Five Lessons America Can Learn From The Failures Of Other Nation-States

by John Hawkins | June 8, 2012 1:09 am

As Ronald Reagan[1] noted,

Freedom is never more than one generation away from extinction. We didn’t pass it to our children in the bloodstream. It must be fought for, protected, and handed on for them to do the same, or one day we will spend our sunset years telling our children and our children’s children what it was once like in the United States where men were free.

That’s true of freedom, but it’s also true of values, wealth, power, and influence. There’s absolutely no guarantee that future generations of Americans will grow up in a prosperous, free super power as we have. In fact, it’s entirely possible that America could be a terrible place to live a few decades from now. Of course, that doesn’t have to be our future either. If we are smart enough to learn from other nations’ mistakes, we can avoid their fates.

1) The Soviet Union: In the sixties and seventies, many economists believed the Soviet Union had an economy that was superior to ours. In fact, when Reagan came into office, many economists still expected the Soviet Union to eventually surpass America economically. Reagan knew better and realized he could break the Soviet Union economically. He dramatically ramped up American military spending because he knew that the Soviets couldn’t afford to keep up with us. Reagan also convinced Saudi Arabia to help reduce the price of oil, which sliced into Soviet revenues, told Europe not to buy more oil or natural gas from the Soviets than absolutely necessary, and helped enmesh the Soviets in an expensive war in Afghanistan. Then Gorbachev, in an effort to save the Soviet Union, started giving the people more economic and political freedom, which spiraled out of control and led to the downfall of the Evil Empire.

Today, America is relying on nations that don’t have our best interests at heart to provide us with the oil we need to power our economy and to buy our debt. Could America handle another seventies-style OPEC oil embargo? Could we deal with an organized effort to convince other nations not to buy our debt? Imagine going another half a trillion dollars deeper in the hole every year just to finance our debt[2]. How long do you think we could keep that up, especially on top of the out-of-control spending we already have?

2) Greece: The Greeks embraced the same sort of European socialist model that the Democratic Party is in love with. They have powerful unions, early retirements, a massive government, and high taxes.

They also have bankruptcy and soon, default.

Greece has been kept from defaulting on its debts thus far solely by infusions of cash from more responsible nations. This option, which likely wouldn’t even be open to the United States because we’re so much bigger than Greece, has come at a terrible price. Nobody wants to throw good money after bad; so in return for giving Greece cash they can’t borrow on the free market, the Greeks have been required to cut into their deficits. We’ve heard a lot about “austerity,” but Greece is still running a large deficit despite the fact that it has slashed pensions[3] and life saving drugs are becoming hard to find[4]. Instead of cutting government and spending all the way to the bone, the Greeks have tried to make up their shortfall by raising taxes, which has further depressed their moribund economy.

Make no mistake about it: unless America makes some dramatic changes[5], we are headed towards the same fate as Greece. Once a nation gets into a position where it has trouble getting loans, has great difficulty paying its day-to-day bills, and has to beg for cash, there are no good options remaining. There’s nothing but misery and pain for a long, long time and a greatly reduced standard of living once the worst of the suffering is over.

3) Italy: Italy is also struggling to pay its bills and eventually it is likely to fail for a simple reason: There are just not enough young Italians being born[6].

“(T)he state needs a birth rate of 2.1 children to maintain a stable population. In Italy, it’s now 1.2. Twenty years ago, a million babies were born there each year. Now it’s half a million. And the fewer babies you have today, the fewer babies are around to have babies in 20 years. Once you’re as far down the death spiral as Italy is, it’s hard to reverse. “

Italy has generous entitlement programs that rely on young workers to pay the bills, but there is such a shortage of Italian youths that the programs are becoming unsustainable. Given Italy’s poor economy, horrible debt situation, and hostility to foreign workers[7], the country is not even a particularly attractive destination for immigrants. So, how will this end for Italy? Badly.

We here in the United States have a birth rate of just around the replacement level of 2.1, which is good. However, because of the Baby Boomer population bubble, we don’t have enough young people to pay for our entitlement programs either. Additionally, although we’re an attractive destination for immigrants, we don’t take advantage of it. We have a family-based immigration system instead of a system centered around getting the best and brightest immigrants. In a nation where almost 50% of the population pays no income tax, how much sense does it make to bring in manual laborers and janitors as American citizens because they’re related to someone who’s already here as opposed to bringing in rocket scientists, engineers, and entrepreneurs who would actually add to the tax base? We’re refusing to take advantage of a great opportunity without realizing that one day that door may close. We may no longer be the top destination for immigrants in the world and we may not be able to bring in the same quality of new American citizens again.

4) Sierra Leone: Sadly, most countries on the planet have “extractive” economies. That means a few people get rich, most people stay poor, and governing tends to primarily be about securing wealth and power for a few people at the expense of the many. Oftentimes in nations like this, politicians will make decisions that seem bizarre to Western eyes. In 1961, Sierra Leone gained independence from the British. Since the country had natural resources galore and burgeoning coffee, cocoa, and diamond exports, the potential was there for the country to take off economically. Unfortunately, after winning an election in 1967, Siaka Stevens became a dictator and deliberately destroyed the railroad that was taking those exports to market. Economically, the country was terribly damaged by his decision, but it had the effect of weakening his political enemies and allowing him to consolidate power. Today, Sierra Leone is wretchedly poor and still recovering from a nearly decade long civil war.

The sad fact of the matter is that we do have similar policies to these here in America, but on a lesser scale. For example, Scott Walker just faced a recall election in Wisconsin because of policies that turned a 3.6 billion dollar deficit into a surplus[8]. His policies also allowed property taxes to be reduced for the first time in 12 years, but to do that, the Democrats’ union allies had to take a small haircut. All across America at the state and local level, there are towns and cities running massive deficits in order to funnel huge sums to the unions. Similarly, our legal system has been drawn up in a way to create as many lawsuits as possible in order to benefit trial lawyers. Hundreds of billions of dollars are wasted on endless paperwork and lawsuits in order to cater to environmental groups that won’t be happy unless everyone is living in grass huts. The more political spoils we toss to these groups, the more it weakens our economy and hurts everyone else.

5) The Roman Empire: If you ask why the Roman Empire fell, you’ll hear a lot of different theories: lead poisoning, moral degradation, high taxes, corruption, a failing economy — it goes on and on. However, the direct cause of the fall of the Western Roman Empire was its failure to assimilate barbarian tribes. The Romans believed in spreading their culture and so, barbarians had always been allowed to become Roman citizens. They were also used in increasing numbers in the Roman military. However, the Roman practice was to split the barbarians up and send them to different areas so that they could be incorporated into the culture instead of retaining loyalty to their tribe. The time came, however, when this practice was stopped. We don’t know for sure if they didn’t have the troops, lacked the will, or just no longer thought it was necessary.

Unfortunately, what happened as a result was that Visigoths and Vandals (among others) who were driven into Roman territory by the Huns were allowed to stay together as tribes, in Roman territory. They kept their loyalty to their own people and never became Romans in any meaningful sense. They bided their time and eventually rampaged through the western half of the Roman Empire, sacked Rome, and put an end to the Western Roman Empire.

Here in the United States, we have more than 10 million illegal immigrants in our country whose first loyalty is not to the United States. Does that mean they’re going to tear through the countryside and sack D.C.? Probably not, but there is a danger in having a large, uncontrolled alien population inside our borders. Does the flood of illegal aliens on our southern border make it much easier for criminals, drug dealers, and terrorists to get into our country? Unquestionably. Could we one day see large numbers of Mexican illegal immigrants who believe that the southwestern United States rightfully belongs to their people start to engage in organized terroristic violence against American citizens? Absolutely. Some people might say, “That’s unthinkable,” but that’s probably also what most Romans would have said if you had asked them if the Visigoths might pillage Rome one day.

  1. Ronald Reagan:
  2. another half a trillion dollars deeper in the hole every year just to finance our debt:
  3. slashed pensions:
  4. becoming hard to find:
  5. dramatic changes:
  6. not enough young Italians being born:
  7. hostility to foreign workers:
  8. turned a 3.6 billion dollar deficit into a surplus:

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