Communist Party of Australia

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Issue #1585      March 13, 2013

US economy: Say goodbye to your expectations

While Russian liberals are criticising the academic concept of Sergei Glazyev, intended to increase the government’s role in the crisis period and abandon the idea of privatisation, the ideal of free-market theoreticians, the US economy is showing signs of imminent collapse. Barak Obama has already acknowledged that the sequestration will adversely impact the quality of life.

This month (after a failed attempt of the Republican and Democratic wings of the Congress to agree on state expenditure), President Obama signed a decree to start the curtailment of the national budget. What are the implications of this unprecedented step?

Here are some specific numbers from the official website of the White House and Research Centre Global Research: 600,000 people will lose their right to food stamps, 700,000 jobs will be lost, 70,000 children will be excluded from the day care programs. The program of budget savings proposed by Barack Obama generally provides savings of about a trillion and two hundred million dollars, including $400 billion by cutting back on health insurance plans, $130 billion – social security and, $35 billion – reduction of pensions for the retired federal employees, who, as a sign of discontent, could significantly weaken the system of public administration.

In the first financial year that in the US ends on October 1, spending cuts in the federal budget will amount to $85 billion, with $50 billion in security agencies and defence.

Compared to the 16-trillion-dollar US debt, the savings do not look convincing, but may lead to very negative consequences for American society. In the short term, the economic recovery in the US will be slowed down (consider how growth is calculated with inflated securities and distorted numbers of actual production). The quality of life of the working class who is mostly paying for these savings will be reduced.

The growth of nationalism will inevitably exacerbate separatist tendencies in the United States that have been previously subdued by a high quality of life. First of all, it is a donor state, Texas with a 30 million-strong population where in the last four years 40 percent of all new jobs in the US were created. Every third Texan believes that the state has the right to self-determination, while 25 percent favour an immediate withdrawal from the US. The directive of the feds to tighten their belts is unlikely to reduce the number of supporters of independence. Furthermore, when in the 1930s the independent Republic of Texas signed a contract to join the United States, it was subject to the reservation that Texas could leave the federation at any time.

In the eight southern states, including Florida and Alabama, where a significant part of the population is black, the movement for the proclamation of a new African republic has been developing for many decades. In 1968 a temporary’’ black government’’ was created that was immediately dismissed by a powerful strike of the FBI, which, however, did not prevent the idea of withdrawal from the United States. There are separatists in California and Michigan, and, given the growth prospects of the minority population to 50 percent, it is clear that the tendency to separate will increase.

Another obvious thing is that the costly US policy of promotion and protection of its interests around the globe has exhausted itself. It has been replaced with other methods – financing of colour revolutions and use of the information networks. Instead of costly air strikes and ground operations computers and psychological operations are used involving networks of activists. It is no accident that the US military created Cyber Command, and the documents on strategic geopolitical planning introduced a new term – “diffusive wars.”

The reduction in military spending should not deceive anyone, as spending on war only moved into a different area. The well-known law of the American political establishment - “nothing personal, just the interests of the US” – does not change, regardless of the price to be paid.


Next article – Syrian insurgents’ training at “Assad’s citadel”

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