The US does have a very large reservoir of good will, built up since WWII, and has been the envy of and stood as an example for the rest of the world to emulate. Foreign policy was viewed as selfless, while domestic policy ensured prosperity while defending the constitution.
Even today, the US is given a pass, simply because of the good will and past moral leadership. But recent mistakes in foreign affairs and domestic fiscal matters are starting to crack the facade. The underlying weakness is economic.
Clinton's famous phrase which got him elected is "it's the economy stupid". And that is exactly right. No-body cares about corporate crime as long as the stock market goes up. Nobody cares how much a CEO is raking off the top so long as the investor gets his small share. Nobody cares about moral issues so long as they are comfortable and able to isolate themselves from it. Why the President would probably get away with smoking wet cigars in the Oval Office while a young intern is smoking something else under his desk.....so long as the economy is roaring ahead. It's the economy stupid! All is forgiven and forgotten in defense of the almighty buck.
But the buck is teetering, and soon the economy will suffer. Corporate America, in its zeal to maximize profits has ensured this by moving the industrial manufacturing base to Asia. And, as the buck falls, so does the standard of living. There is a lag time for this, but daily one reads of factories re-locating, throwing thousands of workers unto the unemployment lines. Just this week, Levi Jeans announced it will close it's last US plant and move production to Mexico.
Like you said before, it seems to be government policy to give up all manufacturing, to abandon the long standing policy of competition to keep prices in line in favour of a few huge multi-national companies operating out of the lowest cost environments anywhere in the world. So, inorder to compete, one must either reduce costs at home, or relocate. In an attempt to compete, many workers have been forced to cut their wages to stem the tide.
The US is buying finished goods from abroad cheaply, but asking those same countries to lend back the profits so that they can keep on buying. As long as the dollar stays strong, this arrangement will go on and on. But the numbers keep piling up and up, every month, every year. The US is clearly living beyond its means. The short term advantage gained through cheap consumer goods was needed to balance the huge inflation coming out of the financial markets and easy money creation. But now they are stuck with it, and they still have severe domestic economic problems. The debt grows by almost 2 billion dollars per day and has accumulated to a total of 6.8 trillion dollars. How long can the debtor dictate terms?
We now are entering a phase of world wide rebalancing. The US citizen will see a declining dollar and declining standard of living. And that is the only thing that matters. The only thing! You will hear the groans of Americans all the way to South Africa when they are called to finally live within their means. God forbid if the actual IOUs are ever called.
The thing about debt is that someone expects to get paid. You can't just walk away from it, and that includes national debt. Someone expects to be paid in full! The system is built around that assumption. Money is created and loaned against existing debt.
People are people everywhere in the world. Like you, I believe we all have been poorly led, led into debt, corruption and ultimate slavery. These are dangerous changing times in which we have no input, but can only observe. Each observer sees something different because he does not see the whole picture. That is the challenge, to observe from a vantage point inorder to see the whole picture. The other challenge is to somehow shield oneself from what must surely come, if possible. |
