A Pathway to Dedominance

Ever since Teddy Roosevelt’s “Great White Fleet” initiative, the United States has striven to hold onto some form of international dominance. The two World Wars gave us a perfect opportunity to rise quickly and re-order world affairs to our fancy. This form of relationship with other countries was a stark departure from the more isolationist approach of the Founding Fathers. While the Founders were so isolationist as to even be protectionist, they did so without attempting to meddle in the affairs of other countries, as we have more recently. Rather than benefiting American citizens, the desire to restructure the world and operate as an empire has greatly harmed citizens and states in many unforeseen ways. There are undoubtedly some benefits from our role as the world’s most involved superpower, yet the costs of maintaining such a regime are paid in individual freedom and a weakening of all more localized forms of government. However, in this position of unique control, the country cannot merely step back from its obligations, but rather must do so strategically and taking into account how it could harm itself and the world by doing so irrationally.

Whether or not it likes it, America has taken a huge step back from currency dominance. To face this inevitability with as little harm as possible, the State must stop running deficits before the de-dollarization situation gets any more drastic. Deficits are enabled by the Dollar’s unique global position, and the less unique that position is, the greater the consequences for taking on debt will be. While it would be impossible at this point to get out of debt in the near future, the State must at least stop accruing more debt as the level and rate of debt are both increasing. If that is not taken care of before de-dollarization becomes more serious, the State will be in an almost unmanageable financial crisis. Debt will become more and more expensive as fewer people internationally demand dollars. The house of cards on which this constant irresponsibility was enabled is already being toppled, and the State must recognize this and act quickly.

America holds a role of international power that costs billions of dollars each year and is necessary to the stability of several regions. Trump‘s recent demands for higher security spending from other countries have been hugely helpful to preparing for a world that can be safe without US support. We created for ourselves a role that was necessary only because we intervened where others should have felt the necessity of protecting themselves. The US protected other countries at its own expense and simultaneously weakened those countries in the long run and deepened its own debt crisis. The US cannot effectively step out instantly in many situations, but it must be aggressively working towards lower military spending and creating more realistic expectations from other countries. Whether redirecting the money to other parts of the government, or simply cutting the spending used for international defense, the US must not perpetuate its unnecessary pattern of insertion in almost every international conflict possible.

With its primary international role in conflict and currency diminished, the Federal identity must diminish its role in relation to the States. Rather than seeking to dominate other countries as a unified superpower, America can better serve its citizens and the world when the Federal government steps into  the role of enabling the states to govern themselves effectively. The diversity of governance with a unified national structure will allow for far more freedom and commercial progress to occur. States that govern themselves effectively with less federal interference will be able to more successfully act on the will of the people and experiment with different forms of government. Other countries will be able to build relationships with states more effectively rather than have their relationship with America change every four years. When the Federal government has lower expenses from a more minimized agenda, it will simply have a lower incentive to squeeze money from the States. The cost of defending a nation is far lower than the cost of defending most of the nations in the world. Each state potentially having its own currency could take even further the lesson learned from the failures of the dollar. Trust could be earned rather than imposed, and states with currencies tied to real assets would inevitably have more success over the long-term. The countless costs of maintaining a large Federal system could be a burden taken off the backs of the states, and enable a new era of worldwide flourishing not dependent on the US Federal government.