America's Fading Hegemony and the New World Order

Doug Casey

International Man: For decades, the US has been the world's dominant military, financial, and political power. Where is the American empire today? Are we witnessing a temporary period of weakness—or something more fundamental, like the beginning of the end of US global hegemony?

Doug Casey: The U.S. today is a very different country than it was in 1946. At the end of World War 2, it was by far the most financially, economically, industrially, and militarily powerful country in the world. It was culturally, religiously, and ethnically aligned, and a genuine middle-class society. Now none of those things are true.

The U.S. has devolved into a bankrupt multicultural domestic empire. The Government's $40 trillion—and rapidly growing—debt can never be paid off. The dollar is an irredeemable fiat unit. US welfare benefits are drawing immigrants who are at odds in every way with the existing population. It's no longer the country that promotes individualism, free minds, and free markets. Rather, it has been captured by a gigantic regulatory bureaucracy that requires permission for most everything while taking roughly 40% of GDP directly and indirectly. The military is well-equipped, at gigantic expense, to fight 20th-century wars, but totally ill-equipped to fight the kind of wars the US is provoking everywhere.

I'd say the US decline has more or less mirrored that of Rome. If you use that analogy, we're moving into a time similar to Rome's mid-3rd century—a time of foreign wars, civil wars, wholesale bankruptcy, and societal chaos.

The bright side is that certain areas of technology are still advancing rapidly—at the moment. But we're at the peak of the biggest financial bubble in history, and it's tech-driven. When it pops, the consequences will be widespread and serious. AI data centers will remain, but will mostly be used to monitor the population.

So, yes, the era of US hegemony is coming to an end. And the rest of the world is visibly reorganizing around that reality: the BRICS bloc has expanded to include countries such as Iran, Egypt, Ethiopia, and the UAE, and its members have openly discussed reducing their reliance on the dollar in trade settlement—early, still-limited steps, but a marker of where sentiment is moving.

International Man: The Middle East seems to be entering a new and much more dangerous phase. How do you view what's happening there now? Has US involvement strengthened its position in the region, or is Washington discovering the limits of what military power can accomplish?

Doug Casey: With Afghanistan, Iraq, Syria, and Libya, among others, the US Government has, for reasons that make zero sense, decided to involve itself in the world's most chaotic and blood-soaked perpetual tribal war zone.

Now, idiotically, it has decided to hunt big game in the form of Iran. The U.S. started baking this cake in 1953 when the CIA overthrew Iran's popularly elected leader, replacing him with the Shah. It's not that Mossadegh was a good guy. Nor was the Shah the Americans replaced him with. Iranians resented the U.S. replacing their government with a puppet dictator, and 27 years later the result was Khomeini and his Mullahs.

Of course, there has been a lot of nasty rhetoric toward Americans since then. But harsh language from the Iranians, who have zero ability to threaten the U.S. in any way, isn't an excuse to launch an unprovoked surprise attack on the country in the midst of negotiations. Iran has never been a threat to anybody but Israel. And it's very clear that Israel is using the Americans to solve its Iran problem.

The US has decisively lost the war against Iran, making the situation much, much worse than before the Israeli/American strikes six months ago.

International Man: Then there's Russia and Ukraine. After years of war, enormous spending, sanctions, and confrontation with Moscow, what do you think the US has actually accomplished? And what does this conflict tell us about the relative power of the US, Russia, and Europe today?

Doug Casey: One of the good things about Trump is that he reopened communications with Russia. There was zero communication between the two nuclear powers during the Biden years, making for an extremely dangerous situation.

Worse, the U.S. fomented the Russia/Ukraine war when it conducted a color revolution against Ukraine in 2014. At that point, the Russian-minority Donbas provinces split off from Ukraine, and Kyiv launched a war to recover them. Seeing Ukraine turned into an enemy before his very eyes, Putin felt he had no alternative other than to teach them a lesson and defend Donbas and Crimea with his "special military operation" in 2022.

Since then, things have gotten completely out of hand. It appears there have been a couple of million casualties. Numerous serious missile attacks have been launched into the homelands of both countries. Worse, European governments seem to be plumping for a full-scale war against Russia while providing the corrupt Zelensky regime with money and masses of materiel.

The situation could easily go critical. Russia may finally decide to draw a line in the sand and launch a nuclear strike against Ukraine or a European country.

The best solution—the only solution, actually—is for the US to withdraw all aid of any type from Ukraine, which is acting as a flashpoint for World War III. The same is true of support for Israel, and "aid" to all foreign governments, without exception. I've described foreign aid as a transfer scam from poor people in rich countries to rich people in poor countries. It just gives them the money they need to fight with each other.

International Man: China is obviously the bigger long-term question. Washington increasingly treats Beijing as its principal strategic rival, while Taiwan remains an obvious potential flashpoint. Do you think a direct confrontation between the US and China is becoming more likely—and if it happens, is the US really in a position to win it?

Doug Casey: It's unfortunate and irrational of Beijing to insist on bringing Taiwan back into its fold. Perhaps the next Chinese leader, after Xi, will recognize that the status quo has changed; Taiwan has become a separate and independent country over the last 80 years—apart from the fact that a war of conquest against Taiwan would be immensely destructive to both parties.

But that shouldn't be the concern of the US. By sticking its nose into a fratricidal conflict, the Americans can only make things much worse. The Americans, who understand Chinese culture about as well as they understand Iranian or Russian culture, should leave both parties to their own devices.

We can only hope that the US won't let an alliance with Taiwan draw it into a full-scale war with China. There's no way the US can win it. It's a bad idea for a bankrupt empire to go looking for trouble on the other side of the world in three different theatres.

And, as I pointed out earlier, our means of military force projection are basically relics from World War II. Aircraft carriers, for instance, are nearly useless in today's military environment, as are $100 million F-35s and billion-dollar B-2s. It's worth noting that Ukraine's use of cheap sea drones and missiles against the Black Sea Fleet has been widely cited by defense analysts as evidence of exactly this shift—the premium platforms of the last century are increasingly exposed to low-cost precision munitions.

International Man: When you put all of this together—the Middle East, Russia, China, a weakening Europe, rising powers outside the West, and America's enormous financial problems—where do you think the world is headed over the next decade? What does the decline of an empire typically look like, and what should individuals be doing now to prepare for it?

Doug Casey: Large-scale formal war has been a feature of human existence for at least 5,000 years, starting with the rise of cities. As humans have become vastly richer, wars have become vastly more deadly. Everybody seems aware of that except for the posturing non-entities who run NATO and the EU.

When Einstein was asked what weapons he thought World War 3 would be fought with, he said he didn't know. He was only sure that World War 4 would be fought with sticks and stones.

Everyone is justifiably afraid of nuclear weapons. But in today's world, where computers control everything, a cyber war could be nearly as deadly. And a biological war could be deadlier than either. I've discussed those possibilities in the past. Recently it has occurred to me that mass migration could be as destructive as any of the other three alternatives. Don't believe me? I urge you to read Jean Raspail's "The Camp of the Saints." It's ultra non-PC, funny, scary, well-written, and accurate.

And there are other varieties of war lurking. AI, drones, and robots together mean the world of the Terminator has arrived. As Gilda Radner's Roseanne Roseannadanna used to say: "It's just one damn thing after another. It's always something."

What should you do about it? We can't control what today's MegaStates, or the Deep States behind them, will do. Being politically involved in "our democracy," hoping to make a change by voting, is somewhere between laughably counterproductive and criminally stupid.

Instead, do your best to insulate yourself from these things. I've got a lot more general thoughts on my YouTube channel, and specific suggestions at Contrarian Insider and CrisisInvesting.com.

Reprinted with permission from International Man.

About the author

Doug Casey

Best-selling author, world-renowned speculator, and libertarian philosopher Doug Casey has garnered a well-earned reputation for his erudite (and often controversial) insights into politics, economics, and investment markets.

Doug is widely respected as one of the preeminent authorities on "rational speculation," especially in the high-potential natural resource sector.

Doug literally wrote the book on profiting from periods of economic turmoil: his book Crisis Investing spent multiple weeks as #1 on the New York Times bestseller list and became the best-selling financial book of 1980 with 438,640 copies sold, surpassing big-caliber names like Free to Choose by Milton Friedman, The Real War by Richard Nixon, and Cosmos by Carl Sagan.

Then Doug broke the record with his next book, Strategic Investing, by receiving the largest advance ever paid for a financial book at the time. Interestingly enough, Doug's book The International Man was the most-sold book in the history of Rhodesia. His most recent releases, Totally Incorrect (2012) and Right on the Money (2013), continue the tradition of challenging statism and advocating liberty and free markets.

He has been a featured guest on hundreds of radio and TV shows, including David Letterman, Merv Griffin, Charlie Rose, Phil Donahue, Regis Philbin, Maury Povich, NBC News, and CNN; has been the topic of numerous features in periodicals such as Time, Forbes, People, and the Washington Post; and is a regular keynote speaker at FreedomFest, the world's largest gathering of free minds.

Doug has lived in 10 countries and visited over 175. Today you're most likely to find him at La Estancia de Cafayate (Casey's Gulch), an oasis tucked away in the high red mountains outside Salta, Argentina. Cafayate most resembles the isolating beauty of Bryce Canyon, Utah, combined with the lush vineyards of Napa Valley. Residents enjoy economic and social freedoms not found in the US and some of the best wine and golf on the planet.