This week’s lengthy cover article in Germany’s Der Spiegel is definitely worth reading. Non-German readers can even read it in English there.
By the way, Bernhard of Moon of Alabama shows us the cover here. The title there is “The price of Haughtiness” (or perhaps, Hubris). Inside the mag, the title is “The End of Arrogance: America Loses its Dominant Economic Role.”
The team of staff writers who wrote it start out by noting how irrelevant and old-hat George Bush’s speech at the UN last week seemed to many of the diplomats who heard it:
- He talked about terrorism and terrorist regimes, and about governments that allegedly support terror. He failed to notice that the delegates sitting in front of and below him were shaking their heads, smiling and whispering… The US president gave a speech similar to the ones he gave in 2004 and 2007, mentioning the word “terror” 32 times in 22 minutes… George W. Bush was the only one still talking about terror and not about the topic that currently has the rest of the world’s attention.
“Absurd, absurd, absurd,” said one German diplomat. A French woman called him “yesterday’s man” over coffee on the East River. There is another way to put it, too: Bush was a laughing stock in the gray corridors of the UN.
The article continues by noting that even Chancellor Angela Merkel, long a very close ally of Bush’s on the world scene, has started to express ill-concealed anger about his misgovernance of the US economy:
- There was no mention of loyalty and friendship last Monday. Merkel stood in the glass-roofed entrance hall of one of the German parliament’s office buildings in Berlin and prepared her audience of roughly 1,000 businesspeople from all across Germany for the foreseeable consequences of the financial crisis. It was a speech filled with concealed accusations and dark warnings.
Merkel talked about a “distribution of risk at everyone’s expense” and the consequences for the “economic situation in the coming months and possibly even years.” Most of all, she made it clear who she considers the true culprit behind the current plight. “The German government pointed out the problems early on,” said the chancellor, whose proposals to impose tighter international market controls failed repeatedly because of US opposition…
Merkel had never publicly criticized the United States this harshly and unapologetically.
The writers comment,
- This is no longer the muscular and arrogant United States the world knows, the superpower that sets the rules for everyone else and that considers its way of thinking and doing business to be the only road to success.
A new America is on display, a country that no longer trusts its old values and its elites even less: the politicians, who failed to see the problems on the horizon, and the economic leaders, who tried to sell a fictitious world of prosperity to Americans.
Also on display is the end of arrogance. The Americans are now paying the price for their pride.
Gone are the days when the US could go into debt with abandon, without considering who would end up footing the bill.
The article contains a helpful short appraisal of the way in which the globalization of financial markets in recent years has allowed the swift worldwide spread of the contagion from the financial crisis that originated with the problems of the US’s sub-prime mortgage market:
- The financial assets that economies hold abroad have grown more than sevenfold in the past three decades. By late 2007, the market volume for derivatives, which are used to bet on interest rate, stock and credit risks worldwide, had reached a previously unthinkable level of $596 trillion (€411 trillion).
At the same time, the number of players has multiplied. The banks stopped being the only ones in control of the industry some time ago. Nowadays, hedge funds bet on falling stock prices and mortgage rates, private equity companies buy up failed banks and bad loans, and wealthy pension funds keep the fund managers afloat.
The “greater complexity of linkages within and between the financial systems” now has one man worried, a man whose profession ought to provide him with a better idea of what’s going on: Jean-Claude Trichet, president of the European Central Bank. In a recent speech at New York University, Europe’s highest-ranking central banker complained about the “obscurity of and interactions among many financial instruments,” often combined with a “high level of borrowing.”
The inventors of these complex securities hoped that they could be used to distribute risk more broadly around the globe. But instead of making financial transactions more secure, they achieved the opposite effect, increasing the risks. Today the notion of using “many shoulders for support,” the constant mantra of the gurus of financial alchemy, has proved to be one of the catalysts of the crash.
American economist Raghuram Rajan, whom ECB President Trichet is frequently quoting these days, had a premonition of the current disaster three years ago. The total integration of the markets “exposes the system to large systemic shocks,” Rajan wrote then in a study. Although the economy had survived many crises before, like the bursting of the Internet bubble, “this should not lead us to be too optimistic.” “Can we be confident that the shocks were large enough and in the right places to fully test the system?” Rajan asked. “A shock to equity markets, though large,” he continued, “may have less effect than a shock to credit markets.”
There was certainly no shortage of warnings, and there were many voices of caution…
New York economist Nouriel Roubini presented the most accurate scenario of a crash, from the bursting of the real estate bubble to the domino-like demise of major banks. Roubini, known as a notorious alarmist, now predicts a prolonged recession in the United States that will drag down the entire global economy with it. “The US consumer has consumed himself to death,” says Roubini.
Paul Samuelson, the doyen of the world’s economists, predicted this bitter outcome three years ago. “America’s position is under pressure because we have become a society that hardly saves,” Samuelson, 90 at the time, said in an interview with SPIEGEL. “We don’t think of others or of tomorrow.”
And now the global conflagration is a reality, triggered by cleverly packaged US subprime mortgages sold around the world…
The writers quote Bernd Pfaffenbach, Merkel’s chief negotiator on foreign trade issues, as saying that now the relative conservatism that Germans have shown in financial matters is now paying off:
- “One can see that we are on a more solid base,” says Pfaffenbach, who refers to the crisis as a “purifying storm.”
Pfaffenbach isn’t the only one to see the problem in this light. The American bank crash has prompted economists and politicians worldwide to prepare for the end of an era of turbo-capitalism driven by the financial markets.
The financial industry — especially in the United States — will shrink considerably, while the significance of the real economy will increase. Once again, the government will have to base its supervisory function on the old banker’s principle: security first.
They conclude that a “new chapter in economic history has begun,”
- one in which the United States will no longer play its former dominant role. A process of redistributing money and power around the world — away from America and toward the resource-rich countries and rising industrialized nations in Asia — has been underway for years. The financial crisis will only accelerate the process.
The wealthy state-owned funds of China, Singapore, Dubai and Kuwait control assets of almost $4 trillion (€2.76 trillion), and they are now in a position to buy their way onto Wall Street in a big way.
But they have remained reserved until now, partly as a result of poor experiences in the past. The China Investment Corp., for example, invested in the initial public offering of the Blackstone Group, a private equity firm, and invested $5 billion (€3.45 billion) in Morgan Stanley. In both cases, it lost a lot of money.
But time is on the side of the Chinese…
Both in Asia and the United States, expressing schadenfreude over the decline of the United States as a superpower is out of place. The risk is too great that if America goes into a tailspin, it will drag the rest of the world down with it.
It is true that we are in a period of unprecedented interdependence among all the world’s major power centers. This inter-dependence means that, as I have long argued, if the crisis is well handled by the leaders of the major powers we have a fair chance that the transition from a US-dominated world to a more multipolar system can be effected without major strife or bloodshed.
That will take a good measure of realism, humility, patience, and vision from all the leaders concerned, inside and outside the US. Leaders and publics, both, I would rather say.
But here’s the thing. We are now at a seminal point in world history where (a) There is actually quite enough capacity to produce enough material stuff to give everyone on earth the prerequisites of a decent life; (b) Most people understand the counter-productive and destructive nature of war; and (c) In the United Nations we have a system of rules and norms for international engagement that, though far from perfect, is still far, far better to have than not to have, and that can certainly be further reformed.
So we can do this. Yes, we can. Provided we bear in mind two of the strongest norms in the UN system: the strong norm against addressing disagreements through warfare, and the equally strong norm that stresses the equality of all human persons.
Helena
Good Grief!
This inter-dependence means that, as I have long argued, if the crisis is well handled by the leaders of the major powers we have a fair chance that the transition from a US-dominated world to a more multipolar system can be effected without major strife or bloodshed.
I hesitate to use the word “naive” about the views of a respected and battle experienced journalist.
The lessons of history are that empires don’t just die away peacefully in their sleep. Once the interest groups who control the empires see their particular interests threatened then they react with savagery.
Look at the Spanish repression of the Dutch, The British in Ireland, India and Africa, the French colons in Algeria, the Turkish in Armenia.
The only empire that contracted was the Russian one which allowed the local heavies to plunder the economy and sell shares to overseas investors. The Russian Empire is making a comeback probably driven by the sound of Catherine the Great spinning in her grave keeping the president awake at night. This is just another iteration of the well known Russian cycle of centralisation and dispersal of power and wealth.
The levels of arms purchases and the construction of naval capital ships in the world is enormous. Just for fun try counting the number of Aircraft Carriers under construction around the world and look at the planning for the battle of the Indian Ocean.
The only ray of hope is Mr Gates recent statement that he sees little need for armies equipped to fight the battle of Germany.
If you read the CSIS report on global water futures you will see that the US wants to control the building and management of water infrastucture around the globe and by doing so maintain its hegemony.
http://www.csis.org/gsi/global_waters_future/
The credit crisis if it leads to the construction of other centres of capital concentration around the world will loosen off the stranglehold that the US has on major construction projects.
Last but not least the Somali pirates have done us a favour by highlighting the delivery of fairly modern tanks to East Africa amid speculation that they are for delivery to Southern Sudan pending a restart of the civil war.
One of the biggest dams in the world is being built on the Nile in Sudan with Chinese funding. The creation of the lake behind it will reduce water flow in the Nile by about 10% due to evapouration.
The Egyptians aren’t terribly happy at the idea and have threatened war. Nobody is really taking a great deal of interest in the brushfire wars in Africa which can easily suck in much of the world to protect their oil and mining interests.
Sorry to rain on your parade but that’s the way I see it.
Correction
The figure for evaporation loss in the previous post should read 1.4% not 10%.
There is actually quite enough capacity to produce enough material stuff to give everyone on earth the prerequisites of a decent life
One day I was driving listing to radio, as far I recall according to one of senior guy in food field said the world produce twice what the people on the earth consume but the industrial countries eat twice than their share….
So Helena here there is some misbalanced what you stated here, are you and your follow happy to half your food habit for the other poor in Africa and India else where those who come every day on the screen used as ONE dollar A day? And we got rid of those horrified seen of the starving kids and babies and mums?
Provided we bear in mind two of the strongest norms in the UN system: the strong norm against addressing disagreements through warfare,
Iraq has two wars where 25 millions suffering from UN in addition to 13 years of inhuman sanction forced by same system called UN.
Helena you either forgot what UN really is, or who have the control of UN and its system
Israelis have violated more than 99 UN regulation for last 60 years but this state still have all the support specially from the democratic and strongest world on the base The Only Democracy in ME, where the reality is that sate similar if worse that South African old regime.
Helena did you and other American ask themselves very basic question here, with today financial crises that US have why this deals goes forward?
Pentagon Aims to Sell Israel Fighter Jets
U.S., Israel seal deal for missile radar defense system
For the last 60 years your tax money went to support Israel any one why should their tax paid to that state?
Even now in this financial crisis they pay Israel more money with these billions of dollar to state of Israeil?
Really US have financial crises I start doubting here.
A report on Water.
http://www.csis.org/component/option,com_csis_pubs/task,view/id,4876/type,1/
I do have to agree with Dwight Eisenhower that water shortage is one of the big causes of conflict in the Middle East. He advocated setting up a number of desalinisation plants with a nuclear reactor each to drive them.
Unfortunately the fighter jets get in the way whenever people try and build one.
Lets keep the fingers crossed for the fuelling process at Bushehr.
Americans such as Chalmers Johnson and Congressman Ron Paul among others have said the spending and national debt by the United States government is unsustainable. Also implicit and explict in their comments as well as many others is that malfeasance and corruption in the U.S. government allowed financial practices that are unethical and worse causing the Wall Street meltdown.
The U.S. government is so immense it cannot police itself-that’s why the Founding Fathers did not believe in a gigantic central government, for it produces malfeasance, incompetence and corruption at a rate that is uncontrollable and unmanagable.
Also the mainstream television networks do not provide sufficient facts and information for the American people to make informed decisions about the two dominating politial parties and their policies which are increasingly inept, incompetent and unrespresentative, for appear to be representing lobbyists more than the American people. Do these two political parties really represent the best interests of the American people in domestic and foreign policies?
Frank, I truly do believe the present transition is different from all previous ones, for a number of reasons including the three listed (‘a’, ‘b’, and ‘c’) at the end of the post.
In addition, it is definitely worth noting that China’s rise to world prominence has thus far been accomplished in ways unprecedented in human history. It has not emerged through military invasions or challenges outside its own borders (except for the military challenge to Taiwan, which it considers with some non-trivial justifiability to be ‘Chinese’; or through arms-racing, Soviet-style. It has emerged by playing quite within the rule system established by the US in 1945 including by incorporation within the until-now US-dominated global market system.
I truly think that what you define as “the lessons of history” are not immutable and might well be considered to be different today for a number of reasons: (1) We have nuclear weapons. (2) There is atruly globe-girdling economic system in which all major powers– declining and emerging– have large stakes.
It is true that many declining powers engage in some ‘last throes’ of violence before they go under. I think the US’s invasion of Iraq might qualify as that.
But look at the way that, earlier on in the post-1945 era (i.e., the post-Hiroshima, and UN-led era), the European colonial powers ‘declined’. Britain, France, and Portugal– to take the three major ones at that point– all engaged in some serious ‘last throes’ violence but then lost the taste for bearing the costs of empire and retreated to within their national borders (with a few small exceptions)… And life in all three countries has been a lot better since that happened.
So the ‘lessons of history’ are definitely mixed.
Helena
Can you apply points a) b) and c) to
Lebanon
The Saudi vs Iran tensions (think of an island)
Chinese ambitions in Siberia
(On the last one I agree with Sbigniew Brzezinski that we end up with Panzer Divisions alongside Motor Rifle Divisions minding Russian oil and gas fields somewhere East of Kazakhstan)
The Chad Libya Sudan Somalia Ethiopia mess
Kurdistan and Kiruk
Mikheil Nikolozis dze Saakashvili
All it really takes is some clown to blow up Ras Tanura and away we go.
SPIEGEL online doesn’t represent how “others” see the US. Its editorial stance is hysterically anti-US. it’s like saying FOX news represents how americans view the french.
more great spiegel covers here:
http://medienkritik.typepad.com/blog/2008/05/davids-medienkr.html#more
Vadim
The UK papers say much the same thing.
http://tinyurl.com/4xpege
We are rationally anti usurped authority but respect competence
Frank, the guardian’s comment page doesn’t hold a candle to spiegel. and yes, articles like this about “america’s fall from power” are simply irrelevant to anything important. they reflect little but narrow-minded resentment. you have to be really narrow minded to view the world through this US-centered prism.
I provided the wrong link, here’s the piece on spiegel covers:
http://medienkritik.typepad.com/blog/2007/11/more-hyperbole.html
“… the guardian’s comment page doesn’t hold a candle to spiegel ….”
Candles, eh? Can buggy whips and sliderules be far behind?
Now if *I* was a dubyapologist, I’d watch my choice of techie metaphors a little closer than that!
But seriously, Mr. John Gray is well above the Guardian par, regardless of where one places that absolutely. So I mention his name. And allow me to toss in a little of his really narrow-minded resentment, if I may:
“Having created the conditions that produced history’s biggest bubble, America’s political leaders appear unable to grasp the magnitude of the dangers the country now faces. Mired in their rancorous culture wars and squabbling among themselves, they seem oblivious [of] the fact that American global leadership is fast ebbing away. A new world is coming into being almost unnoticed, where America is only one of several great powers, facing an uncertain future it can no longer shape.”
Far be it from the present keyboard to pronounce on whether the Yank Racket has finally stopped working! But as a petty matter of literary criticism, isn’t Mr. Gray doing about all rhetoric can do to avoid sounding narrow?
Still, perhaps they do do all these things better in Germany. At times, anyway. How about this for REALLY NARROW narrow-minded resentment?
Coriolanus.
Du schlechtes Hundepack! des Hauch ich hasse
Wie fauler Sümpfe Dunst; des Gunst mir teuer
Wie unbegrabner Männer totes Aas,
Das mir die Luft vergift’t.–Ich banne dich!
Bleibt hier zurück mit eurem Unbestand,
Der schwächste Lärm mach euer Herz erbeben,
Eur Feind mit seines Helmbuschs Nicken fächle
Euch in Verzweiflung; die Gewalt habt immer,
Zu bannen eure Schützer–bis zuletzt
Eur stumpfer Sinn, der glaubt, erst wenn er fühlt,
Der nicht einmal euch selbst erhalten kann,
Stets Feind euch selbst, euch endlich unterwerfe
Als höchst verworfne Sklaven einem Volk
Das ohne Schwertstreich euch gewann. Verachtend
Um euch die Stadt–wend ich so meinen Rücken–
NOCH ANDERSWO GIBT’S EINE WELT.
(( Might do for the Big Management Party’s neocomrade H. M. Paulson, should the Senate vote wrong also. ))
Happy days.
Gone are the days when the US could go into debt with abandon, without considering who would end up footing the bill.
An interesting conclusion considering that sovereign yields in the US are still lower than in Germany, across the curve.
(€411 trillion).
one casualty of this ‘crisis’ is the credibility of dilettantish financial journalists who continue to confuse a “notional value” for a “value at risk.”
New York economist Nouriel Roubini presented the most accurate scenario of a crash
except there has been no crash! The S&P is exactly where it was in late 2004. SPIEGEL editors take note: the DAX has experienced more volatility than the S&P 500 over most of the last ten years. German unemployment (its lowest in years) is still higher than the US rate SPIEGEL flags as evidence of economic armageddon.
No Time to Gloat
That this is even a caption speaks to the seriousness of the piece. I think i was too hard on FOX. It’s hard to imagine them running a piece on recent turmoil at Soc Gen, warning its audience not to gloat. Pathetic.
The Meltdown of Wall Street
dubyapologist
Hey there ‘gloomy gus’ – just so you know, I’m no ‘dubyapologist.’ But if I were I wouldn’t have much to say about SPIEGEL’s rant since very little of the ‘deregulation’ they seem to blame for this imaginary crisis occurred on Bush’s watch.
But as a petty matter of literary criticism, isn’t Mr. Gray doing about all rhetoric can do to avoid sounding narrow
Sure he’s trying, and failing due to the nature of his analysis, made up of deeply stupid observations like this:
A new world is coming into being almost unnoticed, where America is only one of several great powers, facing an uncertain future it can no longer shape.
Enlighten me Gloomy Gus…when has the world ever been otherwise ( a specific date or range of dates would help)? And why on earth should any American fear this very natural state of the world?
But here’s the thing. We are now at a seminal point in world history where (a) There is actually quite enough capacity to produce enough material stuff to give everyone on earth the prerequisites of a decent life;
This statement might be true depending on how you define a decent life (If you define it as the same way that the Europeans now live you are out of your mind), but declining supplies of fossil fuel are soon going to make providing a decent life for everyone much more difficult. We are at the peak of oil production right now, and it is only the recession initiated by the U.S. credit crisis that has prevented oil prices from heading further into the stratosphere.
Here are some quotes from a recent on line Reuters article about the report of a United Kingdom parliamentary committee on the possible effects of oil supply constraints on future global economic development:
“The deepening energy crisis has the potential to make poverty a permanent state for a growing number of people, undoing the development efforts of a generation.”
“Communities across the globe are more vulnerable than ever, living in an unsustainable present and facing an uncertain future.”
“It is clear that the current level of global energy consumption is unsustainable, from both environmental and geological points of view.”
These are the comments of main stream politicians, not a peak oil survivalist group. Your should give them some serious consideration.
I am not predicting the collapse of civilization myself, but I believe that the issue of the fair sharing of the earth’s resources is going to become more urgent and more difficult to solve over the next decade or so. If we really want to bring about global economic equity we are going to have to reduce our demand on resources and, at the same time, recreate large parts of our infrastructure to function in a world with smaller supplies of total energy and other resources (Have you ever hear of peak phosphorous?). This transformation is an extremely tall order and will not take place in the context of capital markets and growth oriented economies no matter how conservatively managed they may be.
So there you have it.
There has been no solitary American Superpower in this new century. No in fact, nor the wild imaginings and failed schemes of her leaders and their advisers as projected through a collusive media lens. We’re all about global democracy!
There has also been no deregulation of financial markets. To the extent there has it was:
a) something the Democrats did
b) not deregulation at all
Not that I support George McCain Palin at all of course. I’m just sayin’.
There is NO global financial crisis. If there is, which there isn’t, the free market will fix it. This is why the current “there is no alternative” situation faced by Congress is about bailing out an elite group because they have lost all of your money that they did not keep themselves from your now worthless mortgages.
That’s why the bailout is that; exactly just that, not any bailing out of the victims, not allowing any deficit State budgets, no hint of a New Deal to rebuild the sunken economy. Just exactly that bailout or DOOM prior to the free market sorting it all out once our friends are taken care of. Give us some credit please! Seriously we are suddenly a bit short, please print more money and give us some credit!
If you disagree I’m sure I can pick out and analise some sentence or two from your comment to show that you are an idiot, idiot idiot just like John Gray and that like Der Boese Spiegel you hate America, a country which is just like every other country and the best in the world.
It’s clear all the people who want America to be fearful are not her fearmonering, warmongering, crony capitalist leaders but actually the people who say America should work towards and support a healthier and civilized balance of global power, which is a stupid idea because it obviously already does.
Blink as much as you feel compelled to reading this. If you start to feel faint, take a seat especially if you don’t enjoy the benefits of socialized medicine. Also I am making a fortune on the stock market right now, and I can also offer you plenty of advice about your portfolio and how to get well over $1.75 $US selling your abandoned house.
Roland, haven’t you heard? The bailout was voted down. Read more carefully. Pay attention! .
There has also been no deregulation of financial markets.
Surely you can answer something I’ve actually said, without having to put words in my mouth. Did I ever say this? Or is it as made up as your other notions of “what americans think?” like…
we’re all about global democracy!
Here’s a tip roland: we’re not “all about” anything. Here’s another: try to stop thinking about Americans quite so much (tall order, I realize) . It’s making you hallucinate.
For a Canadian Roland, you seem pretty obsessed with America, and yet Americans think very little about Canada. They don’t want to bomb it, or colonize it, or convert it to Christianity. They certainly don’t spend all day on websites gloating over its demise, crowing about its failures, and caricaturing its citizenry as selfish evil half-wits.
If US power is really on the wane, its intrusions into your mental space should be fewer still going forward. That’s great and I’m very happy for you, and for your family and whoever else suffers through your affliction.
t’s clear all the people who want America to be fearful are actually the people who say America should work towards and support a healthier and civilized balance of global power
Actually it’s the people who are tempted to “gloat” over economic misfortune, real or imagined.
I met a Canadian not long ago who introduced herself as “an unarmed American with a Health Plan”
I warmed to the concept.
Cohen in NYT today
Market capitalism is a sophisticated thing that calls for transparency, ethics and rules. Bush and his crowd gambled that some “new paradigm” meant these things were passé.
They’re not. We have to be careful now. Already the contagion of bank failures has spread to Europe. People are asking of the United States: what became of this country?
The Chinese have been ready to treat U.S. Treasuries as a rock-hard store of value and loan us the dollars they accumulate at a very low interest rate. But what if they start to doubt the U.S. government will repay its debt?
“We are getting closer to a tipping-point,” said Benn Steil, an economist. “People are asking: can we really trust the dollar as a store of value?”
Cohen in NYT today
Market capitalism is a sophisticated thing that calls for transparency, ethics and rules. Bush and his crowd gambled that some “new paradigm” meant these things were passé.
They’re not. We have to be careful now. Already the contagion of bank failures has spread to Europe. People are asking of the United States: what became of this country?
The Chinese have been ready to treat U.S. Treasuries as a rock-hard store of value and loan us the dollars they accumulate at a very low interest rate. But what if they start to doubt the U.S. government will repay its debt?
“We are getting closer to a tipping-point,” said Benn Steil, an economist. “People are asking: can we really trust the dollar as a store of value?”
Frank, would you believe that most americans are unarmed? In fact a similar proportion of canadian households guns. Also, most (85% in fact) have health plans. The US actually compares well with Canada in terms of public health statistics like cancer and heart attack survival, infant mortality etc. This isn’t to say the health care system is perfect, but it also doesn;’t square with the apocalyptic images drawn by America-haters like your Canadian friend.
Last time we went got stuck in this “Canada vs. USA” rah-rah showdown, I wondered why so many Canadians migrate to the US annually (Canadians are 20 times more likely to head south than Yanks to emigrate north.) Our canadian friend Bevin volunteered that it was the weather, which led me to conclude that warm weather is 20 times more important to Canadians than free health care and handgun mortality rates.
But why is American gun ownership or level of health care a topic of jesting conversation among Irishmen or Canadians at all? It isn’t as if americans are demanding that vermont’s liberal gun laws be extended to quebec or that canada dismantle its public health program. (and can you imagine an American introducing himself as “A Canadian with more money”? of course you can, only because you’ve spent more time reading smug guardian editorials than speaking with real yankees.)
In general sneering jokes about american domestic policy between non-americans doesn’t do much to enhance the spirit of mutual respect. actually it reinforces the idea that much criticism of the US is rooted in insecurity.
“People are asking: can we really trust the dollar as a store of value?”
For an economist Ben Steil seems pretty oblivious to currency markets. The US dollar has had an unprecedented surge in value since the “big crisis” broke out.. As of this morning it’s at 1.39, 15% stronger than 3 months ago . And although I’m as much an flag-waving jingo as bevin woud like to believe, I’m personally hurt by this move, and so are many US exporters.
Frank, would you believe that most americans are unarmed? In fact a similar proportion of canadian households guns. Also, most (85% in fact) have health plans. The US actually compares well with Canada in terms of public health statistics like cancer and heart attack survival, infant mortality etc. This isn’t to say the health care system is perfect, but it also doesn;’t square with the apocalyptic images drawn by America-haters like your Canadian friend.
Last time we went got stuck in this “Canada vs. USA” rah-rah showdown, I wondered why so many Canadians migrate to the US annually (Canadians are 20 times more likely to head south than Yanks to emigrate north.) Our canadian friend Bevin volunteered that it was the weather, which led me to conclude that warm weather is 20 times more important to Canadians than free health care and handgun mortality rates.
But why is American gun ownership or level of health care a topic of jesting conversation among Irishmen or Canadians at all? It isn’t as if americans are demanding that vermont’s liberal gun laws be extended to quebec or that canada dismantle its public health program. (and can you imagine an American introducing himself as “A Canadian with more money”? of course you can, only because you’ve spent more time reading smug guardian editorials than speaking with real yankees.)
In general sneering jokes about american domestic policy between non-americans doesn’t do much to enhance the spirit of mutual respect. actually it reinforces the idea that much criticism of the US is rooted in insecurity.
“People are asking: can we really trust the dollar as a store of value?”
For an economist Ben Steil seems pretty oblivious to currency markets. The US dollar has had an unprecedented surge in value since the “big crisis” broke out.. As of this morning it’s at 1.39, 15% stronger than 3 months ago . And although I’m as much an flag-waving jingo as bevin woud like to believe, I’m personally hurt by this move, and so are many US exporters.
Speaking of hallucinating Vadim, just how often do I have to bring up little old New Zealand in Helena’s blog comments before a person can (as we say down under) “twig to” the fact that I actually come from there and not Alaska,..er I mean Canada?
I don’t want to bore people with my obsessive nationalism or anything, and hell its only another outline on a map after all. What is it you Americans so aptly say on such occasions, of that’s right, “sheesh”! Hang on, I’m recklessly presuming you are American, perhaps you are Nepalese or Spanish? Or should I just guess, incorrectly imagine I know and shoot off at the mouth?
However after reading Frank’s wonderful quote from his Canadian acquaintance I really don’t mind so much being so strangely mistaken for one, there seem to be at least some similarities. Moreover in the spirit of Commonwealth diplomacy I am prepared to admit Maple Syrup beats Golden Syrup in many circumstances, and “Tiki Bar” is a very funny podcast, almost as funny as “Flight of The Conchords.”
Who should (be allowed to) give a moment’s thought about America anyway, even if she did seem to assume leadership of the western world so many decades ago? Will we really soon be free not to care, as you say Vadim and if so how marvelous!
Now, did America’s massive financial sector screw up (as opposed to the massive military screw ups over the last decade) really harm my little country enough for me to notice? Well now you’ve possibly worked out which one I am in feel free to Google it. There’s plenty to find. I for one have had to sell 1/4 of my race horses. Sorry, another joke. Thats us antarctic Canadians, always joking, especially in a non-existent crisis like this one.
Let me tell you, dear readers on the actual topic of this blog post: “America as others see us” that if I don’t want to hear “crisis” and “America” in the same sentence down here (next door to Antarctica) these days I must turn off the TV, Radio and my internet connection. But perhaps as Vadim intimates I should just shut up, even if that is the topic, because America doesn’t really want to know.
Very sorry Roland. I admit I had my chronic US-bashers confused. An honest mistake.
It’s still a pity you see fit to fret that you (like bevin) waste hours of your life fretting over domestic issues, where most Americans don’t care to fret over New Zealand’s health care system, or gloat over its economic problems.
even if that is the topic
Unfortunately that seems to be the unstated topic of every post, and the topic presumes that the dull, shallow view of the world shared by insecure US-bashers is congruent with what “the world” sees. As for your internet connection, it takes you where you choose to go, which seems to be here quite a bit of the time.
I don’t want to bore people with my obsessive nationalism
I doubt you’re obsessively nationalistic. As I said, US-hatred is probably strongest in nations with weak self-images.
But perhaps as Vadim intimates I should just shut up
I haven;t intimated anything. I welcome your point of view, and you should welcome mine.
if I don’t want to hear “crisis” and “America” in the same sentence down here (next door to Antarctica) these days I must turn off the TV, Radio and my internet connection.
Rather than parroting what you hear from media, why not question some of their assumptions? Why for example are (journalist) Roger Cohen’s or (philosopher) John Gray’s economic insights more valuable than your own? Spiegel’s 40th editorial isn’t going to convince me to flee to Mexico, whereas a well conceived argument fleshed out with facts might.
Doesn’t it trouble you that even though your favorite internet sites are saying the US is in a death spiral, we aren’t seeing meaningful moves in major indicators like sovereign bond yields, stock prices, or currency markets? Why am I (an ignorant jingo) the only person here contesting the fact of this ‘crisis’ (touted most vociferously as such by the US media, political and business establishment you hold in such disdain?)
Vadim, yes I do believe you were mistaken. No surprises there.
Vadim
http://news.bbc.co.uk/1/hi/business/7645743.stm
I will take Robin up on his invitation.
of course you can, only because you’ve spent more time reading smug guardian editorials than speaking with real yankees
I was unfortunate enough to spend three years working in Paris alongside a group of Texans and talked to them almost every day. The only way we made any progress was when we did things my way.
At the end of the time they gave up on their investment and sold out to the company I was working for who made an enormous capital gain.
I concluded from the experience that my French colleagues were right. Charles de Gaulle was the greatest statesman of the 20th century.
Hi Frank.
We’ve already read the John Gray editorial. We know what he thinks: US hegemony in all its dimensions is both unwelcome and doomed. What it doesn’t do is show is *why* the US economy is going down the tubes, or why economies like Germany which suffer from higher unemployment rates offer a superior model.
Neither does the BBC piece on the John Gray’s Guardian piece. I now expect someone to link to a piece referencing the BBC piece, taking us one degree further from real information (further into the world of self-referential polemic.)
I’m sorry you worked with some loudmouth Texans, sorrier still that this limited exposure has informed your opinion of all Americans.
But here’s the thing. We are now at a seminal point in world history where (a) There is actually quite enough capacity to produce enough material stuff to give everyone on earth the prerequisites of a decent life;
hmm…sounds like communism, no?
(b) Most people understand the counter-productive and destructive nature of war
sure. i bet all the 9-11 hijackers would agree with you.
and (c) In the United Nations we have a system of rules and norms for international engagement that, though far from perfect, is still far, far better to have than not to have, and that can certainly be further reformed.
yep. the UN is mighty effective. ever seen hotel rwanda?
I’m sorry you worked with some loudmouth Texans, sorrier still that this limited exposure has informed your opinion of all Americans.
Don’t worry there are lots more I have met and worked with and they are all much the same.
Funny enough there are two American individuals who are on my Christmas card list as the people who most influenced my thinking during a year.
you might enjoy
http://www.amazon.com/Second-World-Empires-Influence-Global/dp/1400065089
Interesting discussion about history and the prospects for the USA. Kudos all around.
The USA is on a downward course, and its citizens realize it but can do nothing about it. At a time when there are no military threats against the USA the expanding military budget now equals $2K annually per capita, which is “needed” to waste billions of dollars on the purchase of new ships, planes, guns and bombs, as well as radar sites in the Czech Republic, new military family communities in Korea featuring multi-story apartment buildings and a water park, a new Africa Command and re-birth of the Fourth Fleet to patrol “dangerous” Latin American waters.
It’s worse than we think. Former Bush Administration Treasury Secretary Paul O’Neill: “I have not heard either candidate talk about the $53 trillion worth of unfunded liabilities that we have as a nation, that we need to do something about, or we’re going to have a problem that makes this current financial crisis look like child’s plan not too far down the road.”
As a result of this profligate corporate welfare spending and militarism the per capita debt in the USA exceeds $30K and the American social fabric suffers from lack of attention and investment. The USA leads the world in incarcerated citizens, murders and suicides and suffers from poor health care. The US infant mortality rate (6.4) is 22% higher than Canada (4.6), while life expectancy in the USA (78) is more than two years less than in Canada (80.3). People who don’t have medical insurance, or who have their insurance canceled, are left to suffer and die.
Reckless government spending and lack of financial oversight has produced an economic crisis due to the excessive greed of lenders, with the people, against their will, now (apparently) about to compensate these greedy people for $700B of their financial losses. It’s a bailout of the offenders.
Now Helena, the eternal optimist, and there’s a lot of good in that, writes that correcting this situation “will take a good measure of realism, humility, patience, and vision from all the leaders concerned, inside and outside the US.”
Good luck, as these attributes are nowhere in evidence in the USA “leaders concerned.”
When Canadians move to the US, because of the weather, they retain their Health Care entitlements in most circumstances.
As to Vadim’s musings on gun ownership I’m unsure what he is getting at: few Canadians own handguns and the laws regarding their use and storage are strict.
So far as the position of the United States in the world is concerned, most of us are inclined to Joe Strummer’s view.
But it is not up to us: we have a noisy, noisome, nosy and bullying neighbour whose debased politics and childish sub-political squabbling lowers the moral and intellectual tone of the entire planet. It harasses, bribes and terrorises nations which, from bitter experience, know better, to adopt its parodies of Manchester Political Economy of the school of Nassau Senior. It has recently, through the offices of a barely literate scribbler, caught up with Herbert Spencer’s vapourising and, in the course of dumping its “entertainment” on world cultural markets has shared Ayn Rand’s vulgarities with our more impressionable citizens. To considerable cost for we now have legions of young people who think that evil brings forth good in the world. And that it would be unfair not to be as selfish as one could be.
It spends more on the military than all the rest of the world put together-thus forcing all the rest of the world, in defence, to increase its expenditure on, much worse than merely useless arms. In the course of its posturing and preening around the world it is storing up such a storm of hatred and revenge that we can count upon the imminent arrival of car bombs and suicide bombers in our marketplaces simply because of their proximity to, and our ethnic resemblance with, our neighbours.
What we would really like is for America to get a life, to look inwards and contemplate itself and its meaning and purpose. Instead, like a bantam cock, with a chip on its wingfeathers, it bounces up and down screeching of its power and its love of freedom, of its democracy and so on. Yea, even unto the number of its Nobel Prize winners.
The trouble is that, if we don’t watch out, we’re infected: our health services are being “privatised” by US based companies, our armies are being dragged off to Afghanistan to fight Pashtuns (and lose), our banks are riddled with toxic derivatives, our pension funds have been plundered and our politicians have become clones of Congressmen talking rubbish about Israel and cheering torture and kidnapping.
etc etc. But don’t think, Vadim, that we are admiring you: we’re simply watching you like hawks because you scare us the way that Bonaparte scared our forefathers and those who dream of world domination, without specifying more recent examples, are apt to scare people.
Farah, above. Yes, I’ve seen Hotel Rwanda. Moreover I’ve spent a bit of time in Rwanda and interviewed, there and elsewhere, many survivors of the 1994 genocide… It is true the UN force there was horribly ineffective. What made it so? Well, the fact that as soon as the genocide started Pres. Clinton and Madeleine Albright worked hard at the UN to reduce, that’s right, reduce, its size and capabilities certainly hampered its ability to save lives… In fact, Clinton/Albright wanted the force pulled out altogether but gutsier voices at the UN prevailed and a skeleton force was able to stay in-country. It was able to save numerous lives, whereas the US contributed no peacekeepers and saved no lives.
As I said, the UN is a highly imperfect instrument. Actually it has no independent will but is the creature of the nations that compose it, primarily the five permanent members of the Security Council. If the US were serious about supporting the UN and its principles it could become 100 times more effective.
But even with all its shortcomings, it is still much, much better to have in place in the present time of deep global transition a body that has very broad international respect, the membership of all the world’s nations, numerous very effective bodies–especially in technical fields– and others that are less so, and a generally admirable set of principles and norms (however ineffectively applied.)
If there were no such institution in place today, imagine how much more violent and threatening the transition might become.
The UN was a great creation of an earlier, considerably wiser generation of US leaders. We could even call them the “Greatest Generation”…
Two decades ago a pop singer wrote a very simple song which reminds us of an eminently simple truth “people are the same wherever you go.” Here is a truth we don’t consider enough, my life is worth no more or less than an American life, an Israeli life, a Palestinian life, an Iraqi life, an Indian life, an Icelandic life, or any other.
I would if required gladly give up my life to protect my beloved country, as would many millions around the world, and that is an essential part of why we have war. Patriotism is not uncommon, and to nevertheless presume it’s absence is haughty and foolish.
Like most people, I also prefer not to be surrounded by poverty and suffering, like most people I do all I can think of to prevent that, but soon enough I nevertheless will be surrounded by poverty and suffering, despite being as physically removed as possible from America and the financial crisis and despite having long foreseen it and having very little personal debt as a result.
What has always been “invisible” about the “free” market has never been it’s clumsy and grasping hand, but it’s brain. No human institution, reliant on human choices, is capable of transcending human imperfections whatever the economist’s formulae dictate. Everyone else’s greed and vanity gets into the equation, but never our own.
One can only judge a nation by it’s leaders when that nation’s people have a genuine choice in leadership. Americans do not have any significant choice and they have not had one for a very long time. Faced with this reality, innately patriotic Americans elect to “tune in and drop out” just as one would expect, in a culture where this is encouraged and made as easy as possible, and where so many people don’t even “make stuff” anymore.
Americans commonly are, like so many of us in the western world, debt driven waged servants who have been encouraged to borrow more than they could ever repay to buy “stuff” ownership of which is promoted as essential to “being successful”. They have done so, just as the lenders speculated they would to their seemingly guaranteed profit.
These are very simple truths which can never be changed by the shallow point scoring in an on-line debate, they are universally and consistently self evident as they are verified every day on this earth by our own individual experience. We can debate the causes, we can debate the solutions, but the crisis we now face is rationally undeniable. God bless America.
I apologize if I created any confusion about congressional approval of the mortgage dealer bail out. I did not mean to suggest that this has yet been given. It has not been as yet.
When Canadians move to the US, because of the weather, they retain their Health Care entitlements in most circumstances.
Not when they abandon their citizenship which was the basis of comparison.
But don’t think, Vadim, that we are admiring you
Obviously I don’t think that… but do you honestly care what I think? Or would you rather sit there terrified of the “dreams of world domination” I supposedly share with 300 mln others? Yes somehow you feel qualified to attribute this motive to me, because you would rather lecture arrogantly than listen.
What a shame, that you’d rather cower in terror of a people you don’t care to understand, than address them as equals.
Vadim,
Firstly, our elected whores passed the bailout. But only after it was expanded from 3 unConstitutional pages to 450 pork-laden pages to get enough votes to switch, and one congressman has claimed on the floor of Congress that administration figures tried to scare congressmen by claiming a “no” vote would lead to martial law.
You can call me a liar, but if Bush was threatening martial law how can you claim America is in great shape?
Either he was lying, in which case American democracy and “values” and capitalism (the most pro-business president in history) have produced a lying tyrant whose bailout destroyed the Constitution.
Or we’re about to go off the cliff.
I’m a Texan, and Frank is right about most Texans, and he’s right about most Americans being ignorant and pushy. We know something’s wrong but we’ve been taught not to question why things can’t be done differently.
All the proof you need, Vadim, about America’s enforcement of pro-corporate ideology on weak countries is to be found in Naomi Klein’s “The Shock Doctrine”.
All the proof of America’s will to empire is to be found in the papers of The Project for a New American Century, headed by the man who tells George W. Bush what to think.
People in America are getting scared fast. Two of my four closest friends are in medical bankruptcy, though I’ve helped them with thousands of dollars. Another of those friends lives with a woman who works for AIG. We’re surrounded here in Houston by refugees from New Orleans and victims of Enron, yet we’re lucky because expensive oil profits us at the expense of everyone else. My Mom lives in Vegas where houses have lost over 30% of their value before the recession has even officially started. She just lost tens of thousands of dollars in her General Electric stock because this company, the world’s biggest manufacturer, has plunged from $42 a share to $22 in 3 months while it’s sold more shares to raise operating cash. The Cassandras on the far right and left have warned for years of massive debt, fake economic stats, and a future collapse spreading from mortgages into banking into the consumer economy. Car sales are collapsing, home sales have collapsed. Do you know what a “durable goods sector” is and how important it is to the economy?
Worst part of it is, Vadim, WE DON’T WANT THIS!!
Most of us are against the War, most of us are against the bailout, most of us want to move money from the war budget to social spending and health insurance and alternative energy. Survey after survey shows that. And yet the Iron Legion of big greed and big religion, the 30 or 40% of the country who genuinely want a Christian police state forever, dumb down American politics with faith & values carnivals and keep the rest of us too divided. They really are as dumb as Sarah Palin, ready to believe and say whatever they’re told by rich white Christians. They are not afraid of using nuclear weapons, because they believe the ends justifies the means. I was one of them once, and I’m not kidding.
This is the real America. When do we get to be part of your picture?
I’m a Texan, and Frank is right about most Texans, and he’s right about most Americans being ignorant and pushy
I don’t know what Frank was getting at with the remark about Texans. That they’re stubborn? That they didn’t recognize his genius? That they made bad investment decisions? About Americans he tells us “there are lots more I have met and worked with and they are all much the same,” but does he mean you and me and Helena as well? I think he’s a bit confused.
When you say “most Americans are ignorant and pushy” would this be the majority that wants to end the war and are against the bailout? Or the other half? Are there “white christians” who want to end the war? Do you suppose “white christians” exist in other governments? In other words, are white christian Americans uniquely stupid and arrogant? And if you really believe this, do you expect them to take anything you say seriously? Why on earth should they!
it doesn’t excuse you that you come from texas, super390, you have no right (or basis in fact) to belittle texans or americans as a category, any more than to rant about the shiftless tendencies of mexicans or the stinginess of jews. people who speak this way of entire groups are bigots. I’m not personally offended by it, I only think it has no point. You’ve written yourself out of the political script, and so has Der Spiegel.
http://news.bbc.co.uk/sport2/hi/football/world_cup_2006/5141074.stm
A blast from the past: der Spiegel shames the image of Germany by calling Italians “lazy and greasy, among other things.” Seems like xenophobic slurs are what they’re all about.