Jon Taplin – “The Cost of Empire” and the Economic Crisis We’re In

Posted on July 24, 2008

2


Barack Obama and John McCain need to read The Cost of Empire, by Jon Taplin. It’s the most important and informative blog post of the week, I’d dare to venture.

The Cost of Empire is a tour-de-force analysis of U.S. economic and military policy from President Woodrow Wilson to President George Bush, but Taplin’s focus is on our current economic crisis and its relationship to the 30-year buildup of defense spending since the Ronald Reagan presidency.

Everyone who plans to vote and anyone who hopes to survive the present economic crisis needs to read The Cost of Empire. Please look at it right now at Jon Taplin’s Blog.

It’s neatly organized into a prologue and four parts; written so concisely that you can read it in one sitting, and so clearly that you don’t have to be an economic or military expert to grasp its full import. A brief excerpt:

“So we had the perfect storm: A U.S. government needing to borrow $50 billion a month; a banking system needing to replace perhaps $1.2 trillion in capital losses; rapidly rising delinquencies in consumer mortgages, credit cards and auto loans. This could not end well.”

And, from the perspective of the new flat-world economy:

“We are engaged in a global commercial competition of such scale that unless we are able to rebuild our schools, our health care system, our energy system, our transportation and digital networks, we will surely become a second-class power.”

Jon Taplin’s analysis contains no hyperbole. It has the ring of truth. And, Taplin leaves hope of redemption:

“But this story does not have to end like some sad tale of Nero-like decadence at the fall of Rome.”

Parts one and two of The Cost of Empire give excellent historical background from the Great Depression through Presidents Truman and Eisenhower. Of particular interest, in Part II, Living in Fear, Jon Taplin examines the 1950s fear of another Depression and the fateful decision of American corporations to embrace “planned obsolescence.” Taplin says business leaders made a conscious decision to remove the “durable” from durable goods, resulting in the deindustrialization of America.

Many readers will find Parts III and IV of greater interest, if only because they cover decades in recent memory. In Part III, The Walls Come Down, Jon Taplin talks about the military and consumer spending binges that began in the Reagan administration.

Taplin argues that it was not Reagan, but Pope John Paul II, union leader Lech Walesa, and the Solidarity movement in Poland that set in motion the forces leading to the fall of the Berlin Wall and the Soviet Union. And Taplin gets to the “core of the story” with President Bill Clinton’s failure to produce the expected “peace dividend.”

Most fascinating, like watching a slow-motion train wreck, is Part IV, Imperial Overstretch. Taplin examines the “Pax Americana” hubris of President Bush’s advisers; the economic repercussions of 9-11, the Iraq War, and the DOT-com crash; the booms in credit and housing; and the fall of the U.S. dollar.

Gentle and patient reader, please look also at the comments by Taplin’s legion of brainiac readers as they debate our economic predicament and possible solutions. Most of the comments are not appended to the combined four-part analysis. You’ll have to jump to the Front Page on Taplin’s blog and scroll to the end of each of the four parts, plus the prologue, to read the comments. I suggest reading The Cost of Empire through from beginning to end, and then the comments beginning with Part IV.

In the comments, Jon Taplin’s nemesis, Morgan Warstler, argues that the answer to all our problems is to cut U.S. social spending on education, social security, health care and the like. Warstler blames the U.S. economic dilemma on what he sees as the greediness of the Baby Boom generation.

I will not give away any more of Part IV, Imperial Overstretch. Jon Taplin will have the last word.

Can’t wait for Cost of Empire (the book) and Cost of Empire (the movie.) — Bernie Hayden

Advertisements