The U.S. is stuck in the Cold War

[kenny blankenship]

The U.S. is stuck in the Cold War
America is following security and trade policies that made sense just after World War II, but are disastrous now
By Michael Lind

Thus began the Grand Bargain at the heart of U.S. Cold War strategy toward West Germany and Japan, the "markets-for-bases" swap. In return for giving up an independent foreign policy to their protector, the United States, the West Germans and Japanese would be granted access to American markets (and, in the case of the Germans, access to Western European markets).

For half a century America's economic establishment, turning a blind eye to Asia's crude and Germany's subtle mercantilism, pretended that American protectionism was the greatest threat to the world economy. It is gradually dawning even on former free-trade fundamentalists that you cannot have a liberal global trading system in which three of the four largest industrial capitalist countries -- China, Japan and Germany -- pursue policies that permit them to enjoy perpetual trade surpluses, which require perpetual trade deficits by the U.S. and other countries.

Meanwhile, the security half of America's global strategy is headed for a crash as well. Since the end of the Cold War, the U.S. has mindlessly sought to fill every power vacuum from the Balkans to the Persian Gulf to Central Asia, while spending far less on the military than it did in the Cold War. The U.S. has gone into debt to finance the Iraq and Afghan wars. You don't have to be a grand strategist to figure out that extending territorial commitments without commensurately expanding funding and troop levels is a formula for strategic and perhaps national bankruptcy.

By declaring that the new deficit commission would not consider any cuts in military spending, only in entitlement spending, President Obama reflected the preferences of America's policy elite. Its members would gladly cut Social Security and Medicare in order to pay for bases and "nation-building" abroad. In the same way, for half a century, America's foreign-policy elite tolerated the targeted deindustrialization of America by Asian mercantilist states, as long as those countries did not challenge America's global military hegemony.

[arcadian]

1. They just retooled the Cold War

Strategic policy was going to be centered around control of oil so they dropped the Soviets and made the scarey Muslins the bad guys. Next it will be China.

[kenny blankenship]

2. The thrust of the article is really about how trade and econ policy are warped by military policy

it's short but well worth the read.