Belmont Club

"A crisis of globalization"

“There will be blood” — Niall Ferguson, speaks in Ottawa. Does the crisis mean a new American century? Video at the link. “We are getting the deficits of a World War without a war.”

Ferguson observes that much of US consumption — indeed much of the Obama administration’s deficit — will be financed from overseas. And why do foreigners lend America money? Because crisis isn’t American. It’s global. And despite it’s weaknesses, the United States, was due its institutional strengths, the best bet in a storm.  That combination of characteristics made it a safe(r) haven in the the coming upheavals. As Ferguson puts it, the current crisis “hits others harder than the United States”.

However this is exactly the reverse of the tale which is currently being peddled by some liberal ideologues. According to their point of view it is the world which is in good working order and the United States which is broken. It is America which needs to catch up. We are the anomaly; we are the problem. It is not a “crisis of globalization” that we are experiencing; but a Bush-Halliburton-Cheney depression. Under that theory, the solution to the current crisis is to deconstruct America; to turn it into a progressive socialist state — the kind that today are putting their money into the United States. It is supremely ironical that the response of some liberal ideologues is to simply to take the axe to what others regard as the safest tree in the forest.

But I think Ferguson has it wrong. At some level, the world isn’t simply betting on American stability in the sense of stasis. It is betting on its dynamic stability; in other words on the controlled instability of the US political and economic process; the unrest within civility, the unum in the pluribus, to find a non-destructive way through the thicket into the new world. What the Russians, the Chinese and the rest of the world are ultimately relying on isn’t Obama. It is American political and economic “Minutemen”, who of all the slender hopes in this forlorn world, still represent the best chance of figuring out how to square the circle. The Tea Parties, the culture wars, the debates — this is what the USA has that they don’t. Ultimately, much of the world knows how a big a hole we’re in, but lack the framework of freedom with which to explore solutions.

It’s quite a vote of confidence. I wonder if this generation is up to it.