Review: Rogue Nation

Rogue Nation: American unilateralism and the failure of good intentions by Clyde Prestowitz has to be one of the best non-fiction books I’ve ever read and should be mandatory reading for everyone wishing to understand the global role of USA and how it executes its policies – and how both the policies and their execution are sometimes fatally flawed. Books and opinions critical of USA are not exactly in short supply these days, so it’s worth saying a few words about the author and why he should be listened to. Prestowitz describers himself as follows:

In fact, I am an unlikely person to write this book. The product of a middle class, conservative, rock-ribbed Republican, superpatriotic, born again Christian family, I attended Swarthmore college where, in reaction to the reigning liberal (some would say pinko) orthodoxy of the campus, I founded the college’s conservative club.

His subsequent experience as a diplomat in U.S. embassies, in multinational companies and in the Reagan administration and most recently in a non-profit “think tank” make for a rather convincing background – on top of that, the book is exhaustively researched with hundreds of references for the facts.

Rogue Nation basically reviews American international politics and relationships over the past decades, focusing on the latter part of the 20th century, attempting to explain the reasoning behind each decision and their eventual consequences. While there are many genuine successes of the US foreign policy and intervention, many failures are highlighted and analyzed. While it may be tempting to think that the current dislike of the USA is thanks to the current administration, it’s enlightening to realize that the roots of the mistrust go back much longer in history; it’s only the current administrations actions that are finally beginning to lower the water level of the global goodwill-reservoir towards Americans to a critical level. Still, one cannot escape the feeling that the Bush administrations have done much more harm to the country (and, indeed the world) than the Clinton period. That doesn’t mean that the Clinton administration was without faults; one clear failure from them was ignoring the Asian financial crisis and yet moving heaven and earth to save Mexico when their economy was threatened by an immediate crisis.

To mention just a few of the memorable events highlighted in the book, some excerpts below:

• In 1998, one of the up-until-then most successful hedge funds, Long Term Capital Management (LTCM) began to “hemorrhage money as if from a fire hose.” This was not peanuts, considering there was more than $1 trillion in the fund. What happened next was a good example of how financial liberalism is not a good thing – at least when the world doesn’t function according to your computer models:
  

  This was, of course, bad for the LTCM and its investors, but it had some other people worried too. One of them was Alan Greenspan, the Chairman of the U.S. Federal Reserve system and the most imporant central banker in the world. A disciple of the extreme libertarian novelist Ayn Rand and high priest of the virtues of unfettered markets, Greenspan had assured the U.S. Congress in extensive testimony that there was no need to regulate hedge funds like LTCM because as professionals they knew the risks and were prepared to accept them. But now the risk staring Greenspan in the face was the collapse of the whole global financial system. LTCM had borrowed so much money and placed such risky bets that if it collapsed it threatened to take major banks and perhaps the system itself with it. Faced with that risk, Greenspan blinked and organized a bail-out of the LTCm. In effect, he too imposed capital controls, and in doing so he probably saved the global financial system.

  The irony of the situation aside, it’s another example that shows how vulnerable the global financial system actually is.

• Peak oil is on everyones lips these days and the U.S., as by far the biggest consumer of oil, is a key to pushing back the peak so that we have time to develop alternative energy sources. Calls for Manhattan-project style alternative energy efforst can be heard more and more – and such a project is indeed long overdue, but a lot can be done immediately. Unfortunately, it seems that to some, conservation is a swear word. Cheap energy is considered as the birth right of every American and the illusion of cheap energy is maintained by all means necessary. Yet, it’s an illusion that is bound to crash with reality someday soon.

  One enlightening example is that if the U.S. had the same energy efficiency as the EU, it could do completely without oil imports;

  This would cut $100 billion a year off the U.S. trade deficit, stop the flow of U.S. money that gets recycled through oil-producing countries in the Middle East to fund terrorism and the spread of radical Islam, and greatly reduce the need for U.S. military deployments in the Persian Gulf. These deployments, which cost $60 billion annually, raise the real cost of Gulf oil to about $200 per barrel. Many observers around the world wonder why America isn’t more serious about conserving energy purely in its own interest. As I will explain, the reason has to do with our love of personal freedom. But the price of that independence is a dependence that has made us vulnerable. In turn the vulnerability has led to war, destruction, and death, and finally to a hint of soul searching.

• The Kyoto deal is given a whole chapter of coverage and is another contrast that doesn’t quite add up – U.S. as the inventor of environmentalism is now viewed as the enemy by much of the world. It turns out Bush can be considered the villain here (too):
  

  As one State Department official told me, “The Bushies think environmentalism is where all the commies went after the collapse of the Soviet Union. They hate ‘em”. Second, Bush didn’t believe the science on global warming and really thought the Kyoto measures would hurt the U.S. economy. His economic advisors were from the supply side and the aluminum industry. Third, Bush had made campaign promises to the coal, power, oil and steel companies in order to win critical states like West Virginia. Now it was payback time.

• As it turns out, Kyoto isn’t the only important treaty U.S. has not ratified. It seems that the treaties involving the International Criminal Court, ban on landmines, non-proliferation, cotton, small arms, antigenocide, status of women, ABM and chemical weapons and relationships with the UN, North Korea, Israel and even the EU are some of things that are very problematic for the U.S. Not exactly role-model behaviour there.

In all fairness, the book is not about bashing the U.S., but about understanding how the country got to where it is now and how it could take a better course in the future. Not everything U.S. has done has failed, but too many things have. If you’re at all interested in globalization, the global economy, America or its foreign policy in particular, I can highly recommend the book. While very enlightening for the rest of the world to read, this should really be mandatory reading for Americans – maybe they would understand why the actions of their country are not appreciated as much as they might want to. As was mentioned throughout the book, the people of many (or even most) nations actually like Americans, the people, but they strongly dislike the actions of the country and the government (a sentiment split that I share). If this helps change the system so that wealthy special interest groups wouldn’t have so much power in American politics, a lot of good could come out of this.

Meanwhile, U.S. has again raised its debt limit to almost 9 trillion dollars.