America’s Economic Decline

Posted on 15/07/2011 by

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By Andrew Brown.

The USA been undergoing substantial de-industrialization and de-funding for decades now. The incumbent American political duopoly has not seemed to mind that much though as both of them have actually encouraged this trend with their consonant public policies. Moreover it has picked up steam in the last two decades as substantive differences between the two political parties became almost unrecognizable. In short, a Reagan Republican was actually a Clinton Democrat, who was in turn just the same as a Gingrich Republican, who was himself the same as a Bush Republican. Completing the circle, the Democratic President of Change actually modeled himself on being a Reagan Republican. In all instances, and all political incarnations of recent decades, the same ideology remained intact.

Meantime an enormous feeding frenzy was taking place in the USA. As sick as it may sound, while manufacturing in America was being hollowed out and sent overseas to cheaper wage paying regions of the world, the Wall Street financiers were making record profits. It was so perverse in the halcyon Wall Street 1990s that every time a US Corporation announced job cuts, then its stock price would immediately sky rocket. This was the greedy time of enriching the few at the expense of the many.

And the candy land days, back then, seemed to stretch on and on. After all, the computer revolution was throwing in new inventions on a regular basis, and even the normally Conservative US Federal Reserve, believed that good times were here to stay.

They were wrong.

However, for me, a crucial factor that has often been overlooked during the last two decades in the USA, was the rapid economic rise of India and especially China. Between them both, they have half of the world’s population. Better yet, the bulk of their people are willing to work for a fraction of their North American counterparts’ wage. This, for me, is one of the major reasons why the USA has been deliberately hollowed out.

The other major reason for America’s economic decline has been the rapid rise of loosely regulated Trans National Corporations. Once these Corporations got the green light from the American political establishment to shift production overseas, then it has been all downhill for working America.

In a sense, the futuristic and “enduring” New America that President Eisenhower helped build has been systematically destroyed by his grandchildren. For those familiar with history and patterns of collapse, this is nothing new. What is new this time around is that it is happening in a country, that is without peer in terms of military strength and ability in the world. Moreover, if one bothers to look closer at this ironic situation, then one sees that it is not an accident. The annual GDP of the USA has disproportionately favored the Pentagon needs over all else for decades. Consequently, the USA enforces its “will” over overs simply because of its lavishly funded Military Industrial Complex.

Still, even with all of the weapons and fancy military that money can buy, it must be noted that the USA has not managed to win a single War since World War Two. This despite being regularly in a state of War for decades.

Does this mean a total economic collapse in the USA? Well, to be perfectly frank with you, I am not sure. There has been examples in history of similar economic trends. Ancient Rome springs immediately to mind (See Andrew’s excellent section on Rome and US here at Time Out Corner). So, in theory, the crooked political elite in the USA could continue indefinitely ruling from a posture of military strength, but economic weakness.

Yet, one simple action could undermine even that likely scenario: If the default currency for the purchase and sale of petroleum shifts away from the US Dollar, then America’s pipe dream of living off other nation’s credit will be ended forever.

And, as much as it pains me to say it, the US political leadership, Wall Street, and especially the Pentagon all know this. That is why the USA is determined to militarily remain in the Middle East for as long as it can. If it means overthrowing sovereign governments and killing millions of people in the process, then that is deemed a price worth paying in order to maintain USA geopolitical dominance.

A manifest destiny is not yet manifest.

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Posted in: Analysis