Op-Ed: Could The U.S. Empire Collapse?

America has some things in common with past European economic and military powers that collapsed never to recover their preeminence.

Some economists are predicting a global economic catastrophe that will rival or even surpass that of the American Great Depression of the 1930s. Are these people just negative doomsayers or is there some justification for their dire predictions concerning the world economy? More than 80 percent of Americans now believe that we are on the wrong track as a nation but still believe that the history of other countries in the past that had similar problems is irrelevant. Americans do have one thing in common regarding other economic powers. The majority of the public believes that we are chosen by God to be this way. Rome, Spain, the Netherlands and Great Britain thought this way too. There are also other things that we have in common with imperial Spain, industrial Britain and maritime Holland: a foreign policy that is too ambitious for the number of people that are serving in the Armed Forces; economic polarization, religion that is of a missionary nature and is intolerant; financial institutions replacing manufacturing and excessive debt. However, doomsayers in Britain were premature regarding Britain's demise. Some people predicted that Great Britain would become another Holland as soon as the 1860s and others worried about England in the 1890s when Germany and the United States began to rival them in terms of industrial output. However, by the 1940s, those predictions had come true. Also, the United States has had its share of negative and pessimistic people predicting the nation's downfall. From 1968-72, some people bemoaned our policy in Southeast Asia and possible global trade and currency crises. The fall of Saigon and Watergate contributed to peoples' apprehensions concerning the federal government and their ability to function effectively. During the late 1980s, many people feared how Japan was overtaking the United States in manufacturing preeminence. ''In 1991, Democratic presidential aspirant Paul Tsongas observed that ''the Cold War is over....Germany and Japan won.'' The decade of 1997-2008 has been perilous too. It started out great with the tech mania of 1997-2000. However, it resulted into a bubble and a market crash. Soon, the September 11, 2001 terrorist attacks occurred and the Bush administration's misguided adventure into Iraq in 2003. OPEC has abandoned its $22-$28 price range for oil as prices are over $120 per barrel; other countries condemning us for our policies in Iraq; the American mortgage crisis; family credit card debt and an almost 50 percent decline of the U.S. dollar against the euro since 2002. What parallels the European nation's demise with our own? A reliance on the financial sectors for economic growth. During the 18th century, the Dutch had declining industry and commerce. The leaders of Holland believed that they could replace it with engaging in money-lending schemes to foreign nations and princes. However, a series of crashes and bankruptcies destroyed Holland's economy during the 1760s and 1770s. In the early 1900s, one apprehensive British minister argued that ''banking is not the creator of our prosperity but the creation of it.'' By the late 1940s, Great Britain was mired in debt because of their involvement in two world wars. Does anyone see any similarities? In the United States, our financial services sector overtook manufacturing as a part of the GDP during the mid-1990s. During the 1970s, manufacturing controlled 25 percent of GDP while financial services staked a claim of 12 percent. However, from 2003-06, finance occupied 20-21 percent while manufacturing decreased to 12 percent. During the 1990s and 2000s, loans were bundled recklessly into securities and credit was the lubricant. Total debt in the United States increased from $11 trillion to $48 trillion from 1987-2007. The financial services sector of our national economy weren't regulated during the 1980s and 1990s. Many firms were being constantly bailed out by Greenspan, Robert Rubin and now Treasury Secretary Henry Paulson. Maybe they actually believed that the financial services industry would replace manufacturing as the major component of GDP. The results of this failure to regulate the financial sectors of our economy has led to the United States becoming the world's leading debtor and the largest importer of manufactured goods and oil. Will a second or third rate status as a nation soon ensue?