Bankruptcy of superpowers and paths the US empire may follow in decline

Empowering Weak & Oppressed

Perwez Shafi

Dhu al-Qa'dah 02, 1429 2008-11-01

Special Reports

by Perwez Shafi (Special Reports, Crescent International Vol. 37, No. 9, Dhu al-Qa'dah, 1429)

The days of the American empire are over; even US elites are writing its obituaries. The world Capitalist System was established on such factors as greed, living beyond means, using other people’s wealth, compound interest and a rigid focus on short-term profit. The conservative Republican writer and policy analyst, Doug Bandow, author of several books and Fellow at the American Conservative Defense Alliance, who also served as special assistant to President Ronald Reagan, wrote:

“The American empire is kaput. Neither John McCain nor Barack Obama realizes that fact yet, but the myth of the omnipotent unipower, the essential nation, the country which declares that what it says goes, has been exposed to all. The Iraq debacle sullied Washington’s reputation, but did not destroy the illusion of American indispensability. Assorted politicians, like McCain and Obama, promised to restore US primacy, either through more bluster or better diplomacy. But the financial crash has wrecked the economic basis of America’s imperial pretensions. Washington simply can’t afford to attempt to run the world any longer.”

Even German Finance Minister Peer Steinbruck stated bluntly on September 26: “The US will lose its financial superpower status in the global financial system.” Similarly, British political philosopher, John Gray, wrote in The Observer that the world is witnessing “a historic geopolitical shift in which the balance of power in the world is being altered irrevocably.” He went on: “The era of American global leadership, reaching back to the Second World War, is over.”

For any country, even a relatively small one, to become an empire it must have the necessary economic and military pre-requisites. Exercising the right to protect one’s economic, political, human and social or even defense interests is natural but when it encroaches on others’ rights, especially exploiting them and their resources as well as dominating them in the process that problems emerge. Dominating others becomes an expression and extension of power. Hence it becomes a hegemonic or imperialist power.

Like disease, imperialism also seeks to expand, and extend its power and domination over others to gain control of or influence, directly or indirectly, over their socio-political and economic life. Even a minor incident anywhere in the world immediately becomes a matter of pride and a “national security” issue for the empire. As it extends its commitments globally, the resources available to discharge its imperialist ambitions shrink. This is the classic overstretch which may be maintained or lengthened through various means but decline and collapse hasten or become inevitable when a determined adversary refuses to give up resistance to imperial designs.

The Soviet Union and the US were both broke in the 1980s

It is interesting to note that both the Soviet Union and the US were broke by the end of 1980s due to their Cold War rivalry as they carved up the world into their respective “spheres of influence” or “occupation zones” whether in Eastern or Western Europe or parts of Asia and Africa. In their scramble to grab others’ resources both headed toward bankruptcy and hoped the other would collapse first.

With massive hemorrhaging in Afghanistan the Soviets ceded defeat first. They relinquished their empire and gave up not only the far-flung zones of occupation and influence but also the contiguous mainland states in order to save the core: Russia. As in the period between 1917 and 1924, Moscow thought this would be a stopgap measure and these states would be re-integrated when conditions are conducive. The European parts became “independent” while the Muslim Central Asian states were left to the non-existent mercies of communist bosses from the Soviet era.

Soviet humiliation and defeat in 1991 made the West, especially the US euphoric. Thumping its chest the West proclaimed victory and boldly declared the “End of History”. Many somber Western scholars, however, merely heaved a sigh of relief that the Soviet Union had collapsed first because their own economies were as precarious as that of their erstwhile adversary. The signs and symptoms of American decline were there for those who cared to see. The voices of concern, however, were drowned in the frenzy of euphoria over the demise of the Soviet Union although the US also had accumulated trillions of dollars in debt and was heading for bankruptcy.

The economic bubble in terms of national debt was growing in America for the last two decades. China, Japan and the Middle Eastern Sheikdoms lent huge sums of money but since they were not going to demand payment against worthless American IOUs and Treasury Bills, as they were also part of the same corrupt global capitalist financial system, the crisis was delayed. When George Bush became president, America had already accumulated a debt of $5.8 trillion dollar. Each time the US was close to defaulting on its debt, according to its own debt watch website, Congress would quietly raise the public debt ceiling which permitted the printing of more US dollars. On one such occasion in January 2006, when the US government crossed the spending cap of $8.18 trillion and was technically bankrupt, the economist Dr. Chris Martenson sounded the klaxons and wondered over the criminal silence of the media: “But the silence is all the more troubling because there is an unprecedented level of government borrowing on the books for 1Q06 [First quarter of 2006] with next 2 weeks (Feb 1st to Feb 9th) an especially busy period of time. An ambitious $70-$80b in Treasury paper will hit the market.” He suggested emergency congressional action was needed to avoid a full-fledged default.

Using the latest figures, Doug Bandow said: “Even before the economic crisis spiraled out of control, the US government was effectively broke. The national debt currently stands at $9.8 trillion, up $4 trillion (about 72 percent) since George W. Bush took office. With the pre-bail-out federal deficit in 2009 expected to hit a half trillion dollars, earlier this year Congress upped the debt ceiling to $10.6 trillion. But truly frightening are the many liabilities yet to come due. Uncle Sam is an extraordinary wastrel and soft touch, like the person who cosigns notes for relatives, buys rounds of drinks for his friends, and promises everyone he knows that he'll take care of them."

Thus to ease out of the debt limitation restrictions the US government pushed the debt ceiling upwards, borrowed more money globally and used unusual and immoral practices like “shuffling money among government pension funds to finance operations” and borrow more against non-existent funds. Banks and other financial institutions had already perfected this practice, eventually leading to the collapse.

Besides financial mismanagement and jugglery that keeps creating money out of thin air, other measures taken by the Bush administration were to launch pre-emptive strikes to control global resources and access routes. In an era of dwindling energy reserves and realizing cracks in the empire, Bush launched an offensive using the September 11, 2001 attacks as a pretext to shore up the empire. This was euphemistically called the “war on terror”. The basic strategy was simple: to create an enabling environment for US intervention and direct control by creating chaos, wars, drought, intrigues and socio-economic unrest. Since Muslims have most of the resources, the so-called war on terror is primarily a war against Islam and Muslims.

Soon after the collapse of the Soviet Union in the early 1990s and intoxicated by the euphoria of victory, the American zionists had already set their sights on occupying Iraq when neither Osama bin Ladin nor Taliban was in the picture. They set up the Project for the New American Century (PNAC) in 1997 that became the first body to publicly call for Washington to pursue regime change in Iraq by military means and openly lobbied Congress to exert pressure on the government to pursue this agenda. But more important was the PNAC letter of September 20, 2001, signed by 38 members, most of them zionists, sent to Bush just nine days after 9/11. In addition to calling for the ouster of the Taliban and war on al-Qaeda, the letter also called for a broader and more ambitious “war on terrorism” that would include cutting off the Palestinian Authority under Yasser Arafat, taking on the Hizbullah, threatening Syria and Iran, and, most importantly, ousting Saddam Husain regardless of his relationship to the attacks or al-Qaeda.

Seven months later, the PNAC issued another letter signed by many of the same people urging Bush to step up preparations for war against Iraq, sever all ties with the Palestinian Authority under Arafat and give full backing to then Israeli Prime Minister Ariel Sharon’s efforts to crush the Palestinian Intifada. But the momentum for war against Iraq was slow in building. Since this could not be accomplished in one step it needed a better pretext to go into the Middle East, especially Baghdad. With 9/11, Taliban and Osama bin Ladin became easy targets that generated enough war euphoria to continue the march on Baghdad. As Bandow has said: “The Iraq war continues. Nearly $600 billion so far have been wasted on Bush’s folly, and the total cost will exceed $2 trillion, according to the Congressional Budget Office, and maybe $3 trillion or even more, if [economists] Joseph Stiglitz’s and Linda Bilmes’s numbers come true.”

The $12 billion a month expenditure on Afghanistan and Iraq wars, and financial mismanagement at home were the last straws and both were managed or mismanaged by the zionists. Finally when the world capitalist system reached its logical limit it collapsed on its own like a house of cards. It was inevitable that the American Empire would also decline and collapse.

Paths to American decline

The question is, what form or shape the decline of the American empire would take? Whether the whole empire has to be given up or some parts of it to make a truncated empire more efficient and manageable? There are three possible paths a declining empire can take to reduce its costs and global burden. The real question is how much of the empire and how much of the core—the continental USA—the Americans want to save?

The first and most extreme path is a complete breakup, like the Soviet Union. The Soviet leadership replaced everything: ideology, national anthem, political and economic structures, relations with powers of the world and gave up an entire way of life. Communist values, beliefs and norms were replaced with those from Czarist Russia or even borrowed from the West with greater emphasis on Russian nationalism. All territories around Russia were let go to ease the financial burden thus saving the Russian core.

Similarly to pay back its lenders the US may have to give up its overseas military bases and sell all the equipment. It has to relinquish its role as a global policeman but that will not be enough. Louisiana might be sold back to France; California, New Mexico, Nevada and Arizona to Mexico. Worse, Mexico could seize these territories because wounds of the 1848 war imposed on Mexico in which these territories were illegally occupied are not fully healed yet. Russia has not forgotten the forced sale of Alaska and is willing to buy it back.

However, this may not be easy. In selling any of the above territories, the Native Americans might block such sales as they are the original inhabitants and owners of the land. The oppression and exploitation perpetrated against African-Americans is still a bleeding wound; they might also demand some land where they could be in the majority.

The US could drastically curtail its defense expenditure from the current $626 billion and bring it closer to Russia’s $50 billion. This would involve closing the 750 US bases worldwide and bringing the troops home from over 100 countries. The penchant for exotic weapons would have to be given up as well. All this might save the core, the continental USA east of Mississippi as was originally handed to the British colonies, but with a new name and ideology. This would be akin to the dismemberment of the Soviet Union.

The other extreme—the second path—is that somehow all the technical and financial measures might just succeed and the empire would remain intact except for shedding some of its global responsibilities. After paying minimal costs and a few years of retrenchment and economic crisis, the empire could be rejuvenated. Thus, after the initial trauma not only the empire but more importantly, the continental USA is saved as well. Momentum is building for a fresh dose of economic bailout package in addition to the $700 billion already approved by Congress to weather the crisis. The hope is that the recession or even a depression would be short-lived. The zionists are still preaching that even now both the core and the empire can be saved.

This is unlikely to happen and may be based on a superficial study of the financial meltdown and its worldwide effects. This view treats the symptoms and not the root causes and shows ignorance of the scale of the problem. In this view, whether naive or deliberate, the problem is considered as merely financial in nature that could be rectified by taking some remedial measures. In other words, closing a few unnecessary bases and recalling some overseas troops home, some reduction in defense and domestic budget, plus more financial bailout packages would suffice to keep the empire intact. The zionists in and out of government who have played havoc with US resources and policies earning global notoriety, are now telling Americans not to worry; both the US and its empire can be saved. But the financial resources available are far smaller than those required to dig it out of the hole or maintain the burden of empire. At the same time, the destroyed social fabric of society and the frail structural and moral foundations of institutions mean that revival of empire is mere wishful thinking.

The third path, which falls somewhere between the two extremes—the complete dismemberment of the empire and the US, or saving both at nominal costs—the trade off would be between the empire and its core. The third path is more realistic based on experience of the European colonial powers. Even saving the entire core may not be possible; some parts may have to be let go. In all colonial cases, whether Spain, the Netherlands, France, Portugal or Britain, they tried to save the core and reluctantly gave up the empire or were forced to abandon it. Saving Russia was more costly; not only the Soviet empire was abandoned, a number of countries and regions also gained independence from the core. So here the main question is: how much of the core can be saved after abandoning the US empire?

Several US analysts have expressed the hope that the entire continental USA can be saved by abandoning the empire. According to them when people are faced with a choice between their health, education and pension or maintaining empire, they would definitely choose the former. Faced with such stark choices, people do not care about the empire’s security problems in far off places like the Balkans, Darfur, the Korean Peninsula, Kuwait or Latvia and Lithuania. Some US analysts want to pursue this path in hopes of saving the entire core. Influential conservative Republican Patrick J. Buchanan in an October 14 column titled “Liquidating the Empire”, speculated what would go under the axe:

“Social Security and Medicare are surely exempt... Medicaid and food stamps are untouchable. Interest on the debt cannot be cut. It is going up. Will a Democratic Congress slash unemployment benefits, welfare, education, student loans, veterans’ benefits – in a recession? No way. Yet, that is almost the entire US budget–except for defense, the wars in Afghanistan and Iraq, and foreign aid. And this is where the axe will eventually fall. It is the American Empire that is going to be liquidated.”

He continued about how much of the core i.e., the entire USA, should be saved by no longer taking responsibility for guaranteeing the security of other countries:

“And, to be perfectly blunt, who cares if they [Bosnia and Kosovo] become real countries? We should be concerned about the mistreatment of people everywhere. But Washington has demonstrated no competence in setting foreign nations right, and ivory tower humanitarians have no right to risk the lives of our brave servicemen and women in the name of a glorious crusade for democracy in Mesopotamia, the Balkans, Caribbean, Africa, or anywhere else. War truly must be a last resort, which means no resort at all unless American society truly is at risk in some fundamental way. No wars of choice or convenience, no matter how easy and cheap they appear likely to be.”

So as long as no one threatens the security of continental America, the US would not care about obligations of the empire. But is it realistic to assume that the entire continental America could be saved?

As mentioned earlier, the cost of maintaining the empire on an ongoing basis year after year is huge compared to financial bailout packages and other costly measures. Therefore, the cost has to be taken out from the empire as well as the core. In other words, after discarding the trappings of empire, closing bases, recalling troops home, drastic reduction in defense budget, more financial bailout packages, technical and financial measures would be sufficient to save the pre-World War II continental USA which sits happy, aloof and isolated from events in the world. From that point, it may one day again aspire to become a big power or even an empire.

This rosy scenario may still become reality. The exact portion of core area chopped off depends on numerous factors and conditions that are difficult to predict at present. It is possible that the US might save two-thirds of its core—everything east of the Colorado Rocky Mountains—and everything west of it has to be put up for sale to whom it owes debt. The Chinese may be interested in buying the northern west coast to retire its debt, and the Southwest—the five states Arizona land–may be legitimately claimed back or given to Mexico to avoid flooding the US with Latino immigrants. Hence, some portion of the core has to be sacrificed to save the rest, almost like severing a limb to save the body.

Sometimes even the best conceived plans go awry. Additionally, there is still reluctance to find out the real scope and depth of the financial crisis to save the role of wealthy bankers, large capitalist investors and zionist manipulators who benefited before and after the crisis. The solution proposed would not work if the scope of the problem is not fully known.

Social cohesion and fault lines

In all these scenarios, the values and social cohesion have not been discussed which come under severe pressure during times of crises. Events could go out of control when people’s interests and values are at stake. Drastic cuts in social programs and defense expenditure may lead to civil and social unrest, chaos and breakdown of society. This explains the sudden powers granted to the president to deploy troops on mainland United States to control crowds in case of massive unrest. Besides, there are numerous fault lines in the US. One is based on race and color that runs throughout US society. The reaction of African-Americans to various cutbacks may be different than that of Native Americans or Latinos. Anglo-Saxons of the East Coast may feel threatened differently than mid-westerners of German ancestry.

Another fault line runs parallel to the length of the country from Washington, DC, to San Francisco that divides it into North-South. In 1860, 11 southern states seceded from the US on the question of continuing slavery. After five years of Civil War that killed millions, the industrialized North defeated the agrarian South. The Southerners have not forgotten the bloodshed and humiliation and they still fly their confederacy flag on their public buildings—a symbol of the act of remembrance and defiance—along with the US flag. Any financial and economic pressure resulting in social breakdown might open up the North-South divide.

In the end it will depend on the US elite’s ability to adopt the right solutions and implement them, giving up on imperial ambitions and a willingness to work with multilateral institutions. But since it will be a great shock psychologically to be brought down from superpower status to an ordinary country, mistakes will be made and social unrest may follow in addition to other unknowns. Other powers might nibble at the core so it does not again become a threat in the future. Only time and conditions will tell how much of the core Americans are able to save.

For Muslims the fundamental question is whether the decline and collapse of superpowers would automatically lead to a renaissance and resurgence of Islamic civilization? The sad truth is it will not. Renaissance and resurgence depend on other factors. These can be summarized as resistance to foreign occupation and ideological domination; rediscovering the roots of Islam and re-evaluating re-assessing and reconstructing Muslim philosophical and historical evolution by discarding the baggage of malukiyya.

(Dr. Perwez Shafi is Director, Institute of Contemporary Islamic Thought, Pakistan).

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