Covid brings US decline out in the open

Excellent study material for all civil services aspirants - begin learning - Kar ke dikhayenge!

 Covid brings US decline out in the open

---

Read more on - Polity | Economy | Schemes | S&T | Environment

---

• The decline of the US: The signs were visible since some months, when empty construction sites and delayed road & building projects kept piling up. US citizens even started avoiding hospitals due to horrible and unpredictable bills. 
• US power: Normally, analysts talk in terms of "US power" when they intend to mention international power. They compare it with the rise of China, waning of US hegemony and moral authority. But these are abstract notions for US citizens. Damage will be felt when investors move away, not without that.
• 2020 pandemic response: The horrible US response to this crisis has shown the total leadership failure of the US, at all levels. Who all failed? The President, the CDC, the FDA and regional leaders - everyone. So today, hurt states are hurting as usual, and new ones like Arizona, Texas and Florida are facing a huge surge. Italy like countries - notorious for poor governance - have crushed the infection curve already.
• Real cost: Anyone under-estimating the cost of this death-toll in America must realise that with more fear, economy will sink further. Citizens will live inside, while watching Italians walking freely in Italy! And the EU is planning a ban on US citizens now.
• Losing the appeal: For high-skilled workers, the US will lose its appeal due to many factors coming together viz. high housing costs, poor infrastructure, gun violence, racial tensions, police brutality, and more. If companies now choose to move away to Europe or Asia, then local service economy will crumble even more, leading to poor tax collections, and lower infra spending. A vicious circle.
• All advantages under threat: The strengths of US have been immigrants, research Universities, cheap housing, etc. If those are lost, decades of stagnation await.
• The dollar itself at risk: With the above decay, America will face the final challenge in the form of dollar losing its prime position. Since the USD is the centre of global financial world, US has borrowed cheaply, and citizens have enjoyed cheap imports (and better lives). If many investors lose faith in the US, that edge will be gone.
• Capital flight: The day large-scale capital flight happens from the US, citizens will realise they need to pay more for all goods. Higher interest rates to lure back investment capital and a 1970s-style stagflation will arrive. 
• Political system collapsing: As the leaders wrangle, and voters remain bitterly divided, the US may decline in a civilisational sense in a few decades. That can still be reversed.

Read more on - Polity | Economy | Schemes | S&T | Environment

Join UPSC Self Prep course | Online Course (PT Gurukul)  | Covid Special Course | Join PT courses

* Content sourced from free internet sources (publications, PIB site, international sites, etc.). Take your own subscriptions. Copyrights acknowledged.