The Upshot of the War on Terror
There is instead a new reality: the greatest transfer of income in human history, away from energy importers such as the US to energy exporters; the rise of a new breed of wealthy autocracies that cripple US hopes of dominating the global system; and demands on the US to make fresh compromises in a world where power is rapidly being diversified. Far from the Obama-McCain contest being America’s saviour, it has another dimension entirely: evidence of the generic failure of the US political system. The US struggles but seems unable to confront the world that exists. It slips into pessimism while fooling itself another irresistible revival is just around the corner. But the structural trends offer a different conclusion. Despite cyclical fluctuations, world oil and energy prices will stay high, driven by long-run changes in supply and demand. This provokes a global wealth redistribution without precedent to oil exporters, mainly in the Middle East and Russia, that marches in tandem with China’s export-driven current account surplus. It is an extensive transfer of economic power away from the US to nations that are not mainly democracies, a dynamic that is the subject of agonising review in seminars and debates in the US….