[GJM] End of America's Hegemony? [CITS Captial & Debt Watch Alert]

[Thomas Greco -- CIRC2]

This is an interesting view of the geo-political prospects.
However, there are other, happier scenarios that Wallerstein does not see.
These are based on innovations in exchange and finance that are still under
the radar of mainstream economics.
Such innovations have the power to shift the loci of power and move the
emphasis from confrontational competition among nation states to widespread
cooperation and harmonization of interests.

Thomas H. Greco, Jr.
P. O. Box 42663, Tucson, Arizona 85733
520-795-8930
thg at mindspring.com
www.Reinventingmoney.com
Blog: http://beyondmoney.blogspot.com


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Subject: [GJM] End of America's Hegemony? [CITS Captial & Debt Watch Alert]


> A colleague recently distributed this article by Prof.
> Wallerstein.
>
> This is probably the best single piece I've seen about
> why this economy is in trouble.
>
> W. Curtiss Priest,
> Editor, CITS Captial & Debt Watch Alert
>
> http://www.binghamton.edu/fbc/186en.htm
>
> ["fair use," "teachable moment," "archival," Section 107(a), 1976
> Copyright Act and 1998 Digital Millennium Act]
>
> Fernand Braudel Center, Binghamton University
>
> List of previous commentaries in English and translations in other
> languages
>
> Commentary No. 186, June 1, 2006
>
> "Whose Century is the 21st Century?"
>
> In 1941, Henry Luce proclaimed the twentieth century the American
> century. And most analysts have agreed with him ever since. Of course,
> the twentieth century was more than merely the American century. It
> was the century of the decolonization of Asia and Africa. It was the
> century of the flourishing of both fascism and communism as political
> movements. And it was the century of both the Great Depression and the
> incredible, unprecedented expansion of the world-economy in the 25
> years after the end of the Second World War.
>
> But nonetheless, it was the American century. The United States became
> the unquestioned hegemonic power in the period 1945-1970 and shaped a
> world-system to its liking. The United States became the premier
> economic producer, the dominant political force, and the cultural
> center of the world-system. The United States, in short, ran the show,
> at least for a while.
>
> Now, the United States is in visible decline. More and more analysts
> are willing to say this openly, even if the official line of the U.S.
> establishment is to deny this vigorously, just as a certain portion of
> the world left insists on the continued hegemony of the United States.
> But clear-minded realists on all sides recognize that the U.S. star is
> growing dimmer. The question that underlies all serious
> prognostication is then, whose century is the twenty-first century?
>
> Of course, it is only 2006, and a bit early to answer this question
> with any sense of certainty. But nonetheless, political leaders
> everywhere are making bets on the answer and shaping their policies
> accordingly. If we rephrase the question to ask merely what may the
> world look like in, for example, 2025, we may at least be able to say
> something intelligent.
>
> There are basically three sets of answers to the question of what the
> world will look like in 2025. The first is that the United States will
> enjoy one last fling, a revival of power, and will continue to rule
> the roost in the absence of any serious military contender. The second
> is that China will displace the United States as the world's
> superpower. The third is that the world will become an arena of
> anarchic and relatively unpredictable multi-polar disorder. Let us
> examine the plausibility of each of these three predictions.
>
> The United States on top? There are three reasons to doubt this. The
> first, an economic reason, is the fragility of the U.S. dollar as the
> sole reserve currency in the world-economy. The dollar is sustained
> now by massive infusions of bond purchases by Japan, China, Korea, and
> other countries. It is highly unlikely that this will continue. When
> the dollar falls dramatically, it may momentarily increase the sale of
> manufactured goods, but the United States will lose its command on
> world wealth and its ability to expand the deficit without serious
> immediate penalty. The standard of living will fall and there will be
> an influx of new reserve currencies, including the euro and the yen.
>
> The second reason is military. Both Afghanistan and especially Iraq
> have demonstrated in the last few years that it is not enough to have
> airplanes, ships, and bombs. A nation must also have a very large land
> force to overcome local resistance. The United States does not have
> such a force, and will not have one, due to internal political
> reasons. Hence, it is doomed to lose such wars.
>
> The third reason is political. Nations throughout the world are
> drawing the logical conclusion that they can now defy the United
> States politically. Take the latest instance: The Shanghai Cooperation
> Organization, which brings together Russia, China, and four Central
> Asian republics, is about to expand to include India, Pakistan,
> Mongolia, and Iran. Iran has been invited at the very moment that the
> United States is trying to organize a worldwide campaign against the
> regime. The Boston Globe has called this correctly "an anti-Bush
> alliance" and a "tectonic shift in geopolitics."
>
> Will China then emerge on top by 2025? To be sure, China is doing
> quite well economically, is expanding its military force considerably,
> and is even beginning to play a serious political role in regions far
> from its borders. China will undoubtedly be much stronger in 2025;
> however, China faces three problems that it must overcome.
>
> The first problem is internal. China is not politically stabilized.
> The one-party structure has the force of economic success and
> nationalist sentiment in its favor. But it faces the discontent of
> about half of the population that has been left behind, and the
> discontent of the other half about the limits on their internal
> political freedom.
>
> China's second problem concerns the world-economy. The incredible
> expansion of consumption in China (along with that of India) will take
> its toll both on the world's ecology and on the possibilities of
> capital accumulation. Too many consumers and too many producers will
> have severe repercussions on worldwide profit levels.
>
> The third problem lies with China's neighbors. Were China to
> accomplish the reintegration of Taiwan, help arrange the reunification
> of the Koreas, and come to terms (psychologically and politically)
> with Japan, there might be an East Asian unified geopolitical
> structure that could assume a hegemonic position.
>
> All three of these problems can be overcome, but it will not be easy.
> And the odds that China can overcome these difficulties by 2025 are
> uncertain.
>
> The last scenario is that of multi-polar anarchy and wild economic
> fluctuations. Given the inability of maintaining an old hegemonic
> power, the difficulty of establishing a new one, and the crisis in
> worldwide capital accumulation, this third scenario appears the most
> likely.
>
> by Immanuel Wallerstein
>
> [Copyright by Immanuel Wallerstein, distributed by Agence Global. For
> rights and permissions, including translations and posting to
> non-commercial sites, and contact: rights at agenceglobal.com,
> 1.336.686.9002 or 1.336.286.6606. Permission is granted to download,
> forward electronically, or e-mail to others, provided the essay
> remains intact and the copyright note is displayed. To contact author,
> write: immanuel.wallerstein at yale.edu.
>
> These commentaries, published twice monthly, are intended to be
> reflections on the contemporary world scene, as seen from the
> perspective not of the immediate headlines but of the long term.]
>
> Email this Commentary to a colleague
>
> ______________________________________________
>
> Go to Fernand Braudel Center Homepage
>
>
> -- 
>
>
>    W. Curtiss Priest, Director, CITS
>    Research Affiliate, Comparative Media Studies, MIT
>       Center for Information, Technology & Society
>          466 Pleasant St., Melrose, MA  02176
>    781-662-4044  BMSLIB at MIT.EDU http://Cybertrails.org
>
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