The sun’ll come out tomorrow
Bet your bottom dollar
That tomorrow there’ll be sun
Previously on Apocalypse Soon…
It was the worst of times, it was the not quite so worst of times.
The predecessor to this book was called America Alone: The End of the World as We Know It, and, given the title, you may be tempted to respond,
“C’mon, man. You told us last time it was the end of the world. Well, where the hell is it? I want my money back. Instead, you come breezing in with this season’s Armageddon-outta-here routine. It’s like Barbra Streisand fare-well tours—there’ll be another along next summer.”
Well, now: America Alone: The End of the World as We Know It was about the impending collapse of all of the western world except America.
The good news is that the end of the rest of the West is still on schedule.
The bad news is that America shows alarming signs of embracing the same fate, and then some.
Nobody writes a doomsday tome because they want it to come true.
From an author’s point of view, the apocalypse is not helpful: the bookstores get looted and the collapse of the banking system makes it harder to cash the royalty check. But Cassandra’s warnings were cursed to go unheeded, and so it seems are mine. Last time ’round, I wrote that Europe was facing a largely self-inflicted perfect storm that threatened the very existence of some of the oldest nation-states in the world. My warning proved so influential that America decided to sign up for the same program but supersized.
Heigh-ho.
It starts with the money. In “The Run Upon the Bankers” (1720), Jonathan Swift wrote:
A lot of writing on the wall these days. Who has the bonds of a “developed world” developed to the point that it’s institutionally conditioned to living beyond its means? Foreigners with money. So who’s available and flush enough? The Chinese Politburo; Saudi sheikhs lubricated with oil but with lavish worldwide ideological proselytizing to fund; Russian “businessmen.”… These are not the fellows one might choose to have one’s bonds, never mind one’s soul, but there aren’t a lot of other options.
So it starts with the money—dry stuff about numbers and percentage of GDP. As Senator Michael Bennet of Colorado fumed to a room of voters in 2010, “We have managed to acquire $13 trillion of debt on our balance sheet. In my view, we have nothing to show for it.”1
He’s right—and $13 trillion is the lowest of lowball estimates. But why then did Senator Bennet vote for the “stimulus” and ObamaCare and all the other trillion-dollar binges his party blew through? Why did Senator Bennet string along and let the 111th Congress (2009–2011) run up more debt than the first one hundred Congresses (1789–1989) combined?2 Pan-icked by pre-election polls into repudiating everything he’d been doing for the previous two years, the senator left it mighty late to rediscover his virtue.
You would think that Colorado voters might have remembered that, like Groucho Marx apropos Doris Day, they knew Michael Bennet before he was a virgin. Alas, an indulgent electorate permitted the suddenly abstemi-ous spendaholic to squeak back into office.
And, contra Senator Bennet, eventually you do have something to show for it. It starts with the money, but it doesn’t stop there. It ends with a ruined and reprimitivized planet, in fewer easy stages than you might expect.
Let’s take a thought by the economist Herbert Stein: If something cannot go on forever, it will stop.3
This is a simple but profound observation. Dr. Stein first used it in the context of the long-ago debts and deficits of the Reagan era. “The Federal debt cannot rise forever relative to the GNP. Our foreign debt cannot rise forever relative to the GNP,” he said. “But, of course, if they can’t, they will stop.” It was, as he later wrote, “a response to those who think that if something cannot go on forever, steps must be taken to stop it—even to stop it at once.”4 And he has a point: if something can’t go on, you don’t have to figure out a way to stop it, because it’s going to stop anyway.
Eventually.
As you might have noticed, since he first made the observation, the debt has gone on rising, very dramatically. But the truth is unarguable. If you’re careening along a road toward a collapsed bridge, you’ll certainly stop, one way or the other. But it makes a difference, at least to you, whether you skid to a halt four yards before the cliff edge or whether you come to rest at the bottom of the ravine.
In 2010, Douglas Elmendorf, director of the Congressional Budget Office (CBO), described current U.S. deficits as “unsustainable.”5 On that everyone’s agreed. So let’s make them even more so! On assuming office, President Obama assured us, with a straight face, that his grossly irresponsible wastrel of a predecessor had taken the federal budget on an eight-year joyride. So the only way his sober, fiscally prudent successor could get things under control was to grab the throttle and crank it up to what Mel Brooks in Spaceballs (which seems the appropriate comparison) called “Ludicrous Speed.” Let’s head for the washed-out bridge, but at Obamacrous Speed!
The Spendballs plans of the Obama administration took the average Bush deficit for the years 2001–2008 and doubled it, all the way to 2020.6
“We’ve got a big hole that we’re digging ourselves out of,” the president declared in 2011.7 Usually, when you’re in a hole, it’s a good idea to stop digging. But, seemingly, to get out of the Bush hole, we needed to dig a hole twice as deep for one-and-a-half times as long. And that’s according to the official projections of the president’s economics czar, Ms. Rose Colored-Glasses. By 2020, the actual hole will be so deep that even if you toss every Obama speech down it on double-spaced paper you still won’t be able to fill it up. In the spendthrift Bush days, federal spending as a proportion of GDP averaged 19.6 percent.8 That’s crazy. Obama’s solution was to attempt to crank it up to 25 to 30 percent as a permanent feature of life. That’s load up the suicide-bomber underpants and pass me the matches.
The CBO doesn’t put it quite like that. Musing on the likelihood of a sudden fiscal crisis, it murmurs blandly, “The exact point at which such a crisis might occur for the United States is unknown, in part because the ratio of federal debt to GDP is climbing into unfamiliar territory.”9
But it’ll get real familiar real soon. A lot of the debate about America’s date with destiny has an airy-fairy beyond-the-blue-horizon mid-century quality, all to do with long-term trends and other remote indicators. In fact, we’ll be lucky to make it through the short-term in sufficient shape to get finished off by the long-term. According to CBO projections, by 2055 interest payments on the debt will exceed federal revenues.10 But I don’t think we’ll need to worry about a “Government of the United States” at that stage.
By 1788, Louis XVI’s government in France was spending a mere 60 percent of revenues on debt service, and we know how that worked out for the House of Bourbon shortly thereafter.11
So take your eye off the far prospect, and instead look about fourteen inches in front of your toecap. Within a decade, the United States will be spending more of the federal budget on its interest payments than on its military. You read that right: more on debt service than on the armed services.
According to the CBO’s 2010 long-term budget outlook, by 2020 the government will be paying between 15 and 20 percent of its revenues in debt interest.12 Whereas defense spending will be down to between 14 and 16 percent.
Just to clarify: we’re not talking about paying down the federal debt, just keeping up with the annual interest charges on it. Yet within a decade the United States will be paying more in interest payments than it pays for the military—and that’s not because the Pentagon is such a great bargain. In 2009, the United States accounted for over 43 percent of the world’s military expenditures.13 So America will be spending more on debt interest than China, Britain, France, Russia, Japan, Germany, Saudi Arabia, India, Italy, South Korea, Brazil, Canada, Australia, Spain, Turkey, and Israel spend on their militaries combined. The superpower will have evolved from a nation of aircraft carriers to a nation of debt carriers. The CBO numbers foresee net interest payments rising from 9 percent of revenue to 36 percent in 2030, then to 58 percent in 2040, and up to 85 percent in 2050.14 If that trajectory holds, we’ll be spending more than the planet’s entire military budget on debt interest.
But forget mid-century—because, unless something changes, whatever goes by the name of “America” under those conditions isn’t worth talking about.
By 2010, about half our debt was owned by foreigners, and somewhere over a quarter of that was held by the Chinese (officially).15
What does that mean? In 2010, the U.S. spent about $663 billion on its military, China about $78 billion.16 If the People’s Republic carries on buying American debt at the rate it has in recent times, then within a few years U.S. interest payments on that debt will be covering the entire cost of the Chinese armed forces. In 2010, the Pentagon issued an alarming report to Congress on Beijing’s massive military build-up, including new missiles, upgraded bombers, and an aircraft carrier research and development program intended to challenge U.S. dominance in the Pacific. What the report didn’t mention is who’s paying for it.17
Answer: Mr. and Mrs. America.
To return to the president’s declared strategy: “We’ve got a big hole that we’re digging ourselves out of.” Every politician’s First Rule of Holes used to be: When you’re in one, stop digging. If you don’t, as every child knows, eventually you dig so deep you come out on the other side of the world—someplace like, oh, China. By 2015 or so, the People’s Liberation Army, which is the largest employer on the planet, bigger even than the U.S. Department of Community-Organizer Grant Applications, will be entirely funded by U.S. taxpayers.18 As Bugs Bunny is wont to say when his tunnel comes out somewhere unexpected: “I musta took a wrong turn at Albuquerque.” Indeed. When the Commies take Taiwan, suburban families in Albuquerque and small businesses in Pocatello will have paid for it.
And even that startling scenario is premised on the most optimistic assumptions—of resumed economic growth but continued low interest rates. If interest rates were to return to, say, 5.7 percent (the average for the period 1990–2010), the debt service projections for 2015 would increase from $290 billion to $847 billion.19 China would be in a position to quadruple its military budget and stick U.S. taxpayers with the bill.
The existential questions for America loom not decades hence, but right now. It is not that we are on a luge ride to oblivion but that the prevailing political realities of the United States do not allow for any meaningful course correction. And, without meaningful course correction, America is doomed.
It starts with the money. It always does. P. G. Wodehouse fans will recall the passage in Right Ho, Jeeves in which Bertie Wooster’s uncle, like many Americans today, is much preoccupied by the Exchequer’s claim upon him:
“Is he still upset about that income-tax money?” asks Bertie.
“Upset is right,” replies Aunt Dahlia. “He says that Civilization is in the melting-pot and that all thinking men can read the writing on the wall.”
“What wall?”
“Old Testament, ass,” snaps Aunt Dahlia. “Belshazzar’s feast.”
“Oh, that, yes,” says Bertie. “I’ve often wondered how that gag was worked. With mirrors, I expect.”
The gag with mirrors comes from the Book of Daniel: Babylon’s king throws a wild party and, in the midst of his drunkenness, toasts the gods of gold, silver, and various other commodities. No sooner has he done so than the writing appears on the wall, spelling out with disembodied fingers “mene mene, tekel, upharsin.” They’re currency units: half-dollar, half-dollar, penny, and two bits. But what does it mean? None of the A-list seers Belshazzar keeps on the payroll has a clue what it portends, so the King calls in Daniel the Jew to explain things, which he does, very bluntly: Mene: “God hath numbered thy kingdom, and finished it.”
Tekel: “Thou art weighed in the balances, and art found wanting.”
Upharsin: “Thy kingdom is divided, and given to the Medes and Persians.”
Within twenty-four hours, Belshazzar is slain and Darius the Mede is king.
Today, the units are larger than in Babylon: “Mene mene, tekel, upharsin” is now trillion trillion, billion, half-trillion. But the upshot’s the same.
We’ve spent too much of tomorrow today—to the point where we’ve run out of tomorrow: fiscally, our days are numbered; structurally, we’ve been weighed in the balances and found wanting; and geopolitically, the Medes are thin on the ground but the Persians have gone nuclear.
So, if the deficits are “unsustainable,” then what happens when they can no longer be sustained? A failure of bond auctions? A downgraded government debt rating? Reduced GDP growth? Total societal collapse?
Mad Max on the New Jersey Turnpike?
Testifying to the House Budget Committee in 2010, CBO chief Douglas Elmendorf attempted to pull back from the wilder shores of “unsustainable”: “I think most observers expect that the government will act, that the unsustainability will be resolved through action, not through witnessing some collapse down the road,” he told the political grandees. “If literally nothing is done, then eventually something very, very bad happens. But I think the widespread view is that you and your colleagues will take action.”20
Dream on, you kinky fantasist. If that’s your deus ex machina, bet on Mad Max. As an example of the “action” being contemplated, Obama’s Debt Commission produced a report melodramatically titled “The Moment of Truth”—and then proposed such “actions” as raising the age of Social Security eligibility to sixty-nine.21
By the year 2075.
As that “solution” suggests, the real problem is that over the last three-quarters of a century the United States has adopted a form of government all but impervious to reality. Come alternate Novembers, the American people have a choice between a fellow running on fluffy abstract nouns—“hope,” “change,” “generic gaseous uplift”—and a fellow promising small government. That’s a best case scenario, by the way. Sometimes, as in 2008, you find yourself choosing between a candidate promising to guarantee the mortgages of people who “bought” houses they and their banks knew they couldn’t afford, and a candidate promising to give “tax cuts” to millions of people who pay no taxes. But, assuming you did get a genuine choice, what is the net result of these two starkly different platforms?
None. In America, federal spending (in inflation-adjusted 2007 dollars) went from $600 billion in 1965 to $3 trillion in 2008.22 Regardless.
The Heritage Foundation put it in a handy cut-out’n’weep graph: until the Democrats accelerated up to Obamacrous Speed in 2009, it’s a near perfect straight line across four decades, up, up, up.23 Doesn’t make any difference who controls Congress, who’s in the White House—Democrat, Republican, bit of both. The government just grows and grows, remorselessly. A president of one party and a Congress of the other? Up and up it goes. So much for those sophists who hymn the virtues of “gridlock.” Every two years, the voters walk out of their town halls and school gyms and tell the exit pollsters that three-quarters of them are “moderates” or “conservatives” (a clear center-right majority) and barely 20 percent are “liberals.”24
Sometimes, as in 1980, 1994, and 2010, they explicitly vote for small government. And then, on the Wednesday morning after the Tuesday night before, Big Government resumes its inexorable growth. Newt Gingrich and his dragon-slayers? According to a 2000 report by the Cato Institute, “the combined budgets of the 95 major programs that the Contract with America promised to eliminate have increased by 13 percent.”25
That’s what’s happened since the Sixties. What of the future? The CBO ran the longer-term numbers: The “alternative fiscal scenario,” which factors in likely changes in policy, calculates that public debt will rise from 44 percent of GDP in 2008 to 716 percent by 2080.26 Then again, the CBO’s “extended-baseline scenario,” which assumes there will be no changes to current policy, says public debt will only rise to 280 percent by 2080.
It doesn’t matter which of these figures is correct, and it was a complete waste of time running the numbers. The worst case is 716 percent? And the best is 280 percent? That’s a choice between dead and deader. Who cares?
If either number is right, there isn’t going to be a 2080, not for America.
You can spend a month ploughing through the CBO statistics, but the numbers don’t matter because they all make the same point: under no likely scenario does America’s debt burden do anything but go up. Whether it’s Cloud-Cuckoo Land up or Planet Zongo up is mere details. Nothing is certain but debt and taxes. And then more debt. If the government of the United States had to use GAAP (the “Generally Accepted Accounting Practices” that your company and mine and the publishers of this book have to use), Uncle Sam would be under an SEC investigation and his nephews and nieces would have taken away the keys and cut up his credit cards. By 2010, the federal government was issuing about $100 billion of Treasury bonds every month—or, to put it another way, Washington is dependent on the bond markets being willing to absorb an increase in federal debt equivalent to the GDP of Canada or India—every year.27 While India’s growing its economy, we’re growing our debt to match. We’re asking the world to dump the equivalent of a G7 nation into U.S. Treasury debt every Christmas.
So let’s take it to the next stage: we know American government has outspent America. What happens if it outspends the entire planet?
John Kitchen of the U.S. Treasury and Menzie Chinn of the University of Wisconsin published a study in 2010 entitled: Financing U.S. Debt: Is There Enough Money in the World—and At What Cost?28
The fact that sane men are even asking this question ought to be deeply disturbing. As to the answer, foreign official holdings of U.S. Treasury securities have usually been less than 5 percent of the rest of the world’s GDP.
By 2009, they were up to 7 percent. By 2020, Kitchen and Chinn project them to rise to about 19 percent of the rest of the world’s GDP, which they say is… do-able.
Whether the rest of the world will want to do it is another matter. A future that presumes the rest of the planet will sink a fifth of its GDP into U.S. Treasuries is no future at all. But on Big Government’s streetcar named Desire we have come to depend on the kindness of strangers.
If something cannot go on forever, it can still go on long enough—especially if you enjoy bookkeeping advantages the government denies to the private sector. And the idea that “you and your colleagues will take action” to reverse it, or at least end it, or maybe just slow it down a wee bit, flies in the face of that Heritage graph. The one thing that can be said for certain is that the political class, whether led by Barack Obama, Harry Reid, and Nancy Pelosi, or the usual reach-across-the-aisle Republican accommodationists, or even the Gingrichite revolutionaries of 1994, will not take meaningful, transformative action.
That leaves Director Elmendorf’s alternative scenario. What was it again? Oh, yeah:
Some collapse down the road.
And you’ll be surprised how short that road is.
Two propositions. First, Adam Smith, after the Battle of Saratoga, in reply to a friend despondent that the revolting colonials were going to be the ruin of Britain:
There is a great deal of ruin in a nation.29
Alternatively, Samuel Huntington in his final book, Who Are We?
A nation is a fragile thing.30
Who’s right?
Smith’s view is correct for a lot of European countries: The “deal of ruin”—incremental decay—is seductive. In some ways, the most pleasant place to live is a colossus in gradual decline. Great powers aren’t Sudan or the Congo, where you’re sliding from the Dump category to the Even Crummier Dump category. Genteel decline from the heights can be eminently civilized, especially to those of a leftish bent. Francophile Americans passing through bucolic Provençal villages with their charmingly state-regulated charcuteries and gnarled old peasants wholly subsidized by the European Union’s Common Agricultural Policy can be forgiven for wondering if global hegemony is all it’s cracked up to be. Okay, the empire busted up, but the capital still has magnificent architecture, handsome palaces, treasure houses of great art, a world-class orchestra, fabulous restaurants, stylish women…. You still have the opera house, but it’s easier to get a parking space. Who wouldn’t enjoy such “decline”? To be sure, everything new—or, anyway, everything new that works—is invented and made elsewhere. But still: you benefit from all the cultural inheritance of greatness without being troubled by any of its tedious responsibilities. Much of Europe feels like that: a sidewalk café, chestnuts in blossom, have another coffee and a pastry, and watch the world go by. Life is good, work is undemanding, vacation’s coming up, war has been abolished. Somewhere beyond the horizon is a seething Muslim ghetto of 50 percent youth unemployment, whence the men swagger forth at sundown to torch the Renaults and Citroëns of the infidels.31 But not in your arrondissement. And not even on the Friday afternoon drive to your country place. What’s to worry about?
There may be a deal of it, but in the end ruin is the natural condition of the nation-state: three of the five permanent members of the Security Council have endured revolutionary upheaval and/or constitutional collapse since their “permanency” was established by the United Nations in 1945. Four of the G7 major economic powers have constitutions dating back barely half a century.
And, even if you escape (as most nations do not) coups, invasions, civil wars, and/or occupations, there arrives the moment when ruin comes to close the deal. Whether decline will seem quite so bucolic viewed from a Jersey strip mall rather than the Auvergne remains to be seen. But, either way, gradual decay is not the way it will go. American ruin will not be like France’s or Austria’s.
The exception to the Smith rule, and something closer to Huntington, is this: for dominant powers, ruin comes by the express lane. Unlike AIG, Fannie Mae, Detroit, and Greece, the United States is big enough to fail, spectacularly—and big enough to drag much of the world down with it.
Most citizens of advanced western democracies haven’t read Gibbon’s Decline and Fall of the Roman Empire, but they figure they get the general idea. The “decline” bit of the title suggests you’ve got a bit of time before you get to the “fall,” and actually, given that he took six volumes and covered a millennium and a half, that may be all the time you need. In fact, once the key elements were in place, the fall was very swift. By the time Odoacer took Rome in 476, the city’s population had fallen by 75 percent in barely half a century—or the equivalent of the Beatles to now. Within a few years, a prototype “globalization” of European commerce had reverted to a subsis-tence economy of local agriculture.
The question to ask is: What’s holding the joint up? A second- or third-tier nation—Iceland, for example—is generally resting on modest assumptions about its resources and economic outlook. There is a deal of it in a nation, but a superpower relies on subtler stocks, like image and credibility.
If you’re on a train going uphill and you’re out of fuel, you’ll still move forward—for a bit. By the time you notice you’re slowing down, the coal’s already gone. What comes next? You roll backwards, downhill, fast.
It starts with the money. For dominant powers, it always does—from the Roman Empire to the British Empire. “Declinism” is in the air these days, but we full-time apocalyptics are already well past that stage. In the space of one generation, a nation of savers became the world’s largest debtors, and a nation of makers and doers became a cheap service economy.
Everything that can be outsourced has been—manufacturing to by no means friendly nations overseas; and much of what’s left in agriculture and construction to the armies of the “undocumented.” At the lower end, Americans are educated at a higher cost per capita than any nation except Luxembourg in order to do minimal-skill checkout-line jobs about to be rendered obsolete by technology.32 At the upper end, America’s elite goes to school till early middle age in order to be credentialed for pseudo-employment as $350 grand-a-year diversity consultants (Michelle Obama) or in one of the many other make-work schemes deriving from government micro-regulation of virtually every aspect of endeavor.
So we’re not facing “decline.” We’re already in it. What comes next is the “fall”—fast, sudden, off the cliff, if only because the Obama spending binge made what was vague and distant explicit and immediate. America has squandered its supposedly unipolar moment on the world’s most expensive suicide. What is happening to the United States is not “cyclical,” but structural. Like Belshazzar’s Babylon, when you weigh us in the balances, we’re seriously wanting. Under a ruling class comprehensively inept but comfortably insulated, America has been thoroughly unbalanced: thanks largely to distortions driven by government, we have too much college, too much housing, too much financial sector, too much “professional servicing”—accounting, lawyering, and other activities necessary to keep the fine print in compliance with the regulatory state.
All of these are huge obstacles to making productive use of even our non-borrowed money and to keeping America competitive with the rest of the world.
Even in its glory days, the Age of Abundance wasn’t exactly a Belshaz-zaresque party for most folks: since 1973, the wages of 90 percent of Americans have grown by only 10 percent in real terms, and consumption even of cheap Chinese goods was fueled by borrowing.33 But eventually even that mirage fades and you see the writing on the Wal-Mart.
When government spends on the scale Washington’s got used to, that’s not a spending crisis, it’s a moral one. The Irish have a useful word for the times—flaithiúlacht—which translates to ruinous generosity, invariably with someone else’s money. There’s nothing virtuous about “caring” “compassionate” “progressives” demonstrating how caring and compassionate and progressive they are by spending money yet to be earned by generations yet to be born. That’s what “fiscal conservatives” often miss: this isn’t a green-eye-shade issue. Increasing dependency, disincentivizing self-reliance, absolving the citizenry from responsibility for their actions: the multitrillion- dollar debt catastrophe is not the problem but merely the symptom. It’s not just about balancing the books, but about balancing the most basic impulses of society.
These are structural and, ultimately, moral questions. Credit depends on trust, and trust pre-supposes responsibility. So, if you have a credit boom in an age that has all but abolished personal responsibility, it’s not hard to figure how it’s going to end.
The U.S. Bureau of the Public Debt (and no, that’s not a satirist’s fancy but an all too real government body) uses as its motto the words of Alexander Hamilton:
The United States debt, foreign and domestic, was the price of liberty.34
But in the early twenty-first century, foreign and domestic debt piles up to the cost of liberty. As I wrote in America Alone, it’s not the “deficit”: these programs would be wrong if Bill Gates wrote a check to cover them every month. They’re wrong because they represent a transfer from the citizen to the state not of money but of power. And over time, as we see in the urge to expunge words like “default” and “foreclosure” and indeed any form of consequence from life, they have a debilitating effect. A society can cope with corroded infrastructure and a devalued currency more easily than with corroded liberty and a devalued citizenry.
King Belshazzar’s wild party began with an act of desecration: Then they brought the golden vessels that were taken out of the temple of the house of God which was at Jerusalem; and the king, and his princes, his wives, and his concubines, drank in them. They drank wine, and praised the gods of gold, and of silver, of brass, of iron, of wood, and of stone.
Similarly, the statists took the vessels of the American republic and filled them up with Big Government happy juice. The United States joined the rest of a cosseted western world in voting itself a lifestyle it was not willing to pay for.
The bad news is our children will not enjoy the American Dream. The good news is that under the next “stimulus” bill they’ll be eligible to apply for a position as a federally funded American Dream Awareness Assistance Coordination Program Grantwriter. If the political class plus their dependents in the underclass and their cheerleaders in the media and academy have disconnected themselves from the animating principles of the American idea, what then is the point of America? Like President Obama, the progressive elite doesn’t believe in American exceptionalism, yet somehow assumes that the very exceptional peace and prosperity Americans have enjoyed since 1945 are eternal—as permanent a fact of life as the sky and the oceans.
The “bubble” is not the property market or cheap credit. The bubble is twenty-first-century America itself, from the financial sector to a wretched education system culminating in languorous, undemanding “college” courses whose absurd soaraway prices were affected not a jot by the economic downturn. When you weigh America in the balances, it’s not just wanting, it’s wanting a sugar daddy—urgently: if Europe’s somewhat agreeable post-war decline was cushioned by America, who’s volunteering to do the cushioning for America?
There is no good answer to that question.
By September 2010, America’s public debt was up to 94 percent of GDP.
Hey, relax, says New York Times columnist and Nobel Prize-winning economist Paul Krugman. Back in 1945, it was 113 percent.35
That was also the year that America made Hiroshima and Nagasaki the first and to date only recipients of the world’s newest and most devastating technology. That’s a helluva bang for the buck. The America sliding ever faster to that 1945 debt burden and way past it has no such credibility—and, as every two-bit nationalist provocateur in any old dusty colonial backwater will tell you, for a superpower, credibility is essential. America hit 113 percent after a world war in which it vanquished mighty enemies of global reach and established itself as the dominant power on the planet.
What do Americans have to show for the debt this time ’round? Cash-for-clunkers? Stimulus funding for a stimulus-funding application-coordinator in Idaho? Take Your Child Bride to Work Day in Afghanistan?
As to worshipping false gods, even avowed secularists have their moments of evangelical fervor. There have been two competing theories at play in the twenty-first century. The first and better known is “globalization”—which is less a theory and more a religion with universalist claims.
To its worshippers, globalization is some kind of mysterious metaphysical force that’s out there remaking our assumptions about the planet. May the Force be with you—because, if it’s not, you’re just a squaresville daddy-o receding in the rear view mirror of history. The high priest of this cult is the New York Times’ in-house thinker and beloved comic figure Thomas L. Friedman. Hardly a week goes by without the Times’ most frequent flyer filing from a state-of-the-art departure lounge on the other side of the planet and marveling at its complimentary wi-fi, light-rail link, and the way his luggage was brought in by cheery native bearers in traditional dress playing some raucous Abkhazi-Nauruan hybrid of Gamelan gangsta rap on an affordable new xPod-iBox you can wear under your sarong made at a state-of-the-art plant by a small Uighur start-up backed by a Herzogovine hedge fund. All of which makes a forlorn contrast with the scene that greets him when he lands back at Newark.
The United States has two roles in a “globalized” world: it funds the transnational bodies, it keeps the sea lanes open, it’s there when an earthquake or tsunami strikes—at least until the debt and politically untouchable social programs necessitate sweeping cuts in military capability. Which, for great powers in decline, they always do.
That’s America’s first role. Its second is just as important: the burgeoning middle classes of China, India, and elsewhere improve their lives by making stuff to sell to us. America’s government is the guarantor of global order; its people are the guarantors of global prosperity. That’s the United States the world needs: in security terms, the order maker; in economic terms, the order placer.
Unfortunately, neither role is sustainable. America is on course to be the first great power in history literally to shop till we drop. And the way to bet is one hell of a drop, and sooner than you think.
“Globalization” has the appeal of all inevitablist theories: it’s gonna happen. Why? It just is. Don’t sweat it. Likewise, Francis Fukuyama and The End of History: No nation can resist the pull of western liberal democracy, and so one day the entire planet will be Sweden and there will be no more wars. These days, even Sweden isn’t Sweden. Ask a Jew in Malmö, if you can find one.
Against this globaloney is the thesis put forward by the late Samuel Huntington in The Clash of Civilizations. Huntington’s view is less appealing because it’s less sedating. Globalization asks nothing of us, whereas the clash of civilizations puts a cold hard question mark over the future. Huntington posits that cultural identifiers count for more than economic ones.
A man in a factory on the other side of the world may make parts for an electronic gizmo Thomas Friedman plays with while waiting for the VIP lounge to call his flight, but that does not mean they share anything like the same worldview. It seems sad to have to point out something so obvious.
Which, after all, is more central to a man’s identity? The fact that he makes trinkets for Thomas Friedman? Or the fact that he’s an Indonesian Muslim?
In 1996, Huntington identified ten world civilizations, including three major ones—western, Muslim, and Sinic.36 A decade and a half on, China—the Sinic power—is on the rise economically but is demographically weak, while Islam is surging demographically but is economically irrelevant, except for that portion of the Muslim world that sits on oil it needs foreigners to extract. Meanwhile, the West is in steep decline both economically and demographically. And as western civilization was the indispensable component in the construction of the modern world, that raises a question: What comes next?
Which brings us to the third line of the warning to Belshazzar, the geopolitical writing on the wall. Not a lot of Medes around these days, but the Persians are still in business, and the nuclear mullahs are eager to advance the finishing of the Great Satan and divide up what’s supposed to be a “unipolar” world. North Korea is assisting the Iranians with their delivery systems, and the Iranians are promising to share their nukes with Sudan. Far from Obama’s plea for “a world without nuclear weapons,” we face the prospect of a planet in which the wealthiest societies in history, from Norway to New Zealand, are incapable of defending their borders, while impoverished Third World basket cases go nuclear.
How long do you think that arrangement will last? As the Medes and Persians did to Belshazzar, the Russians, the Chinese, the new Caliphate, and others are looking forward to carving up the western world.
When money drains, so does power. The British learned that the hard way, even as theirs drained to the friendliest of successor powers across the Atlantic in Washington. Today, money is draining across the Pacific. They have our soul who have our bonds. Just as America had Britain’s money, so China has America’s. How will it use it to advance its power and influence?
What might prompt the threat of a little economic blackmail? American action against North Korea? Washington’s support for Taiwan? China is dangerous not (as many argue) because of its strength but because of its weakness. As I wrote in America Alone, the People’s Republic has a crude structural flaw: thanks to its disastrous one-child policy, it will get old before it gets rich, and, unless it’s planning on becoming the first gay superpower since Sparta, the millions of surplus young men whom the government’s One-Child Policy has deprived of female companionship is a recipe either for wrenching social convulsions at home—or for war abroad, the traditional surplus inventory-clearance method of great powers. That’s actually worse news than if China was cruising to uncontested global hegemony—because it means that Beijing’s calculations on how the Sino-American relationship evolves are even less likely to align with ours. China has to maximize its power before demographic decay sets in. In other words, it has strong incentives to be bold and to push, hard and fast. And, when it happens, Washington will be taken by surprise by something that was entirely inevitable.
Faced with a choice between unsustainable entitlements and maintaining armed forces of global reach, the United States, as Europe did, will abandon military capability and toss the savings into the great sucking maw of social spending. That, in turn, will make for not only a more dangerous world but a more vulnerable America that, to modify President Bush, will wind up having to fight them over here because we no longer have the capacity to fight them over there.
For Americans, the best-case scenario is that Washington’s ruling kleptocracy sleepwalks its subjects into smaller homes, smaller cars, smaller lives, and soft despotism so beguilingly they don’t notice it’s over until late in the day. A more likely prospect is a catastrophically convulsed America that descends into Balkanized ruin and social collapse on a planet with no global order in which the former hyperpower still makes the most inviting target.
What? You wanted a happy ending? Well, you’re going to have to make that happen—because, without fundamental course correction, there is only the certainty of disaster, and a step-by-step descent deeper into the abyss:
A is for ADDICTION
We spend too much, borrowing from the future to such an extent it’s no longer clear we’ve got one.
R is for REDISTRIBUTION
Day by day, an unprecedented transfer of wealth from the productive class to the obstructive class is delivering a self-governing republic into rule by regulators, bureaucrats, and social engineers.
M is for MONOPOLY
Old ruling class: “We the People.” New ruling class: “We the People who know better than you frightful people….” America is ruled not by a meritocracy but by a cartel of conformicrats imposing a sterile monopoly of outmoded ideas.
A is for ARTERIOSCLEROSIS
“Yes, we can”? No, we can’t! By comparison with the past, America is already seizing up.
G is for GLOBAL RETREAT
As Britain and other great powers quickly learned, the price of Big Government at home is an ever smaller presence abroad. An America turned inward will make for a more dangerous world.
E is for ENGINEERING
“Celebrate Diversity”? The ideological homogeneity and social engineering of the nation’s schools would be regarded as child abuse in any other age. Aside from its other defects, it diverts too many Americans into frivolous unproductive activity, while our competitors get on with the real work.
D is for DECAY
Mired in dependency and decline, much of the United States will be on a fast track to the Third World. And, no matter how refined the upscale communities the elites retrench to, it will prove increasingly impossible to insulate yourself from the pathologies a decadent liberalism has loosed to rampage Godzilla-sized across the land.
D is for DISINTEGRATION
We are becoming the highly singular United State of America.
No advanced society has ever tried hyper-regulatory direct rule for 350 million people. Will it work? Or is it more likely that increasingly incompatible jurisdictions and social groups will conclude that the price for keeping fifty stars in the flag is too high? Without the American idea, there will be insufficient glue to hold the United States together.
O is for OPEN SEASON
Do you find it hard to imagine a world without America? The Russians, the Chinese, and the would-be New Caliphate don’t.
And on a planet where rich passive nations are defenseless while every failed state from North Korea to Sudan is butching up, it’s not hard to figure out what comes next.
N is for NUKES AWAY!
Addiction, Redistribution, Monopoly, Arteriosclerosis, Global retreat, social Engineering, Decay, Disintegration, Open season, Nukes away. Put them all together, they spell…?
From Big Government to busted government, from federally regulated school bake sales to Armageddon—in nothing flat.
Look around you. From now on, it gets worse. In ten years’ time, there will be no American Dream, any more than there’s a Greek or Portuguese Dream. In twenty, you’ll be living the American Nightmare, with large tracts of the country reduced to the favelas of Latin America, the rich fleeing for Bermuda or New Zealand or wherever on the planet they can buy a little time, and the rest trapped in the impoverished, violent, diseased ruins of utopian vanity.
“After America”? Yes. It will linger awhile in a twilight existence, arthritic and ineffectual, declining into a kind of societal dementia, unable to keep pace with what’s happening and with an ever more tenuous grip on its own past. For a while, there may still be an entity called the “United States,” but it will have fewer stars in the flag, there will be nothing to “unite” it, and it will bear no relation to the republic of limited government the first generation of Americans fought for. And life, liberty, and the pursuit of happiness will be conspicuous by their absence.
On the other hand:
The United States is still different. In the wake of the economic meltdown, the decadent youth of France rioted over the most modest of proposals to increase the retirement age. Elderly “students” in Britain attacked the heir to the throne’s car over footling attempts to constrain bloated, wasteful, and pointless “university” costs. Everywhere from Iceland to Bulgaria angry the mobs besieged their parliaments demanding the same thing: Why didn’t you the government do more for me? America was the only nation in the developed world where millions of people took to the streets to tell the state: I can do just fine if you control-freak statists would shove your non-stimulating stimulus, your jobless jobs bill, and your multitrillion-dollar porkathons, and just stay the hell out of my life and my pocket.
That’s the America that has a fighting chance—a nation that stands for economic dynamism, not the stagnant “managed capitalism” of France; for the First Amendment and the free-est, widest, rudest bruiting of ideas, not Canadian-style government regulation of approved opinion; for self-reliance and the Second Amendment, not the security state in which Britons are second only to North Koreans in the number of times they’re photographed by government cameras in the course of going about their daily business. But when you hit the expressway to Declinistan there are few exit ramps. That America’s animating principles should require a defense at all is a melancholy reflection on how far we’ve already gone. Live free—or die from a thousand soothing caresses of nanny-state sirens.
Like I said, if you want a happy ending, it’s up to you.
Your call, America.
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