Steyn On Decline

In today’s New York Times we learn that President Obama, to his credit, recently made clear to President Hu Jintao that if China would not do more to contain North Korea, the USA would have no choice but to increase its military presence in the region. China has, in response, made a few helpful gestures.

Our leverage, however, is limited at best, as Mark Steyn points out in a pungent new article that’s been making the rounds.

The New Criterion article, which is about the accelerating dissolution of the English-speaking nations, begins with a frank summary of the economic full-Nelson that China has applied to the USA:

Decline starts with the money. It always does. As Jonathan Swift put it:

A baited banker thus desponds,
From his own hand foresees his fall,
They have his soul, who have his bonds;
’Tis like the writing on the wall.

Today the people who have America’s bonds are not the people one would wish to have one’s soul. As Madhav Nalapat has suggested, Beijing believes a half-millennium Western interregnum is about to come to an end, and the world will return to Chinese dominance. I think they’re wrong on the latter, but right on the former. Within a decade, the United States will be spending more of the federal budget on its interest payments than on its military.

According to the cbo’s 2010 long-term budget outlook, by 2020 the U.S. government will be paying between 15 and 20 percent of its revenues in debt interest—whereas defense spending will be down to between 14 and 16 percent. America will be spending more on debt interest than China, Britain, France, Russia, Japan, Germany, Saudi Arabia, India, Italy, South Korea, Brazil, Canada, Australia, Spain, Turkey, and Israel spend on their militaries combined. The superpower will have advanced from a nation of aircraft carriers to a nation of debt carriers.

What does that mean? In 2009, the United States spent about $665 billion on its military, the Chinese about $99 billion. If Beijing continues to buy American debt at the rate it has in recent years, then within a half-decade or so U.S. interest payments on that debt will be covering the entire cost of the Chinese military. This year, the Pentagon issued an alarming report to Congress on Beijing’s massive military build-up, including new missiles, upgraded bombers, and an aircraft-carrier R&D program intended to challenge American dominance in the Pacific. What the report didn’t mention is who’s paying for it. Answer: Mr. and Mrs. America.

Within the next five years, the People’s Liberation Army, which is the largest employer on the planet, bigger even than the U.S. Department of Community-Organizer Grant Applications, will be entirely funded by U.S. taxpayers. When they take Taiwan, suburban families in Connecticut and small businesses in Idaho will have paid for it. The existential questions for America loom now, not decades hence. What we face is not merely the decline and fall of a powerful nation but the collapse of the highly specific cultural tradition that built the modern world. It starts with the money—it always does. But the money is only the symptom. We wouldn’t be this broke if we hadn’t squandered our inheritance in a more profound sense.

Mr. Steyn makes clear that this is far more than a matter of trade imbalances, or out-of-control budget deficits:

We are coming to the end of a two-century Anglosphere dominance, and of a world whose order and prosperity many people think of as part of a broad, general trend but which, in fact, derive from a very particular cultural inheritance and may well not survive it. To point out how English the world is is, of course, a frightfully un-English thing to do. No true Englishman would ever do such a ghastly and vulgar thing. You need some sinister rootless colonial oik like me to do it. But there’s a difference between genial self-effacement and contempt for one’s own inheritance.

Not so long ago, Geert Wilders, the Dutch parliamentarian and soi-disant Islamophobe, flew into London and promptly got shipped back to the Netherlands as a threat to public order. After the British Government had reconsidered its stupidity, he was permitted to return and give his speech at the House of Lords—and, as foreigners often do, he quoted Winston Churchill, under the touchingly naive assumption that this would endear him to the natives. Whereas, of course, to almost all members of Britain’s governing elite, quoting Churchill approvingly only confirms that you’re an extremist lunatic. I had the honor a couple of years back of visiting President Bush in the White House and seeing the bust of Churchill on display in the Oval Office. When Barack Obama moved in, he ordered Churchill’s bust be removed and returned to the British. Its present whereabouts are unclear. But, given what Sir Winston had to say about Islam in his book on the Sudanese campaign, the bust was almost certainly arrested at Heathrow and deported as a threat to public order.

Somewhere along the way a quintessentially British sense of self-deprecation curdled into a psychologically unhealthy self-loathing.

Mr. Steyn, examining the etiolating effects of the expanding State, quotes Hayek:

There is one aspect of the change in moral values brought about by the advance of collectivism which at the present time provides special food for thought. It is that the virtues which are held less and less in esteem and which consequently become rarer are precisely those on which the British people justly prided themselves and in which they were generally agreed to excel.

The virtues possessed by Anglo-Saxons in a higher degree than most other people, excepting only a few of the smaller nations, like the Swiss and the Dutch, were independence and self-reliance, individual initiative and local responsibility, the successful reliance on voluntary activity, noninterference with one’s neighbor and tolerance of the different and queer, respect for custom and tradition, and a healthy suspicion of power and authority.

Within little more than half a century, almost every item on the list had been abandoned, from “independence and self-reliance” (some 40 percent of Britons receive state handouts) to “a healthy suspicion of power and authority”—the reflex response now to almost any passing inconvenience is to demand the government “do something.” American exceptionalism would have to be awfully exceptional to suffer a similar expansion of government without a similar descent, in enough of the citizenry, into chronic dependency…

When William Beveridge laid out his blueprint for the modern British welfare state in 1942, his goal was the “abolition of want,” to be accomplished by “cooperation between the State and the individual.” In attempting to insulate the citizenry from the vicissitudes of fate, Sir William succeeded beyond his wildest dreams: Want has been all but abolished. Today, fewer and fewer Britons want to work, want to marry, want to raise children, want to lead a life of any purpose or dignity. Churchill called his book The History of the English-Speaking Peoples—not the English-Speaking Nations. The extraordinary role played by those nations in the creation and maintenance of the modern world derived from their human capital.

What happens when, as a matter of state policy, you debauch your human capital? The United Kingdom has the highest drug use in Europe, the highest incidence of sexually transmitted disease, the highest number of single mothers; marriage is all but defunct, except for toffs, upscale gays, and Muslims. For Americans, the quickest way to understand modern Britain is to look at what lbj’s Great Society did to the black family and imagine it applied to the general population. One-fifth of British children are raised in homes in which no adult works. Just under 900,000 people have been off sick for over a decade, claiming “sick benefits,” week in, week out, for ten years and counting. “Indolence,” as Machiavelli understood, is the greatest enemy of a free society, but rarely has any state embraced this oldest temptation as literally as Britain. There is almost nothing you can’t get the government to pay for.

Plucked at random from The Daily Mail: A man of twenty-one with learning disabilities has been granted taxpayers’ money to fly to Amsterdam and have sex with a prostitute. Why not? His social worker says sex is a “human right” and that his client, being a virgin, is entitled to the support of the state in claiming said right. Fortunately, a £520 million program was set up by Her Majesty’s Government to “empower those with disabilities.” “He’s planning to do more than just have his end away,” explained the social worker.

“The girls in Amsterdam are far more protected than those on U.K. streets. Let him have some fun—I’d want to. Wouldn’t you prefer that we can control this, guide him, educate him, support him to understand the process and ultimately end up satisfying his needs in a secure, licensed place where his happiness and growth as a person is the most important thing? Refusing to offer him this service would be a violation of his human rights.”
And so a Dutch prostitute is able to boast that among her clients is the British Government.

What is to be done? As is usually the case with Mark Steyn’s writings on this theme, the article is long on gloomy description, and quite barren of prescription. But odds are that even if he had offered a prescription (which would have to be for strong and stinging medicine), nobody would bother to fill it; until we can acknowledge the reality and gravity of our predicament, and look frankly at ourselves as we try to divine its cause, rallying cries and exhortations will be useless. The West is in the grip of a dire psychological affliction — the cultural equivalent of the self-loathing that impels young women to cut and starve themselves, or to subordinate themselves to abusive spouses — and as with any debilitating psychological malady, the first step in curative transformation is necessarily that the patient begin to be able to to see things as they really are.

The English-speaking peoples — Britain itself, and most importantly its cultural heir and indispenable ally the United States — created the modern era. They have a great deal to be proud of: more so, arguably, than any nation or empire in the world’s long and bloody history, and they have an essential role to play if the prosperity and freedom they have brought to the world is to be sustained. If, however, their rot and decline continues unchecked, if their centuries of virility and confident purpose give way irreversibly to impotence and senescence, then a long and bitter darkness will surely descend upon us all.

Read the article here.

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8 Comments

  1. the one eyed man says

    Most US government debt is held domestically, with holders including institutions, individuals, and the Fed. China owns roughly 6.5% of the national debt. Sounds pretty manageable to me.

    I’m not so sure about all of this doom and gloom talk. Oswald Spengler said pretty much the same things nearly a century ago in Decline of the West, and we’ve done pretty well since then. I think that free societies with strong educational systems have an insurmountable advantage over the others. America has a tradition of nourishing native genius, from Thomas Edison to Henry Ford to Bill Gates to Steve Jobs. It also has a tradition of bringing the best and the brightest from overseas, from Albert Einstein to Andy Grove to Sergei Brin. I don’t disagree that we have deep and systemic problems, but I also believe we have strengths which Steyn ignores.

    I would say to Steyn: take that frown and turn it upside down. Sing a happy song instead.

    Posted January 21, 2011 at 3:29 pm | Permalink
  2. Malcolm says

    Yes, China only holds a small percentage of our enormous total debt (the figure you mention is just treasuries) — but as Steyn points out, before long the service of that debt will be sufficient to cover the entire cost of China’s military. This is our path to future greatness?

    Our mandatory obligations far exceed even the rosiest projections of revenue, and are rising steeply.

    And Steyn doesn’t ignore our strengths; his point is that the qualities that made us strong and prosperous in the first place — individual responsibility and self-reliance, aversion to intrusive and authoritarian government, and above all, respect and gratitude for our founding culture and its history and tradition, and the will to defend it — are swiftly melting away.

    There’s a National Guard armory near my house in Brooklyn, and outside it there stands a statue of a WWI doughboy. I walk by it every Thursday evening, on the way to class. On the plinth are inscribed the words:

    “Strike! — till the last arm’d foe expires;
    Strike! — for your altars and your fires;
    Strike! — for the green graves of your sires;
    God, and your native land!”

    Who would write such words today?

    Posted January 21, 2011 at 4:26 pm | Permalink
  3. JK says

    “I think that free societies with strong educational systems have an insurmountable advantage over the others.”

    Seems “manifestly” evident:

    http://news.yahoo.com/s/afp/20110120/ts_alt_afp/useducationuniversity

    For the also happy news on the ASVAB front – refer to archives.

    $2.6B/week for Afghanistan related expenses – drop in the bucket. We’ll recover those costs with all the precious minerals contracts we’ve negotiated with Karzai, once we get him securely propped up after we’ve got his Army able to learn their ‘ABCs’ and the pistachio factories humming.

    We’ll likely get the cream of Afghan trained engineers and biologists too – just as we did when we skimmed the population of Somalia.

    It’s no wonder at all Malcolm seems to be posting such inordinately “chipper” pieces of late.

    Posted January 21, 2011 at 5:06 pm | Permalink
  4. chris g says

    The author came up with a clever and impactful way to express the magnitude of our debt to China (funding their military with interest alone).

    My clever way of downplaying the magnitude of our debt relative to our “earning power” using our innovator du jour, Mark Zuckerburg, and also to think a little about death taxes and baby boomers.

    Facebook’s value is being tossed around at $50 billion. Mark Zuckerburg, a 26 year old U.S. citizen owns 25% of Facebook… value that at $12.5 billion. More foreigners use facebook than Americans.

    If Mark’s net worth manages to grow at 10% per year until he dies at the age of 80, he’ll be worth over $2 trillion. If he pays 50% death tax, then the gov’t will get $1 trillion. Our national debt stands at $13 trillion right now. I don’t know what it will be in 30+ years but a lot of baby boomers will be paying death taxes between now and then (rich people tend to dramatically oversave cuz nobody wants to die broke and no one knows exactly when they’ll die).

    Posted January 22, 2011 at 11:39 am | Permalink
  5. chris g says

    Sorry, my theory is that it takes only 13 Mark Zuckerburgs and a bunch of dead baby boomers to eradicate our debt.

    Posted January 22, 2011 at 11:40 am | Permalink
  6. the one eyed man says

    Apparently Steyn is wrong on the facts: over the past two years, China has been a net seller of Treasury paper (although some speculate that China has been masking purchases by placing them through British brokers). Hence his conjecture regarding what would happen “if Beijing continues to buy American debt at the rate it has in recent years” is groundless.

    http://www.nytimes.com/2011/01/22/business/economy/22charts.html (grammatically incorrect headline, which should either read “the datum shows” or “data show”. Shame on you, Gray Lady.)

    Posted January 22, 2011 at 12:51 pm | Permalink
  7. Malcolm says

    Right, then, nothing to worry about.

    Posted January 22, 2011 at 1:24 pm | Permalink
  8. the one eyed man says

    If you’re going to make an argument, it should be based on fact. Steyn fails this test.

    When Sputnik was launched, pundits speculated that the Russians would eat our lunch. After the Berlin Wall fell, pundits speculated that the Japanese would be eating our lunch instead. Russia’s economy is levered to the price of commodities, and the Japanese economy has been moribund for two decades. See above regarding the inherent advantages of open societies with strong educational systems.

    Having lived in what is now China, I would not doubt for a minute that the Chinese will, at some point, reach parity with us. There is much that we can do to maintain our competitive edge, and getting our fiscal house in order is certainly one of them. As you correctly note, Steyn’s piece is short on ways to do this, but he is hardly alone. There are plenty of proposals around to achieve this – Obama’s deficit commission having produced one of them – but no political will to do so. As a Times article noted yesterday, people will tell pollsters that they want government spending cut, but are loath to support actual cuts in entitlement programs. The lack of political will was underscored this week when the deficit hawks in the GOP House caucus came out demanding more cuts, but without specifying where the cuts would come from and specifically exempting entitlements and the military. As others have noted, the GOP abandoned the war on terror to start a war on arithmetic.

    You and I have previously agreed on a number of things which would reduce the deficit: selling national assets, reducing the number of military bases here and abroad, selling the naming rights to the Statue of Liberty to Coke, and so forth. I’m not so sure that the trajectory which Steyn predicts is any more accurate than his understanding of sovereign debt. My guess is that future deficits will be mitigated by a combination of economic growth and inflating the currency, so the debt is repaid in cheaper dollars. However, like global warming, the risks involved argue for erring on the side of caution. So while you, me, and Steyn would likely end up at roughly the same place as far as policy should go, I think that Steyn takes the wrong way to get there.

    Posted January 22, 2011 at 2:53 pm | Permalink