“I think future historians will put the beginning of America’s decline as a great empire in the year 2003, when the U.S. invaded Iraq,” said a French historian at dinner last night.
The summer is an idyllic time in the French countryside. Parisian intellectuals return to their ancestral estates and invite you to dinner. We dined al fresco, under the stars, next to a large lake.
“Hear the frogs croaking?” asked our hostess. “The noise is much louder in June. These are love songs…quite a racket. But now what we’re hearing is just the old frogs remembering what a good time they had a few weeks ago. These are the nostalgic frogs…”
“I would put the beginning of the decline a bit earlier,” we had protested, “to the crash of the speculative bubble on Wall Street. That was really when the markdown of U.S. assets began. Of course, you could put it almost at any time. It’s not a precise moment…but a whole series of things…and we don’t really know what it means, not yet. This might not be the top of U.S. power at all. There could be hyperinflation to wipe out the debts…a revolution or coup d’etat to get rid of the bureaucracy…who knows?”
Nobody knows. But our guess is that the great empire is on a downward slide. So much the better, in our opinion. We liked it better as a humble republic. Empires can be great. But they are rarely good.
“No…when you talk about empire,” she continued, “you are talking politics, not economics. Political power, not purchasing power. And it was with the invasion of Iraq that the United States lost its political position in the world. When the Twin Towers came down, America was still at its peak of power and prestige. The rest of the world was sympathetic and eager to get behind America’s campaign to rid the world of terrorists. But then, with this military adventure in Iraq, America’s political capital began to drain away. People lost their faith in American power and American judgment.”
The Daily Reckoning Australia