Can
America
Lose?
William deB. Mills, 1995
Unrealistically
pessimistic as this scenario may appear to most Americans, it is
predicated on
no disaster, no sudden failures, no new threats. Unfortunately, the
specter of the
world's last superpower declining toward Third World status is evoked
by the
simple continuation unchecked of a number of already well-entrenched
social,
economic, and political trends.
The U.S. Decline Scenario.
Continued
voter and corporate demands for handouts plus lower taxes increase the
Federal
deficit, undermining Government financial stability; continued emphasis
by
individuals on consumption at the expense of savings leaves them
equally
exposed. In a self-centered society where everyone feels abused,
attacks on the
rights and status of other combine with the bashing of successful
foreigners to
create an atmosphere in which reform movements have no chance: the
concept of
"sacrifice" becomes politically incorrect. As politicians increasingly
reflect the views of the most self-centered voters, people become
increasingly
disenchanted with and alienated from government. Personal incentive to
excel
dissipates as scholarships, grades, jobs, and promotions increasingly
are given
for politically correct reasons rather than merit. Fewer workers
support more
dependents on salaries that are being diminished by declining
international
competitiveness. America strikes back with a wave of protectionism and
isolationism fueled by the cry of ambitious politicians to "protect
American sovereignty." Foreign investors flee to more hospitable
markets,
and allies drift away.
With government, corporate, and personal financial reserves used up,
isolated
America slowly declines: infrastructure decays, educational levels
drop,
research lags, cities go bankrupt, alienation spreads, America ages.
Gradually,
East Asia and West Europe inherit leadership of a rapidly advancing
global
society peacefully enriching itself through the expanding market
opportunities
born of multilateralism.
Mapping the Future.
The
above paragraph is certainly not a prediction. Moreover, it is neither
balanced
nor unbiased. It is not intended to be. It is a scenario - a picture of
one out
of a broad range of possible futures.(1) We may turn out to be
fortunate enough
to approximate Michael Zey's complacent image of science as the
savior.(2)
Alternatively, a visit to much of the "developing" world -- where
environmental degradation and the population explosion sometimes
undercut the
quality of life faster than modern technology can improve it(3) --
might
suggest that Dennis Meadows'(4) or the Ehrlichs'(5) warnings of
possible a
Malthusian future within our lifetimes are more accurate portrayals of
the
future.
Given America's resources, relative power, and absence of major
enemies, the
"U.S. decline" scenario presented in the first paragraph is one the
American people have well within their capability to avoid - provided
that they
first realize that it could come true if certain negative trends are
not
reversed.
Scenarios, if used wisely, are powerful tools for helping us face up to
and
gauge the likelihood of possible futures. A useful set of scenarios
constitutes
a map of the future which, like any map, lays out the possible routes.
That is,
a set of scenarios should cover all possible futures. It should also
contain
the drivers -- the factors that affect the route that will be selected.
Finally, a well-designed set of scenarios will incorporate milestones
to help
determine how far along the route one has traveled. A good set of
scenarios
would lay out all the main routes to the future; this article describes
just
one of these possible routes: a route jumbled with hairpin economic
turns,
decaying safety net guardrails, and dangerous educational potholes.
Unfortunately, the disastrous picture of American decline presented
above is
not predicated on any fundamentally new developments; it does not
require the
emergence of a hostile power intent on overthrowing the world order and
armed
with biological weapons, a wave of domestic terrorism, or the collapse
of
California into the Pacific. This scenario of American decline simply
assumes
that a number of well-known trends already in existence continue to
develop and
that some countervailing positive trends die away. Below, this scenario
is
presented again in more detailed form and with some of the key drivers
that
will affect our future and a few of the long list of milestones those
of us who
care about the future should be watching for.
DRIVERS
Education:
* capable of innovation or a nation of followers
* cultural receptivity to a multilateral worldview or "America
firster" isolationism
International Security Regime:
* multilateral cooperation or zero-sum competition
Trade Regime:
* open or protected
Development of Third World:
* rich, friendly market or poor, alienated aid recepient
Economic Structure:
* development or consumption;
* innovative or dependent;
* focused on improving infrastructure or on debt payments
Social Structure:
* productive lower class or welfare state
"U.S. Decline"
Explained.
In
a world of rising affluence powered by spreading technology, global
acceptance
of an unthreatening range of pragmatic forms of social organization
vaguely
termed "democratic" and "capitalist" lays the groundwork
for a generally stable advance. Minor problems are infinite in variety,
but the
major stormclouds of history that could call a population to arms and
motivate
voluntary sacrifice -- threatened invasions, arms races, alien
ideological
movements, pandemics -- are absent.
Stabilized by the late 1990's, Germany becomes the powerhouse of
economically
unified West Europe, which in turn propels the East European and
Russian
economies. Fueled by yen, an increasingly pragmatic China booms. With
Iran and
Iraq focusing on internal rebuilding and international funding pouring
into
Palestine, the Mideast is calm. Egypt avoids collapse; Kashmir does not
provoke
Indo-Pakistani warfare; the two Koreas work out a modus vivendi;
Colombian democracy
stumbles ahead; and global integration proceeds. The dawn of the 21st
century
finds the world a rather upbeat place.(6)
For a few years, the current carries a complacent U.S. along. Negative
underlying trends that had begun in the 1980's or before continue but
are
visible only to a few. Against the backdrop of low unemployment and
high
incomes generated by employment of both parents and often an adult
child living
at home, the few warnings are easy to discount. Most of those who do
see where
things are headed have, in the information age, plenty of personal
options:
telecommuting from their protected communities or emigrating for even
higher-paid jobs. They inevitably protest less than they would have in
a more
state-centered, nationalistic age.
Consequently, reformist proposals do not go far. The absence of fiscal
discipline evident on the part of voters, corporate executives, and
government
alike during the 1980's continues unabated through the 1990's. The
negative
trends move slowly enough so people find it easier to adapt to
adversity than
to discipline themselves.
* In an expanding global economy, money remains available throughout
the 1990's
to cover the rising U.S. national debt, which commands a full 40% of
the
Federal budget by the year 2010. The declining need for a large defense
budget
helps conceal the seriousness of the problem.
* Rising good health, resulting especially from the decline in heart
disease,
masks the graying of the population, which will put 20% of all
Americans over 65
by the year 2025.
The post-1980 American focus on 'rights' rather than responsibilities
intensifies, and society becomes increasingly fragmented.(7) With
echoes of a
Maoism long dead in China, Americans stress equality over progress --
redividing the pie, rather than enlarging it. Reformist politicians are
repeatedly defeated by those who pander to the demands for special
consideration on the part of increasingly vocal interest groups.
MILESTONES
NEGATIVE:
Mexican collapse into narco- or rightist dictatorship
Raising tariffs to protect uncompetitive U.S. auto industry
Refusal by U.S. to participate in peacekeeping
The U.S. drops out of the U.N.
POSITIVE:
Legally defining welfare as privilege entailing responsibilities rather
than
right
Raising basic requirements for high school graduation
Formal recognition that state sovereignty is limited
U.S. peacekeeping forces put under foreign command
Raising minimum age for social security
Lagging COLA's for retirees behind rate of inflation
Restoring discipline in public schools
This social sensitivity harms both education and commerce. Public
schools
stress respect for others over academic performance; universities admit
and
hire on the basis of status rather than merit. In the corporate world,
a rise
in politically correct promotions diminishes the incentive for
performance.
Simultaneously, the proportion of good jobs declines. For a few years,
employment stays high because people go into debt in order to continue
consuming. Corporations stay afloat by trimming back, lowering
salaries,
cutting the critical investment in research that would enable them to
stay
competitive, agreeing to takeovers by foreign firms. Instead of
building for
the future, people borrow against it.
Foreign firms maintain production in the U.S. as a way around U.S.
protectionist tendencies, but increasingly the value added comes
primarily
overseas. Americans assemble kits, allowing the products to be sold as
"locally produced" while the technical experience that forms the
basis for further innovation accumulates abroad.
Gradually, the economic toll of high interest rates required to attract
foreign
capital to pay the rising national debt takes its toll on American
competitiveness. The failure of American society to make good use of
the wisdom
and experience of the rapidly expanding group of citizens over 65 but
still
healthy further reduces competitiveness. In contrast, East Asia's
traditional
respect for the aged enables it to adapt more effectively.
* A reform effort to raise gradually the minimum age for receiving
social
security fails as irresponsible political references to "destroying
social
security" make senior citizens oppose any change.
Increasing disenchantment with the widening division between the
lifestyle of
the elites and the low-tech, low-skill lives of the average citizen
polarizes
political debate and accentuates demands for handouts: whether food
stamps,(8)
free health care, house mortgage deductions,(9) import quotas and
tariffs, or simply
outright tax cuts.
* A reform effort to require welfare recepients to accept certain
responsibilities in return for the privilege of "temporary" grants
fails in the face of voter insistence that welfare is an "inalienable
right."
* The rich strike back by getting an increase in the upper limit on the
home
mortgage deduction.
As taxes are increasingly drained away by transfer payments rather than
being
used for the general good (e.g., education, transportation, parks,
communication, defense), anti-tax feeling naturally grows. The Federal
government becomes more and more an organization for managing the
growing
national debt and appeasing interest groups masquerading as abused
minorities.
The elites have private schools; the rest care less and less about
education,
reasoning with some justification that there are no good jobs anyway.
Cities
become increasingly difficult to manage, exploited during the day by
suburbanites who desert them at night with no sense of responsibility
for the
base of their livelihood. Urban unemployment and the resulting
alienation by
the young grows as does the proportion of aged. Workers thus decline as
a
proportion of the population even as their salaries decline and number
of
dependents rise.
America-firsters, fighting against the trend toward global integration,
succeed
in isolating America politically with an appealing but self-deluding
call to
defend American "sovereignty" just as the rest of the developed world
is awakening to the realization that the 17th century concept of state
sovereignty is no longer a viable framework for problem resolution in
the
information age. Simultaneously, rising protectionism -- justified by
blaming
foreigners for declining American competitiveness -- isolates the
country
economically.
The U.S. fails to adapt to its loss of economic dominance and the
rising need
for multilateral coordination of economic policy.(10)
* Tired of repeated peacekeeping efforts, the U.S. drops out of the
U.N. and
engages in several ineffective solitary military adventures overseas.
This solitary stance makes the U.S. defense budget duplicative and
wasteful,
resulting in far less bang for the buck than other countries obtain
through
international cooperation. American military power is further weakened
by the
declining American industrial base and growing technological
backwardness.
Allies become increasingly wary of the intentions of an isolationist
U.S. and
unwilling to support its foreign policy goals. By 2015, even in the
military
realm, America is no longer viewed as a superpower.
East Asian societies, in contrast, continue to place primary
responsibility for
individual well-being at the door of the family rather than the state.
Unburdened by the welfare state,(11) their economies increasingly
outpace that
of the U.S.
Given the technical leadership of Japan, West Europe and--in certain
fields--Singapore and China combined with the attractiveness of
investing in
the highly literate and now stable Russian Republic,(12) the global
economy
expands despite lessening U.S. participation.
* Symbolic of and furthering its increasing isolation, the U.S. drops
out of
the World Trade Organization and forms a "trade bloc of one."
By 2015 the government discovers that it has few sources of domestic
capital in
a country of decayed cities and noncompetitive industry, no foreign
allies from
which to request help, little attractiveness to foreign investors, and
an
atomistic society. The government is also surprised to find that its
years of
responding to citizen demands notwithstanding, it has too little
credibility
with the people to launch innovative reform efforts. The U.S. slowly
sinks to
the status of a second-rank power as East Asia and West Europe gain
world
leadership...
Putting the Scenario in
Perspective.
On
the roadmap to the future, the "U.S. Decline" scenario is just one of
many possible routes. Nevertheless, enough trends already occurring in
our
society are consistent with the above to suggest that as we move
forward into
the future we should carefully consider our course. Today, we in the
U.S. are
following a road with many forks. The "U.S. Decline" scenario argues
that branches leading to a U.S. decline are out there in front of us
and easy
to turn onto by mistake.
Constructing scenarios with clearly specified drivers and repeated
reviews to
assess our progress vis-a-vis predefined milestones can be a critical
tool to
help us avoid such branches and keep on the high road to a bright
future.
NOTE: This material has been reviewed by the U.S. Government to assist
the
author in eliminating classified material, if any; however, that review
neither
constitutes U.S. Government authentication of material nor implies U.S.
Government endorsement of the author's views.
FOOTNOTES
1. On scenario writing, see Peter Schwartz, The Art of the Long View
(New
York: Doubleday, 1991).
2. Michael G. Zey, Seizing the Future (New York: Simon and Schuster,
1994).
3. See Robert Kaplan, "The Coming Anarchy," The Atlantic Monthly
February 1994: 44- 76.
4. Donella H. Meadows, Dennis L. Meadows, Jorgen Randers, Beyond the
Limits
(Post Mills, Vt.: Chelsea Gree Publishing Co., 1992).
5. Paul R. and Anne H. Ehrlich, The Population Explosion (New York:
Simon and
Schuster, 1990).
6. These two upbeat paragraphs make many unwarranted assumptions about
the
future of the rest of the world, as John Mearsheimer's warning of a
rise in
post-Cold War warfare and instability makes clear. See Mearsheimer,
"Why
We Will Soon Miss the Cold War," Atlantic Monthly, Aug 1990: 14-33.
7. For some thoughtful comments, see Harlan Cleveland, "The Limits to
Cultural Diversity," The Futurist, March-April 1995: 23- 26.
8. For an example of a useful condition that might be attached to
welfare
(namely, that mothers be required to attend school with their
children), see
Ann Crittenden, Killing the Sacred Cows (New York: Penguin Books,
1993),
pp.89-92.
9. On the high cost of the home mortgage deduction, see Crittendon, op
cit,
pp.143- 145.
10. See Takatoshi Ito, "U.S.-Japanese Macroeconomic Policy
Coordination:
Agenda for the 1990s and Beyond," pp.80-110, in Yoichi Funabashi, ed.,
Japan's International Agenda (New York: New York University Press,
1994).
11. See Wolfgang Kasper, "The East Asian Challenge," Swiss Review of
World Affairs, April 1995: 24-26.
12. See the "Chodo" scenario in Daniel Yergin and Thane Gustafson,
Russia 2010 (New York: Random House, 1993), pp.158-173.
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