GRIM HARVEST:
A Cambodian garbage picker scours a trash heap
Posted Sunday, January 18, 2004; 13.35GMT Then came Sept. 11, 2001, which, in the American telling, made "the war against terrorism" the dominant security issue facing the world. American soldiers, with an unparalleled technological advantage over all other armed forces, took the lead in waging it. In 2003, the Bush Administration acted on its conviction that the crises of the Islamic world could no longer be allowed to threaten those outside its borders. The U.S. removed the murderous regime of Saddam Hussein in Iraq, committing itself to the growth of democracy and liberal economics in an arc of crisis from Maghreb to Mindanao. Just as in the '90s, Washington was setting the agenda and not just in security. Seen from the U.S., as the global economy entered its first synchronized recession for almost 30 years in 2001, it was wise American policy-makers and confident American consumers who started to lead it to recovery. The U.S. figures for both GDP and productivity growth released in the second half of 2003 proved, once again, that America was the motor of the international economy just as it was the guarantor of international stability. Indispensability, it could be argued, was too weak a word for American dominance of the international agenda.
That, in any case, is the view from the U.S. This week, it will be interesting to see if it is also the way the world looks from the Swiss Alps, as many of the planet's top business and political leaders make their annual trek to Davos for the meeting of the World Economic Forum. Not long ago, one of the joys of Davos was that you were more likely to meet finance ministers from the developing world and European business leaders than U.S. Senators and tycoons. Davos, the New York City-based filmmaker Peter Foges used to say, was "one great adult-education class for the Mittelstand."
The U.S. concentration on terrorism undermines the process of developing better relations.
— ANNETTE HESTER, director of the Latin American Research Center
But that changed in the late '90s, as Davos became much more attractive to Americans. Hillary Clinton was there in 1998, Al Gore braved a blizzard to get up from Zurich in 1999, and the following year Bill Clinton visited for the first time. The Lords of the New Economy decided the trip from California was worth it, and the meeting's character was subtly altered; you were more likely to meet a snot-nosed software brat from Silicon Valley than a shoe manufacturer from Turin. But this year, there is a case for hoping that Davos may once again become a place not dominated by American concerns, America's agenda and the sense that America is the sun around which everywhere else rotates. The world needs a broader perspective.
Of course, there's no denying that terrorism is a crucial threat or that the U.S. is leading the world out of recession. Growth in the euro zone and Japan remains Micawberish, something that may turn up one day. But the relative health of the U.S. economy does not flow from the fact that American business leaders are more broad-shouldered than anyone else or American consumers more spendthrift. The recovery is a function of old-fashioned Keynesian economics; extraordinarily loose fiscal and monetary policies have lifted the U.S. economy out of its gloom. The Federal Reserve has cut interest rates 13 times since January 2001, so that short-term rates are now at their lowest for more than a generation. At the same time, the federal government has been spending like a drunken sailor.
What you see depends on where you stand. If your vantage point is in or around the centers of the U.S.-led alliance, America's recent behavior can seem benign and helpful. Such an outlook would focus on the amazing recent performance of the American economy. As Ed Balls, chief economic adviser to Britain's Treasury, pointed out in a recent speech, "Between 1991 and 2002 the U.S. economy grew by more than 40% double the growth in the euro zone and almost four times the growth of Japan." Whenever global economic hot spots erupted in the 1990s, as at the time of the Mexican currency crisis or the Asian financial meltdown, American government largesse and the willingness of the American consumer to buy the world's goods cushioned potentially devastating shocks. When security challenges presented themselves for example, in North Korea in 1994 or in the Balkans throughout the '90s American diplomacy and muscle were vital to resolving them. The U.S., in the phrase of former Secretary of State Madeleine Albright, became "the indispensable nation."
Mogadishu at 60 Miles an Hour Arms merchants are once again doing brisk business after a rapid change of power in this tough town, but so far the peace has held
The Year of The Nuke A rundown of the world's nuclear powerhouses, and what to expect in the coming months
Then came Sept. 11, 2001, which, in the American telling, made "the war against terrorism" the dominant security issue facing the world. American soldiers, with an unparalleled technological advantage over all other armed forces, took the lead in waging it. In 2003, the Bush Administration acted on its conviction that the crises of the Islamic world could no longer be allowed to threaten those outside its borders. The U.S. removed the murderous regime of Saddam Hussein in Iraq, committing itself to the growth of democracy and liberal economics in an arc of crisis from Maghreb to Mindanao. Just as in the '90s, Washington was setting the agenda and not just in security. Seen from the U.S., as the global economy entered its first synchronized recession for almost 30 years in 2001, it was wise American policy-makers and confident American consumers who started to lead it to recovery. The U.S. figures for both GDP and productivity growth released in the second half of 2003 proved, once again, that America was the motor of the international economy just as it was the guarantor of international stability. Indispensability, it could be argued, was too weak a word for American dominance of the international agenda. 
Premium Content
