Australia and New Zealand — losing an empire, who will protect us now? Part 5. US decline and collapse

5. US decline and collapse — The end of empire

One of the great lessons of history is that all empires eventually collapse. Exceptional though many believe it to be, the US empire will be no different and there are many signs that having achieved a couple of decades of apparently unchallenged global domination following the fall of the USSR in 1991, the Anglo-US empire has hit its peak and the way forward lies in its decline. Although empires at their peak can look formidable and unassailable, their collapse can happen quite quickly and while there may be a final military denouement, this often happens in the context of a pre-existing collapse from within. In the end, it is the accumulation of a series of political, social, economic and military collapses combined with the inability of a delusional self-focused elite to face reality that leads to an overall collapse of empire.

In the case of the USA, this collapse is contained within the commitment of its elites to an economic system designed to concentrate and channel wealth to themselves and a social philosophy based on promoting individualism as an ideal that holds out the promise of wealth for all while obscuring the reality that only a very few can actually be wealthy. The exploitative mechanisms employed in this setup are hidden beneath the trappings of democracy and freedom that camouflage the underlying undemocratic, plutocratic and increasingly fascist nature of the political structures, and the managed mass-media facilitated creation of an alternative history and reality for the population. The very real danger in this being that the elites themselves come to believe in and act on the basis of that fake alternate reality.

“The American vaingloriousness described by Tocqueville has today become a clear and present danger to the world and it is, in the end, a direct threat to what’s left of America’s democratic institutions and processes. It threatens a shaky republic and it is embedded in the very foundation of a now increasingly obvious American decline.”

Source: Losing Military Supremacy: The myopia of American Strategic Planning, by Andrei Martyanov, Clarity Press (July 26, 2018)

Political collapse

Although right from the start, the US political system has been dominated by elites and their commercial interests, the controls and mechanisms contained within the US Constitution provided some degree of protection by separating and providing tension between the different branches of government. For instance, the power of the president to make war was constitutionally constrained by fact that only Congress has the power to declare war. Likewise, the lifetime appointment of Supreme Court judges was intended to assure the integrity of the power granted to them and protect them against unwarranted interference from either the legislative or executive branches. The executive branch, which is headed by the President, is supposed to be formally independent of both the legislature and the judiciary. It is also revealing that while a two party political system quickly developed, “The United States Constitution does not mention political parties, primarily because the Founding Fathers did not intend for American politics to be partisan.”

However, it is evident that many of the erstwhile self-checking mechanisms of the US Constitution have been progressively sidestepped or eliminated so that the system of checks and balances it established has been corrupted by political bias and money. In the first instance, this seems to have occurred through the formation of a two party political system that sprang from the first-past-the-post voting system. The effect of this can be seen in the politicised selection of nominees to key roles, such as the Supreme Court, many of whose decisions have for some decades been split along party political lines rather than merely based on an independent and unbiased assessment of constitutional and legal merits of the issue at hand. Likewise, the role of Congress in determining whether the country is at war has been effectively sidestepped so that under the 1973 War Powers Resolution, the president is can initiate military attacks even without prior congressional approval.

But, the core issues that have undermined the US political system appear to centre around the influence three key inter-related factors. These being the:

  1. Unrestrained ability of wealthy individuals and corporate entities to influence lawmakers
  2. Merging of corporate power with political power through a revolving door mechanism involving key industrial sectors, such as the military industrial complex, pharmaceutical industrial complex, agro-industrial complex and the education industrial complex
  3. Infiltration and domination of US political institutions and discourse by the US and Israel based Zionist lobby.

While the influence of big money has long been a feature of US politics with many US presidents having been millionaires and the existence of a range of often longstanding privately funded think tanks and political action committees channelling money from wealthy donors to candidates, the 2010 Supreme Court case Citizens United v. Federal Election Commission opened the field by determining that “the suppression of any political speech by corporations would interfere with the “marketplace of ideas” by preventing the “voices and viewpoints” of corporations from “reaching the public and advising voters on which persons or entities are hostile to their interests.” In effect, this ruling gave corporations the same right as individuals to donate to political parties and candidates. This ruling was then added to in v. Federal Election Commission (2010), where the US Court of Appeals for the District of Columbia Circuit, citing the Supreme Court’s decision in Citizens United, struck down FECA-imposed limits on the amounts that individuals could give to organizations that engage in independent expenditures for the purpose of express advocacy. Consequently, between 2000 and 2012 the estimated total spending for US presidential elections almost doubled, from USD3.1 billion to USD5.8 billion, and the total budget for the 2016 presidential and congressional elections was USD6.5 billion. The overall effect of money on the US political process is most clearly seen in a study by Prof Martin Gilens (Princeton University) and Prof Benjamin I. Page (Northwestern University) that found “that economic elites and organized groups representing business interests have substantial independent impacts on US government policy, while mass-based interest groups and average citizens have little or no independent influence”. In effect, that means that rather than being a democracy, the USA operates as a plutocracy. Somewhat generously, the Economist Intelligence Unit, downgraded the USA in their 2016 Democracy Index to the status of a “Flawed Democracy” where it remained in 2018.

“The U.S. has been teetering on the brink of becoming a flawed democracy for several years, and even if there had been no presidential election in 2016, its score would have slipped below 8.00,” the report explained. Instead, dwindling trust in government, elected representatives and political parties is to blame… “Trust in political institutions is an essential component of well-functioning democracies. Yet surveys by Pew, Gallup and other polling agencies have confirmed that public confidence in government has slumped to historic lows in the U.S. This has had a corrosive effect on the quality of democracy,” the report found.

Source: US is no longer a full democracy, EIU warns, CNBC, 25 Jan 2017

This low confidence in government is mirrored in a persistently low level of confidence in the mainstream new media. While in 1979, Gallup polls recorded a 72% level of confidence in the mass media to report the news “fully, accurately and fairly”, this had declined to just 32% in 2016 and 2018 in spite of a recovery to 45%, Gallup’s polling in 2018 revealed that “US adults estimate that 62% of the news they read in newspapers, see on television or hear on the radio is biased”. Whatever the level of confidence in the new media, there is no doubt that the independence of the news media in the USA has been heavily impacted by a concentration of ownership, so that by 2012 just six corporations controlled 90% of the media in the USA. When combined with the mechanisms explored in Chomsky and Herman’s Propaganda Model, the independence of the Fourth Estate as a key check on power is called into question. Significant factors charting the decline of this role include the CIA’s program to influence the news and entertainment industries under Operation Mockingbird, the migration of the CIA and ex-defence personnel into the media as commentators and editors, and the acquisition of outlets previously thought to be reasonably independent by billionaires like Jeff Bezos who bought The Washington Post in 2013 and whose company, Amazon, has huge contracts with the intelligence and defence industries.

As President Dwight D. Eisenhower warned in 1961 the merging of corporate power with political institutions marks a key change in the nature of government:

“This conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence — economic, political, even spiritual — is felt in every city, every State house, every office of the Federal government. We recognize the imperative need for this development. Yet we must not fail to comprehend its grave implications. Our toil, resources and livelihood are all involved; so is the very structure of our society. In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military industrial complex. The potential for the disastrous rise of misplaced power exists and will persist.”

Source: Military-Industrial Complex Speech, Dwight D. Eisenhower, 1961

Yet in spite of Eisenhower’s prescient words US political sphere has become hopelessly entangled with vested corporate interests across nearly every sphere of government so that we can now speak of not just the military industrial complex (MIA), but also a wider sphere of entanglements, such as the pharmaceutical industrial complex, the agro-industrial complex and the education industrial complex. The election of oil baron and ex-CIA operative and director, George H.W. Bush, to the presidency in 1981 is just one example of how big business combined with the MIA reached the very peak of power within the US government. However, this merging of corporate and government has perhaps reached its pinnacle in the initial raft of appointees and the dizzying parade of corporate and military personalities that have been rotated through positions of power in the Trump administration. This is most recently evidenced in Trump’s January 2019 appointment of former Boeing executive, Patrick Shanahan, as acting Secretary of Defense who was then replaced in July 2019 with Mark Esper, a former lobbyist for defence contractor Raytheon, as permanent occupant for the role.

“With Esper’s confirmation, four Trump Cabinet departments will be led by former lobbyists. Despite Trump’s executive order requiring officials not to lobby the agencies where they once worked for five years after leaving government, ProPublica reported in February that at least 33 former officials have found their way around the pledge. The swamp is far from drained.”

Source: Trump’s New Defense Secretary Embodies “the Swamp.” Congress Is Fine With That, Slate, 25 July 2019

Notably, as reported in an article, stocks of both Lockheed Martin and Raytheon soared after Trump announced the US would leave the Iran nuclear deal:

“Executives of major defense companies, including Lockheed Martin and Raytheon, have told investors that Iran tensions were good for business, The Intercept reported. Defense companies have consistently denied lobbying government on whether the U.S. should engage in conflicts.”

Source: Lockheed Martin hires Trump-tied lobbyist who pushed for strike against Iran,, 28 June 2019

The Zionist influence in US politics has been an unacknowledged fact for many years, that has recently been brought into prominence by Ilhan Omar’s tweet that “It’s all about the Benjamins baby” referring to the influence of money in US politics (although maybe also to hawkish Israeli Prime Minister Benjamin Netanyahu?), which was then followed by a response to another Twitter user who asked who she thought was paying those politicians, Omar’s response was “AIPAC!“—this being the American Israel Public Affairs Committee. The political furore created by this involving accusations of anti-semitism led to Omar deleting the tweets and apologising, which merely served to underscore the power of the Zionist lobby and prove her point. Nonetheless, her forthright exposure of the truth led to the topic being openly discussed in the media in ways it had not before:

“In the past, the entire America Left, led by people like Noam Chomsky, has denied the power of the Israel Lobby. Anyone who pointed out that Israel runs America’s Mideast policy through its Fifth Column, using its monstrous money power, was denounced with the obligatory nonsensical slur “anti-Semite.” Even Walt and Mearsheimer’s understated The Israel Lobby and US Foreign Policy (2007) was vilified and marginalized.”

Source: Ilhan Omar and “All about the Benjamins”, by Kevin Barrett

The Zionist influence in the Trump administration is underscored by one of Trump’s major donors being casino billionaire, Sheldon Adelson:

“Adelson has long been an ally of Trump — donating tens of millions of dollars to his campaign, serving on his inauguration team, and regularly having private meetings with the President. Adelson has also guided Trump’s foreign policy as it relates to Israel, as he was a key player in the President’s decision to recognize Jerusalem as the capital of Israel and has offered to pay a significant portion of the cost to relocate the U.S. embassy to Jerusalem from Tel Aviv.”

Source: Zionist Lobby, with Backing from Adelson, Greasing the Skids for McMaster’s Ouster, by Whitney Webb, Mint Press News, 6 March 2018

With the Trump administration the power of the Zionist lobby is directly surfaced within the President’s own family and close associates (such as son-in-law Jared Kushner and his parents who have all supported illegal West Bank settlements). These influences at the heart of US power take the Zionist well beyond the group of neoconservatives that engineered the Iraq War featuring the likes of Bill Kristol (husband of Victoria Nuland who championed the Ukraine coup of 2014), Richard Perle, Max Boot, Paul Wolfowitz, Douglas Feith, Scooter Libby and Robert Kagan. The strength of the Zionist influence in the Trump administration recognising Jerusalem as Israel’s capital and moving the US embassy there, Trump supporting Israel’s claim for annexation of the Golan Heights, and total silence over increasingly assertive Israeli moves against the Palestinians, such as July 2019 evictions and home demolitions in East Jerusalem. Under these influences, much of the US actions against Iran and the Middle East in general, like renouncing the Iran nuclear deal, seem to have been initiated based on Israel’s interests (and those of Saudi Arabia) rather than those of the USA itself.

“The Israel lobby’s strength in western capitals has depended precisely on its ability to remain out of view. Simply to talk about the lobby risks being accused of perpetuating anti-Semitic tropes of Jewish cabals… What is special about the Israel lobby in the US – an amalgam of hawkish Jewish leadership organizations and messianic Christian evangelicals – is the fear it exploits to silence critics. No one wants to be labeled an anti-Semite.”

Source: The Israel Lobby is Slowly Being Dragged Into the Light by Jonathan Cook, Mint Press News, 14 November 2017

Overall, the Zionist influence over US politics bears a striking resemblance to the parasitic wasp Reclinervellus nielseni, that injects a spider with its eggs which then hatch into larvae that mind-control the spider into building a special web to protect it, before killing the spider by sucking out its insides.

Social collapse

The social collapse of the USA as been charted by numerous writers and commentators over the past 10-15 years, including commentators such as Maurice Berman in Dark Ages America: The Final Phase of Empire (2007), Dmitry Orlov in Reinventing Collapse: The Soviet Experience and American Prospects (2011) and Chris Hedges in America: The Farewell Tour (2018). While this collapse of has been heralded for some time and it has arguably not fallen into total anarchy yet, it is obvious that a significant and very much increasing proportion of the US population is experiencing deteriorating social conditions that point to a collapse of faith and trust in US institutions. This can be seen in the vast rates of imprisonment, daily mass shootings, metal detectors and security guards at school entrances, millions of people in poverty and homelessness, rampant opioid and other drug addictions, crippling medical care debts and lower life expectancy, increasingly violent and militarised police forces, political and social repression through the FBI secret police and intelligence agencies, and a corrupt and racially biased justice system.

“US claims about how well they run their own country are challenged on so many fronts. Forty three million US citizens live in poverty, they have a massive prison population with its indelible racist connotations, guns are ubiquitous and they refuse to address the issue. Violence is as American as cherry pie. It is embedded in US behaviour both at home and abroad.”

Source: JOHN MENADUE. Tugging our forelock again and again to our dangerous ally. An update, 98 August 2019

The collapse of US society is charted in the Trump campaign mantra “Make America Great Again (MAGA)”. But, as Umair Haque, among a number of others, has pointed out America was never great for vast numbers of Americans, such as the poor, blacks and native Americans. The people for whom America was once great constitute the mostly white middle-class workers who did so well in the post-WW2 period but who have been largely dispossessed in the de-industrialisation and stripping of the lower middle class that has taken place since the 1980s. It is in this band of American society that the power of US fascism has grown, so that power and wealth have been accumulated by elites and corporates, the dispossessed former middle-class has cast its lot with a demagogue who promises to restore their position by casting out the teeming masses of illegal economic migrants crashing the nations borders while reasserting the glory of US economic and military might in the world to make them all feel important and respected again. This pattern is repeated from history, so that the German Wiemar Republic likewise saw the rise of fascism under Hitler based on the dispossession of the German middle class that resulted from the dire conditions of the Treaty of Versailles. Haque, charts three phases for this process, and relating them to the USA today, posits that the cycle is already well advanced:

“First, extremists like fascists capture institutions — they gain power over them. That’s phase one of any proper collapse. Then, they subvert them — they pack them with cronies, flunkies, admirers, and sycophants. That’s phase two. But in phase three, the institutions of a democracy are perverted. They are turned from instruments of freedom, justice, and equality, to weapons of subjugation, repression, fear, and violence.”

Source: (Americans Are in Denial That) Fascists Took Over America, by Umair Haque, 15 July 2019

The first two stages of this have been documented above in the section on Political Collapse, while it is obvious that the third stage has been progressively enacted in the seemingly ever increasing repression, spying, media censorship, police violence, judicial corruption and harassment of ordinary citizens. Brutal repression has been most especially enacted against those who push back against the state—Julian Assange, Chelsea Manning, a raft of other whistle-blowers, oil pipeline protesters, Occupy Wall Street protesters, the Black Lives Matter movement, and opponents of the US government’s wars and regime change actions. Since the events of 9/11, the rights of ordinary citizens have been usurped and the police and security agencies given wide powers to act with impunity.

“They said that while I was being held I didn’t have any rights,” Torrez told The Grayzone, referring to the CBP. “I said, ‘Can I call my lawyer?’ They said, ‘No, you don’t have any rights, it doesn’t matter if you call a lawyer. First of all, you can’t even use your phone and second of all, you don’t have any rights to do anything.’”

Source: ‘You don’t have any rights’: CBP agents interrogate US citizen and seize his phone after Venezuela solidarity trip, by Max Blumenthal, The Greanville Post, 3 August 2019

But, repressive actions against ordinary US citizens are not a new phenomenon. In the 1960’s, leaders of the Black Power movement that sprang out of an increasingly empowered black community were vigorously targeted by intense surveillance and harassment. The US government launched a war against dissent in the form of the FBI’s Counter Intelligence Program (COINTELPRO) in which Black leaders and their movements were subject to an intense campaign of surveillance, infiltration, perjury, police harassment and killings. In 1968, the Nixon administration launched the US government’s “War on Drugs”, which according to former Nixon domestic policy chief, John Ehrlichman, was deliberately “created as a political tool to fight blacks and hippies.” The War on Drugs has now been going for 50 years, during which time the effects on the Black community have been devastating through a perpetual cycle of harsh policing, community and family violence, incarceration, unemployment, educational disadvantage, poverty and disenfranchisement. Arguably, the War on Drugs and its intrinsically linked industrialised prison-to-grave system constitute a form of cultural and racial genocide. As pointed out in Sophia Kerby’s 2012 article for the Center for America Progress “racial disparities in the criminal-justice system threaten communities of color—disenfranchising thousands by limiting voting rights and denying equal access to employment, housing, public benefits, and education to millions more.” A 2013 report prepared by the Sentencing Project argued that racial disparity pervades “every stage of the United States criminal justice system, from arrest to trial to sentencing.”

As a primary model of the neoliberal individualism and corporatisation of ordinary life that has been rolled out across the Western World, US society appears to bear the fruit of an ideology that worships success in the form of ostentatiously flaunted wealth, while casting those who cannot achieve that success solely as victims of their own moral flaws and failures.

“It’s difficult to say that the prosperity gospel itself led to Donald Trump’s inauguration. Again, only 17 percent of American Christians identify with it explicitly. It’s far more true, however, to say that the same cultural forces that led to the prosperity gospel’s proliferation in America — individualism, an affinity for ostentatious and charismatic leaders, the Protestant work ethic, and a cultural obsession with the power of “positive thinking” — shape how we, as a nation, approach politics. What is our collective approach to health care, after all, if not rooted in a visceral sense that the unlucky are responsible for their own misfortune? What is our willingness to vote a man like Trump into office but a collective cultural reward for those who brand themselves as successful?”

Source: The prosperity gospel, explained: Why Joel Osteen believes that prayer can make you rich, by Tara Isabella Burton, Vox, 1 September 2017

In the corporate world this idea that success is based on individual effort and hard work alone drove management techniques such as the forced ranking performance management system that “leaders” such as Jack Welch of General Electric (GE) used to reward the top performers while culling those at the bottom. In creating a system where an individual’s rewards and continued employment depend on being in the top performance bands, the system pitted every employee against their workmates in a dog-eat-dog competition, so that an individual’s success inevitably comes at the failure of the person next to them—creating the incentive for collegial sabotage and other unethical self-promoting behaviours—while those in critical yet unassuming support roles risk being cast as non-performers and ejected. Welch’s singular focus on share price presaged the current short-term focus on share price and quarterly profit figures as key determinants of enterprise success above all else.

“…hundreds of other CEOs adopted Six Sigma after Welch did. But they also bought into his obsession with the stock price. At its worst, that obsession gave us Enron Corp. and WorldCom. But even putting crookedness aside, it led most of corporate America to care primarily about dancing to Wall Street’s tune. Employees, communities, and even customers became less important than “maximizing shareholder value.””

Source: Forced Rankings Are Institutionalized Stupidity at Its Worst, by Rob Enderle, 13 July 2012

GE’s decline after Welch left has been variously ascribed to the personal failings of his successor and to the stock market crash. But, that is also the way of this form of success worship—GE’s success during the good times through which he led is held up and celebrated as proof of his genius and marvellous leadership, while the subsequent decline is ascribed to the leadership failings of the next guy and to the bad luck of the economic events that happened after—rather than to any seeds of chaos and destruction that Welch himself may have sowed, that just took a while to sprout and come to fruition. When extrapolated across an entire society this form of thinking is a sure recipe for societal disaster.

The decline of US society is charted in numerous statistics that document the end of the so called American dream—whether that be the decline of social mobility, the ever widening wealth gap, the declining life expectancy, the increase in levels of extreme poverty, increasing levels of under-employment, the ballooning student debt, the increasingly unaffordable healthcare, the endemic homelessness of more than 550,000, the mass incarceration of 2.3 million people, rampant domestic violence costing some $8.3 billion per year, or the ever increasing numbers of mass murders. These instances are supported by figures showing that the USA is declining across a range of key quality of life factors. According to Numbeo, as at mid-2019 the USA stands at #13 (down from #9 in mid-2017) in national rankings for Quality of Life, which includes #3 for Purchasing Power (down from #2), #58 for Safety (down from #44), #30 for Healthcare (down from #26), #2 for Property Price to Income Ratio (remaining at #2), #32 for Traffic Commute Time (down from #24), #21 for Pollution (down from #15), #46 for Climate (down from #32) and #18th for Cost of Living (up from #19). While some ascribe this collapse to the decline of Christianity or the rise of the LGBTI community, the USA is among the most Christian nations in the world with some 79.5% of the population being said to be Christian in 2010. Whatever the effects of religion the underlying processes in this decline are likely to be complex. But, it is hard to escape the conclusion that the USA appears to be in the process of a systemic social collapse.

Economic collapse

There is much debate about the prospects of an imminent US economic collapse with some commentators (eg Gaurav Sharma in 5 Signs of a U.S. Economic Collapse in 2019, Daan Joubert in The US Economic Collapse Of 2019, and Alex Williams in Are You Ready for the Financial Crisis of 2019?) saying this is likely on the basis of factors such as growing government and consumer debt levels, increased interest rate uncertainty, the slowing global economy and a dysfunctional US political environment. Others, like Bill Conerly writing for Forbes, predict not a crash but merely a recession in 2019 which would be triggered by the Federal Reserve making an error in managing interest rates and its securities portfolio.

Writing in 2010, Alfred McCoy (J.R.W. Smail Professor of History at the University of Wisconsin-Madison) sets out a range of factors and scenarios pointing to the demise of the US as the global super power and likely heralding an economic collapse by 2030. But, his Economic Decline: Scenario 2020 seems to very accurately capture the essence of the current situation—right down to the rise of Trump as a far right patriot as President:

“After years of swelling deficits fed by incessant warfare in distant lands, in 2020, as long expected, the U.S. dollar finally loses its special status as the world’s reserve currency. Suddenly, the cost of imports soars. Unable to pay for swelling deficits by selling now-devalued Treasury notes abroad, Washington is finally forced to slash its bloated military budget. Under pressure at home and abroad, Washington slowly pulls U.S. forces back from hundreds of overseas bases to a continental perimeter. By now, however, it is far too late. Faced with a fading superpower incapable of paying the bills, China, India, Iran, Russia, and other powers, great and regional, provocatively challenge U.S. dominion over the oceans, space, and cyberspace. Meanwhile, amid soaring prices, ever-rising unemployment, and a continuing decline in real wages, domestic divisions widen into violent clashes and divisive debates, often over remarkably irrelevant issues. Riding a political tide of disillusionment and despair, a far-right patriot captures the presidency with thundering rhetoric, demanding respect for American authority and threatening military retaliation or economic reprisal. The world pays next to no attention as the American Century ends in silence.”

Source: How America will collapse (by 2025), by Alfred McCoy, Salon, 7 December 2010 [Emphasis added]

The fact is that while the US has not yet started reducing most of its overseas bases, negotiations are underway with the Taliban to get out of Afghanistan and while Trump promised to get the US military out of Syria, it has so far failed to leave. Meanwhile, due to the way the US government has employed the US dollar as a weapon against other nations through sanctions and other forms of economic warfare, many nations are now in the process of developing alternatives. The alternatives include the use of currency swaps between Russia and China and a number of other trading partners that allow them to avoid using the US dollar for trade and the establishment of alternative payments mechanisms—like Russia’s SWIFT alternative the system for transfer of financial messages (SPFS), China has a similar SWIFT alternative in CIPS and the EU-Iran payment vehicle INSTEX is also designed to facilitate trade payments with US sanctioned Iran.

“…states need local currency settlements not only to protect themselves from the effects of the Fed’s moves. At the moment, most bilateral transactions between Russia and China are still carried out in US dollars. More importantly, they are carried out through the SWIFT system, which means that the United States may freeze any transaction or even completely cut off a country’s access to international settlements, which has been the case with Iran.”

Source: Rouble and Yuan Challenge US Dollar Hegemony – Financial Experts, Sputnik, 28 November 2018 [Emphasis added]

As another sign of the US dollar losing its pre-eminence, countries like Russia and China have begun to stockpile gold as a backstop reserve while reducing their holdings of US Treasury bonds. As at the end of March 2019, Russia is reported to have increased its gold reserves to 2119.20 tonnes which is well up from an average of 830.43 tonnes during the period 2000 until 2019. During 2018, Russia also moved to diversify its state reserves away from US debt so that its share of US Treasuries hit an 11-year minimum of only $14.9 billion in May of that year. Meanwhile, China’s gold reserves currently stand at 1864.30 tonnes with 12 tonnes being added in the March 12019 quarter. In 2018, China was also reported as considering reducing its USD1.182 trillion of US Treasuries in response to trade tariffs imposed by the Trump administration and as at May 2019 its holdings were reportedly down to USD1.11 trillion.

Meanwhile, the US government has in 2019 again increased its defence budget to USD716 billion, bringing the nation’s overall budget for military related expenditure to well around USD1 trillion when you add in the budgets for the Department of Veterans Affairs (USD93.1 billion), Homeland Security (USD51.7 billion), the State Department (USD42.8 billion), the National Nuclear Security Administration in the Department of Energy (USD16.5 billion), and the FBI and Cybersecurity in the Department of Justice (USD26.1 billion). As reported by the Peter G Peterson Foundation, US defence spending accounts for 15 percent of all federal spending and roughly half of discretionary spending. Notably, the US spends more on national defence than China, Saudi Arabia, India, France, Russia, the United Kingdom and Germany combined.

The US budget deficit now stands at USD22 trillion and the US Treasury now expects to borrow over USD800 billion over the next two quarters of 2019, with the situation said to only likely to get worse.

“By 2021, Treasury will begin to have a problem, given deficit growth, and need to increase coupon sizes,” said Margaret Kerins, global head of fixed-income strategy at BMO Capital Markets. Then again, if the current administration is still in charge, the world will likely have far more pressing issue than the eventual insolvency of the US to worry about…”

Source: US Treasury Now Expects To Borrow Over $800 Billion In Debt In Two Quarters, by Tyler Durden, Zero Hedge, 29 July 2019

Adding to this picture of economic decline is the USD2 trillion backlog of infrastructure spending, which in spite of a promised USD200 billion allocation for the purpose seems to have been made even worse under the Trump administration through cuts to various government programs.

“America’s infrastructure is desperately in need of investment, according to the American Society of Civil Engineers. The ASCE estimates the US needs to spend some $4.5 trillion by 2025 to fix the country’s roads, bridges, dams, and other infrastructure. Trump reportedly “hates” major parts of the infrastructure plan he unveiled in 2018, which proposed $200 billion in federal funding designed to finance new projects and repairs while incentivizing private investment.”

Source: America’s infrastructure is decaying — here’s a look at how terrible things have gotten, by Cadie Thompson and Mark Matousek, 5 February 2019

Notwithstanding the serious economic realities facing the USA, as anticipated by Alfred McCoy the bellicosity of the Trump regime has steadily increased with loud demands, economic sanctions and tariffs and military treats being applied to a number of nations that have been targeted by the administration. These actions have to-date included those against:

  • Russia – sanctions, diplomatic expulsions, theft and occupation of consular premises
  • Syria – continued sanctions against the populace, denial of restoration funding, cruise missile attacks, occupation of lands, training and support of terrorist insurgents and organisations
  • North Korea – threats of nuclear annihilation, use of sanctions against the populace, trade blockade
  • Venezuela – sanctions against the populace, theft of US and UK based state resources, occupation of consular premises, regime change activities through support of prospective presidential usurper Juan Guaido, cyber warfare impacting power systems, assassination attempt on elected leader, threats of trade blockade
  • Iran – sanctions against the populace, economic warfare through use of secondary trade sanctions, threats of nuclear attack, piracy of an oil tanker carrying Iranian oil using UK special forces, increased military presence and arming of proxy nations in the region, working with and support for MEK terrorist organisation to plot actions against Iran and its people
  • Yemen – supply of weapons and provision of military aid and support for the Saudi war on the Houthis in Yemen.

Additionally, the US has attempted to strong arm its erstwhile ally and vassal, Germany, into abandoning the Russian Nord Stream 2 gas pipeline project in favour of purchasing much more expensive US sourced LNG. This has gone to the extent of moving to sanction companies involved in the project. The US has also recently moved to propose sanctions against its supposed NATO ally, Turkey, which has earned disfavour for purchasing a Russian S400 missile system and is also looking at sanctions against India for the same offence.

Remarkably, in spite of these threats and acts of economic and other forms of war, the US has been largely unsuccessful in achieving any form of outright “win” against any of these targeted nations. Iran has refused to talk with the US until it removes the sanctions, Germany has ignored the US demand to cease with Nord Stream 2, Turkey has defiantly bought the S400 system anyway and India is proposing to do the same, Venezuela has somehow held out against the acts of war enacted against it, Syria continues to rid its lands of US and its allies terrorist proxies and restore its cities and nation, North Korea has entered into negotiations with the US and South Korea but is standing firm on its nuclear defence capability, the Houthis in Yemen are fighting back and have forced the UAE to withdraw its forces, and Russia has insulated its economy from US attack and entered into a partnership with China for their mutual benefit and support so that together they have set up alternative economic structures and organisations that may one day by-pass or replace the roles played by the US dollar, SWIFT, the IMF and the World Bank—all being key elements of US economic power projection and the basis of its global economic hegemony.

The poverty of spirit and increasing powerless frustration of the US elites sees them turn against people who have no power, so that fear of the other must be manufactured in the form of swarming desperate “illegal economic immigrants”—pitiful creatures who can be blamed for much of what ails the USA and stand as whipping boys for the loss and dispossession of the newly impoverished US middle classes. These less deserving people must be imprisoned, beaten with batons and threatened with guns, starved and hunted in the deserts, blotted out with barriers and separated from their caged children as an example to others.

Military collapse

The US military represents the largest, most powerful and most expensive killing machine the world has ever seen. And yet for the last 70 years, its success at winning wars, even against ostensibly much weaker opponents, is truly pitiful. According to Andrei Martyanov, who graduated from the Kirov Naval Red Banner Academy in the USSR and now works in the USA as Laboratory Director of a commercial aerospace group, the reputation of the US military is largely based on a myth about its role in winning World War 2 when in fact it arrived late on the scene to a war in Europe that had already been won by the Russian forces that broke the German eastern advance and had started rolling it back. Martyanov goes on to point out that the US homeland is not ever suffered nor really been threatened by rampaging destructive murdering raping armies and mass destruction of cities and lives. Never having experience of an actual war of invasion on their own territory, the reality of war does not sit in the American consciousness as an existential national threat, it is an academic thing that happens to other people in far away places. Moreover, the corporatised nature of the US military industrial complex has seen the defence budget being merely a way of channelling money from the public purse into the hands of corporations and the elite shareholders. According to Martyanov, the main point of US military equipment is not effectiveness but its ability to generate profits. Like most of the US government functions, the oligarchs have converted the US military into a money making zombie designed to channel wealth from the public purse into their own hands.

Evidence for this extractive relationship can be seen in the design and acquisition of the US military’s F-35 Lightning II Joint Strike Fighters and in the new Gerald R. Ford class aircraft carriers. The acquisition cost of the F-35, which is already the most expensive U.S. weapons program ever, has ballooned from USD233 billion in 2001 to USD406 billion by 2017 with a lifetime cost for the fleet estimated at USD1.5 trillion. Even as far back as 2012, the Government Accountability Office reported that:

“JSF is not on track to meet …operational suitability requirements” (page 17), and finally, GAO says the program is experiencing “excessive time for low observable repair and restoration, low reliability, and poor maintainability performance” (page 17).  After all that, GAO politely calls the sustainability cost goal “a significant challenge” (page 31). GAO is also correct to point out DOD management’s declaration that the current F-35 operating cost estimate, “$1.1 Trillion for all three variants based on a 30-year service life,” (page 10) is “unaffordable and simply unacceptable in the current fiscal environment” (page 11).”

Source: How the F-35 Nearly Doubled In Price (And Why You Didn’t Know), by Winslow Wheeler, 9 July 2012

After nearly two decades of ongoing design issues and production problems, by June 2018, the F35 was only just entering full scale production and the program was still reportedly plagued with planes and parts taking longer to repair than planned and the Air Force, Navy facing increases to fund greater support costs. In 2019, it was reported that the F35-B and C variants were unable use their afterburners without the critical stealth tech ‘bubbling and blistering’ and, in the case of the F35-C, risking compromise of the structural integrity of the horizontal tail and boom of the aircraft—effectively this limits their ability to operate at supersonic speeds. As at June 2019, the F35’s were still being reported as being “marred by flaws and glitches that, if left unfixed, could create risks to pilot safety and call into question the fighter jet’s ability to accomplish key parts of its mission.” Added to which, there continues to be some debate as to whether the stealth qualities of the F35 are actually as effective as advertised against newly developed Russian and Chinese advanced radar systems.

The new first-of-class USD13 billion US aircraft carrier, USS Gerald R Ford, has likewise been plagued by technical issues and cost overruns. As at July 2017, when it was commissioned almost three years behind schedule and $2.4 billion over its estimated budget, the ship went straight back into testing and training, and still wasn’t expected to be fully operational until 2020 at the earliest. Meanwhile, in 2018 Russia’s President Putin announced, among other high-tech military systems, the new Kinzhal hypersonic Mach 10 air-launched missile system, which is reputedly able to destroy large, moving sea-based targets such as aircraft carriers, destroyers and cruisers.

The extractive nature of the military industrial complex is supported by a range of constituents:

With what former defense secretary Robert Gates termed a “gargantuan, labyrinthine bureaucracy” in the Pentagon, manufacturers and subcontractors for each weapons system carefully distributed across congressional districts and backed by aggressive lobbyists, members of Congress determined to protect constituents’ jobs, and military leaders loyal to the weapons systems they trained on and commanded, it is no surprise that the defense establishment has become extravagant, wasteful, and less agile, innovative, and forward-looking than it should be.

Source: America’s Indefensible Defense Budget – Extracts-(The New York Review of Books), Jessica Mathews, 14 August 2019

But, the purported domestic economic benefits of the US’s wars rest on increasingly shaky grounds, as pointed out by William J. Astore and Tom Engelhardt:

We believe military spending brings wealth and jobs galore, even when it measurably doesn’t. Military production is both increasingly automated and increasingly outsourced, leading to far fewer good-paying American jobs compared to spending on education, infrastructure repairs of and improvements in roads, bridges, levees, and the like, or just about anything else for that matter.”

Source: Military Strength Is Our National Religion, by William J. Astore and Tom Engelhardt, 14 August 2019

In spite of all of the issues with the US maintaining military supremacy that Martyanov points out and the gross inefficiencies and corrupt practices that obviously infest the US defence establishment, the US still has the biggest military the world has ever seen and predicting its collapse may be seen to be a stretch of anyone’s imagination. But, as we have seen in the 9/11 collapse of the World Trade Center’s Twin Towers and Building 7, even the most sound and apparently indestructible structure can collapse at near free fall velocity when its foundations are cut from below it. In the case of the US military, these foundations rest on the US’s ability to fund its deficit and over-bloated military spending using its position as the world’s primary reserve currency. Primacy of the US Petro-dollar enables the US to fund all of its military activities using other peoples money so that trade surpluses that these other nations earn are retained in US treasury bonds and other investments that serve to find US government spending. It is no coincidence that several of the countries the US has destroyed in recent years have threatened to stop using the US dollar for their oil trading, most notably Libya and Iraq. Strangely, it is in the US government’s hegemonic use of sanctions and trade barriers to bully other nations that this underpinning economic foundation is starting to crack with significant near-peer nations working to establish trade mechanisms that avoid the US dollar.

“The current U.S. system of ever increasing debt is unsustainable – nobody and no institution can go on massively increasing their borrowing (or selling their assets) for ever. Eventually the rest of the world will call foul and no longer bankroll Americans living beyond their means.”

Source: The Petrodollar System and the Petrodollar Wars Explained, IWB, 20 June 2017

Continued in Part 6.

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