by Frank James
Finally someone has something positive to say about the Great Recession we're currently in.
Walter Russell Mead, the Council on Foreign Relations scholar, argues in an insightful New Republic piece that while the recession is causing severe stress for the American economy, it will ultimately inflict more damage on the U.S.'s rivals and adversaries.
His thesis, in a nutshell, is that because of the size, strength and diversity of the U.S. economy, it will eventually emerge with its form of capitalism renewed as it has after numerous economic calamities throughout history. And as Great Britain did before it.
But nation's like Iran, Russia, China, Venezuela and Saudi Arabia will face real problems. Most of those on the list will suffer greatly because of their over reliance on energy exports for their revenues during a time of falling demand.
In China's case, it will be because the significant decline in demand for Chinese goods will hurt that nation's revenues to such a degree that it may be forced to turn inward because of growing domestic unrest, reducing its desire or ability to project its power beyond its borders.
An excerpt:
Countries like Russia, Venezuela, and Iran, which hoped to use oil revenue to mount a serious political challenge to American power and the existing world order, face serious new constraints. Vladimir Putin, Hugo Chavez, and Mahmoud Ahmadinejad must now spend less time planning big international moves and think a little bit harder about domestic stability. Far from being the last nail in America's coffin, the financial crisis may actually resuscitate U.S. power relative to its rivals.
But Mead doesn't believe this is any cause for gloating by the U.S. Just the opposite. He notes that the kind of instabilities triggered by economic crises like the one the world is currently experiencing often set the stage for international violence.
Another excerpt:
... Developing countries and countries where capitalism has relatively recent and shallow roots tend to suffer greater economic and political damage when crisis strikes--as, inevitably, it does. And, consequently, financial crises often reinforce rather than challenge the global distribution of power and wealth. This may be happening yet again.
None of which means that we can just sit back and enjoy the recession. History may suggest that financial crises actually help capitalist great powers maintain their leads--but it has other, less reassuring messages as well. If financial crises have been a normal part of life during the 300-year rise of the liberal capitalist system under the Anglophone powers, so has war. The wars of the League of Augsburg and the Spanish Succession; the Seven Years War; the American Revolution; the Napoleonic Wars; the two World Wars; the cold war: The list of wars is almost as long as the list of financial crises.
Bad economic times can breed wars. Europe was a pretty peaceful place in 1928, but the Depression poisoned German public opinion and helped bring Adolf Hitler to power. If the current crisis turns into a depression, what rough beasts might start slouching toward Moscow, Karachi, Beijing, or New Delhi to be born?
The United States may not, yet, decline, but, if we can't get the world economy back on track, we may still have to fight.
Comments
Does this mean that the people who've been blaming the whole thing on Democrats and ONLY Democrats will now be taking credit for how brilliant the Republicans are for leading us into this ingenious strategic striking-point? Will we be hearing how Cheney and Bush did this knowing full well how it'd benefit our nation relative to the rest of the world and that we'd have been here sooner but for those ignorant Dems who held us back by insisting on regulations all over the place?
Posted by: Op109 | January 28, 2009 5:38 PM
So Mead thinks that the $5 Trillion that BushCo added to our deficit in just eight short years was a good thing?
Cmon'...
Posted by: Blinky | January 28, 2009 5:47 PM
Well, many of those countries that Mead listed off have national money reserves, and not the national debt that we have.
Then there are the ones like Iceland that just go bankrupt.
I see no silver lining here. It sounds like pug propoganda to me......we will stay ahead by keeping everyone else down.
Posted by: Xcellentform | January 28, 2009 6:15 PM
Only in 'ConWorld' is it good news that someone else is suffering more than you are.
And yet, just earlier this week the Boner, or somebody, said that the terrorists at Gitmo were treated better than many Americans! He seemed happy about this.
Are these cons crazy or stupid?
Posted by: C.Morris✈ | January 28, 2009 9:37 PM
"Sweet are the uses of adversity...."
"When the U.S. sneezes, the rest of the world....."
Yes, Repug propaganda is sprouting.
Freddie and Fannie and Frank Raines and Acorn and CRA--the whole debacle is THEIR FAULT!!!!
That seems to be the talking point of the hour.
Meanwhile, the baby Repuglicans read the editorial page of the WSJ as if if were a psalter.
They seem not to have been informed that the real reporters on the former WSJ used to call the editorial page the "funny page".
O, well. At least it makes it easier to know what they are "thinking".
Posted by: ornery | January 28, 2009 11:38 PM
Yes, Blinky, they really do believe it's a good thing.
They call it "Starve the Beast".
The added twist--diabolical genius--was the bank heist staged by Paulson & Kash & Kari at the end of the reign.
Posted by: ornery | January 29, 2009 11:42 AM
ornery,
It seems Daddy Warbucks and Ernst S. Bloefeld even ruined the few sound institutions that were left.
Wells Fargo has been poisoned by its acquisition of, I think, WaMu.
I really wonder what the Bush plan was??
Posted by: C.Morris✈ | January 29, 2009 6:26 PM