Has there ever been a time when the world’s four leading nations were in a bigger mess than they are now?
Each, in its own way, is destroying itself, although the chosen methods are all a bit different. But it always has to do with leadership.
And while it makes those of us who managed to sack our ratbags look stable by comparison, that won’t help if the US, Britain, China and Russia keep going down the paths they’re on. Their misery will be everyone’s.
Two of them – Russia and China – are being brought undone by autocracy while the two liberal democracies are either undermining the functioning of democracy itself (America) or are floundering in economic fallacy (the UK).
Undone by autocracy
The impending downfall, or at best disorder, of these four is the second emergency the world faces, the first being global warming.
Russia is destroying itself with the most disastrous invasion since Napoleon took his army into Russia in winter.
There is no scenario in which Russia comes out of the Ukraine war in anything other than a shambles, especially if Putin is unwise enough to drop an atomic bomb somewhere in Ukraine.
Win or lose, the revulsion over Russia’s war crimes will isolate and cripple the country for years, if not decades; the only positive outcome is if Putin is overthrown quickly and his replacement helps Ukraine to rebuild.
China is doing it by doubling down on autocracy and appointing Xi Jinping for a third term as president and general secretary of the Communist Party.
Financial Times columnist Martin Wolf argued convincingly last week that this is a “tragic error”, and that the “despot will become increasingly isolated and defensive, even paranoid”. The next 10 years of Xi, Wolf says, will be worse than the last.
Peter Coy in The New York Times calls Xi the second coming of Mao Zedong, whom China took decades to get over, and was finally getting somewhere when Xi came along.
Xi is now dispensing with the consent of the governed, the basis of all political stability.
China’s zero-COVID policy is an example (along with Russia’s invasion of Ukraine) of the folly that goes unchallenged when you have a despotic leader.
China is no longer a high-growth economy and has the added problem of an ageing population and declining workforce.
But it’s not just those things dragging down China. Its reliance on investment to power its economy is backfiring – its growth is top down and debt-funded, not bottom up and consumer driven, which is the only solid basis for economic stability.
And with Xi’s demand that Taiwan must be incorporated into the motherland, China is flirting with crushing sanctions and the end of its export economy.
Financial strife
The UK is doing it first through Brexit, and now the misguided attachment to neoliberal ideology of its new prime minister, elected by 81,326 Conservative Party members, or 0.12 per cent of the UK’s population, and who they are all stuck with until January 2025.
It’s a lesson that a functioning democracy requires an electable, responsible opposition, which the UK did not have in 2019, resulting in a landslide for the dishevelled Boris Johnson, who then had to be sacked for repeated misdemeanours.
Maybe Liz Truss can turn things around, including her own staunch ideas, but that seems very unlikely. She dumped the worst of the tax cuts, it’s true, but apart from that she is still accelerating up an economic cul-de-sac.
And it’s not just this term of Parliament: The UK’s GDP growth was more or less zero for 20 years before the pandemic.
Why? Because of austerity imposed by a succession of conservative governments, including ones labelled Labour.
It turns out that zero public investment and cutbacks to government spending to fund tax cuts equal zero economic growth.
Truss said at the Conservative Party conference that she has three priorities – growth, growth and growth – but saying it don’t make it so.
Last week The Economist wrote: “If the prime minister realises how much trouble she is in, she is not showing it … the risk is growing that a bodged set of tax cuts will be followed by a cartoonish mix of deregulation and posturing.”
America, O America
And finally, America, O America. Its downfall is disguised by the strength of the US dollar, suggesting relative economic success.
Normally a declining empire would also have a declining currency, like ancient Rome and modern UK, but if you were just looking at the US dollar, up 23 per cent in 12 months, you would think America is at the peak of its powers.
But it’s an illusion – America is committing suicide by splitting itself in two and seems in no mood for reconciliation.
Donald Trump got 47 per cent of the vote in 2020 and still has a 41.6 per cent approval rating, even though he’s an obvious crook.
Two-thirds of Republicans want Trump back as president and 70 per cent think Joe Biden did not legitimately win the 2020 election. And as I mentioned in this column last week, half of American Republicans still think Democrat leaders are paedophiles!
The US is as divided and ungovernable as the most tribal African nations, and this is now becoming reflected in its institutions.
Specifically the Supreme Court will be under the control of right-wing extremists for decades unless Biden increases the number of judges, which seems unlikely, and has itself become a kind of second legislature. The constitutional separation of powers is now both meaningless, since the court is itself a political body, and a liability.
As Edward Luce wrote in the Financial Times last week: “Hostility between the two Americas has created an existential mindset that has made an albatross of its constitution.”
The only reason the United States looks remotely OK and its currency is doing well is that its rivals look worse.
Without a national electoral commission like Australia, the US has to guard its democracy from the Republicans’ concerted efforts to subvert it, and reach some kind of agreement on both sides of politics that the other side is not an evil enemy seeking to destroy the country.
Without it, the place will remain paralysed and divided, and maybe something much worse given the 400 million or so guns that they have.
How fantastic it is to live in Australia, where bad governments and prime ministers get thrown out.
And although we have some pretty ferocious arguments, and have made a mess of energy policy as a result, most of us don’t regard the political opposition as an enemy or disagreement as existential … at least since Tony Abbott was tossed out.
Unfortunately, we are spectators to the efforts at self-destruction going on elsewhere, and will be participants in their misery when they eventually succeed.
Alan Kohler writes twice a week for The New Daily. He is also editor in chief of Eureka Report and finance presenter on ABC news
