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The Rise And Fall Of Empires

April 20, 2012

Economy, Finance, History, Politics

In his eminently readable book, Empires of Trust: How Rome Built – and America Is Building – a New World, historian Thomas Madden, compares the United States with the Roman Republic and argues that what is unique about both states is that they acquired their empire, not by conquest but by a series of alliances built on trust. Madden claims we are in an era of American peace or Pax. Ultimately anti-Americanism is rampant throughout much of Europe and the Middle East because people trust that the U.S. will use its power responsibly. No one in their right mind would say the things that Hugo Chavez or some of the leaders of Europe have said if they really thought the U.S. would attack and destroy them. It is true that Rome did not remain a republic forever and eventually came under the rule of emperors, but there were customs and traditions that had been established that even emperors had to acknowledge. Consequently, argues Madden, saying that America is ready to collapse is a bit premature. Several of the Greek and Roman historians said the same thing about Rome, centuries before it ultimately fell. Madden makes the case that America is still a relatively young Republic in the ascendant, not in decline.

Harvard University historian, Niall Ferguson, in his most recent book Civilization: The West and the Rest is not so optimistic. He argues that the West first surged ahead of the ‘Rest’ after about 1500 thanks to a series of “killer applications”: competition, science, the rule of law, modern medicine and the work ethic. However, beginning with Japan, one non-western society after another has worked out that these apps can be “downloaded and installed in non-Western operating systems”. To prevent not just a decline but possibly a “downright collapse” Ferguson argues that we need to “delete the viruses that have crept into our system: the anti-competitive quasi monopolies that blight everything from banking to public education, the politically correct pseudo-sciences and soft subjects that deflect good students away from hard science, the lobbyists who subvert the rule of law for the sake of the special interests they represent, our dysfunctional system of health car, our overleveraged personal finances, and our new found unemployment ethic”. Then we need to “download the updates that are running more successfully in other countries” such as Finland, New Zealand, Denmark, Hong Kong, Singapore and Sweden. Finally, we need to reboot the system.

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“Illusions commend themseleves to us because they save us pain and allow us to enjoy pleasure instead. We must therefore accept it without complaint when they sometimes collide with a bit of reality against which they are dashed to pieces.” Sigmund Freud

“When you see that in order to produce, you need to obtain permission from men who produce nothing – When you see that money is flowing to those who deal, not in goods, but in favors – When you see that men get richer by graft and by pull than by work, and your laws don’t protect you against them, but protect them against you – When you see corruption being rewarded and honesty becoming a self-sacrifice – You may know that your society is doomed.” Ayn Rand

“The best years of your life are the ones in which you decide your problems are your own. You do not blame them on your mother, the ecology, or the president. You realize that you control your own destiny.” Albert Ellis

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About Malcolm Greenhill

Malcolm Greenhill is President of Sterling Futures, a fee-based financial advisory firm, based in San Francisco. I write about wealth related issues in the broadest sense of the word. When I am not writing, reading, working and spending time with family, I try to spend as much time as possible backpacking in the wilderness.

View all posts by Malcolm Greenhill

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