The pages of history are a great place for people who like to place their own twist on events or revise what actually happened.
So the elevation of the first Afro American to the White House will obviously be an event that many remember as pivotal in the history of the United States of America. (check out the recent Foreign Correspondent for those who think I am on my own when I am particular about what America means.)
I digress, will Barack Obama be remembered for the beginning of the end of the empire that currently is the U.S.?
For those of you who play sport or any other competitive pursuit, there is nothing more satisfying than beating the top team and if you are the top team you find that others always elevate their efforts against you. It is only a matter of time before the number 1. falls and others rejoice. So when you are the number 1 world power (U.S) and you have been that way since 1945 then it is reasonable period of time to consider when the end is nigh.
In the article 'An empire in decline as the world turn upside down' Peter Hartcher considers the amount of debt held by the Unite States and how it is becoming an issue. Commentators and the opposition in Australia bemoan the $50 billion Budget deficit Australia has- well consider $1.4 trillion with current interest repayments of public debt at 8% and heading towards 17%.
Obama may be the President that was in power when the Global Financial Crisis of 2008 happened however he does not deserve to be blamed. According to Alan Greenspan (the previous head of the Federal Reserve (US Central Bank) he just did not believe that businesses would operate in a non-rational fashion. That is why did they lend to people when there was a high risk that there would loan defaults? Greenspan believed that the profit motive would prevent this stupidity, well he was wrong and so whilst socialism collasped so to is uncontrolled capitalism now under pressure.
We shall have to wait and see the end result. What is your view? I can see a merit for anyone who makes a comment.
I like Barack Obama, he definitely doesn't deserve to be blamed. That $1.4 trillion debt does seem pretty scary when it's compared to Australia's debt (our debt doesn't seem so bad afterall!) The situation in the US is expected to worsen, and I'm just curious as to how on earth their government is going to turn it all around?!?!
ReplyDeleteWow. On the basis of historical events (i.e. the fall of all the 'mighty powers' in the past due to high levels of debt), it looks like the U.S is doomed to collapse. It's going to be very interesting to see how Obama deals with this problem. I'm also curious about the future implications of the US collapse for other countries (particularly Australia).
ReplyDeleteI personally don't agree that Obama is perfectly irresponsible for the downturn or collapse of the American economic prestige. A well structured, capable and competent goverment for the world's most influential authority wouldn't have been unable to predict and allow such significant economic disaster to happen. And again, why would you pay so much concern for America when this is a perfect opportunity to re distribute wealth and power across the world ?
ReplyDeleteI, even though in favour of China, would be celebrating this rather than being overly concerned with the enormously obese world power America
Michael not completely sure what you mean. Obama is responsible or irresponsible? A capable government would have been able or unable to predict the economic issue? The double negative is not a trick that works very well. Maybe your phoney device knows the answer!!
ReplyDelete$1,400,000,000,000 ! That's a crazily huge amount of debt. Its awesome that Australia's economy is now more integrated with the asian economies. US' massive sh*tstorm(hehe! Kevin11 everybody!) won't affect us as much in terms of trade. I guess speculators could help US' economy out, if i had a lot of spare funds, i would invest in NYSE. The stocks are dirt cheap! Buy it and then leave it for years and watch your portfolio grow as US govt crawls out of this mess. I just can't help to feel sympathetic for Obama, a few months after he got elected BOOM! GFC. Highly educated people in the field of economics LIKE US! know its not his fault. This is a result of G.W.BUSH unable to strictly keep an eye over the nation's financial sector!
ReplyDeleteTo answer Angelica's question on how US might get out of this. I'd assume the value of equity would fall attracting investors as i mentioned before in my previous comment. Also the value of real estate would fall as well. This is because homebuyers are unable to pay off the mortgage. The bank or lender will take the property and sell it. Supply exceeds demand so the price will drop attracting foreign investors. This is a form of direct investment and will provide inflow to the economy. This is a slow process because investors are still reluctant to invest in US as they are still going downhill and theres the risk that value of their investment would fall. But once this starts happening, the "herd mentality" would cause exponential increase in investment, pulling the economy out of severe recession Correct me if im wrong Sir, but thats what i think will happen from my knowledge of eco so far.
ReplyDeleteTo satisfy Tim's curiosity, i think the US collapse will have positive future implications for other nations. i.e. they can't boast they are the most powerful nation in the world when the value of their dollar is 0.2AUD. That might be a dramatic example, but what im trying to saying is that US will be unable to influence other countries as much as they did before the GFC. Their economy is a complete mess, how could they criticise others? im sure US won't completely collapse to a point where they cannot be categorised as a nation anymore. They'll eventually reach a trough and recover again, the question is when and how long this takes. But yes, they'll lose their credibility and how could you be a "superpower" when you owe the world 1.4 TRILLION!. I guess the only thing Obama could do is spending only in areas that is necessary NOT NUCLEAR WEAPONS! He signed some agreement with some Russian dude to reduce the production of nuclear weapons. A strategic and intelligent move by the president.
ReplyDeleteIrresponsible sir. Everyone has been excusing Obama from being responsible for America's Economic disaster.And again,a capable government would have been able to :( .
ReplyDeleteMicheal! could you explain how would a "capable" government could foresee an incoming financial crisis? what do you mean capable? lots of assets? lots of people?
ReplyDeleteAs far as i know, i haven't heard of an ecomony claiming they have predicted the GFC occurring. So Micheal, what aspects or qualities that a government possesses which makes them "capable" of predicting this disaster?
PS: Your statement is poorly worded and i could barely grip the idea, so i apologise if my query doesn't quite relate to your intended proposition.
anthony, you are on fire.
ReplyDeleteHa ha, yes i can see how inflammable Anthony is now...
ReplyDeleteAnd Anthony, to answer your question, i wasn't referring to the entire GFC process but more to the CAUSE to it. May i ask you one basic and simple question? What was the event leading to the GFC? Would there have been such a severe economic crisis across the world if the "innocent" American government had intervened to prevent their own domestic economic collapse ( not entirely as a nation)?
And Anthony, i'm afraid you have to reconsider your logic of interpreting other's opinions. You can't just assume everyone has the same sense of logic as yourself. So "capable" here carries a diverse meaning rather than only a certain aspect that you compelled my statement into.
Cheers, someone hasn't drunk their juice...