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Tuesday, April 2, 2013

The Topsy-Turvy Life of Recent American Declinist Claims: The 5th Time It's Happened

Today's Buggy Topic

It's found here as RealClearWorld --- an outstanding twice daily blog full of links to international relations. Note too, once you're online there, there are lots of other RealClear categories at the top: on US politics, markets and economics, defense (yes, though you may have to run a google search for RealClearDefense), policy, energy, technology, science, history, and religion.  Far and away, in prof bug's opinion, these Real Clear-offerings add up to the best site for up-to-date news and analyses pm all these topics . . . thanks to hundreds of links to various media sources and some original work.

More Specifically, For Today's Topic . . .

Is found in Buggy's lengthy reply to Dr. George Friedman's praiseworthy post on how the US remains the primary global power on all indices --- whether military power of all sort, or economic revival and percapita income, or technological innovation, or growing domestic energy sources, and so on --- do little more, that reply, than add some omissions in Dr. Friedman's wide-ranging persuasive analysis. Something else. You''ll likely profit reading all of Dr. Friedman's posts; they're, found weekly or so at RealClearWorld. He himself holds a Ph.D. from Cornell and is the head of the impressive Stratfor Global-Intelligence Institute.

And note: there are other good analytical studies that his institute produces, all highly recommended.

Keep In Mind Something Else: Worries (or Hopes) for American Decline --- all depending on the countries and the political views of pundits making the pronunciamentos ---Are Over 50 Years in the Making

These declinist dictums, delivered in ex-cathedra ways, have surged for years in duration, off and on, over a good five times since the mid-1950s . . . roughly one a decade. And would you believe it? Each time they have proved wrong.

Specifically:

  • In the late 1950s, after the Soviet Union sent its Sputnik earth-satellite into outer space in 1957 --- a few years before the US sent its first space-satellite into orbit. There followed fears, widespread, of a growing Soviet dominance in nuclear-missiles, economic growth and innovation, American educational decline ("Johnny couldn't read as well as Ivan"), and the Cuban missile conflict of 1962. The end of these first and second declinist dicta--- a dangerous satellite gap, a growing nuclear gap --- was reached in 1969 when the US landed men on the moon.

 

  • The third declinist claptrap burst into endless media chatter in the late 1970s, toward the end of the dismal Jimmy Carter presidency. The US was now in irreversible economic decline, compared to Japan and Germany and the growing EU. Its Carter-adminstration couldn't even mount a successful rescue mission of the hostage-captives in the new radical Islamist Iran; and worse yet, American intervention in Vietnam had ended in disastor the US. A British scholar at Yale, surveying the rise and fall of Great Powers since the Middle Age, added his own biased, noticeably exaggerated analysis to the media and political chatter.� Only Japan and the Rhineland countries in Europe --- Germany, France, Belgium, and Netherlands --- had the necessary large statist-economy and educational wherewithal to become the front-runners in global influence.

Then the Reagan era again reversed the declinist rhetoric. During the next 8 years, the US increased its economic lead in the OECD --- the organization that included all the democratic advanced countries in its membership. The Soviet Union crashed.� Communism everywhere crashed, except in Cuba and North Vietnam . . . China's post-Mao economy opening up, after 41 years of mass murder on a vast scale and endless economic stagnation.

Click the continue button below:

  • Enter the fourth declinist-surge: With the end of the cold war in 1990-91, the US was in recession as Germany united and Japan hadn't yet tumbled into nearly two decades of stagnation. So the winners of the cold war? Not the US. Rather, according to left-wing pundits everywhere --- not least in the USA --- the winners were Germany and Japan. Actually, over the next 10 years, both countries recorded the worst economic performance of industrial output in the advanced world since the Great Depression. The US, by contrast, underwent its longest period of extended GDP growth in its history, not to mention that its new powerful innovative firms had initiated the radical changes in economic life wrought by the Internet. In the upshot, 75% of the Fortune 500 firms in the US in 1999 hadn't even existed in the mid-1970s. The equivalent changes in German and Japanese corporations over that 25 year period? Essentially, nada.

  • The latest extravagantly exaggerated decline-claptrap has gushed since the start of the Great Depression in late 2007. The US, it was now said, had wasted its post cold-war Hyperpower-status by virtue of its failures in Iraq and more recently Afghanistan. It was becoming just another super-power worldwide as it had been in the cold-war, or much worse---a has-been former great power overloaded with government debt and slow GDP growth and Obama's new welfare-state programs. And true enough, at first glance, US federal debt is unusually high --- over 100% of GDP these days, at roughly 17 trillion dollars. But note, about 42% of that debt isn't of the public-sort, owed to private parties here and abroad as well as to foreign government. It represents instead intra-governmental transfers out of the US social security-surplus to other parts of the government. And that surplus is projected to exist even without changes for two more decades.

Some Clarification (Necessarily Truncated):

In the meantime, to continue our brief survey of US federal debt, it should be fairly easy to raise the cap on taxes for social security above its existing level of about $114,000, while simultaneously increasing incrementally existing payments by the working force from 6.2% of income to 7.2%. . . the latter policy found in a recent national-survey to have the approval, believe it or not, of 74% of Republicans and 88% of Democrats. Raising the cap itself --- approved in the survey by 68% of the public --- would over the next decade nearly wipe out all shortfalls. When presented with specific proposals, 69 percent of all respondents favored a gradual one percent increase in the Social Security tax paid by workers and employers (from 6.2 percent to 7.2 percent over twenty years), and 68 percent favored eliminating the cap on taxable income. Not that raising the cap on taxable income --- while excluding dividends and capital gains --- would by itself practically wipe out the entire projected shortfall in Social Security funds two decades hence.

Oh, and note that at about 75% of GDP, US federal debt is far lower than in Germany (80.5%), Japan (218.9%) and France (89.1%) as of 2012. And though pubiic debt is lower (38.9%), that excludes huge debts that local governments owe to the public and especially state-owned banks.� Obtaining accurate official data isn't possible in that country, but almost all experts in China and abroad agree that the total public debt would be near or over 100% of GDP.

As for declining military budgets that both Democrats and Republicans have agreed on for the next several years will hardly cripple American ability to project military power anywhere in the world . . . especially since our political leaders and defense-oriented elites in the public and private spheres have, fortunately, learned the lesson that it's folly to try transforming Arab, and more generally, all Muslim societies: invariably tribal in nature and now torn apart into violent domestic conflict in Tunisia and everywhere south and east of that small country, whether in Africa, the Middle East, Afghanistan, Pakistan, the former Soviet Union Muslim countries, and those in Southeast Asia all the way to Indonesia. Ditto non-Muslim African countries. There will always be a need for an army and its armor, but increasingly our projected military power will rely on helping allies and friendly countries with military transfers, military advisers as well as on the use, if need be, of air and naval power, special forces, and drones and other precisely delivered weapons.

Which, to end these comments, brings us to China's threat. And, it turns out, there's no need to say more here. Both Friedman and buggy's lengthy reply deal effectively, if tersely, with that country's self-made entanglements --- economic, diplomatic, and military.