Welcome to the 38th episode of Conflicts With Interest. You may recall from the prior episode that I planned to move to a longer form but less frequent format. This is my first one of those and, frankly, I hope I’m able to settle on this format if nothing else for my own sanity. One thing to note is that in this format I am bringing back footnotes. While I am writing primarily for the purpose of creating the podcast, there are comments I want to make where the tradeoff of interrupting the flow of thought for extra context just isn’t worth it, so those points will live in footnotes but I won’t call them out in the audio - just something to be aware of.
Hopefully by going long form I can provide something genuinely complementary to your daily news consumption where the column inches generally aren’t available to provide a lot of context or go on useful detours.
I think that is enough throat clearing for now so let’s begin. Initially, I had planned to cover three topics in each edition but when I got to the end of my first topic here I was at 8,000 words and counting so we’re instead going to tackle just the one topic: the future of US power.
Before we dig in, a quick plug to request a share with people you think might be interested or if you’re listening for the first time and you enjoy the episode, please subscribe to get updates about future episodes. Ok, here we go.
The future of the United States
I have been hearing predictions of US decline basically since I was capable of consuming mass media. So that’s probably just over twenty years, something like that. Let me give you some examples.
This first quote is quite long, but it’s powerful given it comes from an American perspective:
I want to speak to you first tonight about a subject even more serious than energy or inflation. I want to talk to you right now about a fundamental threat to American democracy.
I do not mean our political and civil liberties. They will endure. And I do not refer to the outward strength of America, a nation that is at peace tonight everywhere in the world, with unmatched economic power and military might.
The threat is nearly invisible in ordinary ways. It is a crisis of confidence. It is a crisis that strikes at the very heart and soul and spirit of our national will. We can see this crisis in the growing doubt about the meaning of our own lives and in the loss of a unity of purpose for our Nation.
The erosion of our confidence in the future is threatening to destroy the social and the political fabric of America.
Another one, again from an American perspective:
For a few moments, let us look at America, let us listen to America to find the answer to that question.
As we look at America, we see cities enveloped in smoke and flame.
We hear sirens in the night.
We see Americans dying on distant battlefields abroad.
We see Americans hating each other; fighting each other; killing each other at home.
And as we see and hear these things, millions of Americans cry out in anguish.
Did we come all this way for this?
Did American boys die in Normandy, and Korea, and in Valley Forge for this?
And finally, let’s use a non-American example:
About the capitalist states, it doesn't depend on you whether or not we exist. If you don't like us. don't accept our invitations, and don't invite us to come to see you. Whether you like it or not, history is on our side. We will bury you!
Probably this last quote gives the game away, but none of these quotes is in any sense recent. The first, quote, about America’s crisis of confidence, comes from former President Jimmy Carter in 1979. The second, which sounds like it could have been said in the midst of the George Floyd protests was uttered by Richard Nixon in 1968 when he accepted the Republican nomination for President. And the final quote, well that was said by the leader of the Soviet Union, Nikita Khrushchev in 1956 while addressing a group of Western diplomats.1 Talk about a freezing cold take.
As examples of people predicting America’s decline, these quotes are also supported by the data. Below is the frequency of the bi-gram “American decline” in the Google Books corpus which stretches back to the 1800s. You can see the explosion of writing about American decline starting in the early 1970s, no doubt a reaction to the Vietnam War. Talk of American decline then peaks in 1990 with the collapse of the Soviet Union, but comes roaring back in the early 2000s, likely due to the quagmire wars of Iraq and Afghanistan along with the global financial crisis.
I was actually surprised to see that writing about American decline is falling again. I’m expecting that to turn around as the lookback period for Google Ngrams expands to include the Trump years.
Regardless, hopefully the point is clear that people have been talking about and predicting the decline of American power for a long time. Before we think about where the US is going, it is probably worth asking why people have been predicting its decline for so long, and getting it wrong.
There is a left-coded answer to this question and a right-coded answer to this question. The left-coded answer to this question is that elements of Western leftwing political movements have long hoped for the downfall of the United States, and thus they have been afflicted by motivated reasoning in their assessment of America’s future. To put it simply, the far left hopes the US will fall, and so it focuses on evidence pointing to that conclusion while simultaneously ignoring the countervailing evidence. Briefly, the main reason elements of the left want the US to fall is because they’re highly motivated by issues of economic inequality: to them it would be better that a rich society not exist at all than a rich society exist but in which there are significant differences in wealth among its citizens.
In the US, the right-coded answer to this puzzle of why there has been so much expectation of American decline without it coming to pass is that it is a useful rhetorical tool. Consider Nixon’s quote above, he describes a thoroughly apocalyptic scene in America, cities on fire and so on. The reason he’s doing that is he wants to make the case that only he can bring back the “good old days” in America, only he can restore things to the way they were. Does that rhetoric sound familiar to a certain someone we know who is running for president as a Republican in 2024?
Regardless of whether the proclamation of American decline is left-coded, right-coded, or perhaps even a genuine, good-faith attempt to project the country’s trajectory, what these misguided forecasts have foundered on is a combination of the stickiness of America’s advantages and the lack of a viable alternative to provide some of the global public goods that America delivers.2
We have talked before about what makes America a powerful country capable of influencing others, or even compelling them directly with violence on occasion. But only incidentally in the sidelines of other topics, so it is worth going over the most important factors that contribute to American power because most of what made America powerful in the past is what will make it likely to remain powerful in the future.
First is geography. America is protected by two large oceans to its east and west. And it enjoys friendly relations with its vastly less powerful nations to the north and south. But it is also a big country, the world’s fourth largest in land area. This is important to being a major power. Among other things, it enables a nation to support a large population, which the US has. It is the world’s third most populous nation after India and China. And having a big land area also increases your chance of having a large endowment of natural resources. I am not going to catalogue all of the natural resources which the US has access to, but suffice to say that today the largest producer of crude oil in the world is the US, not Saudi Arabia or some other Middle Eastern country as many believe.
Second is a political system grounded in liberal democratic principles which have shown time and time again that they are the path to durable, long-lasting economic development and a high standard of living for citizens. Yes, America remains imperfect in terms of the reach and level of justice experienced by its citizens. And yes, in recent years its political system has been sorely tested. But, for now, it remains broadly democratic.
Third, the country has peerless military strength. For a long time, America’s detractors have pointed to China’s military modernization and to a lesser extent that of Russia with glee. Why they should be so excited about brutal, represssive authoritarian regimes with deep kleptocratic streaks enhancing their military strength is a story for another day, but suffice to say they have been.
It turned out that Russia’s military modernization was a facade. Billions of dollars or rubles rather were stolen through graft and corruption and seemingly no improvement in war fighting doctrine was made due to laziness and incompetence amongst the Russian general staff. All of this has been laid bare by the Russian invasion of Ukraine and such laughable scenes as a huge traffic jam of Russian vehicles on the road to Kyiv. And now, in recent months, we have seen China’s president Xi Jinping remove senior generals on corruption charges which indicates strongly to me that the problem which prevailed in Russia, prevails in China also. So for all of those reasons, the United States remains the pre-eminent global military power. And we’ll talk more about the connection between a liberal democratic political system and military might later on.
Fourth, the US still has the world’s largest economy and China is unlikely to overtake it for decades, if ever. There are a number of reasons for this but most critically is that the US’s demographic trends are much more favorable than China’s. The Chinese population has started shrinking as well as aging and it will age at a truly astonishing rate.
This is actually worth a brief detour. It is not often that I am confronted with some piece of data that truly shocks me. I don’t mean data that changes my mind necessarily, or shows a different conclusion from what I expected. That’s just all part of the game when you are trying to generate insights or make decisions based on data. I am talking about a circumstance in which the data is showing an outcome that is completely outside my expectations for all possible outcomes.
But the rate of China’s aging is an example of a data-based trend that genuinely shocked me. The United Nations, its flaws aside, produces forecasts of demographics around the world for a variety of population statistics.3 The chart below shows its forecasted ratio for China’s over 65 population vs. it’s 20-64 year old population. So in plain language, this is the ratio of retirees to working age people, per 100 persons. it shows that in 2060, for every 100 people of working age in China, there will be 70 who are retired. That is just an enormous economic obligation that China’s working people will need to satisfy.
For comparison purposes, I have included the US’s equivalent chart below. In 2060 it will have more like 47 or 48 retirees for every 100 people of working age. Still a very difficult demographic structure, but much more favorable than China’s. And it is important to remember that the United States is far richer than China on a per person basis, and so will be better able to make capital investments that ease the burden on the working populace in terms of caring for the elderly.
Ok so fifth in terms of US power is that the US remains the dominant cultural force around the world. Hollywood is the most visible and obvious manifestation of this, but you also have powerful consumer brands like Apple and Nike, restaurant chains like McDonald’s, and so on.
Sixth, and I’ll terminate the list here, the US continues to lead the world in many important areas of research and development. The first effective COVID-19 vaccine came from a lab in Cambridge, Massachusetts. Generative AI took off here in the United States. The country is trying to return to the moon with the Artemis missions. Amazon spends more on R&D than the entire EU combined.
There are probably important factors that I am missing. But this list is fine for our purposes. And for our purposes what matters is not just the existence of these factors, but their relative difficulty to replicate and the way they interact with one another to make replication difficult.
Consider America’s military strength. To the casual observer, it seems that matching American military strength should be a case of buying as many aircraft carriers, submarines, fighter jets, tanks and so on. But material advantage, while important in warfare, is not necessarily decisive. How a country uses its forces is also crucial in determining the outcomes of battles, which in turn influence the outcome of wars. One of the most compelling accounts of the role of force employment comes from an academic named Stephen Biddle, who described the “modern system”.
The modern system is a response to the most important trend on the battlefield since Napoleon which is the ever increasing lethality and precision of “fires”. Strictly speaking, fires is a jargon term that most often refers to artillery but for this discussion I’m going to apply it to any kind of “stand off” weapon which is a weapon that can be fired at long range so not just artillery but air to ground missiles, ground to ground missiles, man portable anti-tank missiles and so on.
As fires became more and more lethal, so the imperative of force preservation became more and more important. To win battles, you needed to keep your soldiers alive, and to keep them alive you needed to minimize the impact of incoming artillery, missiles and so on. Thus arises the modern system which emphasizes a number of core elements to keep soldiers alive. These are principles like dispersion of your forces so that a successful artillery strike doesn’t wipe out an entire unit. The use of natural terrain and cover to shield soldiers from fire and so on.
Again, this seems solvable if you are laying out the path for a geopolitical rival to America. Just read Biddle’s book. Hire former service personnel from armies that use the modern system if necessary, and train your own troops on it. Simple, right? Not so fast.
Biddle points out that autocratic regimes have trouble implementing the modern system. The reason being that it requires decentralizing a lot of authority down to junior officers to make decisions on the battlefield. For example, if you want your soldiers to use cover to move across the battlefield, then the officer on the ground has to be able to choose the route. And that in turn means a culture of independent thinking among your officer corps.
That’s a non-starter for autocratic regimes. How can a dictator or a small clique of rulers feel secure in their positions if they have to contend with an independent-minded military? This tension leads to all kinds of quirky arrangements in autocratic societies. In China, the PLA doesn’t swear its loyalty to the Chinese state, it swears loyalty to the Chinese Communist Party directly. In Saudi Arabia, there is an entire armed force called the National Guard whose purpose is to protect the royal family from the regular Saudi military if it were ever to revolt.
So it’s not just that building all of the complex systems the United States military has is hard, it’s that you also need the kind of political regime which can tolerate the tactics required to use those systems effectively. This is just one example of how these various advantages aren’t just monolithic on their own, but how they interlock with one another to create durable advantages in national power.
Of course, nothing is inevitable. The power of nations and empires rises and falls throughout history. And America undoubtedly has problems on its hands. We will talk about several of these, but the first one, which is also the most intractable, is the state of American politics.
Overwhelmingly, when people think about the problems in American politics, they think of Donald Trump and his attempt to overthrow the 2020 presidential election. I understand the instinct, but I think this is basically wrong. Donald Trump threw absolutely everything he had at overturning that election. He called on his vice president not to certify the results. He browbeat state officials to “find” the necessary votes. His supporters even set the Capitol building on fire.
And despite all that, you know who was president of the republic as the sun set on Inauguration Day? Joe Biden and not Donald Trump. In other words, the system held. Now you might say this is naivete and the system won’t hold a second time. Yeah, fine, I mean of course that’s occurred to me?
But, for now at least, I don’t think the problem of an authoritarian leader who wants to terminate democracy is America’s most pressing political problem. Instead, I think that’s partly a downstream consequence of a more fundamental problem and that is the ever shrinking window of compromise available between the nation’s various interest groups. This is most visible in the paralysis of Congress, but before we get into specifics, I want to set some of the more theoretical groundwork first.
An academic whose work has experienced something of a revival in recent times because of how well it maps to the current moment is Mancur Olson. He wrote a book in 1982 entitled The Rise and Decline of Nations in which he observed that over time, stable societies will accumulate various interest groups and mechanisms for collective action which will reach a critical mass that makes decision making and bargaining impossible.
A simple situation to highlight what he is talking about is negotiation of free trade agreements. Imagine a free trade agreement in which an entire country will be 5% better off on average. But now imagine that there’s one industry which will be 50% worse off and another which will be 50% better off. Because the average person will only be 5% better off, they don’t have much incentive to get involved. Instead the outcome of the agreement is more likely to be determined by political fighting between the two narrow industries that are most affected.4
Now expand from industry groups to trade unions, issue groups, local community groups and so on. You start to see Olson’s point: eventually there are just too many organized interests to satisfy and the political system grinds to a halt. And you see this in America today.
A great example is the confrontation between NIMBYs and the push towards a carbon free electric grid. For those unfamiliar with the acronym, NIMBY stands for Not In My Backyard and in American politics its strongest connotation is with homeowners who block any type of construction in or near their neighborhoods. They do this both due to an inherent aversion to change, but also in a bid to keep property prices high: less housing means lower supply and higher prices.
NIMBYs are often concentrated in blue states like California and Massachusetts which sets up the kind of interest group gridlock I’m talking about. Both of these states are notionally in favor of efforts to decarbonize the American economy, but in both cases major initiatives to achieve this have foundered on NIMBY politics.
In California, attempts to build high speed rail between San Francisco and Los Angeles, which would take hundreds of thousands of cars off the road and significantly reduce the number of flights between the two have completely collapsed as NIMBYs have challenged high speed rail construction at every turn.5 In New England, a region in the northeast of the US of which Massachusetts is a component, efforts to connect the area’s grid with carbon free hydro power from Canada have been stymied by homeowners in Maine whose property sits along the route of the high voltage power line that would provide the grid connection.
So here you have these examples of conflicts between highly motivated interest groups that end up blocking outcomes with massive benefit for the broad populace. This, I think, is the biggest threat to American power from a political perspective: that the national ecosystem of overlapping interest groups prevents the country from solving problems and getting things done.
And there are lots of deals to cut in American politics that would improve the lives of its people and increase national prosperity over the long-term. On immigration, Republicans want less immigration and Democrats want more. So there’s a deal to be had to tighten the southern border to discourage illegal migration, while simultaneously expanding the pathways for legal migration.
On Social Security, which is famously at risk of insolvency, Republicans want to increase the retirement age to extend the life of the program while Democrats want to increase taxes for that purpose. Clearly the deal to be done is a little bit of both.
And you can go on down the line of major policy problems in the US and find lots of examples where there are deals to be done, but the complicated web of interests represented by both parties prevents said deals.
Of course the issue of partisanship and politics as identity needs to be considered here, too. Casual observers of American politics will cite the emergence of Donald Trump as marking the really severe turn in American partisan politics. But the increasingly stark divide between Democrats and Republicans is a trend that goes back much further.
In 1992, Republicans took back control of the House of Representatives for the first time in forty years from the Democratic party. And they did it in part thanks to a new, pugnacious style of politics from the then leader of House Republicans, Newt Gingrich. He was the first to start calling Democrats words like “sick” and “weirdos” and was really the mastermind of turning the word “liberal” into a word with negative connotations for many Americans.
So it is important to keep in mind that Trump is not the divergence of a trend line, but the continuation of it. As a brief aside, if you are interested in the topic of polarization in American politics I highly recommend Ezra Klein’s Why We’re Polarized which touches on a lot of the issues I’m highlighting here.
So, as I said, Trump is the continuation of a trend. And that trend is that conflict and even violence have essentially always been a part of the American political landscape. It is true that storming of the Capitol building on January 6 was a unique event and one that should be troubling. But it certainly fits into a broader historical narrative of violence as part of the political process in the United States. Race has often been a catalyst for such expressions of political violence. Some of the George Floyd protests in the summer of 2020 did entail looting and destruction of property. Just as property was destroyed in protests related to the shooting of Michael Brown in Ferguson, Missouri in 2014, in the protests following the verdict in the trial of the police officers who beat Rodney King in 1992, and of course in the 1968 riots that were a response to the assassination of Martin Luther King.
To be clear, race has not been the only source of political violence in the United States. Obviously you have January 6 itself in which one of the rioters was shot and killed by police and that’s an example of electoral politics itself driving violence. In 1995, Timothy McVeigh and Terry Nicols blew up a truck bomb in Oklahoma City killing 168. They were primarily motivated by anti-government sentiment and saw their attack as revenge for government sieges at Ruby Ridge and Waco.6 In 1970, members of the Ohio National Guard shot and killed four college students protesting against the Vietnam War. Indeed throughout the 1970s the Weather Underground engaged in a series of bombings on behalf of leftwing policy positions, especially opposition to the Vietnam War.
The goal of this history lesson is to make clear that violent political confrontation is a common pattern of American political history.7 And the examples I just shared are a small sample: I haven’t covered violence related to the women’s suffrage movement in the late 19th century or the confrontations between capital and labor during the same period.
And the point of all of this is just that, America hasn’t just survived domestic political turmoil throughout its history, it has thrived in the aftermath of it. So as much as the level of negative partisanship present in American politics today is unpleasant, and its associated violence can be frightening, the country has survived similar events in the not so distant past.
Which brings me back to the original point: the ossifying of the American political system and the shrinking window for compromise bothers me much more than negative partisanship. Because without compromise, there is no way to solve the challenges the US faces to its power.
We started this topic with a laundry list of the pillars of American power, but what could undermine those pillars? What are the challenges America faces moving forward that would need to be solved through political decision making?
The first factor I pointed out that supports American power is the country’s size which, among other things, supports a large population. But the US needs to keep expanding that population for reasons I’ll get into, as well as make efforts to change the composition of the population in terms of age and skills.
The US has a famously large national debt. Currently, it stands at about $34 trillion. That is absolutely a lot of money, but for a developed country it is not outrageous relative to the size of its overall economy. The US federal debt is about 110% of GDP. The equivalent figure for the UK is 101%, 92% for France, 102% for Spain and 214% for Japan.
Nevertheless, it is true that the US’s current debt levels present a potential constraint to the nation’s power. For example, if the US were to find itself in a conflict with a peer competitor, mostly obviously China, its pre-existing debt levels could make it more difficult to borrow more money to fund the war.
Just a quick side tour to debunk a really common misunderstanding about US federal debt. I hear all the time that China holds huge amounts of US federal debt that it could sell at the outbreak of war to tank the US economy. This is just outright false. Foreigners hold just under a quarter of all US federal debt and of the share of federal debt held by foreigners, the largest holder isn’t China it is Japan, a close US ally and host of the US Navy’s 6th Fleet. So the next time you hear this from some oxygen thief at a barbecue, get in there and bust that pack open for me.
Ok, back to the main thread… By far the most significant component of the US’s national budget is a group of programs that are often lumped under the term “entitlements”. Just as a brief aside, you will sometimes hear claims that the US spends half of its national budget on defense. This is total rubbish. The US spends about 15% of its national budget on defense. Lots of pack busting going on right now.
Entitlements are essentially the various programs that make up the US’s welfare state. The three most significant are Social Security which provide income for the elderly, Medicare which provides healthcare coverage for the elderly and Medicaid which provides healthcare coverage for the poor and disabled.
To explain how population composition creates problems for the US budget, I want to focus on Social Security. Social Security is a pension scheme that Americans become eligible for at the age of 65. Eligibility is a bit more complicated than that, and there are various incentives to continue working until you’re 67, but that’s the basic scope of the program: you turn 65 and you retire and start receiving Social Security benefits.
Importantly, the way Social Security works is that current workers pay the benefits of current retirees. In other words, imagine the US has one worker, one retiree and the Social Security benefit owed to the retiree is $1. In 2024, the worker would pay $1 of tax and that $1 would go to the retiree: it is a straight transfer of wealth.
This makes the math straightforward: the more workers you have to support the retired population, the easier it is to pay for Social Security. In 1945, at the end of World War Two, there were 42 workers supporting 1 retiree. Today that figure is closer to 2.8 and Social Security is much harder to pay for which is one of the drivers for the US’s enormous national debt.
I think you can see the solution here: if you can increase the worker to retiree ratio, you can put Social Security on a sustainable path and not have it become such a burden on the national debt. What’s the fastest way to increase that ratio? Let more immigrants come into the United States of course.
Another example where immigration could solve challenges the US faces is in skilled labor shortages. Nearly 300,000 Chinese students were studying in the US last year. On graduation, those of them that wanted jobs in the US had to brave the H1-B lottery system which only makes 85,000 places available each year. As a consequence, after educating those folks most of them have to return to China where their employment prospects are poor: China’s youth unemployment rate was running above 25% until the government stopped reporting the statistic so as to avoid public embarrassment.
Imagine if instead, the US provided more pathways for China’s best and brightest minds to stay in America instead? Consider what that would do to China’s demographic problems if its most highly educated young people started leaving for the US? And if you are thinking to yourself, why would a Chinese person possibly want to leave China for the US, the stories of the growing number of Chinese migrants trying to cross into the US illegally via its southern border will help you understand.
And, historically, immigration has been enormously important to the US at all sorts of important junctures in its history. During the Civil War, the steady flow of tens of thousands of Irish immigrants helped propel the Union to victory by ensuring it had more manpower than the South. During World War 2, immigrant scientists from Eastern Europe who had fled Nazi Germany were instrumental in winning the race to develop the first atomic bomb. Today, immigrants, especially from South Asia, are a huge source of economic dynamism in Silicon Valley.
But the US can’t get a deal done on immigration because of the gridlock between different political interests. As I write this, Donald Trump is preventing the Republican party from negotiating with Democrats on a deal to solve the current crisis at the southern border. Trump would prefer the border remain a mess so that he can use it in his campaign against Biden later this year.
Staying with the theme of issues that are essentially derivative of questions about population, the health of the US population is worth considering as well. America is a famously sick country, everyone is familiar for example with its extremely high rate of obesity.
Just to briefly bust another pack, lots of provincial intellectuals in peripheral countries like to smugly see this as an inherent moral failing of Americans. They see obesity as a natural, inevitable consequence of American consumerism gone mad and imagine a country eating itself to death. That’s actually mostly not the reason obesity in the US is so high. Rather, it is much more a factor of the US’s wealth inequality. Poverty is highly predictive of obesity rates and if you look at a map of obesity rates by state, you can see the high rates in the former Confederate South where the legacy of slavery and Jim Crow drives higher rates of poverty, especially among Blacks.8 So rather than obesity being primarily a function of people deliberately choosing to eat themselves into an early grave, it is much more a downstream consequence of issues related to poverty. Which arguably is a moral failing of America’s, but is definitely a different issue to Americans having an inherently unhealthy relationship to food.
Back onto the main thread, obesity isn’t the only major public health problem facing the United States. The opioid epidemic and its effects cannot be understated, especially in the context of drug overdoses in general. In 2021, drug overdoses killed more than 100,000 Americans, with the vast majority of those deaths attributable to opioids. That’s nearly 300 people a day.
When you see those charts of US life expectancy much lower than those of other developed countries, much of that effect is related to the statistical impact of overdose deaths. Often when people see those charts they imagine what they’re seeing is the impact of sitting on the couch all day eating Ding Dongs or Twinkies in front of the TV and dying at 65. And that is certainly a real dynamic and a problem the US needs to confront. But much more impactful in terms of calculating average life expectancy is people turning to drugs and overdosing at 25.
Anyway, you have this fundamentally sick population in the US which has all kinds of negative downstream consequences. It makes it harder to recruit for the military because fewer people can’t meet the basic fitness requirements, it consumes huge amounts of economic resources, and it is mentally and emotionally corrosive not just for the people directly affected, but their family and friends as well.
It’s worth noting that on these two specific issues, I’m actually quite hopeful for the US. Regarding obesity, the arrival of GLP-1 weight loss drugs looks like it could be a game changer for public health here and elsewhere. I’m not going to go into depth on what these drugs are or how they work, you can Google around and find plenty of information about them. Suffice to say they cause weight loss and have a number of other significant health benefits. I saw a good comment about them on Twitter or X or whatever it’s called which was something to the effect of: the idea that America’s most pressing health issue wouldn’t ever run into its dynamic and sophisticated pharmaceutical research capabilities was always unlikely. Good tweet. I was jealous.
And for fentanyl and opioids generally there’s a huge amount of focus on this issue in Congress and the White House is negotiating with China to crack down on the makers of fentanyl precursors who are mostly located in that country. China has lots of incentive right now to do a deal and be cooperative given its economic woes, so I think the prospects there are quite good.
So we’ve talked about some of the critical factors that make America strong. And we’ve talked through some of its biggest challenges including the difficulty of political compromise, age and skill issues in the labor force, and the general population’s health, but what does it all mean? Where is America headed?
Before I answer this question, my biases should be pretty clear. I live in the US. I am a US citizen. I am raising a family in the US. I have every reason to want this country to have the brightest possible future. To some of what we discussed at the top of the episode, that’s the classic basis for motivated reasoning.
And I’m only human so here let me give an answer that completely aligns with my biases which is that I am still hopeful for the US. Again, going back to the top of the episode, I was struck in my preparations by the number of times the US has seemed down and out, only to emerge from its challenges stronger than ever.
Even the country’s very idea seemed preposterous. Breaking with the monarchical system that had ruled the world for thousands of years and creating a government whose legitimacy depended on the consent of the governed, rather than divine right, was a radical concept. And the nascent United States wanted to put that idea into practice in the face of opposition from the most powerful political entity on earth at that time: the British Empire. Just to make clear the extent of British power, at the height of the revolutionary war the British Army in the US numbered over 100,000 soldiers and most of them arrived there on sailing ships. And yet the US prevailed and inherited a system of government that would propel its growth for the next two centuries.
Fast forward to the 1930s when the US faced the complete economic devastation of the Great Depression. Millions out of work and forced to resort to government handouts for food. And yet the US would emerge from the Great Depression with critical social welfare programs that would form the bedrock of the relationship between its citizens and the state, such as Social Security.
In the late 1960s and early 1970s the country seemed impossibly divided over race and Vietnam. The former would see a slew of America’s most prominent civil rights leaders assassinated and cause massively destructive riots across the country. The latter embittered an entire generation against its government for sending them to fight a war they ultimately lost from a strategic perspective and whose purpose remains somewhat elusive today. And yet America would find a way to if not resolve these differences, accommodate them and emerge victorious in its Cold War competition against the Soviet Union.
Indeed, so many of the current scars and open wounds in American society have parallels to earlier periods when it seemed as if the US was on the way out. The global financial crisis and its devastating economic impacts took a decade for the country to recover from. The longest war ever undertaken by the US, its war in Afghanistan, lasted for 20 years and seemed even more futile than Vietnam given the mere months it took the Taliban to sweep back to power. The protests over George Floyd’s murder at the hands of the police show that the country’s racial divisions remain as potent as ever.
But as I said earlier, these are problems of a type the US has shown it has the ability to move beyond. The country’s ability to reinvent its economy should be beyond question at this point having transformed from an agrarian, land-owner economy at its inception to a manufacturing power house by the middle of the 20th century to entering the 21st century as a leader in services crucial to the global economy such as banking, as well as being a powerhouse of high tech research in fields including biopharma, AI and the commercialization of space.
The US military, having regained its confidence after the disaster of Vietnam, was able to successfully prosecute the first Gulf War and restore an ally’s independence after it was invaded. While the wars in Iraq and Afghanistan were unsatisfying outcomes for the US military and policy makers, their impact on the military was far less negative than Vietnam: US military power can recover.
All of this makes pressing the question of what would it take? What needs to happen for the US to remain globally influential? At the most abstract level, I think Americans need to decide they want to remain the world’s global hegemon, and be willing to put that desire above all other priorities. At some level it is a question of mentality.
Left wing American NIMBYs are throttling the country’s economic future by preventing the building of new infrastructure, especially for renewable energy. And all out of a resistance to change and a desire to keep driving up the value of their homes. Right wing American racial purists are actively undermining one of America’s most important historical strengths: its attractiveness as a destination for bright, skilled, highly motivated immigrants.
In other words, there are a great many segments of American society for whom parochial, petty grievances and concerns are more important that the country’s national greatness and its role in the world. I think that needs to change if America is to pull itself out of what feels to be a period of decline. To put it another way, I don’t think the policy levers required to strengthen American primary in the world are mysterious and unknown, although of course there is always room for disagreement and ambiguity over these questions. But much more uncertain is whether the desire and the will remains among the American populace to pursue the country’s historical role as a global leader.
And, my own motivations for wanting that aside, I think that would be a net good for the world. The United States is not a perfect country. Internally, I think it would be better off if it could shave off the worst excesses of capitalism and transfer a little bit more wealth from the rich to the poor9, as well as better fund its government agencies, especially at the state and local level, to improve service delivery. The country continues to confront yawning, race-based disparities including household wealth, life expectancy and infant mortality. And its most vulnerable citizens continue to suffer from the scourges of obesity and drug epidemics which we’ve already discussed.
Abroad, the US has frequently blundered. Its wars in Vietnam, Iraq and Afghanistan obscure other interventions with negative consequences but that are less well known, especially its invasions and coups in Latin and South America during the Cold War. I’ve talked before about the spoiling role that Israeli Prime Minister Benjamin Netanyahu has played with respect to peace in the Israel-Palestine conflict: the US has played a significant enabling role with respect to Netanyahu.
But these failings need to be weighed against the positive contributions the US makes, as well as a consideration of the alternatives. In the Middle East, it is not Arab or Muslim countries that were the biggest funders of the UN refugee agency responsible for Palestinians, it was the US. It only recently suspended that funding while an investigation is completed into agency staff who are accused of participating in Hamas’ attack on Israel on October 7.
The US is by far the world’s largest provider of foreign aid in absolute dollar terms. Regarding foreign aid, I think a lot about a program called PEPFAR which is short for the President’s Emergency Plan for AIDS Relief. PEPFAR has spent about $100 billion since its inception and basically what it does is gives the anti-retroviral drugs required to prolong the lives of HIV/AIDS sufferers in Africa. It’s estimated to have saved upwards of 20 million lives in sub-Saharan Africa. It’s worth noting that PEPFAR was launched by George W. Bush, not a president many people remember as being the generous type.
As I write this, the US is launching airstrikes against the Houthis, an Islamic insurgency movement that controls vast swathes of Yemen. The Houthis, in solidarity with Palestinians, have been disrupting commercial sea traffic transiting the Suez Canal. If you look at the crude map below and think for a second, you will quickly realize that most of the freight that goes through the Suez Canal has nothing to do with the US. It’s mostly EU-China trade or EU-Japan trade. But the US takes its self-declared responsibility to protect free navigation of the seas and global commerce seriously, and so it is the US leading the effort to protect commercial shipping in the area. China hasn’t contributed any military capability to the effort as far as I am aware.
And, of course, while the US has work to do to improve the degree of justice experienced by its citizens, its political system has shown a capacity for moral growth.
Further, what of the alternatives? Which enlightened country with a political system grounded in liberalism and at least a stated commitment to human rights stands waiting in the wings to inherit America’s role? Those eagerly awaiting the US’s downfall will, I think, be sorely disappointed by China, a country that but for a brief period in the 15th century has always been primarily concerned with its immediate periphery and whose contemporary treatment of Uyghur Muslims suggests a fairly limited capacity for compassion across racial and religious boundaries. The EU is a nice place to visit, but its populace is even less interested in the wellbeing of the rest of the globe than America’s.
I’ve drifted quite far here from the question of what I think the US’s trajectory is or will be so let me conclude by simply saying this. The US has been down before, and gotten back up. The current moment seems utterly incomprehensible because for the three plus decades since the collapse of the Soviet Union, the US seemed an unassailable hegemon. Now that it has real competition from China, supported by allies like Iran and Russia, the prospect of American decline feels more real and more possible than we are accustomed to. We shouldn’t let that obscure the real strengths the US retains: if the country chooses to get back up, I think it will.
So that brings us to the end of this episode. I hope you enjoyed. If you did enjoy, I would humbly ask that you share this with others who you think might be interested. Thanks as always for listening.
Krushchev was of course the most wrong of the three: the Soviet Union would collapse less than forty years after his confident proclamation of communism’s victory.
If you are listening this and thinking to yourself “no but this time America really is going to fall” you should definitely go outside and touch grass. If you throw enough darts, some are bound to hit the bullseye. That doesn’t make you a prophet...
I’ve backtested these before (i.e., looked at historical forecasts and compared them to the actual outcomes) and the UN, if anything, tends to under forecast when it comes to aging. I.e., UN forecasts of developed world aging tend to predict populations to be about three years younger than they actually end up being.
I am sort of butchering Olson’s argument here and introducing some elements that are more related to the diffuse benefits of policy making, but this hypothetical does its job.
There are other reasons for the failure of California high-speed rail but NIMBYs are a big part of the story.
Ruby Ridge was a siege situation in which the US Marshals Office tried to serve an outstanding federal warrant against Randy Weaver who refused to surrender which precipitated a standoff between Weaver and federal authorities. Waco was a siege against a religious cult called the Branch Davidians who were thought to be stockpiling illegal weapons. Both cases led to the deaths of civilians and federal law enforcement officers. The Waco situation was particularly tragic as nearly 80 people died in a fire resulting from the siege, including 28 children.
For more detail on the presence of violent conflict in America’s political history, I recommend Howard Zinn’s A People’s History of the United States
There are many causal mechanisms for why poverty causes obesity but these include obvious things such as a poorer understanding of nutrition as well as less access to fresh fruit and vegetables both due to cost but also due to “food deserts” - parts of the country where fresh produce is especially difficult to access.
Better to have a few less billionaires and a lot more millionaires I am fond of saying.
CWI #38 - The future of American power