British anti-Americanism 'based on misconceptions'

JemyM said:

Fortitude roll?

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Charisma, I think.

Bartacus said:

But what we, Europeans, specially don't like are the interfering with the memberships of the EU. Turkey will never be a part of it when I have to chose for it.

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Funny, that -- I'm looking forward to having the Turks on board, one day. Also the Russians. And then the Chinese. European Union FTW! (Muhahahaha...)

World union with important functions given to local governments instead of the nation-state is PJs dream, I believe.
A very nice dream to have, but not one that will be realized in our lifetimes, sadly.

Prime Junta said:

I'm sure that's a really smart move, given your huge level of debt and dependency on Chinese manufacturing and Arabian oil.

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We could readily revive American manufacturing, which is something near and dear to me. Not an instant thing, and surely not without growing pains (it's safe to say there'd be some serious price increases in the electronics industry), but we've done it before and the infrastructure to do it again is still present. The legs are atrophied, but we haven't amputated yet (aside: although my belief is that we're on the operating table these days).

The oil could be problematic, although OPEC hasn't had too much trouble taking our money whether they like us or not (outside of 1979), so I don't figure that's too big a hurdle, TBH. This would apply to practically all natural resources that we didn't have domestically.

The debt thing is much more tricky. I didn't propose true isolationism in any sense, so I'm not sure the mechanisms for instant and complete devaluation of the dollar would be activated, which means the dollar probably does a slow fall over a decade or less and there's a chance we eventually lose our throne as the world's currency. All of those "failures" would be gradual, which would allow us time to get "Fortress America" rev'd up enough to halt the slide. For that matter, I'm not sure an international one-finger-salute (which I view as a political statement with economic fallout rather than the other way around as you imply) would lock us out of international trade anyway. The need to grow domestic sources or the cost of intermediaries (you know as well as I do that there's always access to anyone's products if you've got enough money) would certainly change our prices here in the US, but the resurrection of a middle class employed by domestic manufacturing would be better positioned to shoulder that new price structure anyway until domestic manufacturing matured again.

The beauty of it is that a manufacturing renaissance could go a long way to increasing the government coffers, which (given some fiscal discipline-- which we've failed to show for longer than 1 sitting congress since the early 70's--there was even a minor "backslide" under Saint Ron) would actually ease the problem of foreign-held debt over time.

You're arguing for more self-sufficiency with, perhaps, a dash of isolationism. Those are very respectable positions. However, they've nothing to do with telling "fuck you" to the world, which is what I was rolling my eyes at.

The fact is that we have you by the balls. If you tell us to go fuck ourselves, we'll collapse the dollar and strip you of the assets we already own but have left in place for the time being. That'll leave you right about where Ukraine is now, which is not a nice place to be.

Unless the USA very soon (like, at the start of the next administration) starts taking a genuinely more constructive tone in its international relations, we will start treating you fundamentally differently -- we're more patient than you think, and we have been treating Bush Jr something like a bout of really bad weather that we can probably just sit out.

But if McCain gets the job and does what he says he'll be doing, we will make some fundamental adjustments -- we'll start treating America as a problem to be contained, managed, and cut to size -- a bit like Russia, come to think of it. IOW, we'll be looking for win-lose scenarios rather than win-win ones, because we'll figure that you won't be using your wins in a mature and responsible way. That's not a situation I'd want; it would be unpleasant for us too. I'd much prefer to have the USA a constructive, responsible member of the international community than a loose cannon or rogue state.

Well said PJ. Bush, much though we hate him, is ultimately seen as a woeful aberration, an idiot only elected because the democrats put up nobody to oppose him properly and only re-elected because of 9/11 (or 11/9 UK style).

If the pendulum swings back we'll draw a line under it and move on, if it stays swung over to the right that far we'll have to start assuming that this is the ongoing state for America. We're already doing everything we can to disentangle ourselves from you financially after the recent debacles, we're trying not to get as involved in your foreign policies, the US needs to be rebuilding international ties not announcing to the world that it doesn't need them.

And DTE, what are your views on some of Obama's policies for building up the manufacturing base and reskilling the work force and investing in the technology to make the US the world leader in green technologies? IMO that's where the growth is going to be over the coming decades. Time spent trying to claw back market share from other countries who already have significant competitive advantages would I think be wasted compared to time spent on leveraging the intellectual capital and fluid labour market of the US to establish an untouchable competitive advantage in the businesses that the rest of the world will be crying out for in the immediate future.

Prime Junta said:

You're arguing for more self-sufficiency with, perhaps, a dash of isolationism. Those are very respectable positions. However, they've nothing to do with telling "fuck you" to the world, which is what I was rolling my eyes at.

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Fair enough, although I'm not sure why the "self-sufficiency as a vehicle toward isolationism" would preclude a political "FU" starting with something like leaving the UN (as an example, more than a recommendation).

Prime Junta said:

The fact is that we have you by the balls. If you tell us to go fuck ourselves, we'll collapse the dollar and strip you of the assets we already own but have left in place for the time being. That'll leave you right about where Ukraine is now, which is not a nice place to be.

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I believe we're in agreement with the direction, but not the timing. At the moment, the world is too tied up in our economy and currency. The position I stated was that the time it would take the entire world (or even just the major players--and it could take y'all 100 years of talking to even determine who gets to be "major players") to:
1) all agree to decide to pull our plug (because it's got to be largely world-wide to have the desired effect)
2) prepare each nation to be capable of doing it without pssing in their own economic cereal bowl
3) agree to actually "flip the switch"
would give us enough time to get our manure in order so we were better prepared to deal with that sort of economic war. Now, as I think I mentioned, we'd need to set a political and economic course and stick with it over several sitting congresses and a few presidencies, which might reduce my grand plan to a lousy fairy tale before it ever got off the ground.

Prime Junta said:

Unless the USA very soon (like, at the start of the next administration) starts taking a genuinely more constructive tone in its international relations, we will start treating you fundamentally differently -- we're more patient than you think, and we have been treating Bush Jr something like a bout of really bad weather that we can probably just sit out.

But if McCain gets the job and does what he says he'll be doing, we will make some fundamental adjustments -- we'll start treating America as a problem to be contained, managed, and cut to size -- a bit like Russia, come to think of it. IOW, we'll be looking for win-lose scenarios rather than win-win ones, because we'll figure that you won't be using your wins in a mature and responsible way. That's not a situation I'd want; it would be unpleasant for us too. I'd much prefer to have the USA a constructive, responsible member of the international community than a loose cannon or rogue state.

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I wouldn't attempt to gage the European mind on US policy and poliltics, but I think the original point was that a measurable part of me doesn't give two hoots and that I'm not sure we specifically have to. That's not to say that a measurable part of me doesn't think it would be wise to play nice, but that wasn't part of the comment that got this branch of the conversation going.

dteowner said:

I wouldn't attempt to gage the European mind on US policy and poliltics, but I think the original point was that a measurable part of me doesn't give two hoots and that I'm not sure we specifically have to. That's not to say that a measurable part of me doesn't think it would be wise to play nice, but that wasn't part of the comment that got this branch of the conversation going.

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I don't suppose you "have to" do anything, but if you care about stuff like your standard of living, you cannot afford to tell the rest of the world to fuck off (e.g. by pulling out of the UN). You're far more dependent on us than we are on you -- the US economy as a whole only accounts for about 25% of the global economy, and most of that is domestic consumption. Trade with the US is only about 10% of the Chinese economy, which is the country that's most dependent on it.

IOW, you're still living in the past when, indeed, the US *was* the linchpin of the world economy. That's no longer the case. You're big, and your collapse would certainly cause damage, but it would not throw the world economy into disarray like it would have done when Bretton Woods II was still going strong.

Collapsing the dollar wouldn't require a consensus, either. All it would take is that one of the countries with massive amounts of dollars would dump them. You know, like, Russia ($600bn), China ($1+ trillion), or Saudi Arabia ($800bn). That would trigger a "death spiral" of the currency -- a panic where everyone holding them would try to dump them too, before they lose all of their value.

It would certainly hurt them, but it would hurt you a lot more. Do you really trust them not to pull the plug should you tell them to go fuck themselves? 'Cuz from where I'm at, that looks like a bit of a gamble...

Benedict said:

And DTE, what are your views on some of Obama's policies for building up the manufacturing base and reskilling the work force and investing in the technology to make the US the world leader in green technologies? IMO that's where the growth is going to be over the coming decades. Time spent trying to claw back market share from other countries who already have significant competitive advantages would I think be wasted compared to time spent on leveraging the intellectual capital and fluid labour market of the US to establish an untouchable competitive advantage in the businesses that the rest of the world will be crying out for in the immediate future.

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I guess I don't trust Obama's words/plans to hold up in the crucible of congressional gridlock and political pandering. As I've said elsewhere, my vision of democrats and republicans is a bit outdated, particularly since neither party really stands for much of anything these days. When you grind it down to the simplest form, I believe the democrats, as represented by Obama, would prefer to force the issue with typical bull-in-the-china-shop government efficiency. The republicans, stumbling to McCain as a (IMO) misleading figurehead, would prefer to largely stay out of the way and assume greedy businessmen will jump on the environmental goldmine. Perhaps a simpler way to nutshell it:
"If you build it, hopefully they will come"
vs
"If there's a need, hopefully someone will build it"

The latter position is rooted in human greed and self interest, which I trust wholeheartedly. The former position is rooted in human goodness and vision, which I group with Bigfoot and Peter Pan.

Prime Junta said:

Collapsing the dollar wouldn't require a consensus, either. All it would take is that one of the countries with massive amounts of dollars would dump them. You know, like, Russia ($600bn), China ($1+ trillion), or Saudi Arabia ($800bn). That would trigger a "death spiral" of the currency -- a panic where everyone holding them would try to dump them too, before they lose all of their value.

It would certainly hurt them, but it would hurt you a lot more. Do you really trust them not to pull the plug should you tell them to go fuck themselves? 'Cuz from where I'm at, that looks like a bit of a gamble...

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Without a global consensus, a unilateral move to pull the plug would more likely be met with a multilateral response to prop it back up than a death spiral. Russia is in no position to give away $600bn simply because the Saudis get a wild hair. Again, I don't dispute your mechanism so much as the time required to implement it. You're really predicting the global equivalent of a Depression-era bank run, and I just don't see that being likely.

dteowner said:

Without a global consensus, a unilateral move to pull the plug would more likely be met with a multilateral response to prop it back up than a death spiral.

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And you believe that a multilateral consensus to prop it up could be efficiently and quickly set up overnight, with all countries of the world acting in glorious unison for the common good in a spirit of self-sacrifice and understanding, because...?

Russia is in no position to give away $600bn simply because the Saudis get a wild hair. Again, I don't dispute your mechanism so much as the time required to implement it. You're really predicting the global equivalent of a Depression-era bank run, and I just don't see that being likely.

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It takes no time at all to set up. All it would take is an official announcement from Moscow/Beijing/Riyadh tomorrow that they are liquidating their dollar reserves over the next 30 days, starting tomorrow. We're talking money supply here -- the same stuff the Fed deals in. That turns on a dime, and the effects are instant.

To stave that off, you'd need a coordinated global response by all of the major players. The problem with that is that trying to catch that bullet is very costly. Suppose the EU Central Bank decided to play the White Knight and sponge up all the dollars being released by, say, Russia. That means that it'd have to issue €400bn worth of bonds overnight. To get those bought up, it'd have to jack up the interest rate dramatically -- say, to 15%. That would bring the EU economy to a grinding halt, while China and Saudi Arabia, who decided to opt out of the bailout, would get off scot-free.

You seem to be very, very selective in your distrust of global governance, my friend -- apparently a coordinated economic attack on America is impossible due to selfishness, sluggishness, and general inefficiency, but a coordinated, perfectly executed *defense* of America will automatically happen within hours, with no cheaters or saboteurs involved. Why is that, I wonder?

Well, because it supports my point, of course. To point, I believe that in this case, self-interest lies on the defensive side of the equation and more importantly the status quo lies on the defensive side of the equation. It takes a fair bit of vision and cajones to act to change the world order, even if it truly is as simple as a non-binding official announcement (and I'm not disputing that). It takes very little thought (and public approval) to maintain. My gamble is that nobody is going to step up all by their lonesome on the international stage and put their nuts on that anvil, no matter how big a middle finger we wave at them. If we progressed to mooning and the flaming-bag-of-poo, perhaps someone would get mad enough to take action, but that, again will take time and there will be significant warning signs well beyond the current grumbling.

dteowner said:

Well, because it supports my point, of course. To point, I believe that in this case, self-interest lies on the defensive side of the equation and more importantly the status quo lies on the defensive side of the equation. It takes a fair bit of vision and cajones to act to change the world order, even if it truly is as simple as a non-binding official announcement (and I'm not disputing that).

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Just like... Georgia, about three weeks ago, wouldn't you say? It's not in Russia's self-interest to screw up relations with the West, it's not in Georgia's self-interest to screw up relations with Russia, and it's not in the West's self-interest to screw up relations with Russia either. What with Syria and Iran and natural gas and all.

But woo-hoo, here they all are, happily screwing up relations left and right. I don't know if we're witnessing the collapse of an international order, but if that does happen, this is very much how its early stages would look like. And if it does happen, *everybody* is going to end up the loser -- the only question will be who loses the most.

It takes very little thought (and public approval) to maintain. My gamble is that nobody is going to step up all by their lonesome on the international stage and put their nuts on that anvil, no matter how big a middle finger we wave at them. If we progressed to mooning and the flaming-bag-of-poo, perhaps someone would get mad enough to take action, but that, again will take time and there will be significant warning signs well beyond the current grumbling.

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Just like there were significant warning signs in Georgia, eh?

International crises don't, generally speaking, give significant warning signs -- at least not significant enough to make anyone other than the people already interested in watching the particular region or domain or area from which they erupt. Before August 8, most people were only hazily aware of Georgia, yet here it dun sprung a flaming bag of poo on all of us.

IOW, your gamble is a pretty big one -- it's based on "best-case scenario" thinking, just like Saakashvili's attack on S.Ossetia, or your attack on Iraq. I agree that the best case is less unlikely in your gamble, but IMO you're being awfully cavalier by not considering what might happen if it doesn't turn out that way -- and what you could do to make the bad outcomes less likely.

On a lighter note, I just came across this on one of my favorite webcomix, [ http://www.basicinstructions.net ].

I'm not sure playing armymen in disputed territory (from either perspective of the Russia/Georgia fiasco) that most of the world couldn't find on a map is a very good parallel for a complete upheaval of the world economic order, PJ.

dteowner said:

I'm not sure playing armymen in disputed territory (from either perspective of the Russia/Georgia fiasco) that most of the world couldn't find on a map is a very good parallel for a complete upheaval of the world economic order, PJ.

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Nope, but the chain reaction it may spark/is sparking is.

Georgia attacks Tskhinvali. Russia attacks Georgia. The USA and Poland announce a deal about a missile shield. Nato announces that it's not "business as usual" with Russia. Russia announces that it "suspends cooperation" with Nato, and "is ready to sell arms" to Syria. Tit, tat, tit, tat, and so on and so forth.

Unless somebody breaks the cycle some time soon, we'll see continuous escalation of this type, which will eventually end up with concrete actions with immediate consequences. "Nato announces that Georgia is fast-tracked for membership. Russia cuts gas supplies to Georgia. Nato announces that Ukraine is fast-tracked for membership. Russia raises gas prices for the EU by 200%. The EU announces punitive tariffs on Russian trade. Russia recognizes South Ossetian and Abkhazian independence. The USA introduces new visa regulations for Russia. Russia announce sale of cutting-edge S-400 AA missile system to Iran. The USA adds punitive tariffs to trade with Russia. Russia announces that it is building permanent military bases in Sukhumi and Tskhinvali. The USA announces that it is freezing Russian assets held in the American financial system. Russia announces that it will start to liquidate its dollar holdings." Sound far-fetched to you?

Prime Junta said:

Collapsing the dollar wouldn't require a consensus, either. All it would take is that one of the countries with massive amounts of dollars would dump them. You know, like, Russia ($600bn), China ($1+ trillion), or Saudi Arabia ($800bn). That would trigger a "death spiral" of the currency -- a panic where everyone holding them would try to dump them too, before they lose all of their value.

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I read a good article recently link (a bit spoiled by the fact that it ultimately sold a product, but I did still find it interesting). It suggested that actually the move away from USD as reserves was already happening stealthily with the true wealth generators of the world today investing heavily all over the world converting their dollar reserves into cold, hard commodity based assets.

Partly explaining the scale of the recent commodities boom, and intimating a worrying point where the west turns round and realises that somehow all of a sudden BRIC own everything and have bought it with the money we paid them for making us crap.

If you're looking for an official frantic rush out of the dollar and into another paper currency, you're looking for the wrong thing. The exodus out of the dollar began nearly four years ago, by foreign investors who saw that it was better to own real tangible assets than the unbacked liability of a bankrupt government.

Governments always and everywhere print money they don't have to keep promises they can't meet to voters who pretend not to notice their money is worth less and less each year. The money is corrupted. Savings evaporate. And in response, in nominal and real terms, precious metals re-asset themselves as the best store of value and medium of exchange.

But the dollar is not merely losing value against gold, the currency of the ages, it is also losing value against the essential commodities of every day life - things like oil, copper and corn.

This reality has not been lost on the Chinese or the Russians or on hundreds of millions of investors worldwide. That's why the resource land grab in Australia and elsewhere continues, with active participation from the Chinese and the Russians.

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dteowner said:

"If you build it, hopefully they will come"
vs
"If there's a need, hopefully someone will build it"

The latter position is rooted in human greed and self interest, which I trust wholeheartedly. The former position is rooted in human goodness and vision, which I group with Bigfoot and Peter Pan.

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:lol: Fair enough, I'm of the camp that says there's definitely a massive need that hasn't been fully appreciated yet and I wish we had a government with the vision to steal a march on the rest of the world because by the time the need is blindingly obvious to everyone we'll already be left behind.

IMO it's definitely a major WIN for greed and goodness is a nice side effect. Look at your military spending in Iraq & Afghanistan trying (whatever else is claimed) to secure oil for the future, for a fraction of the economic cost you could have achieved technological advances and efficiency savings that would dwarf the power that could be obtained if you drained iraq dry.

Prime Junta said:

It takes no time at all to set up. All it would take is an official announcement from Moscow/Beijing/Riyadh tomorrow that they are liquidating their dollar reserves over the next 30 days, starting tomorrow.

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Interesting factoid, apologies if you all already know it, but purely coincidentally of course a short time before Iraq was invaded they'd announced that they were going to start trading oil in Euros rather than Dollars.

I think the US pull out all the stops to keep the dollar as the world's global reserve currency, but the balance of power has shifted too much for them to stand a chance if one of the big players takes a different direction.