Even if you don’t agree with some of the fundamental political values at the heart of the Euro, the prospect of the single currency going south is pretty scary on a European scale. But can we think of developments that would be an even bigger disaster on a global scale?
There are a number of candidates for Catastrophe of the Year 2012 out there: Iran getting nuclear weapons and using them against Saudi Arabia or Israel would be very high on the list. Similarly, the prospect of a hard landing of the Chinese building boom in particular and the Chinese economy in general has economists worried – although they wouldn’t be surprised if it happened. Still, as long as everybody consider the perspectives, Iran would be a basically regional problem (so long as we forget about the Saudi oil) and the Chinese economy slowing down would probably first and foremost be a problem for the Chinese.
So, what about the world’s remaining superpower being taken over by a political movement decoupled from anything remotely like the reality? As in the Republican Party winning the 2012 Congress and Presidential elections in the US.
The US Republicans are interesting and scary because they – and their associated think tanks, media outlets, etc. – from the 1980s on increasingly have developed into a post-modern party. What I mean by this is that one defining characteristic of post-modernism (at least in my interpretation) is that reality is seen as constructed. So what in an earlier age or among more traditional politicians were seen and treated as facts, are seen and treated as the results of a rhetorical power struggle. Win the people’s minds, and you create the reality.
The approach has been in force in economic policy since the 1980s as the “starve the beast”-strategy – cut taxes at all costs even if it makes absolutely no sense and makes grown economists cry – and also came to prominence in foreign policy during the Bush43 years. Actually, the “if we say it’s real, it’s real”-approach has now spread to just about every conceivable policy area among US Republicans.
During the past thirty years – and during the Bush43 years in particular – the Republicans have done unspeakable damage to the US federal budget, something that now makes it very hard for the present administration to manage the worst recession in more than 70 years in an economically sustainable way. Fuelled by the anger of Tea Party militants, a new Republican administration would be Bush43 squared and blow a massive hole in what is left of the economy’s resilience. The Bush43 years were an epic of crazy foreign policy adventures. A new Republican administration would concentrate on building an imaginary Third Temple. Anything even resembling environmental policy would go down the sewer. And so on. And so forth. Politics will be creating the facts.
Until something – the international economic system, the Middle East or the global climate – blows up in a very big way, that is. (Not that the Republicans would ever admit it: After all, they haven’t talked about any disaster).
And remember: If this happened in, say, Denmark, it would be a problem for the Danes (well, actually not: Part of the Euro crisis is due to the fact that Greece and Italy were run by governments subscribing to the economics of imagination). The US is a slightly bigger deal.
Enjoy your campaign.
And with this, I wish you a happy 2012.