Financial Meltdown = No Superpower?
With all the turmoil in the financial markets and the talking heads discussing the causes, implications and responsible parties for the financial meltdown in the US financial sector, I have been thinking about the impact on the US Super Power status.
Part of the reason why the rest of the world looks to the US is because its financial strength enables the US to have the freedom to do what it wants, likes and feels it should do pretty much where and when it likes and how it likes. And the rest of the world knows that the US has the financial power to engage in humanitarian, military, financial or a host of other ways if it so chooses. The question at hand is how the implosion will affect the willingness, appetite and ability to act in this traditional way now that finance and politics at home are in flux and not on the footing to support the role at the same level. And abroad, is the sentiment “how the mighty have fallen?” or one that says that pain is relative and the US is suffering like the rest of us in a different way and $700 billion while an unfathomable amount is relative to the US economy and a bump that the US can navigate?
The impact of the woes in the US is not something that will go quietly into the night and the fallout is still unravelling. In the global economy that we live in, so goes the US has been an indicator for so goes the rest of the world. Especially since the institutions are so global in their sources and uses of funds. But we do live in an era where wealth and buying power has been redistributed to other areas of the globe such as the Middle and Far East – in some cases to countries that are not so friendly to the US.
It will be interesting to see how this plays out.
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