Month: May 2015

Perhaps it required a politically independent entity like the United Nations to release a report stating what has been obvious to anyone who has followed international news for the past several years; i.e. global jihad has been growing at an accelerating rate since the 09.11.2001 terrorist attacks in the US.  The recent UN report also contained information that even surprised me; i.e. more than half of all countries in the world are now exporting Islamic radicals who are committed to jihad in support of their Islamic sect and against Western Civilization.

A summary of the recent United Nations report can be read on the Financial Times web site at URL: http://www.ft.com/intl/cms/s/0/bddfe15c-0466-11e5-95ad-00144feabdc0.html?siteedition=intl#axzz3bQHn23m4

The United States and its NATO allies have been fighting Islamic radicals in SW Asia, the Middle East, North Africa and Sub Saharan Africa continuously since the 09.11.2001 terrorist attacks.  The cost to the US alone has been more than $4T in direct and indirect financial costs and more than 100,000 dead and permanently maimed soldiers.

What have been the net results of the US – NATO military misadventures in SW Asia, the Middle East and Africa?  The Taliban, al Qaeda and ISIS operate openly in rural Afghanistan and the Taliban are actually providing the most effective administrative services in most rural areas in Afghanistan.  Since the US invaded Iraq and deposed Saddam Hussein in 2003, Iraq has devolved into a multi-front Sunni – Shiite civil war and humanitarian catastrophe of historical proportions.  The Sunni controlled area in Iraq is being administered as a Caliphate under the control of ISIS. Libya no longer exists as a unified country and Libya has now been partitioned into numerous Caliphates by various Islamic militias.

ISIS and al Qaeda (al Nusra Front) now control more than fifty percent of the land area in Syria and they are administering areas under their control in what was once known as Syria as Caliphates.

Yemen has been partitioned in the past year into several different autonomous regions under the control of the Shiite Houthis, the Sunni AQAP, the Sunni ISIS and the pro Saudi Sunni regime that once controlled Sanaa.

Somalia has also been partitioned into several regions under the control of various Islamic warlords and secular warlords.

Nigeria, Niger, Chad and Mali are all under attack by Boko Harem and other Islamic militias that continue to control large areas where they have displaced the national government military and the national government administrative services.

It is shocking to me that the US has spent several trillion dollars and has lost more than 100,000 KIA and permanently maimed soldiers fighting Islamic radicals since the 09.11.2001 terrorist attacks and the net results have been an unmitigated geopolitical disaster.  The US invasion and occupation of Iraq facilitated the Iranian hegemonic integration of Iraq into Iran’s Shiite sphere of influence.  The Afghan “democratic” government centered in Kabul continues to survive as a result of the US financial and logistic support of the Afghan army and of the Afghan national police force.  Libya is an open haven for radical Islamists and ISIS recently established another Sunni Caliphate in eastern Libya.

More and more pro American international political economists, like Ian Bremmer in his recent book titled “Superpower”, are promoting the strategy that the US should merely attempt to contain the fallout of radical Islam and that the US should abandon the effort to install liberal capitalist constitutional democracy in the Islamic world.  Of course Samuel P. Huntington, in “The Clash of Civilizations”, published in 1994, warned that the US and Western Europe would fail miserably if they ever attempted to transplant Western Civilization into non Western societies.  Henry Kissinger, in his recent book titled “World Order”, also obliquely commented on the expensive and ultimately failed efforts by the US to impose democratic capitalism on the Islamic world.

It will be difficult for the US government to step back from its interventions in the Islamic world and merely attempt to contain the threat from radical Islam.  It is easier for US political leaders to beat war drums in the interest of US national security than it is for US political leaders to attempt to explain to American voters that the US efforts of the past fifteen years to defeat radical Islam have, in spite of the enormous expenditure of American blood and treasure, been tragic failures that have only motivated tens of thousands of additional young Muslims to join the jihad against Western Civilization.

Richard Nixon confronted a similar political conundrum when he attempted to end the US involvement in the thirty year long US – Vietnam War.  Nixon and Kissinger kept repeating the mantra “Peace With Honor” as they negotiated the end of the US – Vietnam War, knowing that the North Vietnamese would overrun South Vietnam as soon as the US military stopped propping up the puppet South Vietnamese government.

It remains to be seen whether a Nixon stature American political leader will be willing and able to honestly explain to the American people the limits of American power when the US is confronting the dangers of the radical Islam that is festering throughout the Islamic world.

An interesting and long overdue column appeared today in the New York Times: http://www.nytimes.com/2015/05/17/upshot/dont-be-so-sure-the-economy-will-return-to-normal.html?mabReward=A4&action=click&pgtype=Homepage&region=CColumn&module=Recommendation&src=rechp&WT.nav=RecEngine&_r=0&abt=0002&abg=1

In the article, Tyler Cowen, an Economics professor at George Mason University, describes the many changes in the American economy that may portend permanent reductions in the standard of living for the vast majority of Americans.

I have personally witnessed, since finishing a BA program in political economy at Northwestern University in 1973, the constant shift in political power and economic power from organized labor and its allies to multinational corporate interests and to the global financial center located on Wall Street.  There are many reasons why this shift in political power and in economic power were likely inevitable; e.g. (1) the globalization of labor markets where truly multinational corporations shifted the labor component of their production to emerging market economies, (2) the global computer and communication revolutions that enabled call center workers in India to service business customers in the US and any other country, and (3) the automation of so many business processes and activities that has reduced the labor component required to produce goods and to provide services.

The abrupt reorganization of US corporations in the 1970s and in the 1980s, precipitated by the increasing competition from Japanese and European corporations and by the oil shocks of 1973 and 1978, were just the beginning of what has become an ongoing and pervasive transformation of the American economy in the past forty five years.

The transformation of the American economy in the past forty five years has caused, directly and indirectly, a corresponding transformation in all strata of American society.  It is now a cliche for politicians of all major political parties to express their concern for “the withering Middle Class” in the United States.

The most recent economic shock that has impacted American demographics is the Financial Crisis of 2007-2008 and the Great Recession of 2008-2009.  There were approximately ten million full time jobs lost during the Great Recession that paid a median wage of $18.00 per hour.  Since the end of the Great Recession in 2009, the US economy has only added nine million full time jobs.  The median wage of the jobs created since the end of the Great Recession is approximately $13.00 per hour.  There are now 1.3 million fewer full time jobs in the US than there were in 2007, even though there are now 14 million more workers in the US now than there were in 2007.

The US commercial media has portrayed the reduction in wages and the reduction in the standard of living for American workers since 2007 as a temporary consequence of the Financial Crisis and of the Great Recession.  Only recently have economists like Tyler Cowen, Thomas Piketty, et al been independently studying labor market data and overall US demographic data and coming to the conclusion that the economic trends and demographic trends in the US are reflecting a permanent reduction in the standard of living for the majority of American workers.

Historically, all great civilizations have evolved through a process of emergence, consolidation, expansion, decay and relative decline.  Many historians in the 1970s thought that the US had peaked in political economic power in the decades after WW2.  The Vietnam War, the OPEC oil embargoes, high inflation and general malaise in the 1970s contributed to the impression that the US was in a process of decline.  Reagan’s “New Dawn in America” initiated a remarkable resurgence of American power and American dominance in global affairs in the 1980s and 1990s.

The series of US financial and economic crises in the past fifteen years, combined with the 09.11.2001 terrorist attacks, the multi trillion dollar Afghan invasion – occupation debacle, the multi trillion dollar Iraq invasion – occupation debacle, the 2011 Libyan Gadaffi decapitation debacle, the spread of radical Islam throughout the Islamic world, etc. once again create the impression that the US is in rapid political economic decline vis a vis the other regional powers in the world.

Samuel Huntington, in “The Clash of Civilizations”, written in the years after the end of the Cold War, discusses his perception that Western Civilization is in rapid decline compared to several other emerging regional powers.  Huntington’s perception that Western Civilization is in rapid decline is so strongly felt and articulated in “The Clash of Civilizations” that he dedicates sections of the book to topics on what the “West” must do to save itself.

Perhaps it is actually a positive trend that economists like Tyler Cowen are openly writing about the decline in the standard of living for the majority of Americans.  After all, the first step in responding to a profound issue in American political economy is the need to acknowledge that there is in fact a problem that needs to be studied, analyzed, modeled and remedied.  Kudos also to the New York Times for providing Tyler Cowen a forum for his thoughts and analysis.