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El Universal, Mexico

Obama and the New State


By Francisco Valdés Ugalde

Translated By Natalia Barnhart

11 November 2012

 Edited by Lau­rence Bouvard


Mexico - El Universal - Original Article (Spanish)

The United States continues to be the most influential country in the world. Some say China has already caught up in economic weight, but it would take a lot for the United States and Europe to be, shall we say, displaced from the global ideology. I make no apologies for imperialism; this is just a realistic assessment.

In terms of science and technology, the United States still has the greatest capacity for innovation. This will change as other countries increase their investments in those fields. A decline is not on the horizon unless science and technology produce a self-destructive civilization. Besides, growth in the productive capacities of other regions is good news, assuming that it can lead to a new phase of better cooperation among humanity.

Obama’s victory is good news for the world. It resulted from decisions by the groups and sectors that represent a hope for the future for their country and the world. Fortunately, they were a majority. Compared to the euphoria of 2008, this time around the campaign woke much less enthusiasm, but Americans recognized that the Obama administration has made important progress if you take into account the poor state the country was in when he received it from the Bush administration. Evidence of his success: he stopped the 2008 crisis, changed the course of U.S. foreign policy and enacted health care reform.

But the situation caused by Bush’s policies and the accumulated problems holding back the American economy cannot be fixed easily. It is even more difficult with a Republican Party that has been captured by radical conservatives. The Republicans retain their veto power in the Congress in the new period.

The most important immediate problem facing the president is the fiscal deficit. Together with the European crisis, the U.S. deficit represents a threat to public finances and future growth prospects. Without a doubt there will be major cuts, but unlike the Romney proposals, Obama will seek to minimize the effect on the most vulnerable sectors and key areas of economic development. A solution without sacrifice is not possible, but it is hoped that the new fiscal policy can offer an example for the world. An economic policy that offers a balance between freedom and justice; that is to say, a new focus based on justice. Without justice, simply, human society will retrogress into barbarism.

This last point is the biggest challenge. In the 20th century we moved towards a welfare economy that resulted in the unintended, and ultimately unwanted, growth of costly public administration. In the second half of the 20th century, the pushback gave rise to criticism of Keynesianism, which is a spectrum of public policies, many of which did not do justice to their namesake. So, once the governing elites and world economies broke the civilizing treaty that had joined them during World War II, they chose the much-reviled “neoliberalism.”

Market ideology, as it should more accurately be called, burst onto the scene, blanketing everything with the hegemonic greed of economic interests. It shrank the state, reduced tax revenue and ceased to provide public goods. The social debt of nations has been increasing ever since.

Globalization, which was caused by ideological and market liberalization, has been followed by another symptom, the reduction of social protections. The result has been global misery and suffering for more than 30 years: great masses without any hope or means of self-defense, the rise of the informal economy, uprooting of legal systems …

Deficits of all kinds grew, driven by imbalances in the distribution of power and wealth. Finally, the model that the market ideologues had thoughtlessly pushed became unsustainable. The economic situation in the European Union and the United States may be the start of a spiral into barbarism.

Obama, like those European leaders who have not lost their sense of reality, knows this. The leaders of other regions know this also, at least those with some understanding of the situation.

What they must now confront is a problem of civilization, not a bookkeeping issue. Or the opposite, a bookkeeping problem that threatens this tired civilization: Human dignity while living in this world.



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