has been Obama’s refusal to depart from the Bush status quo on the issue of domestic surveillance.

Since January, the Obama Justice Department (DOJ) has taken action to ensure the legality of Bush’s domestic spying policies will go unquestioned, the details of the program will remain unknown, and surveillance practices will remain institutionalized for possible use by future administrations.

Supporting evidence is provided in abundance by the DOJ’s record in the ongoing Al-Haramain court case.

Wendell Belew and Asim Ghafoor, former lawyers for the now defunct Al-Haramain Islamic Foundation, sued the Bush administration after they accidentally received documentation from the Treasury Department revealing that they had been subject to warrantless surveillance in 2004.

To review, Bush’s domestic surveillance program, operating without the use of warrants, was in direct violation of the Foreign Intelligence Surveillance Act of 1978 (FISA) which permitted domestic surveillance only in the case of a court order. Bush’s spying policies were unquestionably illegal. His own DOJ refused to certify them and his attorney general, John Ashcroft, threatened to resign if they were continued (1).

To date, Bush’s spying program has withstood attacks against its legality by employing a clever bit of sophistry. The defenders of surveillance essentially argue:

1. No one can bring suit against the program who does not have standing.
2. No one can claim they have standing (because no one knows they have been spied on).
3. No one can be told they were spied on because the information is a “state secret.”

Because of its unlooked for gift from the Treasury Department, the Al-Haramain case appeared to be the first with substantial promise to penetrate this circular reasoning—at least until the Bush administration declared the document a “state secret” and Al-Haramain was forced to return it to the Treasury Department by court order (2).

For three years, the Bush administration continued to assert the state secrets privilege and thus prevent Al-Haramain from proving the standing necessary to question the legality of the surveillance program.

Recently things began to take a different turn. Last July, U.S. District Judge Vaughn Walker ruled that the state secrets privilege didn’t apply to the Al-Haramain case. Then, on Jan. 5, Walker ruled that, with some minor qualifications, Al-Haramain’s lawyers should be given access to the controversial document in order to establish standing.

Enter the Obama administration. Writing last week in Salon, Al-Haramain’s lawyer Jon Eisenberg described how Obama’s election had given the plaintiffs “hope” that they would see some “change we can believe in” in “the Justice Department’s handling of the case under Attorney General Eric Holder” (3).

Perhaps Al-Haramain’s lawyers had taken heart from Obama’s campaign Web site. Herein, “The Plan to Change Washington” describes one aspect of “The Problem” as being “Secrecy Dominates Government Actions” (4).

Specifically, “The Bush administration has ignored public disclosure rules and has invoked a tool known as the "state secrets" privilege more than any other previous administration to get cases thrown out of civil court.”

Despite its rhetoric, Eisenberg testifies that Obama’s Justice Department “has continued to assert the state secrets privilege in the Al-Haramain case, even though Judge Walker ruled last July that the privilege does not apply.”

Also writing in Salon, constitutional and civil rights lawyer Glen Greenwald describes how “the Obama DOJ” is “not merely trying desperately to keep the Bush administration’s spying activities secret, and not merely devoting itself with full force to preventing disclosure of relevant documents concerning this illegal program, but far worse, doing everything in its power to prevent any judicial adjudication as to whether the Bush administration broke the law by spying on Americans without warrants” (5).

Greenwald details how “Obama lawyers have been running around for weeks attempting one desperate, extreme measure after the next to prevent this case from proceeding—emergency appeals, requests for stays, and every time they lose, threats of still further appeals.”

The process reached a climax late last month. On Feb. 27th, the Ninth Circuit Court of Appeals rejected an emergency request by Obama’s DOJ to halt further proceedings before Judge Walker. This ruling effectively ensured that Al-Haramain’s lawyers would have access to the top-secret document necessary to prove standing.

At this point, Obama’s lawyers took unprecedented action. According to Eisenberg, “they informed Judge Walker in a public court filing that if he intends to give us access to the secret filings in the case, the government will ‘withdraw that information from submission to the court’.”

As Eisenberg describes, this statement implies that “executive branch authorities (who? the FBI? the army?) will attempt to seize the documents from Judge Walker”—something that would be “a violation of the constitutional separation of powers, unprecedented in this nation’s history.”

From its actions in the Al-Haramain case, it seems quite clear that the Obama administration has chosen to defend the Bush status quo on domestic surveillance. Legal arguments aside, it’s a rather disturbing decision—one preventing the achievement of justice for past crimes and effectively guaranteeing that domestic surveillance practices will be available to future administrations.

It’s less than clear why the Obama administration has elected this position. It’s not as if they’ve merely invoked "state secrets" in order to protect a few pieces of sensitive information; rather, in exactly the same fashion as Bush, they’ve employed the privilege to have undesirable cases thrown out in their entirety, ensuring that the legality of domestic surveillance will never meet serious challenge.

At best, Obama’s surveillance policy is simply representative of a hesitancy to investigate past crimes. At worst, it’s an attempt to retain expanded, illegal powers for the executive branch and a tacit approval of establishing an above-the-law presidency effectively immune from judicial restraint.

Unfortunately, the context of past actions seems to rule out the least of all evils. Obama voted for the 2008 FISA amendments—bestowing legitimacy on surveillance practices and described by Yale Law School Professor Jack Balkin as “byzantine” and giving “new powers” to the presidency that are “either sketchy or opaque” and “will have to be worked out” by “the executive branch” (6).

Welcome Caleb Hamman to the team

2009-03-16T19:05:00.002-04:00

Caleb Hamman, a former student of mine, will be joining this blog as a guest contributor. Caleb is double-majoring in Political Science and Philosophy at Butler University, and is the opinion editor and columnist for The Butler Collegian. HIs first blog will appear here shortly.

Is the Global Economy a Ponzi Scheme?

2009-03-09T17:25:00.004-04:00

In his Sunday New York Times column, Thomas Friedman quotes a climate expert, Joe Romm, who nicely captures a problem that I discuss in my book, and in several blogs posted here(especially "The US Economy Will Shrink A Lot, and It Should.").

"We created a way of raising standards of living that we can't possibly pass on to our children. . .We have been getting rich by depleting all of our natural stocks--water, hydrocarbons, forests, rivers, fish and arable land--and not by generating renewable flows."

This led me to Joe Romm's blog, climateprogress.org, where he has a thoughtful and thought-provoking entry entitled "Is the Global Economy a Ponzi Scheme?" The essay, and that site, are worth a look, and I have added a link to it in my blogroll.

The End of the American Century Published in China

2009-03-05T15:33:00.004-05:00

The End of the American Century will appear this month in China, published by the Shanghai Lexicographical Publishing House, and translated by Professor Ni Lexiong and Sun Yunfeng of the Shanghai University of Political Science and Law.

The US Economy Will Shrink (A Lot), and It Should

2009-03-01T16:42:00.004-05:00

The U.S. economic stimulus plan passed by Congress aims to regenerate economic growth, spending and consumption. But it is almost certainly bound to fail, and not for the reasons given by partisans on both sides of the Congressional aisle. In spite of the stimulus, the economy will continue to contract. This is inevitable; it is necessary; and it is even desirable. The main task of the government should be protecting those who are displaced and impoverished during this contraction and retrenchment.

The U.S. economy must contract because it is way too large, in numerous respects. It is too large given the U.S. levels of production and exports. It is built largely on consumption and debt, not output. And it is too large for the rest of the world, even given the size and wealth of the country.

The U.S. economy is big—about 28% of global GDP. But the U.S. accounts for only about 8% of global exports; 16% of manufacturing value-added output, and 5% of the world’s population.

The main contributor to the outsized US GDP is consumption, where the U.S. is indeed the world’s leader. Consumption accounts for about 72% of US GDP, which is a record for any large economy in modern history. As we are now learning, this consumption has been built on a mountain of consumer and household debt, which now totals some $13 trillion—approximately the size of the entire U.S. economy. This is unsustainable.

Furthermore, much of U.S. debt is owed to other countries. About half of the federal debt and a quarter of corporate bond debt is held by foreigners. As former Senator Hillary Clinton pointed out in 2007, "16% of our entire economy is being loaned to us by the Central Banks of other nations."

These huge levels of consumption are a drain on the planet, its resources and its people. The U.S. has only 1 in 20 of the globe’s people, but we consume a quarter of the world’s fossil fuels; 29% of “materials” (including minerals, metals and synthetics); 19% of forestry products; and 14% of its water. The U.S. is also the world’s biggest contributor to environmental pollution, greenhouse gas emissions (a quarter of the world’s total) and global warming. At 5% of the globe, we leave a huge carbon footprint.

In the 1970s Yale historian Paul Kennedy, writing in The Rise and Fall of the Great Powers, suggested that eventually the U.S. would have to decline to its “natural” share of the world’s wealth and power, which he estimated should be in the 16-18% range, rather than the 30-40% held by the U.S. at that time. This would indicate a cutting of the U.S. economy by half.. But so would many of the economic indicators I mention above. Consumption, debt, and borrowing all need to be reduced by about that amount, as should petroleum and energy use.

Given the hugely bloated size of the U.S. economy, and of U.S. consumption, and of consumer and government debt, it is hard to see how the economic stimulus package will make much of a dent in things. The economy is bound to decline, and needs to.

This contraction has already begun. The country’s GDP shrunk last quarter at an annualized rate of 3.8 %. If this continues, it will be the largest yearly decline in the US economy since 1946. But a much larger decline will be necessary to bring the economy back to a more natural, balanced and sustainable level. The contraction of GDP is likely to continue for several years, at the very least. This would be unprecedented for the postwar period, when only once (1974-75) did the economy contract two years in a row.

Such a decline could be on a scale of that of the 1930s. The main problem then, as now, will be the reduction in employment, and the consequent growth in poverty. It is hopeless throwing good money after bad in an effort to revive growth, consumption and debt. Instead, the federal and state governments should focus on alleviating the suffering that this contraction will entail, by increasing funds for unemployment compensation, Medicaid, welfare, job retraining and education.

Many people will suffer in this transition, and they should be helped. For most people, though, this economic retrenchment will simply mean belt-tightening. Our standard of living will decline, in ways most of us have not experienced before. But we are still a highly developed wealthy country, and will remain so. Once the U.S. economy has stabilized at a more natural size, it will grow again. And this time, it can happen in a way that is not so destructive of the planet, other peoples, and our souls.

Forthcoming Presentations on "The End of the American Century"

2009-02-28T18:07:00.007-05:00

Over the next several weeks, I will be giving several public presentations related to themes of my book The End of the American Century.

March 4, Muncie "The Future of America's Power in the World" Co-presenting with Michael Kraig, Senior Fellow at the Stanley Foundation. The Annual Trivers Lecture, sponsored by the Ball State University Department of Political Science. Wednesday, March 4 at 4:00 p.m. in Bracken Library, Room 226.

March 11, Chicago Two presentations at Northeastern Illinois University (Chicago), as part of their conference on "The Past and Future(s) of Revolutions: A Global Exploration" (see program at this link).

Noon. Teaching a Master Class on "The Unraveling Revolution: The Collapse of U.S. Superpower." NEIU Auditorium.

7pm "Systemic Revolutions and the End of the American Century." Presentation on a panel on "New Forms of Revolution" with other presentations by Julie Mertus and Jonathan Schell. NEIU Auditorium.

March 18, Indianapolis. "The End of the American Century" as part of the Distinguished Speaker Series of the Indiana Council on World Affairs. 6:30pm, The Marten House Hotel, Indianapolis.

April 1, Indianapolis. "The U.S. and Rising Powers" Presentation as part of the "Great Decisions" series presented by the Mid-North Shepherd's Center. 11:00 a.m. at the North United Methodist Church, 3808 N. Meridian Street. More information at this link.

More Evidence That Taxes Must Go Up

2009-02-26T12:55:00.009-05:00

David Leonhardt, the prescient and hard-headed New York Times economics columnist, states flatly that "your taxes are going up" in his column of Feb. 25. Leonhardt's data and arguments reinforce those I have made in The End of the American Century, in my Op-Ed for the Christian Science Monitor ("This is not the time to cut taxes"); and in other posts here.

Leonhardt argues that if we want the government services that we have come to expect and rely on (like national security, infrastructure, Medicare, education), we need more federal revenues, because at the moment "we are not paying nearly enough taxes to maintain those programs." He sees taxes going up soon, "and the increase will be permanent."

On the upside, Leonhardt argues, there is room for such an increase, and it will probably not hurt economic growth. As he points out, for a half century federal taxes have remained fairly constant relative to the size of the economy--at about 18% of GDP. "But the 18 percent era has to end soon."

In The End of the American Century, I show that US tax rates are low in global comparisons.

"Compared to other wealthy countries, the United States has among the lowest rates of both individual and corporate income taxes, and total tax revenues in the U.S. (as a percentage of GDP) are lower than those in most of the affluent democracies that are members of the OECD [see OECD data here]. Thus, not only is the U.S. spending and consuming more than most countries, but it is not paying for the relatively few benefits that the government provides. This is the crux of the problem of the deficit and the debt."

Leonhardt argues (as I do in my CSM Op-Ed), the "despite all the scary stories you've heard, the evidence that higher taxes necessarily cripple an economy is somewhere between thin and nonexistent." He points out that the fastest postwar economic growth occurred in the 1950s and 1960s, "when the top marginal tax rate was a now-unthinkable 90 percent."

He also points out that it will not be sufficient to simply raise taxes on the very wealthy, as President Obama has proposed. The incomes and wealth of that group have soared in the last decade, as their federal tax rates have declined. So their higher tax rates should be restored.

But, as Leonhardt says, "the problem can't be solved just by taxing the rich." That top 1% pays only about one quarter of federal taxes. So the tax increases will have to spread more widely.

This will be a very difficult task politically. No politician wants to raise taxes. But not to do so will simply pass the problem onto our children, and burden them with an even bigger mountain of debt. We need to start paying for what we get. And especially now, as we launch huge new spending programs for health care, education, infrastructure and banks, we need to shell out for what we are getting.

Indiana Governor Has "No Idea" of Costs of Commercial Flights

2009-02-25T11:44:00.005-05:00

Indiana's Governor Mitch Daniels, using a $1000 per hour state aircraft for a trip to Washington, appeared clueless when a reporter asked him if it might be cheaper to fly commercial and stay an extra night in DC.

Last weekend, Daniels was flying to Washington for the annual meeting of the National Governors Association when the plane developed a crack in one of the windows, forcing it to land in Columbus. He flew on from there on a commercial flight.

The state-owned plane, a King Air prop, costs $791 per hour for fuel plus $184 in maintenance costs for each hour of flying. The flight from Indianapolis to Washington takes about two hours.

According to the Indianapolis Star, when he was asked why he didn't fly commercial in the first place, Daniels said there was no commercial flight that would have gotten him to Washington on time. "I would've had to come the night before and buy a hotel room and I don't know what else." When asked whether it still wouldn't have been cheaper to fly commercial, even if it meant another night in a hotel, Daniels said "I have no idea."

This seems a peculiar response from the former director of the national budget, and a man who President Bush referred to as "The Blade" for his acumen at budget cutting. But even then, Daniels was not so good at keeping spending under control. During his tenure as director of the Office of Management and Budget from 2001 to 2003, the federal budget flipped from a $236 billion surplus to a $400 billion deficit.

So I took the liberty of checking up on prices for the gov. The Governors Association was meeting at the J.W. Marriott hotel in DC. A king size bed on a weekend night costs about $200--though almost certainly the governors attending the conference received a reduced convention rate. A commercial roundtrip flight from Indy to DC--non-stop and at least as fast as flying a smaller turboprop--also runs about $200.

So to fly commercial and stay an extra night would have been roughly $400. To fly the 9-seat King Air, without having to "buy a hotel room and I don't know what else" costs about 2k each way, for a total of $4000. Ten times as much, Mr. Governor.

Maybe this is trivial, but Daniels' cavalier dismissal of the question on costs betrays an arrogance and profligacy that is unbecoming of a public servant. Some of our Congressional representatives have grilled the bailout CEOs about their use of corporate jets. Surely our elected representatives should be held to at least the same standards, particularly in this time of deficits, belt-tightening, and sacrifice.

(Scott Adam's 2/25 "Dilbert" strip.

Guns on Campus Would Add to the Mayhem

2009-02-19T11:52:00.005-05:00

One of the themes of The End of the American Century is the exaggerated and destructive aspects of "American Exceptionalism"--the tendency for Americans to see themselves as exceptional, different and better than other peoples and countries. This takes extreme form in the combination of individualism and violence in this country, which is manifested in the peculiar (and exceptional!) obsession with individual gun ownership. The prevalence of firearms in the U.S.--almost as many as there are people--contributes to some 30,000 firearm deaths each year, and a homicide rate that is far higher than any other industrialized country.

For people in other countries, the levels of violence and the prevalence of guns in the U.S. invoke both amazement and horror. Global opinion surveys show that the two most common negative characterizations of Americans by foreigners are "greedy" and "violent." They contribute to the growing disillusionment with the U.S. (and with American citizens) in other countries, and to the view of the U.S. as being violent both in its foreign policy and inside its own borders.

In recent years, the National Rifle Association (NRA) has been pushing for the adoption of "conceal carry" laws in the states, and lately has been arguing for laws that would allow more guns on college campuses. They claim to see this as a way to avoid tragedies like those at Virginia Tech where a student killed 32 people in 2007. But few experts believe that arming students could prevent such a tragedy, and that it will simply lead to an increase in campus firearms injuries and deaths.

The NRA-sponsored bill in my state, Indiana, was introduced by a lifelong NRA member who wrote a letter to the Indianapolis Star arguing in support of the bill, Senate Bill 12. Below is my response to his letter, which appeared on the Star's website at the following link.

-----------------------
Nothing positive to gain from guns on college campuses

Posted: February 13, 2009

In his recent letter to the editor, state Sen. Johnny Nugent contends that "allowing guns will make our campuses safer." He is a sponsor of Senate Bill 12, which would "prohibit a state college or university from regulating in any manner the ownership, possession, carrying, or transportation of firearms or ammunition." Nugent believes that

"the only thing that can stop a bad guy with a gun is a good guy with a gun."

It would seem, though, that the best people to ask about security and safety on campus are the campus safety and police departments. Nugent would find that they overwhelmingly oppose this measure, as would almost all faculty and staff on campuses (as I am). Butler University Public Safety Director is Ben Hunter was formerly an officer with the Indianapolis Police Department. When I asked Hunter his views on this, he wrote "I am against the idea of carrying weapons on campus" and continued as follows:

"As a lifelong supporter of responsible gun ownership, I can attest that educational institutions and employers should be allowed to regulate their buildings and properties. Having students, faculty and staff possibly carrying guns on campus could result in accidental discharges, a false response to a threat and untrained persons that create an operational danger for (police). Proponents of such legislation will often talk about how well trained persons can assist with these threats; the only issue is that their training does not come close to what police officers are required to undertake."

College campuses are already much safer than the community in general, with far lower levels of both homicides and suicides. Surely, this is due, in part, to the prohibition of guns by most universities. Probably the biggest consequence of allowing guns on campus would be an increase in the incidence of suicide. Suicide is already the third leading cause of death for Hoosiers of college age, but suicides are much less common on college campuses than off. Since the most common means of death in suicides is a gun, increasing the number of guns on campus will only make suicides more likely.

Before pushing this law onto colleges and universities, our legislators should consult with those who are most familiar with the situation: the public safety departments, mental health professionals, and the deans of student life. I can't imagine that any of them would want to see more guns on campus.

Russian Reflections in a U.S. Mirror

2009-02-12T12:01:00.000-05:00

A prominent Russian professor and former KGB analyst,Igor Panarin, predicts that the U.S. will collapse and break into six pieces next year. His forecasts are “all the rage” in Moscow and Panarin has become a media celebrity in Russia. As interesting as his theories are though, and as bad as things are in the U.S., his predictions are way overblown, reflect a shallow understanding of the United States, and actually tell us more about Russia than about the U.S.

In December the Wall Street Journal reported on an interview with Panarin, entitled “As If things Weren’t Bad Enough, Russian Professor Predicts End of U.S.” The Russian sees mass immigration, economic decline and moral degradation in the U.S. leading soon to a civil war and a collapse of the dollar. Soon thereafter, the richer states will withhold funds from the federal government, effectively seceding. The country will break into six pieces, based mostly on ethnicity, and foreign powers will move in to gobble them up. (There is a map of the future Un-United States in the WSJ article).

As with many such apocalyptic scenarios, there are bits of truth in Panarin’s analysis. He points to the problem of U.S. debt, and foreign debt in particular as a “pyramid scheme” that is unsustainable. In an Izvestia interview in November, he predicted the U.S. financial crisis would worsen, that unemployment would grow, and that people would lose their savings. He sees the revival and growth of both Russia and China as major political and economic powers. All this is pretty accurate.

However Panarin’s more extreme predictions about the U.S. seem more like a reflection of what has happened in Russia—-he is “projecting” as psychotherapists like to say. His concern about “moral decay” in the U.S., for example, is hard to fathom given the extremely high levels of alcoholism, divorce, crime and corruption in Russia. And the breakup of the US seems more a reflection of Russia’s own past—the 1991 breakup of the Soviet Union into 15 separate countries. But the parallels are few: each of these 15 “republics” of the USSR were based on entirely different nationalities, or ethnic groups, with little holding them together but the centralizing force of the Communist Party. As contentious and fragmented as the US can sometimes seem, almost all people here still consider themselves, first and foremost, Americans.

What is most interesting about Panarin’s predictions—and their popularity in Russia—is what it says about Russia’s desired place in the world. The country has been through some very rough times over the last two decades, and under Putin has begun to revive and reassert itself. Vladimir Pozner, a prominent Russian tv journalist, says Panarin’s vision “reflects a very pronounced degree of anti-Americanism in Russia,” which, he says, is “much stronger than it was in the Soviet Union.”

In The End of the American Century, I point to Russia as one of America’s potential “New Rivals.” One can not ignore that Russia is the largest country in the world, occupying almost twice the territory of the U.S. Within those borders it contains the world’s most abundant array of natural resources. It is the world’s second largest producer and exporter of petroleum and has, by far, the world’s largest reserves of natural gas. Russia’s economy has been growing at about 7 percent annually. It also has the world’s largest stockpile of nuclear warheads.

Both Russia’s citizens and its leaders want Russia to play a bigger role on the world stage and to be more respected by other countries. Premier Putin has been particularly vocal and critical of U.S. efforts to dominate the globe, referring not so subtly to a “world of one master, one sovereign.” He has said that “the trust in America as the leader of the free world and free economy is blown for ever.” (See The Economist's special report on Russia, "Enigma Variations," for more on this theme).

Russia has its share of problems, as the U.S. does. But it will be a force to reckon with, and the U.S. will have to learn to deal with Russia, as with other countries, as partners or competitors, rather than subordinates or enemies.

Galllup Poll Widget

2009-02-08T17:10:00.000-05:00

I added a Gallup Poll widget to the sidebar of this page (scroll down on the right), which shows the latest favorability ratings for President Obama, and has links back to the Gallup home page for results of some of Gallup's recent surveys. Interesting and nifty!

The Measure of America

2009-02-07T12:52:00.000-05:00

The Social Science Research Council and Columbia University Press have published a remarkable and eye-opening book, called The Measure of America: American Human Development Report 2008-2009, which could function as a companion and statistical supplement to The End of the American Century. In analyzing the domestic situation of the U.S., The Measure of America has many of the same themes, and similar (and supporting) evidence as my book. Like my book, it shows that on most measures of societal development, the U.S. has declined over recent decades, and lost ground compared to other countries.

The Measure of America is modeled on the annual Human Development Report published since 1990 by the United Nations Development Programme. That series attempted to get away from the raw economic indicator of Gross Domestic Product, and to determine the level of human development in each country. The “human development index” used by UNDP, an alternative to GDP, was “a composite index measuring average achievement in the three basic dimensions of human development—a long and healthy life, knowledge, and a decent standard of living.” (From the Human Development Report 2006).

The Nobel Prize winning economist Amartya Sen was instrumental in developing the Human Development Report, and wrote the Foreword to The Measure of America. There, he writes that

“we have to judge the success of a society, including its economy, not just in terms of national wealth or the ubiquitous GNP, but in terms of the freedoms and capabilities that people enjoy to live as they would value living” (p. xi).

Sen observes that this approach has been “remarkably neglected in the United States in particular” and notes in this country “a major discrepancy between opulence and achievement.” The U.S. may be on some measures the world’s wealthiest nation, but “its accomplishments in longevity, secure health, fine education and other such basic features of good living are considerably below those of many other—often much poorer—countries.” He also notes, as I do in my book, that the position of the U.S. relative to other countries has been “steadily falling” over the years (p. xii).

The book itself assembles data in clearly presented tables on the three main “building blocks” of the human development index: a long and healthy life; access to knowledge; and a decent standard of living. In all three areas, the U.S. fares poorly in comparison to other countries. Compared to other wealthy countries, for example, the U.S. ranks #24 in life expectancy; #18 in high school graduation rates; and #2 in poverty rates (you don’t want to rank high on that one!).

The data shows the downward trend for the U.S. over time in most of these measures as well. And for the overall index, the U.S. world rank dropped from #2 in 1980 (behind only Switzerland) to #12 in 2005. Countries ahead of us include much of western Europe, Canada, Australia and Japan.

(The American Human Development Project also maintains a useful website at this link.)

These are all trends and themes presented in The End of the American Century, where I also use authoritative data (including many of the same measures used in The Measure of America). They point out how far the U.S. has fallen, and how much work we have to do. The problems of the U.S., both economic and social, predate the disastrous Bush presidency, which simply exacerbated them all. It took more than eight years to dig us into this hole, and will take at least that long to recover. But we have to recognize these problems and understand them before we can begin to solve them.

The Measure of America: American Human Development Report, 2008-2009 (A Columbia / SSRC Book)

Obama Imposes CEO Pay Limits

2009-02-05T11:19:00.000-05:00

Limiting CEO pay must be in the air! I posted a blog with such a proposal on Saturday, before learning that Senator McCaskill had introduced a bill with similar provisions on Friday. Then yesterday President Obama himself announced executive pay limits, along very similar lines as my own "modest proposal." (Do you think the Prez reads my blog?!!).

According to the New York Times story, these executive pay limits "seek to alter corporate culture" which in my view is long overdue and would be a major accomplishment. According to the Times, "the new rules would set a $500,000 cap on cash compensation forthe most senior exeutives, curtail severance pay when top executives left a company,[and] restrict cashing in on stock incentives until government assistance was repaid."

President Obama observed that "This is America" and "We don't disparage wealth" or people achieving success. But "what gets people upset--and rightfully so--are executives being rewarded for failure. Especially when those rewards are subsidized by U.S. taxpayers."

"For top executives to award themselves these kinds of compensation packages," the President said, "in the midst of this economic crisis is not only in bad taste, it's a bad strategy, and I will not tolerate it as president." He pointed to this kind of CEO extravagance reflecting "a culture of narrow self-interest and short-term gain at the expense of everything else."

Bravo, Mr. President. This may be mostly a symbolic gesture, but symbols are important. What this country needs now, even more than an economic stimulus package, is a change of heart, and a change in the way we think, believe and behave. Just as when the President said "The United States does not torture," he is sending a message to Americans and to the rest of the world that the United States is changing.

(See my previous entries on CEO pay by clicking on the "CEO pay" label in the right sidebar).

Limit Bailout CEO pay to U.S. President's Salary

2009-01-31T13:37:00.000-05:00

President Obama called Wall Street bankers "shameful" after reports that they had given themselves some $20 billion in bonuses this year, just as the economy was deteriorating and the government spending billions to bail them out.

Here's a modest proposal: for companies receiving federal bailouts, let's limit the pay of those CEOs to what the President of the United States earns--$400,000.

Once those bailout companies have repaid our tax-paid bailout money, they can return to paying themselves tens of millions of dollars yearly, as they do now.

Indeed, just this week Senator Claire McCaskill (Dem, Missouri) introduced a bill that would cap compensation at $400K for all employees of bailout recipients.

To give you some context, here are the top ten recipients of federal bailout money under the TARP (Troubled Asset Relief Program).

1. Bank of America, $45 billion
2. Citigroup, $45 billion
3. AIG, $40 billion
4. JPMorgan Chase, $25 billion
5. Wells Fargo, $25 billion
6. General Motors, $10.2 billion
7. Goldman Sachs, $10 billion
8. Morgan Stanley, $10 billion
9. PNC Financial, $7.6 billion
10. U.S. Bankcorp, $6.6 billion

And here are the 2007 total compensations for the CEOs of those same firms:

1. Kenneth Lewis, $20.4 million
2. Vikram Pandit, $3.2 million
3. Martin Sullivan, $13.9 million
4. James Dimon, $28.9 million
5. John Stumpf, $11.4 million
6. G. R. Wagoner, $15.7 million
7. Lloyd Blankfein, $54 million
8. John Mack, $41.4 million
9. James Rohr, $14.5 million
10. Richard Davis, $5.9 million

These men are all multimillionaires, even if you only count their take from last year. They can afford to slum it for a while on the salary of the President of the United States. And if these CEOs are genuinely committed to help their companies, and the United States, recover, then they should be willing to forego a little extravagance for a few years. If they are unwilling to do so, then the federal government should appoint a caretaker CEO until the bailouts have been repaid.

The rules of the game have changed. These companies and their CEOs have brought this country to the brink of economic disaster. The government has stepped in to save these companies, as a means of rescuing the economy. There can no longer be any argument that multimillion dollar compensation packages are necessary to attract "talent." It was not true in the past (when CEO salaries were far lower); it is not true in other countries (where CEO salaries are a small fraction of American ones--see chart below); and it is not true now--when this "talent" drove their companies, and the economy, into the ground.

Congress has talked about limiting the pay of bailout CEOs, but they have done nothing about it. It is time. And this idea--of limiting these CEO salaries to the level of the highest paid government executive--was even profferred by Republican John McCain during the campaign:

"no C.E.O. of any corporation or business that is bailed out by us, that is rescued by American tax dollars, should receive any more than the highest paid person in the federal government.”

CEO Pay as a Multiple of Average Worker Pay, in US and Other Countries

(from The End of the American Century, p. 40.

Interview and Review of "The End of the American Century"

2009-01-29T15:16:00.002-05:00

David Hoppe interviewed me and wrote a story on my book in the 1/28 issue of Nuvo magazine. I believe he nicely captures the essence of the book, and my thinking about the current situation and place of the U.S. The story can be found at this link.

Retrenchment, Not Recovery

2009-01-27T15:10:00.000-05:00

Economists and politicians are debating whether we are in a recession or a depression, and how many months or years it will take to recover from the downturn. As I have argued on this blog and in my book, what is now happening to the economy is not typical or normal. I would call it a "retrenchment" rather than a recession. In that sense, it is a permanent correction, and will result in a substantial and long-term contraction of GDP, the standard of living and the stock market. It will take many years to return to where we were. The problem is that the U.S. government and consumer have both been living on borrowed money for a generation, so that most of the gains of that period are illusory. We were never really that wealthy, and now we have to start paying for that extravagance.

A similar argument is made in an interesting article entitled "Will There Be A Recovery?" by Paul Craig Roberts, a former Assistant Secretary of the Treasury in the Reagan administration. He also sees the current situation as different from past recessions. Recovery in the past could be stimulated by cuts in interest rates, allowing consumers to spend more against rising real wages. This would lead the economy to rebound.

Now it is different though. For one thing, for most workers, real wages have remained stagnant for almost twenty years. Consumers have maxed out their credit and can no longer borrow so freely. And interest rates are already at rock bottom levels.

"And there’s another problem," says Roberts. "Much of what American consumers purchase today is made offshore. Stimulating consumer demand in America puts factories back to work, but those factories are located elsewhere in the world." The U.S. consumed more than it produced, by borrowing from abroad. But this source of funds is also drying up now.

These are all themes that I raised in The End of the American Century. While I do not totally agree with all of Roberts' arguments, his overall point is a good one. There will not be a recovery, like recoveries in the past. The task for the U.S., and the Obama administration, is to figure out how to navigate this difficult transition, and to convince U.S. citizens that we can live a good life without all the excesses of the past.

Take a look at Roberts' essay, and offer your thoughts in the Comments section here.

Merrill Lynch's John Thain: Poster Boy for Greed and Incompetence

2009-01-26T13:23:00.000-05:00

Last week, John Thain, the former CEO of Merrill Lynch was sacked by the CEO of Bank of America, which recently absorbed the bankrupt brokerage firm. Thain is a prime example of the mind-boggling greed, incompetence and cluelessness of the captains of the U.S. financial services sector. I called attention to Thain in my September blog on CEO pay, where I noted that Thain was the highest paid CEO in 2007, with compensation exceeding $83 million. This was a year in which Merrill Lynch lost $7.8 billion, mind you. Granted, Thain didn’t take over Merrill until November of 2007. But 2008 was even worse. Merrill’s losses of $27 billion last year was what led to its absorption by Bank of America.

But Thain’s greed and arrogance gets even worse. He apparently demanded a bonus of $30-40 million for 2008, the year he presided over the company’s bankruptcy and collapse. This was after Merrill had already received some $10 billion from U.S. taxpayers as part of the federal government’s financial bailout. Furthermore, according to a story in the Financial Times, Merrill granted some $4 billion in bonuses to other executives in the company, just before the Bank of America takeover was finalized. As the Financial Times observers, “this was money that appeared to come directly from US government funds.”

A New York Times story says that Thain spent $1.2 million to redecorate his Merrill Lynch office last year, including an $87,000 rug and a $68,000 credenza.

John Thain stands out as the worst abuser of corporate and government funds. But the problem is much wider than John Thain or Merrill Lynch, and extends across the entire corporate landscape. In my earlier post on CEO pay (and in my book), I point out that these huge CEO compensations in the U.S. are horribly inflated, both by historical standards and in comparison to other capitalist countries. In the 1980s, average CEO pay in the U.S. was about 50 times that of average worker pay. In Germany, Canada, and Japan, the ratio is less than 25 to 1. In the United States in recent years, on the other hand, that ratio has approached 500 to 1.

Thain is out, thank goodness. New York Attorney General Andrew Cuomo is investigating the bonus payments in Merrill Lynch. There is some accountability there, at least. U.S. representatives and taxpayers should make sure, though, that U.S. citizens do not subsidize the lavish lifestyles and obscene salaries of executives in companies that are receiving taxpayer money. Most of them are multimillionaires already. If they truly want to help the economy and the country (as most of them say they do), let them live on an average worker’s salary for a few years.

The End of America's Disgrace

2009-01-24T23:19:00.000-05:00

I only admitted this to my friends, but I was embarrassed about my country, and embarrassed to be an American during most of the past four years. For me, the President of the United States was particularly embarrassing and humiliating, but his cabinet and advisors were not much better. Even Congress acquiesced in Bush’s humiliation of America, and his undermining of the Constitution, and of our most fundamental values. The President authorized and advocated torture. Without apparent remorse, he violated international law and universal moral standards. He sent thousands of young Americans to their death in a useless, illegal and immoral war. He barely mentioned the tens (or hundreds?) of thousands of innocent Iraqis who lost their lives as a result of his personal crusade. The President approved the violation of habeas corpus, one of the most ancient and fundamental principles of law and human rights. He stifled freedom of speech and the press, and ridiculed his opponents, both at home and abroad. And even in seemingly trivial matters, he was an embarrassment; denying President-elect Obama and his family the use of Blair House during the transition was a final, departing, glaring example of his lack of even elementary decency and civility.

My own embarrassment even extended to my countrymen. We elected this jovial demagogue not once, but twice and even after all of this should have been clear to all. Eventually, I realized that I could not distance myself from my country—I am too much part of it. I also realized that Americans were only partly at fault for Bush. He exploited and played on our fears, and encouraged our baser instincts. This is the age-old strategy of demagogues and dictators everywhere, and it worked here too.

For me, all of this changed on January 20. Once again, I am proud to be an American, and—perhaps for the first time in my life—proud of the person we have elected as President. The November election itself was a revelation and an inspiration, but somehow it did not fully hit home until the inauguration. The two million people on the mall, many of them (like my daughter and her husband) arriving in the frigid pre-dawn hours. The poem, the music, the speech, and the benediction—all weaving together the same themes of unity, community, charity, justice, equality, freedom and faith. And especially Obama himself—a smart, hard-working, family man; an African-American; and a person who wants to help other people, especially the less fortunate.

What is perhaps most remarkable about this presidential transition is the absolutely huge difference from one man to the other. In past elections, I have been pleased with the election of some leaders (mostly Democrats, I have to admit), but I always felt that the change was incremental and marginal at best. The new guy was better than the old, but the difference was not earth shaking. This time, we have left behind the worst president in modern American history—a playboy millionaire who could barely compose a sentence—for a young man who braved amazing obstacles to rise to the top by hard work and intelligence, who has written books (on his own!), and who has dedicated much time to helping others.

Furthermore, his election has restored my faith in America, and in my fellow citizens. I actually did not believe that the U.S. could elect an African-American as President at this point in its history. But we did! Even Indiana voted for Obama (maybe because he can shoot 3-pointers!). The rest of the world, which understandably viewed Bush as a lightweight and a cowboy, is already reassessing the United States and its people. (As I document in my book, foreign publics increasingly blamed the disfunctionalism of the U.S. on its people, rather than on Bush alone). This is the first time in world history that a majority White country has elected a Black chief executive. The world has taken notice.

Obama’s election does not mean that we will soon solve all of America’s many problems. One man—no matter how talented and promising—can not do this, nor can one or two presidential terms. Over the past 20 years we have dug ourselves into a huge hole, and have squandered resources and reputation aplenty. We have lost our way and compromised our values. We have become a nation of individuals and consumers, rather than a community of citizens.

But in his inaugural address, President Obama called on us to begin rebuilding our shattered country. And he provides what any great leader does—an example for the rest of us.

This Is Not the Time To Cut Taxes

2009-01-12T13:44:00.000-05:00

My op-ed piece, "This is not the time to cut taxes: To increase federal revenue, taxes must go up, not down," appears in the 1/13/09 issue of The Christian Science Monitor, accessed at the link above. There I write that

"talk of tax cuts may be music to the ears of American taxpayers and a nod to satisfy Republicans but they make no sense in a time of soaring budget deficits and huge new government expenditures, including the probability of $1 trillion for Obama's proposed economic stimulus plan."

I conclude the article with these thoughts:

"Obama should allow the Bush tax cuts to expire at the end of next year, for everyone except the very needy. He should also raise the marginal tax rates for the very wealthy. These rates are very low by both historical and international standards. Increased taxes will be unwelcome and painful, but the US is in a situation as unprecedented and dangerous as that of the Great Depression. Obama himself has called on Americans for sacrifice. And after two decades of bingeing, we can afford a little sacrifice."

After the American Century

2009-01-05T16:39:00.000-05:00

David Nye, a Professor of American History in Denmark, is the co-author (with Thomas Johansen) of a book entitled The American Century: A Chronology and Orientation, and has a blog of his own called After the American Century. Both his book and his blog have some similar themes to The End of the American Century. The blog, especially, provides an interesting perspective on some of these issues from outside the United States.

Interview on WUSB Radio

2009-01-05T16:25:00.000-05:00

I was interviewed about The End of the American Century on WUSB Radio (in Stonybrook, NY) by Jim Lynch on his show "Everything is Broken" (!) on December 30. You can hear the show, at least until the next one is posted, at the station's website above. On the "Weekly Schedule" grid at that site, look for the show at 1pm on Tuesday, and click on the speaker icon. The interview begins about 13 minutes into the program.

China, U.S. Debt, and the Economy

2009-01-02T15:20:00.000-05:00

In The End of the American Century, I point to China as one of America’s new rivals, but also as a major factor in U.S. profligacy and in U.S. economic decline. To a large extent, the false U.S. affluence of the last decade has been underwritten by China, in two ways: the country has supplied American consumers with cheap toys, gadgets and clothes; and has been bailing out the federal government by purchasing U.S. debt.

The rapid growth of foreign ownership of U.S. debt is yet another dimension of the unraveling of the U.S. economy. In 1970, only 4 percent of U.S. debt was held by foreigners; now almost half is. In recent years, foreigners have financed about 80 percent of the increase in public debt. The two biggest holders of U.S. debt are Japan and China, with China alone owning about $1 trillion in U.S. debt. Senator Hillary Clinton raised concerns about foreign ownership of U.S. debt in early 2007, when she sent a letter to Secretary of the Treasury Henry Paulson and Fed Chairman Ben Bernanke. “In essence,” she observed,

"16% of our entire economy is being loaned to us by the Central Banks of other nations."

This was a major reason why both the American consumer and the federal government could spend so far beyond their means in the last twenty years, and why the U.S. economy has gotten so severely out of whack. The large-scale purchases of U.S. debt by foreigners helped keep interest rates low, encouraging consumers to borrow more than they could afford for the purchase of cars and houses and other consumer goods. It was a kind of giant international Ponzi scheme. The Chinese lent us money so we could purchase their products. But when the bottom fell out, the economies of both countries began to fall apart.

It is astonishing that so few public officials and economists recognized this enormous looming problem. It is not so surprising, perhaps, that the Bush administration missed the boat on this, because they were either oblivious or willfully ignorant on just about every major issue facing the United States, economic or otherwise. As the New York Times observes in a long and helpful overview of the situation, former Fed Chairman Alan Greenspan and the Bush administration “treated the record American trade deficit and heavy foreign borrowing as an abstract threat, not an urgent problem.”

Ben Bernanke, an esteemed economist if there ever was one, acknowledges that “a better balance of international capital flows early on could have significantly reduced the risks to the financial system.” But “this could only have been done through international cooperation, not by the United States alone.” Bernanke’s view of the problem, according to the Times, “fit the prevailing hands-off, pro-market ideology of recent years.”

This illustrates, in two ways, why the U.S. has fallen so far, so fast. The problem, as Bernanke correctly noted, required international cooperation. This has been a serious weak spot for the U.S. of course, particularly in the last eight years. The U.S. has ignored, denigrated or flouted international laws, conventions and institutions—especially during the Bush administration but before that as well. Because we did not welcome international cooperation in the past—on global warming, the Iraq War, the International Criminal Court, etc.—other countries were increasingly disinclined to look for the U.S. for leadership. This is now being played out in the international economic realm as well as the political.

The second telling aspect of the Bush/Greenspan/Bernanke approach is the “pro-market ideology of recent years.” Under Bush, the “hands off” approach to economic and social problems in the U.S. has indeed taken on the rigidity of an “ideology.” It is no longer simply a policy advocated by policy-makers, but a set of ideas promoted by ideologues. We see this in a whole array of hugely important issues facing the U.S., which have all been ignored or marginalized for eight years. The lack of regulation of financial markets is the most obvious example, but one also sees the “hands off” approach causing tremendous deterioration of U.S. schools, health care, welfare, infrastructure, and the environment, to say nothing of the elephants in the room—Social Security and Medicare.

Treasury Secretary Paulson told the Times “you don’t get dramatic change, or reform or action, unless there is a crisis.” This seems a strange way to run the ship of state. But the crisis is here, Mr. Secretary. Now what do we do?

Are CEOs Paid Too Much?

2008-12-31T13:41:00.000-05:00

Jessica Williams-Gibson interviewed me on the issue of CEO pay for The Indianapolis Recorder, a newspaper founded in 1895 with a mission "to support and empower African-Americans." Her story is at this link.

For my earlier post on this subject, see "CEO Pay and the Bailout."

U.S. Rejects Cluster Bomb Treaty

2008-12-18T10:01:00.000-05:00

The Cluster Munitions Treaty was signed in Oslo, Norway earlier this month by 94 countries, not including the United States. The government of Afghanistan did sign, in a last minute shift, and in the face of intense diplomatic pressure from the Bush White House. This story illustrates several themes of The End of the American Century.

Cluster bombs are munitions dropped from the air or ground-launched that eject smaller submunitions or bomblets over a wide area. They are most commonly employed to kill enemy personnel or destroy vehicles. At least fifteen countries have used cluster munitions, including the U.S.in Iraq and Afghanistan, and both Russia and Georgia in their conflict earlier this year. The most extensive use, however, was by U.S. bombers over the Ho Chi Minh trail in Laos during the Vietnam War. It is estimated that at least 9 million unexploded bomblets remain in Laos.

These unexploded bomblets are the biggest problem with these weapons. Like landmines (which are also banned under an international convention), the unexploded munitions remain a deadly hazard for civilians long after a conflict ends. Often they are brightly colored and look like baseballs, attracting children and with deadly results. A third of cluster bomb casualties are children.

Like the international treaty that banned land mines, the impetus for a cluster bomb ban grew out of an international grass roots movement. The Cluster Munition Coalition brought together some 300 "civil society organizations" from 80 countries, including Amnesty International, Human Rights Watch, and Handicap International. The coalition also includes the International Campaign to Ban Landmines, an organization that won the 1997 Nobel Peace Prize.

The convention banning cluster bombs was signed in Oslo by 94 countries, including U.S. allies like Britain, Germany, France and Japan, but not including the U.S. Other non-signatories include Russia, China, India, Pakistan, Iran and Israel. Unexpectedly, Afghan President Hamid Karzai ended up signing the treaty that bans the weapons that have devastated his country. According to the New York Times, Karzai's change of heart was particularly affected by testimony from cluster-bomb victims, including Soraj Ghulam Habib, a 17 year old from the city of Herat who lost both legs when he accidentally stepped on a cluster remnant seven years ago. The Bush administration had urged Karzai not to sign it, so his decision, according to The Times, "appeared to reflect Mr. Karzai's growing independence from the Bush administration."

The U.S. has begun to bend to international pressure on the issue, and has not actually employed cluster bombs since 2003. A State Department official told the Times that cluster bombs were sometimes more humane than conventional ones. "As an example, he said that antennas on a roof could be taken out efficiently with a cluster bomb, without bringing the building down."

Some expect President-Elect Obama to support the treaty, and his team has said it will "carefully review" the treaty. However, as London's The Economist points out,

"Mr. Obama will find it hard to change American policy once he realizes that cluster munitions make up more than half of the country's bomb stockpile."

The U.S. refusal to sign this treaty is part of a larger pattern and long-term trend of the U.S. disengaging from international law and the global community--a theme I develop in a chapter on "Abandoning International Order" in The End of the American Century. There is a long list of international treaties that the U.S. has not ratified. These include the UN convention prohibiting discrimination against women; the UN Convention on the Rights of the Child; the treaty banning land mines (signed by 122 nations), the Kyoto Treaty on global warming; and the treaty establishing the International Criminal Court, to try individuals for war crimes, crimes against humanity, and genocide. All of these treaties have been signed by the vast majority of the world's nations. The only other country besides the U.S. to reject the Rights of the Child convention is Somalia, which has no functioning government.

For each of these treaties, the U.S. has its reasons for non-participation. But the very fact of the U.S. not participating in these international conventions sends a bad signal to the rest of the world. It is a sorry sign of U.S. "exceptionalism" and is an important factor in the declining popularity of the U.S. around the world, even before the extremely unpopular Bush administration. The U.S. shift away from international law is particularly tragic because no country was more important in establishing international law and institutions (like the U.N.) in the years after World War II.

The about-face of the Afghan government is also telling in several ways. On the one hand, the Bush administration pressure on the Afghan government to reject the treaty is also part of a pattern. While other administrations have failed to participate in important international treaties, the Bush White House has gone out of its way to keep other countries from doing so. The most egregious example of this is the International Criminal Court. Shortly after President Bush "unsigned" the ICC statute, he urged Congress to pass the American Servicemembers Protection Act. This legislation gives immunity to U.S. personnel from the court. It also provides for punitive actions against countries that are parties to the ICC, but which refuse to confer immunity to Americans. For many people around the globe, it seemed as if the U.S. was asserting that Americans were above the law when it comes to war crimes and crimes against humanity.

On the other hand, Karzai's rejection of pressure from his protector and benefactor, shows just how weak the U.S. has become in the international arena. The United States, and particularly its current president, has become so marginalized that it can not even influence a country that is utterly dependent on the U.S. Washington has lost an enormous amount of face in the global community, and has little left in its arsenal of "soft power." It will take a major and sustained effort by the Obama administration to repair the damage. But it is unlikely that U.S. reputation, power and influence will ever return to where it was.

The Iraq War Fiasco

2008-12-15T13:03:00.000-05:00

On Sunday, the New York Times reported on an unpublished draft of a U.S. government history of the Iraq reconstruction effort. Titled "Hard Lessons: The Iraq Reconstruction Experience," the government report concludes that after five years, "the United States government has in place neither the policies and technical capacity nor the organizational structure" needed to accomplish the goals. The report finds that

"the rebuilding effort never did much more than restore what was destroyed during the invasion and the convulsive looting that followed."

The Iraq War has mostly disappeared from news headlines, replaced by the U.S. economic crisis and due to the somewhat lessened incidence of violence in Iraq in the last year. But the fiasco of the war remains, and is an important factor in the decline of the U.S. both domestically and internationally--the subject of Chapter 7 of The End of the American Century. The decision to invade Iraq was based on false information and taken without international support. It has claimed the lives of more than 4000 American soldiers and at least 90,000 Iraqi civilians. It has cost the U.S., so far, more than $500 billion. The war triggered economic and social collapse, sectarian animosity, political fragmentation, civil war, and regional instability. It has also inflamed anti-Americanism and stimulated terrorism both in the Middle East and worldwide.

President-elect Obama intends to withdraw most troops from Iraq by the summer of 2010. This will help the United States, but it is not at all clear if it will help Iraq. The country has been devastated, and it will take years to rebuild and reestablish stability. Probably U.S. support for this effort will diminish--though as "Hard Lessons" has shown, there has been negligible progress even with the efforts of the last five years. There are disturbing signs of the growth of fundamentalism in Iraq (including in school curricula). And almost certainly sectarian violence will continue, and probably escalate with the removal of American forces.

The same day that the draft of "Hard Lessons" was leaked, an Iraqi journalist hurled two size-ten shoes at President Bush at a press conference in Baghdad. "This is from the widows, the orphans and those who were killed in Iraq," he shouted. It was a discouraging sign that even among Iraqis, there is much resentment toward the U.S. for its efforts.

I.O.U.S.A. Video On the Toxic Mix of U.S. Debts

2008-12-07T16:47:00.000-05:00

The Peter G. Peterson Foundation has produced a documentary video about the roots of the financial crisis in the U.S., entitled "I.O.U.S.A.: One Nation, Under Stress, in Debt". This link takes you to a 30-minute "bite sized" version of the documentary for viewing online.

Pete Peterson, former Republican Secretary of Commerce, published the book Running on Empty in 2004, which pointed out the toxic nature of the unprecedented "triple deficits" bedeviling the U.S. economy: the budget, trade and household deficits. This film dramatically and powerfully illustrated these deficits and shows how much worse they have gotten in the last eight years. The budget deficits, as a share of the economy, are nearing levels not seen since World War II. The U.S. trade deficit (importing more than we export) is at record levels, and is the largest in the world. And household debts are the worst since the Depression.

As the moderator of the show says at the beginning, the most serious threat to the U.S. is not terrorism, but "our own fiscal irresponsibility."

As I have pointed out on this site, and in my book, these economic problems are the starting point of The End of the American Century, but they are only part of a much bigger set of problems. Pete Peterson and his video say that we have to raise taxes and cut spending. This is probably true. But how do we do this during an economic crisis, and when we face monumental problems--with education, health care, the environment, infrastructure, poverty--that require more resources, not less?

The video is worth watching, and very sobering.

"Global Trends 2025" and "The End of the American Century" Radio Interview

2008-12-03T11:07:00.000-05:00

I was interviewed about the National Intelligence Council's report Global Trends 2025 and my book, The End of the American Century, on WIBC Radio's "Indianapolis Tonight" with Steve Simpson. The interview, broadcast on November 26, can be heard on the "Indianapolis Tonight" audio archives.

Fukuyama: From "The End of History" to "The Fall of America"

2008-12-01T11:11:00.000-05:00

Francis Fukuyama, Professor at the Johns Hopkins School of Advanced International Studies (my own alma mater), had a high profile essay in Newsweek in October, boldly titled “The Fall of America, Inc.” Professor Fukuyama addresses the declining global appeal of America’s “brand.” Two “fundamentally American ideas have dominated global thinking since the early 1980s,” he contends. The first of these was “a certain vision of capitalism” accompanied by “pared-back government.” The second idea was “America as a promoter of liberal democracy around the world.”

Fukuyama sees both of these ideas now tarnished and discredited. The U.S. economy “has gone off the rails and threatens to drag the rest of the world down with it. Even worse,

“the culprit is the American model itself: under the mantra of less government, Washington failed to adequately regulate the financial sector, and allowed it to do tremendous harm to the rest of society.”

The idea of American democracy was “tarnished even earlier,” with the freedom agenda of the Iraq War widely perceived around the world as “an excuse for furthering U.S. hegemony.”

In my book The End of the American Century, I make similar arguments about the decline of brand U.S, but I show that this decline started long before the recent financial collapse, and even before the Iraq War. Global public opinion surveys in recent years have shown little enthusiasm for “American-style democracy” and even less support for the American ways of doing business. And while Fukuyama uses the term “brand” as a metaphor, there actually have been marketing surveys of the popularity of “nation brands” among consumers around the world. In one such study, the United States ranked eleventh out of twenty-five countries.

Fukuyama’s Newsweek essay is interesting both for its perceptive insights, but also because of who he is and what he has written and argued in the past. He gained national prominence in 1989 with the publication of an influential and controversial article titled “The End of History?” In that essay, and a following book, he argued that the collapse of European communism and the end of the Cold War marked “the end point of mankind’s ideological evolution and the universalization of Western liberal democracy as the final form of human government.” Later he became a key figure in the neoconservative movement and its Project for the New American Century which, among other initiatives, strongly encouraged the removal from power of Saddam Hussein, even before September 11. By 2002, though, he had turned away from the neoconservatives, and became critical of the Bush administration and the Iraq War.

Much has changed in the world since the Western triumphalism following the collapse of communism. It has become painfully clear, for one, that many people around the world—perhaps even most people—are not so convinced that Western liberal democracy is—or should be—“the final form of human government.” Even so, it is quite startling to see one of the intellectual fathers of the neoconservative movement so frankly recognizing the failure of the American model to take hold in the rest of the world. As Fukuyama concludes his essay,

“the ultimate test for the American model will be its capacity to reinvent itself once again. Good branding is not, to quote a presidential candidate, a matter of putting lipstick on a pig. It’s about having the right product to sell in the first place. American democracy has its work cut out for it.”

The End of Affluence

2008-11-30T19:51:00.000-05:00

Increasingly, even economists and bankers are coming to understand that we are in the midst of a global economic shift. The core of this change is the inevitable decline in American consumption, which for a generation has been fueled by borrowing and debt. The bill now has to be paid, so the trend of steadily growing U.S. affluence can not continue. Because consumer spending constitutes almost three-quarters of the U.S. economy, a decline in consumption will cause a general and long-term economic decline in this country. A slowdown in the world’s biggest economy will, of course, affect the whole globe.

The centrality and toxic nature of U.S. consumerism is highlighted in an op-ed piece in this week’s New York Times by Stanley Roach entitled “Dying of Consumption.” “It’s game over for the American consumer,” writes Roach, who is the chairman of Morgan Stanley Asia. His argument and many of the statistics he uses are similar to those I marshal in my chapter on “The End of Affluence” in The End of the American Century. Roach points out that for over a decade, “vigorous growth in American consumption has consistently outstripped subpar gains in household incomes.” The consequence has been a long-term decline in household savings and a huge increase in household debt. From 1950 to 1985, American consumers saved roughly 9% of their disposable income. Beginning in the 1990s, that rate steadily declined, dipping below zero in 2005—for the first time since the Depression. At the same time, consumer and mortgage debts rose from 77% of disposable income in 1990 to a record 127% in 2008.

According to Roach, this

“decade of excess consumption pushed consumer spending in the United States up to 72 percent of gross domestic product in 2007, a record for any large economy in the modern history of the world. With such a huge portion of the economy now shrinking, a deep and protracted recession can hardly be ruled out.”

The problem is that the whole American economy is built on consumption. The U.S. doesn’t actually produce much any more. Manufacturing has steadily declined as the linchpin of the American economy, and now constitutes less than a fifth of GDP. The imminent bankruptcy of the U.S. auto companies is simply another (albeit big) element of this downward trend. Meanwhile financial services—primarily banks and mortgage companies—have steadily grown, mostly by providing loans to consumers to finance purchases their incomes will not allow. So when both consumption and financial services decline, on top of the previous decline in manufacturing production, there is not much left. It will take a long time to rebuild the U.S. economy. There will be much belt-tightening for the middle class, growing unemployment, and more suffering by the poor.

Roach is opposed to “tax cuts aimed at increasing already excessive consumption.” I make a similar argument in my previous post on “Tax Cuts Will Make Things Worse.” Such cuts will decrease federal revenues, which are desperately needed to allay the new and mushrooming costs of unemployment insurance and mortgage foreclosures, not to mention the preexisting problems of health care, education, the environment, Social Security, and Medicare, all of which have been under funded for a generation.

Meanwhile, both the Bush administration and the incoming Obama team seem to feel that the best way to alleviate the economic crisis is to promote even more deficit spending, by both government and consumers. The federal deficit, already at record high levels, will balloon even higher with a trillion dollars or more of bailout money. Much of this money is being thrown at banks, mortgage companies and financial institutions to enable them to lend even more money to consumers who are already deeply in debt. This may (possibly) help stimulate the economy in the short run. But in the long run, we all have to stop spending and buying so much, and learn to save and invest. As Roach sums it up:

"Crises are the ultimate in painful learning experiences. The United States cannot afford to squander this opportunity. Runaway consumption must now give way to a renewal of savings and investment. That’s the best hope for economic recovery and for America’s longer-term economic prosperity.”

This shift, from consumption to savings, will be wrenching and painful for America, and for much of the rest of the world. As Britain’s Economist magazine notes (in "The End of the Affair"), America’s “return to thrift” presages a recession that will be both “long and deep.” It marks a fundamental shift in global economics, and in America’s role in the world.

Obama Set To Rebuild Our International Reputation

2008-11-26T15:01:00.000-05:00

A revised version of my 11/13 post on "America's New Face to the World" was published last Sunday in the Indianapolis Star with the title "Obama Set to Rebuild Our International Reputation."

U.S. Intelligence Report Predicts Declining U.S. Influence

2008-11-21T10:54:00.000-05:00

The National Intelligence Council has released its report Global Trends 2025: A Transformed World which forecasts that the relative strength of the U.S. "even in the military realm--will decline and U.S. leverage will become more constrained."

I posted a blog here in September about the preview of this report delivered in a speech by C. Thomas Fingar, the Chairman of the N.I.C. The full 120-page report, like Fingar's earlier remarks, sees the U.S. remaining the single most powerful global actor, but with reduced influence and leverage in the face of the growing clout of China, India, Russia and other countries.

The current report, however, seems less sweeping in its assessment of U.S. decline than Fingar made earlier. In September, he spoke of U.S. leadership eroding "at an accelerating pace" in "political, economic and arguably, cultural arenas." The Global Trends report does not have such language, and focuses more on the rise of other countries than on the decline of the U.S.

The report does, however, call attention to the importance of leadership in managing this transition to a transformed world. "Leadership matters," the first-page summary says. "No trends are immutable," and "timely and well-informed intervention can decrease the likelihood and severity of negative developments and increase the likelihood of positive ones."

Wise leadership, in Washington and elsewhere, is crucial because the scale of global changes are immense. "The international system...will be almost unrecognizable by 2025 owing to the rise of emerging powers, a globalizing economy, and historic transfer of relative wealth and economic power from West to East, and the growing influence of nonstate actors." Indeed, this transfer of global wealth and economic power from West to East "is without precedent in modern history."

The report forecasts a more diffuse distribution of global power, the transformation of current international organizations (like the U.N.), the growing influence of nonstate actors (especially NGOs--non governmental organizations), and "a more complex international system."

In this system, the U.S. will be a "less dominant power" with "less room for the US to call the shots without the support of strong partnerships." Even in the military realm, changes in science and technology and the rise of non-state actors "will construct US freedom of action."

These arguments are similar to those I raise in the last chapter of The End of the American Century, entitled "America and the World After the American Century." A key difference between my book and Global Trends is that most of my book is about trends that have already occurred. Only my last chapter projects into the future, as the NIC report does. In my view, the decline of the U.S. is a fait accompli. As I write on page 1 of my book:

"In the past decade, and particularly since September 11, every aspect of this American predominance has begun to wane. The U.S. economy is riddled with debt [this was written well before the current financial collapse] and unsustainable obligations--by both governments and households--presaging at least long-term economic decline if not general collapse. The educational system, once considered the world's best, now ranks near the bottom among developed countries, and a sizable portion of U.S. citizens is now functionally illiterate. American corporations, once models of dynamism, innovation and efficiency, are hampered by bureaucracy, corruption, and bloated executive payrolls, and few are generating either innovation or growth. Even science is marginalized and beleaguered under the gun of politics qnd religion. While American consumer goods and popular culture remain fashionable in much of the world, there is at the same time increasing resistance in many countries to the erosion of national culture and traditions in the face of U.S.-led globalization."

So a good deal of the decline of U.S. global influence is due to changes within the U.S.--changes that have been accelerating for the last two decades. These internal developments are as much responsible for "global trends" as are the dynamic changes elsewhere in the world.

"Rise of the Rest" Youtube Video

2008-11-20T16:16:00.000-05:00

A cute and striking 5-minute Youtube video, "The Rise of the Rest," is produced by the Futures Group, and based on the phrase and data from Fareed Zakaria's The Post-American World.

The video illustrates some of the global trends favoring the emergence of China, India and other countries as major economic and political forces in the world. Much of this information is also in my own book The End of the American Century, though there are two important differences in my approach and the one in this video.

First, the video often uses projections of trends into the next decade or two--for example seeing the Chinese economy eventually surpassing that of the U.S. While this may turn out to be true, projections into the future are, of course, highly speculative. The recent financial collapse in the U.S., which has become a global crisis as well, illustrates how quickly such projections can turn sour. My book mostly uses trend data up to the present, to demonstrate changes that have already taken place.

A second difference (between this video and me; and between Zakaria and me) is that I focus much more attention on the declining fortunes of the U.S. Zakaria says his book is not about the decline of the U.S., but about the "rise of the rest." My book is about both. Over the last two decades, the U.S. has declined in many ways--the economy, education, health care, infrastructure, equality, and others. It is the combination of U.S. decline and the rise of the rest that is so quickly and dramatically changing the face of the globe.

David Mason Interview on Canadian Television

2008-11-14T09:36:00.000-05:00

Television interview about The End of the American Century and the global financial crisis; Thursday on Canada's CTV Newsnet television, viewable here.

America's New Face to the World

2008-11-13T15:33:00.000-05:00

In the last chapter of The End of the American Century, I write that “a best-case scenario for the future of the United States would have to begin with new political leadership” and that the first thing a new president could do

“would be to mend American relations with the rest of the world and to temper the unilateralism, hubris and militarism that have made it so difficult for the United States to work with other countries in solving pressing global issues.”

The election of Barack Obama is a big first step for the United States in changing our orientation to the rest of the world, and the way the world sees the U.S.

As Britain’s Economist magazine put it, in its endorsement Obama as “the next leader of the free world"--

"Merely by becoming president, he would dispel many of the myths built up about America: it would be far harder for the spreaders of hate in the Islamic world to denounce the Great Satan if it were led by a black man whose middle name is Hussein; and far harder for autocrats around the world to claim that American democracy is a sham.”

He is widely seen as a leader who is open to the views of others, and willing to work with other countries. France's President Nicolas Sarkozy, in a handwritten letter of congratulations to the U.S. President-elect, said

"your election raises immense hope" in Europe and beyond, "of an open America. . .that will once again lead the way, with its partners, through the power of its example and the adherence to its principles."

David Cameron, the leader of Britain's opposition (Conservative)party, said Obama's victory has restored America's status as a "beacon of hope."

Obama enjoys amazing level of support all around the globe. Last summer in Berlin, 200,000 Germans turned out to cheer him—reminiscent of the celebration of President Kennedy during his 1963 “ich bin ein Berliner” speech. A BBC poll of 22,000 people in 22 countries in September found 49% favoring Obama to win, compared to just 12% for McCain. In every single country, more people supported Obama than McCain.

The Economist conducted their own (unscientific) online poll of some 53,000 readers around the world, with Obama winning by a margin of more than five to one. His global victory was even more lopsided if you allocate those votes by country according to size (the way the Electoral College does for states). In this global “electoral college” Obama collected 9115 votes, compared to a paltry 203 for John McCain. In 56 countries, at least 90% backed Obama.

In the Arab and Muslim world, deep skepticism of U.S. intentions remains. But there were voices of hope even in those countries, and marvel at the election of a black man whose father was from a Muslim family. The Saudi-owned pan-Arab newspaper Al Hayat saw Obama’s victory as “a message” repudiating the policies of the Bush administration.

“Obama’s election was a message against such destruction, against unjustified wars, wars that are fought with ignorance and rashness, without knowledge of their arenas or the shape of their surroundings. . . .It was a message against the pattern that became a burden on the U.S. and transformed the U.S. into a burden on the world.” (Reported in the New York Times).

This language is, to say the least, a back-handed compliment to the U.S. It is also emblematic of the way people in many countries—and not just the Arab world—feel about the U.S. and the global role it has come to play. So the U.S. has a lot of global PR work ahead of it.

Fortunately, President-elect Obama is aware of these problems and committed to redressing them. In his book The Audacity of Hope, he acknowledges that in foreign policy “our record is mixed.” At times, he writes, American policies

“have been misguided, based on false assumptions that ignore the legitimate aspirations of other peoples, undermine our own credibility, and make for a more dangerous world.” (p.280).

He writes there of the need for the U.S. to be more cooperative and multilateral in dealing with other countries, and to rely more on persuasion than intimidation: “No person, in any country, likes to be bullied.” He favors U.S. policies that “move the international system in the direction of greater equity, justice and prosperity” and observing the “international rules of the road.”

“When the world’s sole superpower willingly restrains its power and abides by internationally agreed-upon standards of conduct, it sends a message that these are rules worth following, and robs terrorists and dictators of the argument that these rules are simply tools of American imperialism.” (p.309).

In an article last year on “Renewing American Leadership” in the prestigious journal Foreign Affairs, Obama acknowledged that “in the wake of Iraq and Abu Ghraib, the world has lost trust in our purposes and our principles.” But the U.S. could regain that trust by “understanding that the world shares a common security and a common humanity.” If we want to lead the world, he argues, we must do so “by deed and by example.”

Barack Obama often invokes the names, the language, and the ideas of Franklin Roosevelt and John F. Kennedy. These two men, more than any other presidents in this century, inspired citizens of the United States as well as those of many other countries. FDR’s ideals and policies, in particular, helped launch the American Century. Perhaps Barack Obama can begin the process of rebuilding the United States. As he wrote in Foreign Affairs,

“it is time for a new generation to tell the next great American story.”

This new story, however, is unlikely to look much like the previous one.

Can the US Regain Supremacy? Should It?

2008-11-07T12:27:00.000-05:00

In my CBC Radio interview yesterday (see previous blog post) with Anna Maria Tremonti, there was one question she asked that gave me pause. She had first asked if I thought the U.S. is losing its superpower status. When I answered in the affirmative, she followed up with “Can it regain it?” I said I thought not, and went on to say that in a globalized and interdependent world, both the country and the world are better off without a superpower. But I think this needs some elaboration.

There is, first of all, both a descriptive (factual) and normative (value judgment) aspect to this question. Will the U.S. regain its superpower status? And should it do so. I believe the answer is negative to both questions, but the reasoning behind them are similar.

Some scholars have argued that the world needs a powerful and stabilizing force, and that the United States is the only country in a position to play this role. The British historian Niall Ferguson has made this case in his book Colossus, as has the U.S. political scientist Michael Mandelbaum in The Case for Goliath. And through much of history, there has been a big single power that has played this role in great swaths of the planet—Rome, Britain, Spain, the Ottomans, etc. All of those empires are now gone.

The 21st century world is different in several important respects. First, power and influence are more diffuse. There are numerous “rising powers”—China, India, Brazil, Iran, Russia, South Africa—and they are spread all over the globe. None of them want or need a super powerful country encroaching on their turf, or telling them how to behave.

Second, the world is more interdependent, particularly in economic terms—“flat” in Thomas Friedman’s evocative phrase. Prosperity and security are being built on trade, cooperation and compromise. Some countries are bigger and wealthier than others and will naturally play a more substantial role in this globalized community. A “superpower”—economic or military—distorts and destabilizes such a system.

Third, the most important issues facing the globe now require cooperation, consultation, compromise and diplomacy rather than brute strength or intimidation. Global warming, environmental deterioration, epidemics, famine, and drought are the most pressing threats to humanity. All of them require the participation of all states, regardless of their wealth, power and ideology. A superpower, with its tendency to unilateralism and arrogance, can only hinder such cooperation.

For all of these reasons, the U.S. will not, and should not, play the dominant and directing global role that it did through most of the 20th Century.

In addition to these global factors are domestic U.S. ones. In the American Century, the U.S. had the world’s biggest economy, its richest citizens, the best schools, the finest system of medical care, and the most successful democracy. It can no longer make such claims, both because of our own decline in the past two decades, and because other countries have been catching up. Most developed countries now surpass the U.S. in the quality of life, health care delivery, and education, and have much lower levels of poverty, inequality and violence. The vaunted U.S. economy (which for so long was a house of cards built on multiple levels of debt) has now begun an inevitable decline. Until the encouraging results of last week’s election, even the U.S. political system was rickety, with low levels of voting and participation, very unequal representation, erosion of fundamental rights, and questionable electoral outcomes.

So whereas in the 20th Century, the U.S. carried global influence because of its own domestic model of success (in addition to its military strength), it can no longer make those claims of exceptionalism. The rest of the world has caught up.

The U.S. has already lost the status of sole superpower. Even if we wanted it, other countries don’t recognize or accept it. And both the U.S. and the rest of the world will be better off if we don’t regain it.

The End of the American Century and the Post-American World

2008-11-06T13:25:00.001-05:00

David Mason and Fareed Zakaria were interviewed this morning (Thursday) on Canada's CBC Radio program "The Currents" with Anna Maria Tremonti. We each discussed themes of our books, The End of the American Century and The Post-American World and how those related to the tasks facing the Obama presidency. You can hear the half-hour program at the program's website a this link.

An Historic Day, for Indiana and the World

2008-11-04T07:47:00.000-05:00

I went to vote this morning at 6am. It was dark, and there was already a long line outside the polling place at St. Thomas Aquinas elementary school. My daughters went to that school, and as the line snaked through the main hallway, I studied the pictures of the (graduating) 8th grade classes from over the years, and saw their faces--young, innocent, happy and hopeful.

I have never seen such a line for an election in this country. By 7am, I had filled out my ballot and fed it into the optical scanner--it showed that I was the 89th voter in that precinct. My friend Mike, an election official, observed that this was more than one vote per minute since the polls opened.

This is an historic day, for many reasons, but first and foremost because Americans have reclaimed their democracy. After years of embarrassingly low voter turnout levels--far lower than most other democracies--record numbers of people are voting today. This in itself is good for America, and a sign of hope.

In the past, poor people, young people, and minorities were far less likely to vote than rich, older White people. This skewed the political system and made it unrepresentative. This was one reason Chapter 5 of The End of the American Century is titled "Ailing American Democracy." Today, all those groups are voting, probably in record numbers, restoring a truly representative democracy.

But it is momentous as well because of the person that has moved them to turn out today--a young, vibrant, biracial man with an unusual name, who speaks of "community" and says that change must come from the grassroots. When the United States elects this man as their President, it will send a message around the world that the U.S. has rejoined the global community.

Indianapolis Star Neutral on Presidential Endorsement

2008-11-01T11:15:00.000-04:00

The Indianapolis Star decided to withhold endorsing either Obama or McCain for President this year. This was the first time since 1964 (Lyndon Johnson) that the Star had not endorsed the Republican candidate for President. Dennis Ryerson, the editor of the newspaper, wrote that the editorial board was not able to reach consensus, so they simply "decided to agree to disagree" and to withhold an endorsement.

Indiana is one of "swing states" in the electoral campaign, with polls in the state showing the Obama-McCain contest to be a tossup. The latest statewide poll conducted by the Star shows Obama with 45.9% and McCain with 45.3% support among Hoosiers. If Indiana votes for Obama, it will be the first time the state's electoral votes have gone for a Democrat since Lyndon Johnson's landside victory of 1964.