When the Bubble Bursts
The Fed and American hubris
(AntiWar.com) -- by Justin Raimondo --
...With the fall of the Soviet Union, US elites were imbued with a fatal delusion [.pdf] married to a false assumption: that they could fill the vast power vacuum opened up by the Soviet implosion, and that the Middle East and Eastasia would be low-hanging fruit easily picked. It was, they declared, “the end of history,” and “liberal democracy” would henceforth be the “final” form of human government. The argument between competing ideologies was over: actually, it had been over for quite some time, these neoconservative ideologues asserted: ever since Napoleon’s victory in the battle of Jena. It had just taken us a while to recognize it.
That this sort of nonsense reached its climax in the late nineties and the beginning of the new millennium, just as the economic bubble was approaching its delusional apex, is surely no accident. The puffed-up inflated sense of omnipotence and self-importance, which the Greeks called hubris, that inspired Charles Krauthammer to proclaim “the unipolar moment” coincided perfectly with the inflationary policies of the Greenspan years, when the Fed was printing money hand over fist, without thought for the consequences – an act of pure hubris for which we are today paying dearly. It was the age of inflation in more ways than one.
The bursting of the economic bubble has rendered Krauthammer’s “unipolar” pretensions rather quaint: it seems the boom-and-bust cycle also rules the marketplace of ideas, as well as Wall Street, and on the stock exchange of foreign policy views imperialism, as represented by neoconservatism, is today a penny stock.
Yet there are powerful interests that are seeking to drive its price up by manipulating the market, and most especially the political market.
The two-party system is the War Party’s built-in security system, which ensures them a political advantage no matter how agitated the general public becomes. With only two parties to maintain control over, and draconian ballot access laws explicitly designed to effectively ban “third” parties from competing in elections, the War Party in modern times has usually managed to keep the US on a steady course of empire-building.
This political monopoly has rarely been challenged, in large part due to public acceptance of and even pride in the ever-expanding American Empire. Ever since the end of the second World War – the fabled “American Century” of Henry Luce’s imagination and Mitt Romney’s nostalgic yearnings – a certain hubristic bravado was expected and admired in American political leaders. As the Imperial Presidency took root in the fertile soil of the cold war, such old-fashioned republican (lower-case r) virtues as modesty, humility, and a sense of limits were seen as not only archaic but also signs of weakness rather than an admirable restraint.
In domestic affairs, this meant an activist government that sought to assume an important if not central role in American life: in foreign affairs, this meant an activist policy that sought to extend American influence across the globe.
As the President became the final – and sole – decision-maker in our relations with the rest of the world, the announced goals of US foreign policy took on an ever-accelerating grandiosity. From the Truman Doctrine, which declared that the US would henceforth consider itself the defender of the “free world,” it was a natural progression to John F. Kennedy’s vow that we would “pay any price, bear any burden” in fighting for ‘freedom” overseas, and this culminated in Richard Nixon’s crusade for “freedom” in Southeast Asia. When the Soviet Union collapsed, this developed into a form of megalomania, climaxing in “the indispensable nation” of Madeleine Albright’s imagination, and finally ending in the vulgar posturing of George “Bring it on!” Bush, who declared half-way through his disastrous presidency::
“So it is the policy of the United States to seek and support the growth of democratic movements and institutions in every nation and culture, with the ultimate goal of ending tyranny in our world.”
As the newly-elected President uttered those fateful words, the economic bubble had reached its peak: at the end of his presidency it would burst. Go back and look at that speech: the talk of the “fire in the mind,” a direct reference to the nihilistic revolutionaries of Dostoevsky’s The Possessed, the contention that History has “direction” and that the US government is its appointed agent – the inflated rhetoric is a perfect reflection of the artificially inflated “prosperity” of those years of easy credit and high times on Wall Street.
The Federal Reserve [.pdf], which controls the money supply in this country, is a “private-public” corporation whose principals are presidential appointees, but whose secretive actions are otherwise entirely outside of the democratic process and the public purview. They sit in a room and deliberate, in secret, determining how fast and far the bubble must be blown up to support our delusions of debt-based “prosperity.” And when the bubble bursts …
That’s when they call out the troops – in order to keep the Fed’s printing presses rolling, pumping up the failing system with the “stimulus” of military spending. This is what corrals conservatives into playing the Keynesian game: while ostensibly opposed to “big government” and strongly in favor of cutting government spending, today’s fake conservatives are the first to howl when cuts in the “defense” budget are proposed. Spending a trillion taxpayer dollars on unnecessary wars is the kind of government “stimulus package” they can get behind.
The bombastic rantings of Newt Gingrich and radio-shouters like the neocon loudmouth Mark Levin are the last echoes of an economically exhausted American militarism. As Ron Paul has the temerity to point out at every one of these interminable Republican debates: we are broke. Imperialism is a luxury we can no longer afford...MORE...LINK