Editorial ,

Americas Dangerous Decline

By Eduard Lukasovich


This week, in the wake of further falls on the world markets, U.. !resident "eorge #. Bush
announced that he is $re$ared to $ush through yet another %stimulus $ackage% on to$ of the &'()
*illion already $ut forward.
Browse +olumn
,eanwhile, murky +hinese and Ara*ic state-*acked funds are investing tens of *illions of dollars into
leading #estern multinational *anking institutions like +iticor$ and ,errill Lynch, with others soon to
follow.
This is e.actly the wrong $olicy at the wrong time. The free market should *e allowed to resolve and
harmoni/e the distortions in whatever way it sees fit. tate intervention to shore u$ *anks and $ut
money in the citi/ens0 $ockets will only reduce com$etitiveness and create a cycle of de$endency.
Bush0s decision to use socialism to %cure% the free market is yet another indication of how far America
is declining, and how little it has come to terms with this decline.
1or several years now, America has *een suffering from a %hy$er$ower com$le.,% in which it still likes
to act is if it is the world0s only su$er$ower, and can dictate terms to anyone. 2n reality, America0s
geo$olitical $ower has suffered one of the most ra$id declines since the colla$se of the oviet Union.
#ho would have thought that a few thousand $oorly-armed insurgents in a $air of *ackwards nations,
2ra3 and Afghanistan, could defeat su$erior American forces, and at the same time *ankru$t the
em$ire4
2n retros$ect, it0s easy to see why this ha$$ened. A com*ination of im$erial overreach and state-
interventionism is e.actly what doomed the oviet Union, as well as "reat Britain. adly, America is
making the same mistake. 2t cannot admit that it has lost the war in 2ra3, and in fact has em*arked on a
*i/arre self-esteem cam$aign to convince itself that its so-called %surge% has actually worked, and the
war now is won. 2t0s like watching a terminally ill man making $lans to take u$ hang gliding as soon as
he0s u$ and out of the intensive care unit.
2ndeed, America today reminds one of the tragic finale in 5f ,ice And ,en, with "eorge Bush as
Lenny $ointing across the ocean, dreaming of his $lans to *uild a series of democracy farms as far as
the eye can see, while his friend "eorge, $layed *y Adam mith, holds u$ an old musket-$istol to
Bush0s head, and, with a heavy heart, fires a giant musket*all of market economics reality into Bush0s
uncom$etitive state-interventionist *rain.
Today, Americans are too misguided to understand that even if hundreds of *illions of dollars disa$$ear
in the credit crisis, or the American *anking system colla$ses, or they and hundreds of thousands of
American families lose their homes to the waves of foreclosures--that these are not necessarily *ad
things. 2t0s like ri$$ing off a *andage, 2 like to say. o if you lose your house, your 6o*, your kids, your
future, it0s actually 6ust like ri$$ing off a *andage. 7eally, it0s for your own good. 8ow hard is it to
understand that4
8ard, a$$arently. That is why 2 *elieve that the world0s


Ascending !owers 9A!s:, namely +hina, 7ussia, and 2ndia, should demand that the United tates halt
its state intervention into its failed *anks and let the market sort it out. Because nothing sorts out
economic distortions *etter than the free market.
1urthermore, American markets must *e $ried o$en to allow +hinese, 7ussian and 2ndian *anks to
move in and sna$ u$ the colla$sing American *anks at firesale $rices. True, old nationalist feelings will
stir in the American heartland, and Americans will not like watching their once-$ri/ed assets sold off to
foreigners for chea$, *ut Americans must *e made to understand that they have no other choice. Their
finances are in a mess and no amount of socialism can hel$. They must sell everything off now,
3uickly, and chea$ly, to those who understand how to com$ete in the ;'st century market. 1at is
everywhere, and here are 6ust a few suggestions< America could sell =AA to the +hinese and raise a
few hundred million dollars, the school system to 7ussia for $erha$s half that, and the Environmental
!rotection Agency to 2ndia, including the $arks and recreation services, all legacies of socialism, in
return for allowing 2ndia to *ury its to.ic waste in America0s $arklands. 2f America wants to survive in
the new millennium, it will have to undergo a $eriod of $ain. ince each American is less and less
valua*le on a $er-ca$ita *asis, it only makes sense that to.ic waste should *e increasingly directed to
American territory.
The free market teaches us to *e fiscally res$onsi*le and com$etitive in a fair and trans$arent manner,
and when we aren0t, it $unishes us. America is *eing irres$onsi*le *y $retending it is still a
hy$er$ower> the laws of the free market res$onded with an insurgency whose wage costs vastly
undercut the *loated American soldiers0 costs. The market *eat America0s illusions. This was the genius
of free markets at work.
Likewise, America today is $ro$$ing u$ an outmoded *anking sector which cannot com$ete with the
+hinese or 7ussian *anks. The free market is $ounding America0s uncom$etitive *anking sector with
*ullets of market reality. This will continue. And America will lose this war as well.
To change America0s *ehavior, we in 7ussia, along with our +hinese and 2ndian $eers, must offer them
carrots and sticks. 2f they slash government s$ending on welfare $rograms and unnecessary military
costs, cut su*sidies to the *anking sector, and $rivati/e the "rand +anyon, then our countries should
reward them *y e.tending restructuring loans to +iti*ank and other institutions, $rovided that those
loans are converted into chea$ly-$riced shares, and that eventually, America0s streets will *e lined with
*anks whose names are announced in +yrillic, anskrit and ?an6i. 8owever, if Bush continues to defy
the free market, we must cut off America0s credit de$endency and $ush their system to fail. 2t0s for their
own good.
Eduard Lukasovich is the +entral American corres$ondent for United 7ussia maga/ine. 8e contri*uted
this comment to The e@ile.