I have contemplated, of late, that we are watching the decline of the American Empire. I say ’empire’ but America’s empire is not a legal/political entity in the sense of declaring it’s president an emperor like Julius Caesar, Suleiman the magnificent, or Napoleon. Even Britain, prior to Elizabeth 2nd, declared it’s sovereign to be King/Queen of Britain and its colonies and the Emperor/Empress of India. In the modern context I refer to ’empire’ in the sense of dominating global currencies. By that criterion, America ascended the imperial throne at the end of World War 2 deposing England that had been poking its nose around the world back in the 17th century and by the late 18th and 19th centuries their manufacturing technology and their formidable navy led to domination of global trade, through colonies in South Africa, India, Hong Kong, Malaysia, Singapore, the South Pacific and the Americas.
All was going well for the Brits during the 19th century but, by the early 20th century, America was starting to get the better of their balance of trade. The USA now had their own cotton gins. However, Britain remained the centre of world commerce and much of the global trade was conducted in British pounds and all major currencies were pegged to gold bars.
Then came World War 1. That conflict was such an expensive war that many European countries, beginning with Germany, had to abandon the gold standard to pay military expenses; their currencies devalued rapidly. Three years into the war and even Britain needed to borrow money to keep going and the Yanks were there to help. Eventually even Britain was forced to abandon the gold standard and the British international merchants who traded in pounds found their bank accounts severely depleted. The greenback $US was now the leading reserve currency.
When World War 2 broke out only twenty years later, the US stayed out of the conflict for a long time but nonetheless profited from the war as the preferred supplier of weapons, ammunition and supplies to the allied forces. They required payment for most of it in gold and by the end of the war they held most of the gold on earth in Fort Knox. The Americans only entered the war after they were personally attacked at Pearl Harbour by Japan, an ally of Germany. I say personally but the main island of Maui is over 2,000 nautical miles off the coast of California. Playing a major role in ending the war in Europe gave the Americans the opportunity to claim top of the table seat on the global international stage. In 1944, delegates from forty-four Allied countries met in Bretton Wood, New Hampshire, to come up with a system to manage foreign exchange that would not put any country at a disadvantage. It was decided that the world’s currencies couldn’t be linked to gold, but they could be linked to the U.S. dollar, which in turn was linked to gold. The agreement was that the central banks would maintain fixed exchange rates between their currencies and the U.S. dollar. The United States would then guarantee to redeem U.S. dollars for gold on demand.
So now, instead of gold reserves, other countries accumulated reserves of U.S. dollars. Needing a place to store their dollars, countries began buying U.S. Treasury securities, which they considered to be a safe store of money. Now the US currency virtually replaced the international currency of gold. How would that work out? All went jolly well during the relatively peaceful decade of the 1950’s. America was Camelot and Truman, Eisenhower, and Kennedy were the three great emperors of America. I say peaceful, but WW2 had delivered two contenders for world domination, the USA and the USSR. The allies tried to buy a compromise, splitting both Germany and Korea into Russian/American zones of control. Russia tagged China to support the North Korean communists in their war against South Korea and USA and that war ground to an unresolved stalemate. And then came Vietnam. Russia had shown no interest in Vietnam until USA decided to throw bags full of money to support the French attempt to suppress communism in North Vietnam. That is when the Russian bear began to feel poked and in 1954, the kitchen got too hot, and the French pulled out. That was the start of a very expensive war with the USA that, in my opinion, led to the collapse of the American empire. Kennedy, elected in 1960, recognised the disaster that was Vietnam and committed to a withdrawal of all troops by 1965. This plan ended with the palace assassination in Dallas Texas, Lyndon Johnson, who succeeded Kennedy, recommitted to Vietnam and at the same time launched an ambitious and expensive “Great Society” social programme intended to end poverty and racial discrimination in America. Or in other words, to try to hide what was now becoming a very obvious cultural divide in America. Much of the proposed funding, however, went into the increasingly expensive war in Vietnam and the late 60’s exploded in violent cultural riots highlighted by the continued political assassinations of Martin Luthor King in April 1968 and Robert Kennedy in June 1968. In a tragedy worthy of Shakespeare, America lost it’s soul in the five years between the assassinations of the Kennedy brothers 1963-1968.
The collapse of the empire manifested itself, as it’s creation had done, with the greenback. The Vietnam war costs plus the “Great Society” domestic programme budget had become so expensive that in 1971 Richard Nixon had to abandon the gold standard and flood the banks with paper money. This created the floating exchange rates that we have today. However, despite large deficit spending, trillions of dollars in foreign debt and unlimited printing of US Dollars (the last incidence was the Global Financial Crisis of 2007-8) the U.S. Treasury remains the world’s reserve currency because the world trusts that the US will always remain solvent. The US gross domestic product as at 2016 was way ahead of anyone else at over $US18 trillion. That is bigger than the whole BRICS (China, Russia, India, Brazil, and South Africa) trading bloc combined. But everything balances tentatively on trust and confidence. The trust and confidence that the US is politically stable enough to maintain its dominant economy. What could possibly shake that trust and confidence?
His name is Donald Trump. He did not cause a cultural divide in the USA, but he is the highest profile manifestation of it. There is a cultural chasm in America that the rest of the civilised world did not really understand. Not until the good old boys motivated themselves to get sufficient numbers to the polls to elect Donald Trump in 2016, and he has shown us all very clearly what a problem it is for them. It appears that the Civil War never ended because, although they were militarily defeated and subjected to new laws, the hearts and minds of the South were never changed. The cultural difference is as entrenched as any tribal conflict in the middle east. It may have been suppressed by the force of law, but mainly it was suppressed through lack of leadership from the south to stand up and raise the Confederate flag once again. Donald Trump was seen as that man. He talked the Confederate talk. He promised brick walls against the Mexicans, he promised the drawbridge pulled up against Muslims.
The first English settlement in America was from the Pilgrims seeking religious freedom who settled in Virginia in the early 1600’s, but the larger migration came with two distinct groups in the 17th century. First were the Puritans, following the path of the Pilgrims, escaping religious persecution in their home county of East Anglia. They settled in Massachusetts and brought their distinctive East Anglia twang with them, which was the root of the general American accent, albeit modified by other European groups that migrated to America, especially New York and Boston.
But it was the Royalists (Cavaliers) who left south and southwest England in the mid seventeenth century to the safety of America when the civil war in England broke out. These aristocrats left because they opposed the “Parliamentarians” wanting more power over governance. They brought a completely different culture of royalist aristocracy opposing ‘government by the people’ to America and with it they brought the distinctive South England drawl. They settled further south in Virginia and the Carolinas. They bought vast tracts of land and grew tobacco and cotton crops. They imported slaves on British slave boats and exported their cotton and tobacco to England. They established a social hierarchy where even the serfs were happy for their aristocracy to run the politics and businesses and for the slaves to be lower on the social structure than them. And that formed the basis of the southern lifestyle that the Confederates went to civil war to protect. The Charlottesville riot in August 2017 demonstrated that the surrender in 1865 was only a cease fire, not a capitulation. The month after Trump was sworn in, the Charlottesville Council voted 3-2 to remove the statue of Confederate General Robert E Lee. A riot broke out as the good old boys of the traditional south marched opposing the removal. The confederates had declared war. The ghost of General Robert E Lee had risen. The Liberals also turned up ready for the fight. One man drove a car into a crowd; a woman was killed and 19 people injured. Trump appeared unconcerned. Confederates celebrated US President Donald Trump’s remarks about the protests when, after being pushed persistently to make a stance, he denounced violence “on all sides” rather than explicitly condemning white supremacists. After two days, following massive pressure from his own camp, Trump added “including KKK, neo-Nazis and white supremacists.” No one believed him. Racism is alive and strong in the USA, it has Trump as a sympathiser and is the basis of the great cultural divide.
Washington DC made life very difficult for Trump. Even Trump would agree that being president with so many enemies is no fun. He knows who likes him, those good old boys down south and the mid-western solid rural folk. Significantly, after Charlottesville, polls showed Alabama, Alaska, Arkansas, Dakota: North and South, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Nebraska, Oklahoma, South Carolina, Texas, Tennessee, Utah, Wyoming, West Virginia were all in the 50-60% Trump approval rating. Florida and Georgia were close at 48%. Suddenly the states don’t look quite so united.
In the 2020 election saw Trump removed as president and replaced by Joe Biden. Biden was elected President even though Trump won more votes than when he had been elected in 2016 and even though Biden was clearly suffering from age-related cognitive failure. On Trump’s departure a small army of ‘good old boys’ looking very much like a confederate reincarnation marched on the Capitol Hill building right in the heart of Washington DC and put terror into the heart of the Yankee democrats. They were demanding a divorce and they meant business.
Divorce means division of property and the geo-political split was clear. This was a renewed battle between the Confederates and the Yankees. The Cavaliers and the Puritans. It is tribal, it is primal, it is never going to go away. Trump left the office in Washington DC with his army and returned to his home in Florida. Would he be the sort of guy that would see himself as general Robert E Lee reincarnated? Would he like a general’s uniform with medals and would he like to establish a royal, ruling Trump family dynasty? Yes, I do think he might like all that. Would he relitigate the South’s old claims? Would they follow him? Especially the strategically vital and lucrative marginal state of Florida?
If he declared Florida as the capital of a new country with his Mar a Lago palace becoming the presidential palace then I think Florida would lap that up with Georgia following like a lamb. Finally has the Mid-West/ South got enough money to fight a war with the Yankees? Did you think they were just chicken farmers and moonshine bootleggers after the civil war? If so, you were wrong.
Texas is the second largest economy after California. Apart from the bigger than anywhere farms bringing in huge agricultural revenues and ten billion barrels of oil, they have NASA there and all the spinoff aero-tech businesses that brings. North Dakota is the next largest oil producer with a very respectable 5.7 billion barrels of oil. Mississippi is full of huge hi-tech, high-wage factories including the $1,4 billion Russian owned Severstal steel mill producing steel for cars. the Yokohama tyre factory, Nissan factory at Jackson, GE Aviation at Hattiesburg, Hybrid Plastics, one of the top ten nanotechnology producers in the US. They have a Rolls Royce engine building plant, a navy shipbuilding plant and a plant building unmanned helicopters for the navy. Mississippi is a busy little state. Tennessee has GM and Nissan car plants, 142 solar power companies, manufacturing plants for Whirlpool and Electrolux, Eastern Chemical and Delta faucet companies. Tennessee has won economic “State of the Year” award in 2009, 2013 and 2014. And Florida does more than a bit of orange juice too. It has the fourth largest economy in the US behind California, Texas and New York. Florida produces over $100 billion worth of food; 70% of the country’s citrus and in the winter months supplying 80% of the country’s fresh fruit and veg. It’s aerospace and aviation businesses contribute over $140 billion. The Florida tourism industry employs a million people, 10% of the workforce, and earns $US54 billion pa. Allied to tourism is that Florida is also full of wealthy retirees and the flow on bio-tech research and Life Sciences industry is substantial. If the secret to eternal youth is going to be discovered, it will probably happen in Florida. Bundle up the smaller states’ rural economies with these and you have a combined GDP of $US 6-7 Trillion. It would be the third biggest GDP in the world. It would be bigger than Japan and Germany and bigger than the UK and Russia combined. It would not be an insignificant little country for Trump to preside over.
The east coast would be completely cut off from the west coast so maybe California will expand its borders to include Colorado, Arizona, New Mexico, Nevada, Idaho, Oregon, Washington State and Hawaii and declare itself the independent country of OprahLand? Montana becomes an isolated state so may choose to just get right out and join Canada? Maybe the remaining 19 states of the USA: Connecticut, Delaware, Illinois, Iowa, Maine, Maryland, Massachusetts, Michigan, Minnesota, New Hampshire, New Jersey, New York, North Carolina, Ohio, Pennsylvania, Rhode Island, Vermont, Virginia and Wisconsin, will just then rename itself Massachusetts the Nation in respect for the tribe that occupied the Boston region when Puritan settlers from England first arrived there.
But divorce in the 21st century is somewhat more complicated than it was when the confederates first demanded it in the 19th century. Now there are two really big issues, the nukes and the dollar. Much of the nuke hardware is bunkered in the deserts of TrumpLand, but the software and the launch codes are in Yankee territory. The rest of their weapons of mass destruction are on warships, submarines and in the skies. What port do all those military assets call home? And the dollar? TrumpLand would want its own currency. He would probably approach bitcoin or one of the others with a request to ‘give me a couple of trillion dollars of your finest crypto currency my good man’ which, although not a currency trader, I would suspect might have a very destabilising effect on the greenback, the foundation stone of the American Empire. The lawyers will be able to retire in luxury of this divorce settlement. Meanwhile what an ideal time for China to put up a toll gate on the South China seas to keep the world in passive resistance while it performs a classical siege of Taiwan to starve them into submission.
When Trump left the Whitehouse, America and the world were still dealing with the Covid crisis, and the new wave of the delta variant was taking hold. The Climate Change politics were becoming a greater challenge and the internet was now established as a major political tool and social threat.
In respect to the clear message of the spread of the Covid-19 virus through humans around the globe from late 2019, there had two distinctly different responses by nations. In general terms these align with the political bias of the country, taking their lead from the different political structures of the two economic giants of the world, USA and China. China is a social democracy where the government, while allowing what they see as a necessary capitalist ‘virus’ to exist, keeps it firmly under control. The USA is a liberal democracy where huge corporate ‘donations’ to political candidates, give the corporate donors significant leverage over the decisions of government. China went into immediate and severe lockdown particularly at the epicentre. Business simply shut down. Health was more important than wealth. The USA stayed open for business, saying it was not serious, it was more important to keep trading than to take a day off. Until so many workers got sick and unproductive that the “Boss” ungraciously accepted the ‘sick leave’ disruption but warned he wants them back at work very quickly. The billionaires’ club need their businesses to keep running. Both the Democrats and Republicans rely on the billionaires to stay in power.
At the same time there are other social and political issues causing much angst in the western world. These issues have the hand-wringing western countries hell-bent on ridding themselves of fossil fuelled energy within thirty years; hell-bent on self-flagellating for the colonisation sins of their forefathers of 6+ generations ago and hell-bent on making gender a matter of personal choice rather than of nature. Such a state is simply a natural progression of liberalism spinning out of control with abuse of the social media platforms of the internet. The outcomes of all these trends are beyond rational comprehension.
On the other hand, China is the worlds largest consumer of fossil fuels and, despite rhetoric, is continuing to build coal-powered factories. Modern China evolved from the austerity of hard-line communism under Mao Zedong to the social democratic system of China’s Government today. You certainly cannot argue with the economic success of that system as we have seen China emerge over the last four decades from an impoverished nation to an economic powerhouse now seriously challenging the USA.
China recognises the threat of social media as a political tool to destabilise a nation and undermine its government and accordingly maintains strict control on the intrusion of social media into the lives of its citizens. It has also just announced a ban on under 18-year-olds from playing video games for more than three hours a week. 8-9pm Friday, Saturday & Sunday. The market for video games in China alone is $US45 billion; globally it is estimated today at $US140 billion. When the stock market reacted sharply to this decision from China the wealth of the tech giants controlling this industry was massively impacted. The industry’s unwitting spokespeople, the social liberals, will probably be marshalled to the online frontline for damage-control protests. Well-meaning social liberals have always been easy recruits for corporate agendas. Protecting this $140 billion (and growing} industry is a very big corporate agenda.
Chinese authorities describe these games as spiritual opium. I think that would have made a lot of politically centrist western parents sit up and blink. Those millions of parents who are coping with the addiction of their children to virtual worlds. Those parents who are watching their previously bright young children morph into sleep-deprived zombies with the consequential impact on their social behaviour and mental well-being. Those parents who have had the right to make their own disciplining decisions legally taken from them by liberal extremists infiltrating bureaucracy, thereby giving the video gaming industry unregulated access to the children, even legally by-passing parental control.
On the gender issue China supports the rights of trans gender people to employment and education but is balancing that with active support for masculinity in boys. China is also acting decisively to curb the right of individuals either in commerce or in celebrity status, to become excessively wealthy and through this wealth to consider themselves as mass influencers of the population’s culture. In the West, the liberal extremists in bureaucracy are denying parents any level of parental control on children’s gender identity decisions. Make no mistake, Xi Jinping has sent a very strategic message to a middle America that is already worried about the moral and political bankruptcy of their own country.
Today the whole world is being tested on which system, social democracy or liberal democracy will emerge as the dominant global policy. We don’t like having our personal freedom restrained for social good but on the other hand, personal freedom is inevitably abused by self-interested individuals to the great cost of society. Can the Liberalism of the West survive the bleak freezing winters, transport chaos and industry shutdowns as they transfer from fossil fuels to wind and solar power? Can they survive the ecological impact of mining rare earth minerals to support green energy? Can they resolve the social problems of traumatised and roboticised youth from 24/7 exposure to manipulation by social media corporates? For Liberalism today faces the same challenge that Communism faced in the 20th century: economic poverty as the price of ideological inflexibility.
Can the American President keep the United States united? Can he survive as the economic and military emperor of the world? Biden is clearly losing control of his mind but then he also has begun losing control of bodily functions and, when engaged in conversation with the Duchess of Cornwall at the Glasgow Climate summit in 2121, he broke wind without breaking conversation. A loud and long fart that was reported as having been impossible for the Duchess to ignore. It was a metaphorical gesture at a summit where he had just spoken of the failures of world leaders to reduce their methane emissions. Somehow, he was an epitome of the state of the nation in America. It was as if it was a cosmic sign that the American nation had given up the fight for global alpha status.
Is a new star rising in the East? The Star of Bethlehem, the conjunction of Jupiter and Saturn, occurred in December 2020. Auspiciously it occurred on the solstice date of 21-12-2020. Three months later, wise men from Iran (Persia) arrived in China bearing gifts in the form of a 25-year multi-level co-operation agreement.