The decline of the Empire

Patricio Navia

Buenos Aires Herald, July 26, 2011


Those interested in seeing the decline of the American post-cold war hegemonic power are happily witnessing the failure of Republicans and Democrats to reach an agreement, before the August 2nd deadline, to raise the debt ceiling on the federal debt.  On the contrary, all those who share the democratic and market-friendly values the U.S. has generally stood for are inevitably saddened by the self-inflicted wounds the U.S. will have to deal with in the coming years due to the irresponsibility of the Republican leadership in Congress.


The U.S. is by no means a perfect country. The most powerful nation in the world has adopted many policies that have damaged its reputation as a champion of capitalism and promoter of democratic values. In Latin America, Washington policies during the Cold War years are full of mistakes and embarrassing moments. In recent years, the U.S. has championed several causes that have undermined the progress of democracy and free market capitalism. Still, despite its mistakes and wrong policies, the U.S. has been the most important ally of democracy around the world and the strongest advocate of market-friendly policies. The bright moments in American history far surpass its unquestionable mistakes. The U.S. has helped made the world a better place.


The economic success of the United States and its resulting overwhelming military power and undeniable cultural influence over the world can be explained by the country’s ability to build democratic institutions that, overtime, have produced social and economic inclusion and generated the conditions for sustained economic growth. True, abundant natural resources have also fostered growth and have contributed to making the U.S. the world’s largest economy. However, comparable abundant natural endowments have not resulted in equal economic might in the rest of the Americas. The success of the U.S. and its rise during the 19th and 20th century to become the world superpower cannot be explained solely by a commodity lottery.  The U.S. reached the leading position in the world economy because it had a sophisticated and well-functioning institutional framework that allowed its industrious people to generate wealth and that attracted millions of eager immigrants to its shores.


The pursuit of happiness became an American dream because the country developed a system of institutions that allowed capitalism to flourish. A system of separation of powers that prevented tyranny but was conducive to negotiations and bargaining among different parties allowed for the emergence of a democracy that became increasingly inclusive and that eventually facilitated the emergence of a society that aspired to offer equal opportunities to all. 


The U.S. reached its dominant position in the world because it had strong institutions that fostered the development of a democratic society. Those institutions, built to foster a system of checks and balances, produced outstanding results in the past. However, in recent years, the same institutions have deteriorated and have not always produced positive results. 


There are several reasons behind the deterioration of the institutional democratic structure. The sophistication of gerrymandering techniques has allowed parties to design safe electoral districts that end up electing representatives more partisan than the average moderate voters. Rather than people choosing politicians, politicians choose their own voters. Special interests have successfully captured legislators and have infiltrated the political system in such a way that politicians are accountable to those who pay for their campaigns rather than to their voting constituencies.  The growth and penetration of mass media and the consolidation of a 24-hour news cycle makes it increasingly difficult for legislators to bargain and negotiate bipartisan accords.

Rapid and easy access to information leads to an information overflow that makes it more difficult for interested voters to process the relevant information and exercise control over their politicians. Information asymmetries also make it more difficult for voters to assess the quality of the work their representatives are actually carrying out. In sum, the nature and speed of recent technological developments have contributed to worsening the performance of democratic institutions. Political polarization might have also played a role, though voters do not appear more polarized today than they were 30 years ago.  As a result, the political system in the U.S. is no longer working appropriately and the public policies that come out of Washington are no longer conducive to replicating the celebrated policies of the past that helped made the U.S. the most powerful nation in the world.

In the last few weeks, the failure to reach an agreement between the democratically dominated White House and the Republican-controlled House of Representatives has underlined the deficient performance of the institutional arrangements that historically characterized the American political system. In the next few days, even if an agreement is finally reached and a default on federal debt obligations is avoided, the sour taste of an ill working institutional democratic set up should motivate leaders, intellectuals and democratic activists to think about possible ways to fix the system so that the U.S. can once again take pride in having a sophisticated institutional system that fosters and strengthens the daily functioning of the world's oldest democracy.