What a Broken Eagle Really Means for the World

As our sclerotic Congress today continues to govern by inches, it's about time we talked about the real damage that political paralysis in Washington is doing to the once-stable global system that we all depend on like air--a system which, like air, we would probably only notice in its absence. This coming Saturday, Dec. 25--Christmas day--marks the 20th anniversary of the disbanding of the Soviet Union, and the beginning of what I call the American Interlude. Since then the world has experienced fitful U.S. leadership. But now, with our politicians far more confused about what they want than even our protesters in the street, that era too is all but over. And history doesn't bode well for a world without clear leaders or even a stable balance of power.

Let's think about what comes next:  If Washington is no longer the agenda-setter it once was, can a leaderless world continue to enjoy peace and stability? Can the “international system” as we know it today survive without its father in the driver’s seat? The question is as important for America’s future as, say, détente versus confrontation was during the Cold War, or isolationism versus engagement during the rise of fascism. If history is any guide, a global system of open trade and peaceful relations cannot survive under such conditions. Through most of recorded history, and in every region of the globe, an international power vacuum has meant a ruthless jostling for military might, empire- and alliance-building, and sometimes worse. The fall of Rome ushered in the Dark Ages. The Congress of Vienna that imposed European order after the Napoleonic wars broke down in terrible conflicts by the late 19th century. The end of European empire precipitated World War I.

Already signs are emerging that, absent American leadership, the seams are unraveling. Recent G-20 outcomes have been close to incoherent: The world’s major governments didn’t just fail to devise a coordinated strategy for avoiding double-dip recession. In Washington and European capitals, they have embraced policies (for varying domestic political reasons) that most economists argue are the opposite of what is needed. They are pursuing austerity, in other words, when the world needs a concerted stimulus. The 50-year effort to strengthen rules for open trade—so integral to global stability since the General Agreement on Tariffs and Trade began in 1947—is also badly adrift; the 10-year-old Doha Round of talks has been at an impasse since negotiations broke down in 2008.

In fact, the only real evidence of global economic coordination in recent months has come from unelected central bankers, as seen in the coordinated rate cut of early December..... (picture credit:

(http://www.spikehampson.com/images/broken_eagle.jpg)