America enters the dreamland, part of our culture of defeat

Summary: America peaked in 2000. Events since then have sent us on downward trajectory, accelerated by our bad decisions in response. Now the grim reality of future geopolitical and economic problems presses on our imaginations, the end of our hegemonic delusions of power founded on unlimited borrowing at low interest rates.

In response we retreat into comfortable dreams. Something will shatter our dreams, probably bad news of an economic or geopolitical nature. That is the nature of dreams, that one must eventually wake. That’s the first step to a stronger America.

Every society experiences defeat in its own way. But the varieties of response within vanquished nations — whether psychological, cultural, or political — conform to a recognizable set of patterns or archetypes that recut across time and national boundaries. A state of unreality — of dreamland — is invariably the first of these.

From the Introduction to Wolfgang Schievelbusch’s The Culture of Defeat – On National Trauma, Mourning, and Recovery (2003)

In 2000 America stood at the top of the world. Economically vibrant, the Federal budget in surplus, the world’s hyperpower in both technology and war. The tech bust, recession, and 9-11 ruined those delusions. Our corporate accounting revealed as bogus, our investment banks as fraudsters — and our assumption of invulnerability shattered. In response we panicked — abandoning both economic prudence, our traditions of liberty, and rational foreign policy.

Why so many mistakes? We fell from grace, becoming just another great power. The shock broke us, and we took refuge in dreamland.

• Rather than putting America to work rebuilding our rotting infrastructure, we borrowed trillions for tax cuts to sustain consumption. Read More