The US badly needs its European allies to help redress its loss of balance and stem the haemorrhaging of its international clout Barack Obama's $3.8tn budget is a vastly complex affair. But one fact stands out plainly: in layman's terms, America is broke. The federal government's outgoings will exceed income by about $1.6tn this year; over the next 10 years combined, the predicted gap is $8.5tn. Given the partisan impasse on Capitol Hill over spending cuts and higher taxes, there is no reason to assume matters will improve any time soon. Obama suggested this week that such mind-boggling improvidence is unsustainable, economically and even morally. But continuing, chronic American financial vulnerability also carries increasingly serious implications for US global influence and its standing as the world's only superpower. In short, the deficit, and the mindset that produces it, begin to threaten the post-1945 security architecture. The western world has been here before. In Asia, Africa, and the Middle East after the second world war, the US extended its geopolitical pre-eminence and market dominance, filling a vacuum where the exhausted British and European empires once held sway. Facing serious competition only from the Soviet Union, America supplanted the "old world" and took control. The end of the cold war entrenched its global grip. Now the wheel turns – and it is the US that is coming down with a bump. In prospect is America's "east of Suez" moment, when imperial Britain was forced to recognise it could no longer afford to project its power into every corner of the globe. Washington's still pre-eminent military might is increasingly unmatched and undermined by its economic performance and, arguably, by its political leadership. As Obama noted in his West Point speech on Afghanistan, the US can no longer finance open-ended wars. The end of the American empire has long been foretold. But it's not hubris or hostile action that brings it low. It's a lack of readies, meaning unpaid, high-interest, foreign-owned debt, and an unaffordable lifestyle. And unlike the postwar period, when a Europe with common interests, a broadly similar political outlook, and shared values passed the security baton to the US, America has no like-minded, amicable successor to turn to as its own power fades. Quite the opposite, in fact. China, the country most likely to replace the US some time this century as the world's top dog, has sent blunt signals in recent months indicating how very different a post-American world will look. At Copenhagen, by many accounts, it played spoiler against the developed world, deliberately humbling Obama. It made political advantage, not climate change, the most pressing issue. Beijing's deliberately disproportionate reaction to the latest US arms sale to isolated Taiwan, its noisy objections to any meeting between Obama and the Dalai Lama, and its blatant use of internet censorship and broad disregard for international human rights norms highlight disturbing differences in priorities and attitudes. China's rapid military buildup, its appeasement of Iran's energy-rich, nuclear-suspect regime, its exploitative development and resource policies in Africa, and its unfair trading and currency practices are strategically more destabilising. All this suggests a government ruthlessly on the make, determined to exploit perceived weakness in Washington and increasingly prepared to act in direct opposition to western security and political interests. Accumulated US public debt of $7.5tn, much of it held by China, was heightening American vulnerability in the face of such challenges, saidWall Street Journal columnist Gerald Seib. "The US government this year will borrow one of every three dollars it spends, with many of those funds coming from foreign countries," he wrote this week. "That weakens America's standing and its freedom to act; strengthens China and other world powers, including cash-rich oil producers; puts long-term defence spending at risk; undermines the American system as a model for developing countries; and reduces the aura of power that has been a great intangible asset for presidents for more than a century." Obama isn't cutting defence, not yet at any rate. And some argue that a world not girdled by American military bases, embassies and trade missions would be a better place. But it might not be a safer one. It would almost certainly be less compatible with western democratic standards and value systems. These are powerful reasons to invert former British prime minister George Canning's famous 1826 call to bring "the new world into existence to redress the balance of the old". On present trends, Obama's America badly needs the allies of "old world" Europe to help redress its loss of balance and stem the haemorrhaging of its international clout. With wolves at the door, the transatlantic relationship, often dismissed as moribund and unimportant under George Bush and Obama, may be coming back into its own. Obama does not seem to realise this yet, with the state department announcing this week, for example, that the president will not attend a US-EU summit in Spain in May. Give him time. As the bills pile up and threat levels rise, America may remember who its real friends are.America is broke, and needs its old friends
Wednesday, 3 February 2010
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