The End Of US Hegemony - Part II

Commentary By Ron Beasley

Back in February I discussed the End of US Hegemony and  and had this quote:

As Robert Pape of the University of Chicago writes in The National Interest: "America is in unprecedented decline. The self-inflicted wounds of the Iraq war, growing government debt, increasingly negative current-account balances and other internal economic weaknesses have cost the United States real power in today's world of rapidly spreading knowledge and technology. If present trends continue, we will look back at the Bush administration years as the death knell of American hegemony."

As Chis Hedges explains the threat to that won't be found in Iraq, Iran, Afghanistan or North Korea but in Yekaterinburg, Russia.

This week marks the end of the dollar�s reign as the world�s reserve currency. It marks the start of a terrible period of economic and political decline in the United States. And it signals the last gasp of the American imperium. That�s over. It is not coming back. And what is to come will be very, very painful.

Barack Obama, and the criminal class on Wall Street, aided by a corporate media that continues to peddle fatuous gossip and trash talk as news while we endure the greatest economic crisis in our history, may have fooled us, but the rest of the world knows we are bankrupt. And these nations are damned if they are going to continue to prop up an inflated dollar and sustain the massive federal budget deficits, swollen to over $2 trillion, which fund America�s imperial expansion in Eurasia and our system of casino capitalism. They have us by the throat. They are about to squeeze.

There are meetings being held Monday and Tuesday in Yekaterinburg, Russia, (formerly Sverdlovsk) among Chinese President Hu Jintao, Russian President Dmitry Medvedev and other top officials of the six-nation Shanghai Cooperation Organization. The United States, which asked to attend, was denied admittance. Watch what happens there carefully. The gathering is, in the words of economist Michael Hudson, �the most important meeting of the 21st century so far.�

It is the first formal step by our major trading partners to replace the dollar as the world�s reserve currency. If they succeed, the dollar will dramatically plummet in value, the cost of imports, including oil, will skyrocket, interest rates will climb and jobs will hemorrhage at a rate that will make the last few months look like boom times. State and federal services will be reduced or shut down for lack of funds. The United States will begin to resemble the Weimar Republic or Zimbabwe.

One thing that history shows us is when a World Power attempts to build an empire other lesser powers will get together and try to take it down.  Now they can't do it militarily but the United States has given them the economic weapon to do the job.  It started with Ronald Reagan and George W. Bush finished the job.  Of course Barack Obama is following in their footsteps and is letting the financial oligarchs that are responsible for this mess continue to call the shots.  The result could be that the streets of the US could look a lot like the streets of Iran.

Obama, endowed by many with the qualities of a savior, will suddenly look pitiful, inept and weak. And the rage that has kindled a handful of shootings and hate crimes in the past few weeks will engulf vast segments of a disenfranchised and bewildered working and middle class. The people of this class will demand vengeance, radical change, order and moral renewal, which an array of proto-fascists, from the Christian right to the goons who disseminate hate talk on Fox News, will assure the country they will impose.

The Yekaterinburg Turning Point:

I called Hudson, who has an article in Monday�s Financial Times called �The Yekaterinburg Turning Point: De-Dollarization and the Ending of America�s Financial-Military Hegemony.� �Yekaterinburg,� Hudson writes, �may become known not only as the death place of the czars but of the American empire as well.� His article is worth reading, along with John Lanchester�s disturbing expos�/a>of the world�s banking system, titled �It�s Finished,� which appeared in the May 28 issue of the London Review of Books.

�This means the end of the dollar,� Hudson told me. �It means China, Russia, India, Pakistan, Iran are forming an official financial and military area to get America out of Eurasia. The balance-of-payments deficit is mainly military in nature. Half of America�s discretionary spending is military. The deficit ends up in the hands of foreign banks, central banks. They don�t have any choice but to recycle the money to buy U.S. government debt. The Asian countries have been financing their own military encirclement. They have been forced to accept dollars that have no chance of being repaid. They are paying for America�s military aggression against them. They want to get rid of this.�