Question for Discussion: What should be America's role in the World after the Cold War? Will the 21st Century be the "Next American Century"?
Assigned Reading: Why America
Thinks It Has to Run
the World; "U.S. "GLOBAL LEADERSHIP" A
Euphemism for World Policeman" ; "Bush's New
World Order Speech"
1. Should the United States Continue to Dominate the World?
1. What do you think President Bush means he declares a "New World" order is waiting to be born?
2. Do you think now that the Cold War is over the United States will now stand on principle and promote democracy and freedom throughout the world?
3. According toe Benjamin Shwarz, is the United States' commitment to maintaining its domination and leadership over the global economy compatible with its support for democracy and national sovereignty?
4. In the end, why do you think the United States insists on being the global policemen? Whose interests are we protecting?
5. Do you think Americans are willing to continue to spend 250 billion a year on defense now that the Cold War is over?
6. If the Cold War was about promoting democracy, human rights, and national sovereignty, how can the United States support nations such as China, Indonesia, and Mexico, who daily violate the principles the United States says that it stands for?
7. What do you think should be America's role in the world? Will the world continue to allow us to play the global policemen?
8. What do you think will be the result if the United States decided to discontinue its efforts to dominate the global economy and renounce its efforts to dominate our increasingly global society and economy?
The Global Economy and "the New World Order"
Shaping the 21st Century and the Emerging Global Industrial Society
American Culture and Society in the 21st Century
In 1990, just before America's military attack on Iraq, President Bush gave his famous "New World Order" speech, which reflected America's buoyant optimism at the end of the Cold War. Confronted with a world in which the United States was now the lone superpower, Bush wanted to redefine America's larger role in the world. Like many before him who dreamed of this day, President Bush believed that with the political and military threat posed by the Soviet Union now gone, the United States could now be free to finally carry out its destiny: to bring our values, institutions, way of life, and leadership to the rest of the World. Having defeated the Soviet communists, Bush hoped that nothing now would stand in our way. But, alas, there was Iraq and other rogue "terrorist nations" who refused to recognize the leadership and domination of the United States over our emerging global economy and society. If America is going to create this New World Order, we are going to have to put nations such as Iraq in their proper place.
Bush opens his speech by declaring that we must "defend civilized values around the world and maintain our economic strength at home." In order to do this, the United States must shape, dominate, and control the world, and we will do this by creating a New World Order. Bush describes this New World Order in this way:
"[A World] freer form the threat of terror, stronger in the pursuit of justice, and more secure in the quest for peace, and era in which the nations of the world, East and West, North and South, can prosper and live in harmony....
"Today that new world order is struggling to be born, a world quite different form the one we have known, a world where the rule of law supplants the rule of the jungle, a world in which nations recognize the shared responsibility of freedom and justice, a world where the strong respect the rights of the weak."
By defeating Iraq, by freeing Kuwait from Iraqi domination, the United States, Bush argues, would be asserting our leadership and our commitment to creating and leading this New World Order. Bush now asserts the United States' larger role in this New World Order:
"America and the world must defend common vital interests. And we will. America and the world must support the rule of law. And we will. America and the world must stand up to aggression. And we will. And one thing more; in the pursuit of these goals, America will not be intimidated."
Clearly, President Bush is laying the political, military, and economic foundations for an American global empire, a world shaped and controlled by the United States. Bush hopes that such a world will be a free, abundant, democratic, and peaceful place. But can an American global empire really be free and democratic. Isn't there a basic fundamental contradiction, as Williams argues, between democracy and empire?
Can the United States as a global empire really hope to dominate the world and not face opposition, violence, dissent, and terrorism? Of course it can't. The best example of this is the Gulf War itself. In the 1980s, both Presidents Reagan and Bush armed and supported the brutal dictator of Iraq, Saddam Hussein. Both the United States and Europe sold military technology that would allow the Iraqis to build chemical and biological weapons, and yes even nuclear weapons. Even after Iraq dropped poison gas on its own people and killed thousands and thousands of people, the United States and Europe continued to support him. It appears that Saddam Hussein invaded Kuwait in 1990 believing that his ally, the United States, would not challenge his right to do so. But, of course, if America was to be seen as the anointed leader of this so-called New World Order, it would now have to put dictators like Saddam Hussein in their place. The problem of course is that for America as a global empire dictators and the destruction and denial of democracy and freedom are useful. The problem still stands: How can America be a global empire without threatening democracy and freedom both in the United States and throughout the world?
At the end of the Cold War, Williams argues, America will be forced to examine and resolve the growing contradictions between its global empire and its democratic society and institutions. Williams argues that Americans must finally face and understand "the truth of empire as a way of life." He states the challenge we face at the end of the Cold War this way:
"We as a culture have run out of imperial games to play. Assume the worst. Empire as a way of life will lead to nuclear death. Community as a way of life will lead for a time to less than is necessary. Some of us will die. But how one dies is terribly important. It speaks to the truth of how we have lived."
But President Bush and American leaders in the 1990s have refused to examine the fundamental truths of America as a global empire. Instead of recognizing the fundamental costs and contradictions of empire, American leaders are still talking about a New World Order led by the United States.
Williams argues that American leaders refuse to understand the costs of empire because they realize that our society has always been based upon economic growth and increasing wealth. The only way for Americans to maintain and increase their standard of living is to expand the American empire. Economic growth, progress, or increasing GDP all depend on the United States dominating the global economy and exploiting and stealing the wealth, resources, and labor of people from throughout the world. Because of American, European, and Japanese dominance of our emerging global economy, 20 percent of the world's population consumes 80 percent of the resources and wealth, while 80 percent of the world's people consumer only a meager 20 percent of the world's resources and wealth. Because of our confusion between material wealth and consumption and the quality of life, Williams argues, Americans and other First World people refuse to recognize the increasing costs and contradictions of this global empire.
The first and most important cost of our reliance on increasing consumption and material wealth is the increasing global destruction of the Earth. Continued economic growth can only lead to undermining the ability of the natural world to support our imperial way of life, and when this happens, our global industrial civilization will collapse. Many scientists predict that if we don't fundamentally reform our modern industrial civilization within the next fifty to one hundred years, our civilization will collapse amidst the ruins of a decimated and polluted global environment.
But in addition to the environmental costs, the costs of maintaining America's global empire continue to run about 3 to 4 trillion a decade, or more than 300 billion dollars alone just in the United States. But the military and economic costs of empire don't just include massive military spending. The creation and maintenance of a global American military force, and the threats and enemies such a force will inevitably create, threatens and weakens our democracy. Throughout the Cold War, America's democratic institutions and Americans' faith their government and society deteriorated and declined. In order to protect our global empire, we have to weaken and undermine democracy in the United States. This is in part true because America's civilian and military leaders increasingly don't trust the American people to make the right decisions to support and expand our global military and economic empire.
The final cost of America's global empire is the growing decline of Americans' own standard of living. This would seem to be a paradox. Don't we maintain and expand our global empire in order to support Americans' standard of living and increasing wealth? We do, but increasingly America's wealthy and large corporations have demanded an increasing share of the wealth created by this global empire. As a result, since the 1970s, even as America's global empire and expanding economic and military power grew, the United States' middle and working classes, the vast majority of our population, saw their standard of living decline. Ironically, then, at the height of America's global triumph in the Cold War and American leaders' giddy optimism about creating and leading a so-called New World Order, the majority of Americans were beginning to question the increasing costs of this empire. Let's now look at what exactly those costs are. (See The America: What Went Wrong internet site.)
How the game was rigged against the middle class
Published Sunday, October 20, 1991
By Donald L. Bartlett and James B. Steele
Inquirer Staff Writers
Worried that you're falling behind, not living as well as you once did? Or
expected to?
That you're going to have to work extra hours, or take a second job, just to stay even
with your bills?
That the company you've worked for all these years may dump you for a younger person?
Or that the pension you've been promised may not be there when you retire?
Worried, if you're on the bottom rung of the economic ladder, that you'll never see a
middle-class lifestyle?
Or, if you're a single parent or part of a young working family, that you'll never be able
to save enough to buy a home?
That you're paying more than your fair share of taxes?
Worried that the people who represent you in Congress are taking care of themselves and
their friends at your expense?
You're right.
Keep worrying.
For those people in Washington who write the complex tangle of rules by which the economy
operates have, over the last 20 years, rigged the game - by design and default - to favor
the privileged, the powerful and the influential. At the expense of everyone else.
Seizing on that opportunity, an army of business buccaneers began buying, selling and
trading companies the way most Americans buy, sell and trade knickknacks at a yard sale.
They borrowed money to destroy, not to build. They constructed financial houses of cards,
then vanished before they collapsed.
Caught between the lawmakers in Washington and the dealmakers on Wall Street have been
millions of American workers forced to move from jobs that once paid $15 an hour into jobs
that now pay $7. If, that is, they aren't already the victims of mass layoffs, production
halts, shuttered factories and owners who enrich themselves by doing that damage and then
walking away.
As a result, the already-rich are richer than ever; there has been an explosion in
overnight new rich; life for the working class is deteriorating, and those at the bottom
are trapped.
And for the first time in this century, members of a generation entering adulthood will
find it impossible to achieve a better lifestyle than their parents. Most will be unable
to even match their parents' middle-class status.
Indeed, the growth of the middle class - one of the underpinnings of democracy in this
country- has been reversed. By government action.
Taken as a whole, the rules that govern the game have:
* Created a tax system that is firmly weighted against the middle class.
* Enabled companies to cancel health-care and pension benefits for employees.
* Granted subsidies to businesses that create low-wage jobs that are eroding living
standards.
* Undermined longtime stable businesses and communities.
* Rewarded companies that transfer jobs abroad and eliminate jobs in this country.
* Placed home ownership out of reach of a growing number of Americans and made the
financing of a college education impossible without incurring a hefty debt.
Look upon it as the dismantling of the middle class.
Today and over the next eight days, The Inquirer will examine how the rules have changed,
what that has meant and what that will mean in the future. And its articles will show
that, barring some unexpected intervention by the government, the worst is yet to come.
For we are in the midst of the largest transfer of wealth in the nation's history. It is a
transfer from the middle class to the rich, and from the middle class to the poor.
Many students at this point charged that I wasn't leaving them with any hope. So let's look for a moment at some of the proposals put forward to restore the American Dream to America's beleaguered middle- and working-classes. (See America: Who Stole the Dream internet site, where Bartlett and Steele offer some solutions to the above problems.)
The list of possible reforms is long:
The suggestions that follow are starting points, a place to begin
the debate. Some could easily be implemented; others would be difficult.
Trade
Global trade was promoted on the basis that it would benefit everyone. But the concept is
valid only if there is true reciprocity -- if each nation provides equal access to its own
market.
That hasn't happened.
Instead, as foreign competitors discovered that Washington lacks the will to get tough on
trade, they lowered tariffs but raised other barriers to entry of U.S. products into their
markets.
Washington's response was to continue to negotiate agreements with countries that promise
to open their markets, yet never do, at least not to the extent that the United States
does.
The emphasis needs to be changed from exports to imports, at least until trade is brought
into balance. That means placing controls on imported goods.
Access to the world's richest consumer market should be granted on the basis of national
interest, not because of a blind adherence to an abstract economic theory like "free
trade."
Critics will complain that such a policy could set off a global trade war, that it would
force up wages and risk inflation.
Perhaps.
But the Japanese have been managing trade for more than 30 years and no trade war has
erupted.
As for wages, you might ponder this: Why do the people in Washington dismiss executive pay
increases that go up 100 percent or 200 percent as of no consequence, yet call for
restraints when the wages of working people go up 5 or 6 percent?
In any event, a new trade policy needs to look beyond simply balancing the books on
imports and exports.
That's because, dollar for dollar, imports cost more American jobs than exports create.
The reason: Imported products, especially those from developing countries, most often are
made in labor-intensive industries, such as apparel. Goods exported by the United States,
on the other hand, tend to be produced by industries that require less labor, such as
agriculture.
To curb imports would require raising tariffs and other trade barriers on products from
countries that have consistently failed to open their markets. If other nations, for
whatever reason, limit access to their markets, then the United States needs to respond in
kind. It's called fair trade.
Immigration
Restore immigration to pre-1990 levels and scale back the skilled-worker and guest-worker
visa programs that have led to widespread abuses. Using immigration policy to create a
labor surplus, thereby helping to hold down wages or limit wage increases, should never
occur.
Adding to the foreign-worker glut is an army of illegal aliens. No one knows their exact
numbers, but it is estimated they are in the millions. And that's after 2.7 million
illegal aliens were granted amnesty in 1986 and allowed to become U.S. citizens. The U.S.
Commission on Immigration Reform, which was headed by the late Texas Congresswoman Barbara
Jordan, said it believed that stepped-up enforcement of all labor and
workplace laws -- from minimum wage to work safety -- would be "an effective
tool" in reducing the hiring of illegal aliens.
Global wages
Companies that produce goods in foreign countries to take
advantage of cheap labor should not be permitted the kind of unlimited access to the
American market that kills jobs here.
A potential solution: Impose a tariff or tax on imported goods equal to the wage
differential between foreign workers and U.S. workers in the same industry. That way,
competition would be confined to who makes the best product, not who works for the lowest
pay.
Thus, if Calvin Klein wants to make sweat shirts in Pakistan, his company would be charged
a tariff or tax equal to the difference between a Pakistani worker's earnings and what a
U.S. apparel worker makes.
Or if Microsoft wants to have its computer programming done in India, the company would be
charged a tariff or tax equal to the difference between the salaries of Indian and U.S.
programmers.
If this, or some similar action is not taken, the future is clear. Wages of American
workers will continue to slip, along with their standard of living.
Taxes
Reestablish the progressive income tax, which rests on the
principle that tax rates should rise with income. This structure was in place from the
beginning of World War II into the 1960s and 1970s, which coincided with the great
expansion of the middle class.
The top tax rate might apply to, say, taxable income over $5 million, with the top rate
at, possibly, 70 percent, rather than the 91 percent top rate that covered some taxable
income from 1954 to 1963.
To spread the tax burden more equitably, a dozen or so brackets should be added, down to a
tax rate of 5 percent. The bottom tax rate in 1996 was 15 percent; the top rate was 39.6
percent.
To simplify the system, all deductions should be eliminated, as well as the preferential
capital gains tax. All dollars would be treated alike. A middle-class working family whose
income is derived solely from a paycheck would not be taxed at a higher effective rate
than someone whose income is derived from speculating on Wall Street.
All this deals with the federal income tax. Truth to tell, state and local taxes are
weighted even more heavily against middle-income and lower-income workers. To right this
situation, the federal government could create a system of rewards and penalties when
distributing federal money to the states. The more progressive a state's tax structure,
the more federal aid it would receive.
And, finally, the corporate income tax. Thanks to sharply lower rates and a variety of tax
concessions, corporations in the 1990s pay comparatively less income tax than corporations
paid in the 1950s. During that earlier decade, corporations accounted for 39 percent of
all income tax revenue; individuals supplied 61 percent. For the years 1990 through 1995,
the corporate share dropped to 19 percent; the individual share rose to 81 percent.
To restore some measure of balance, the top corporate tax rate, now 35 percent, should at
least be raised above the highest personal rate, 39.6 percent. In the 1950s, the top
corporate rate was 52 percent.
A variety of corporate deductions should be eliminated or scaled back. These include the
essentially unlimited deduction for interest payments and the carryover deduction of
losses, both of which fuel mergers and takeovers. Also, foreign tax provisions should be
amended so that U.S. multinational companies no longer would be able to move income around
the world to escape payment of taxes.
Social Security and Medicare
It is generally understood that shortly after the turn of the century, if not before, both
the Social Security and Medicare systems will have to be drastically revised. They are
running out of money. That means either a hefty tax increase, a reduction in benefits for
retirees, a delayed retirement age, or some combination of all three.
One solution would be means-testing of benefits -- restricting the programs to those
within a certain income level. The system should be changed from a retirement plan for
everyone to a retirement plan for those who need it. Again, the issue is one of balance.
In 1993, 453,833 retired people with incomes over $100,000 collected Social Security
benefits. They received checks amounting to $6.6 billion.
That's the equivalent of all the Social Security taxes paid by 1.3 million young working
families with incomes of $40,000 a year. A direct transfer from them to retirees whose
incomes range from 2-1/2 to more than 25 times their incomes.
Everyone would continue to have Social Security taxes deducted from their paychecks, but
benefit payments would be ended to individuals and families whose incomes exceed, say, two
to three times median family income. That would be between $80,000 and $120,000. Social
Security benefit payments to them would be stopped only after retirees had collected what
they had paid into Social Security, with interest. Medicare, too, should be means-tested.
The inequity of America's health-care system was summed up by a Philadelphia physician:
"I have patients who come to my office in chauffeur-driven limousines. They own three
or four homes. And Medicare pays their bills.Does this make sense?"
This in a society in which 40 million or more people go without health care because they
cannot afford it.
Executive salaries
Corporations are free to pay their executives whatever they want. But that doesn't mean
companies should be permitted to write off the full amount on their tax returns, shifting
the cost to taxpayers.
One possible solution: Tie tax deductibility to a multiple between the highest- and
lowest-paid workers. For example, if the lowest-paid worker earns $20,000, then the
company would be precluded from deducting more than, say, 15 times that amount, or
$300,000, for the pay of its CEO on its corporate tax return. The balance of the
compensation would come out of the shareholders' pockets, rather than being partly funded
by the taxpayers.
Campaign finance and lobbying
Absent sweeping reforms in campaign financing, all other reform
efforts are likely to fail.
That's because the money flowing to candidates and political parties, in staggering
amounts, comes from corporations, wealthy individuals, political action committees, and
other interest groups -- all with agendas that are often at odds with what is good for
average Americans.
Over the years, critics of the current system have generally agreed on the need for a
number of reforms, including these:
Impose a limit on the amount that can be spent to run for office.
Ban contributions by political action committees to candidates.
Close the loophole in campaign finance law that allows donors to circumvent limits on
contributions to candidates by making contributions in unlimited amounts to political
parties.
Restrict the amount of out-of-state money that a candidate may accept while running for
office.
Only by limiting the money that pours into politics will the power of special interests be
curbed.
The above reforms might work, students argued, but as long as the wealthy and larger global corporations are free to blackmail the United States and other rich countries by threatening to take their operations and profits somewhere else, these reforms won't work. Rather than pay higher taxes, pay higher wages, reduce executives' salaries, etc., these companies will simply refuse to operate in these countries. Thus, in order to make reforms in an increasingly global economy, they must be global reforms that will affect all of the 185 nations of the world. As a result of globalization, only global economic and social reforms will work to restore the declining standard of living of America's middle- and working classes. For examples of such global reform proposals, see:
1. Campaign for Global Change: The Global Economy
2. Ending Corporate Governance
3. Sustainability and the Global Economy
4.A Citizen Agenda to Tame Corporate
Power, Reclaim
Citizen Sovereignty, and Restore Economic Sanity
All of these reform programs have one thing in common: They don't accept the argument that it is necessary to enrich the wealthy and larger corporations at the expense of the majority of the world's peoples. They also recognize the global reality of imperialism and economic exploitation of the poor by the wealthy nations.
The larger problem our global modern industrial civilization faces is this: How do we change our values and priorities from increasing material consumption and wealth to democracy and quality of life? We must realize that if some are to consume vast amounts of the Earth's resources, others are not going to be able to consume very much at all. Our insistence on having more than our rightful share is the primary engine driving the growth and expansion of global empire and military conflict. Williams concludes that we are in a transition period "that offers us the opportunity to imagine and act to move on beyond global imperialism to regional communities." How we collectively manage this transition will determine the future of our industrial civilization and ultimately humanity's future. If we don't come to respect the rights of communities to control and protect their own resources, people, and wealth for their own well-being, then we will continue down the path of global empire. And down that path leads global environmental destruction, nuclear war, endless military conflict, and death. At the end of the Cold War, Americans are confronted with the choice between the New World Order or a renewed commitment to democracy, freedom, quality of life, and the right of communities to choose their own collective destinies. In the end, this is a choice about the value of democracy and the necessity of empire as a way of life.