This month marks the second anniversary of September 15, 2008, a date that will be remembered as one of the worst moments in the history of the global economy. On that day US investment bank Lehman Brothers collapsed, triggering a major financial crisis and dramatically worsening a worldwide recession whose effects are still being felt.
The date also matters in the history of international politics, accelerating what is destined to be the most important international political trend of the second decade of the 21st century: the growing financial obligations of the United States government. Coping with these obligations will limit the resources available for American foreign policy, thereby reducing the nation’s international role. Because that role is so important – the United States acts as the world’s de facto government, providing to other countries many of the services that governments typically furnish to the societies they govern – this will have a major, and in all likelihood dangerous, impact both on the global economy and on international politics. That impact is the subject of my new book, The Frugal Superpower: America’s Global Leadership in a Cash-Strapped World...
The impact on all countries, not only the United States, of the growing financial obligations of the US government could be serious indeed, especially since no other country or group of countries is willing or able to do what America does around the world. With so much wealth destroyed and with the sharp downturn in production, the direct, short-term economic consequences for the world of the September 15, 2008, events have already been severe. The indirect geopolitical consequences could, over the long run, turn out to be even worse...
http://thenational.ae/apps/pbcs.dll/article?AID=/20100908/OPINION/709079918/1080
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