Popular belief has it that the 2012 US Election ended in a narrow re-endorsement of the incumbent Barack Obama. He didn’t deserve it, for all sorts of reasons, some of which we’ll come to later, but suffice it to say that, by all conventional wisdom and political punditry, he’s emerged the winner. But is he? Perhaps we need, for the real winner or winners, to look elsewhere.
Allow me to introduce the first big winner to you: he’s Mr Xi Jinping, one of the gilded princelings of China’s Red Aristocracy, and he’s shortly to become Head of the Communist Party of China, and, in due course, China’s next President and Head of State. And, given the extent to which America depends on a flow of Chinese credit to fund its deficits, he can count this week’s Election as a success.
One of Obama’s achievements (if indeed it’s a rather poor sort of “achievement”) in his first Presidential term has been to increase America’s national debt to around $16 trillion, from about $12 trillion when he took office in early 2009. That’s not to argue that the additional debt created under the two George W Bush administrations was acceptable – it wasn’t: Bush was economically and fiscally profligate in the extreme – but Obama’s $16 trillion represents the highest national debt accumulated by any President in US history, and also the fastest four-year increase. Just to translate it to a metric easier to visualise, it’s almost $200,000 of debt for each US family. The debt is so large, and increasing so fast, that any specific figure given is instantaneously out of date, so a glance at the US Debt Clock is recommended.
Obama has no plan to repay it, or even reduce it significantly: on the contrary, the low expectations of economic growth, and the promises of expanded-range and higher-amount entitlements made to his client-state electorate to secure the second term, mean that it’s forecast to balloon to $20 trillion by 2012.
Which is where China and Mr Xi come in. For China’s holdings of US Treasuries amount to about $1.2 trillion and it holds roughly a similar amount of US public debt, about $1.16 trillion or approximately 9% or 10% of the total. But the other principal holders include Japan, Brazil, Germany and the UK, all of whom have economic problems of their own, and appear unlikely to be in a position to fund increased US sovereign debt, so it looks like the expectation of future funding will fall mainly on China.
That situation looks set to worsen by the ratings agencies’ threat of a downgrade if the approaching fiscal cliff isn’t averted, the necessary bipartisan imperative seeming more improbable by the day, given White House determination driven by electoral endorsement and a Republican-controlled House of Representatives resolved to get the deficit and debt addressed. A US debt downgrade immediately raises the prospect of America having, in order to fund itself, to pay higher rates of interest – in all probability mainly to China. So it wouldn’t be unjustified by any means for Mr Xi to regard himself as the real winner of the 2012 campaign.
The second winner isn’t a specific person but, shall we say, an imaginary amalgam of an entire group. Remember how in the early 1990’s, particularly after Clinton’s first election victory in 1992, we all laughed at the guys who warned that Government was about to become the big threat to freedom and liberty, and took themselves off to buy cheap land and build cabins in remotest Montana and Idaho? They weren’t college dropout eco-warriors, determined to live in sustainable, Gaia-friendly, communion with Nature: what they principally wanted was to remove themselves as far as possible from the reaches of the state. Yet, we thought, how utterly eccentric: what a ludicrous idea, that the government of a liberal democracy could constitute a threat.
We shouldn’t have laughed, for several reasons. Firstly, the libertarian one: why on earth should anyone be prevented from decamping to the mountains of Idaho to live in the way they choose, provided they harm no others and impose no costs on others by doing so? In fact the concept of voluntary outlawry (in its literal, not criminal sense) has a discernible philosophical ancestry: in his “The Right To Ignore The State”, Herbert Spencer argued that we are free to drop our connection with the state – to relinquish its protection and to refuse paying towards its support. As Government, says Spencer, is “simply an agent employed in common by a number of individuals to secure to them certain advantages, the very nature of the connection implies that it is for each to say whether he will employ such an agent or not”.
And now, secondly, the very practical reasons. There can be little doubting that a second-term Obama administration looks likely to have a much more leftist, illiberal, statist-authoritarian face than its 2008-12 predecessor. Obama has declared support for United Nations resolutions that seek, in effect, to outlaw globally any expression of criticism of Islam or Shari’a. So much for the First Amendment. He’s reported by several commentators to be sympathetic towards moves to remove to the global jurisdiction of the UN national laws regulating firearm ownership. That’s the Second Amendment taken care of.
Already mooted, less than 48 hours after it hadn’t been mentioned at all during the campaign, is a “carbon tax” on businesses (except “Green” ones, naturally – like er, Solyndra?) to help address the chronically burgeoning fiscal deficit: and as the deficit’s going to increase, how long before a similar tax on homes follows? Obama’s also creating something of a regular modus operandi of skirting round the checks and balances of Congress by employing his executive powers now more than never before during his presidency, and showing a worrying inclination to challenge or override states’ rights where they conflict with the Obama project.
So, all of a sudden, the idea of retreating to the mountains in Spencer’s voluntary outlawry, being as self-sufficient as you can, swapping produce, services and skills with like-minded neighbours, generating income by strictly-cash casual labour to avoid the predations of the IRS, home-schooling your kids to keep them out of the leftist politically-correct indoctrination public education system, and generally flying under the Government radar, suddenly looks as though it might not be such a bad idea after all.
And maybe, just maybe, the guys who worked this out 20 years ago when they looked at the ideological roots of the Clintons, decided to act there and then, and are already tucked away safely in the Wilderness out of range of Big Government, are, in their way, just as big winners of the 2012 Election as China’s fortunate Mr Xi.