Superb account of the state of the USA - Rated 
This outstanding book is the best study of the current state of the USA. Kevin Phillips, the vastly experienced American political and economic commentator, depicts the USA's economic and religious interest-groups and their effects on the Republican coalition. For this paperback edition, he has written a brilliant 40-page introduction updating his 2006 analysis.
He shows how deindustrialisation is destroying the US economy. The debt-driven finance, insurance and real estate sector accounts for 21% of US GDP, manufacturing for only 13%. 44% of all US corporate profits come from the finance sector, 10% from manufacturing. Household incomes have not risen since 2000. Wages are 62% of national income, compared to an average 73% in the late 1960s.
He describes what he calls the `oil-national security complex' and its `100 years' oil war'. The USA, with 200 million of the world's 520 million automobiles, defeats conservation and energy efficiency. The USA consumes a quarter of the world's energy, but has only 5% of its reserves. Since 1998, the USA has been importing more than half the petrol it uses. A barrel of oil cost $3 in 1970, $10 in 1986, $30 in 2002, $75 in 2007. Non-OPEC oil will peak in 2010.
So the US state wants to secure oil supplies from the Middle East, but in a classic case of imperial overreach, its efforts are counter-productive. White House economic advisor Lawrence Lindsay said in September 2002, "the key issue is oil, and a regime change in Iraq would facilitate an increase in world oil so as to drive down prices." Pre-war, Iraq produced 3.5 million barrels a day, now just 1.1 million, "U.S. mismanagement in Iraq having only aggravated the oil-supply and terrorist threats", as Phillips writes. The war has caused most of the recent $45-a-barrel rise.
Phillips also studies the USA's rightwing religious fundamentalism - a toxic brew of Biblical inerrancy and born-again evangelicalism. It claims that we live in the `end-times', when the defeat of the antichrist at Armageddon heralds the second coming. It is anti-women, anti-science, anti-modernism and anti-Enlightenment. It opposes sex education, women's rights, contraception, stem-cell research and abortion.
He shows how successive US governments have indulged the soaring debt and credit industry. They encouraged reckless credit expansion, blowing up the ballooning national, international, business, financial and household debts. Low-interest rates led to the credit-card boom, to exotic mortgages, derivatives (which the speculator Warren Buffett called `financial weapons of mass destruction'), hedge-funds and debt instruments. Buffett also said, "Hyperactive equity markets subvert rational capital allocation."
Americans now owe more than they make. Finance firms are debt collectors; credit card companies offer to consolidate people's debts, but once the debtor is hooked, the company can raise interest rates to 20-30%. No wonder that in Bush's first term (2000-04), there were five million personal bankruptcies and by 2006, the USA's total debt was $40 trillion, 304% of GDP.
Intriguing presentation of the U.S.'s political and economic woes - Rated
You may not like what author Kevin Phillips says about President George W. Bush and America's current state. In fact, loyal Bush supporters may write off Phillips' views as paranoid left-wing poppycock, although he is a former Republican strategist who played a key role in Richard Nixon's 1968 presidential campaign. Here, Phillips unleashes a furious bare-knuckle assault on the Bush administration. He insists that it is setting up the U.S. for a mighty fall. Utilizing historical evidence to construct his case, Phillips postulates that the combination of America's crushing debt, dependence on foreign oil and conservative religious fanaticism is a recipe for disaster. Those who agree with Phillips' contention that "history is likely to remember George W. Bush as one of America's most damaging two-term presidents" will be screaming "I told you so!" as they traverse this tome. And yet, Bush backers should resist the temptation to dismiss Phillips completely. The book is heavily footnoted, but Phillips skillfully connects the dots, extracting information from hundreds of newspaper articles, scholarly journals and speeches to assemble a compelling presentation. Whether you are for Bush, against Bush or worried about the shape the U.S. is in, we recommend this well-researched, thought-provoking work.
A sobering read - Rated
The title is a little misleading, as Phillips anatomises the confluence of THREE merging influences on American policy. In the first section he chronicles the growth of US dependence on more and more imported oil, given the peaking of US production alongside the insatiable appetite of SUV Americans, and lays bare the petrol-head motives of the Cheney/Bush drive to Baghdad. The second section deals with the realignment and southernization of Republicanism as it sought the support of the moral-majority Christian groupings that have become such a powerful (if underestimated) force in US politics. The final section deals with the eye-watering levels of debt that have accompanied the `financialization' of the American economy, and the concomitant inequalities (where a CEO of a large manufacturing corporation in the 1960s might have earned 40 times the income of a median employee, the modern equivalent in the financial services sector may earn 500 times as much; with the top 1% of Americans now earning as much post-tax income as the bottom 35%!). As a result it is the Financial, Insurance and Real Estate (FIRE) sector that now pays the piper ($200m for lobbying in 1998 alone) and calls the tune, in terms of deregulation. This has resulted in a `massive realignment of preferences and priorities within the American system', with the Federal Reserve's sole task of protecting the banking and financial services sector supplanting any other kind of government intervention, even - as in the rescue of Citigroup - when this may work against the public interest. (In this context, Enron and Worldcom represent the inevitable sound of roosting chickens). In essence the American economy is being run by and for the money men. And where do these conjoining tributaries meet? In the form of the born-again Bush, with his dynastic roots firmly planted in the soil of financial services and oil.
As far as Phillips is concerned "If history teaches us anything, it's that this so-called cutting edge finance is an accident waiting to happen." Certainly the figures are quite staggering (consumer debt at 85.7% GDP; $2.7 trillion extra debt in twelve months ... and so on). Human greed and gullibility, combined with "three decades of determined federal regulatory dismantling ... avarice, legal nonchalance and innovation in new speculative instruments" are just the latest in a sequence of "high-wire acts and bubble-blowing kits so recurrent in the four century history of financial manias, panics and crashes."
Unlike many critics of Bush, Phillips comes from a Republican background of impeccable credentials, which makes his savage and wide-ranging indictment of the modern Republican Party all the more hard-hitting - he displays the contempt of an ex-smoker viewing a cigarette manufacturers' convention. There may be a bit more psephological and denominational detail than a UK reader might require, but the influence of these developments on British politics (Iraq, private equity buyouts, attitudes to Islam, etc., etc.) make it essential reading on this side of the Atlantic. Phillips also has an eye for a brilliantly entertaining and humorous turn of phrase, which undercuts the acerbity of his analysis.
The four ghosts of hegemony - Rated
Kevin Phillips analyzes thoroughly the US policies of the last twenty years under Republican leadership.
For him, these policies are not less than disastrous, putting the US under the demonic spell of a four headed ghost: the simplistic, Taliban-like radical religion of Christian fundamentalists, the energy (oil) vulnerability, ballooning public and private debt and global military overreach.
The GOP bets heavily on, what the author calls, national Disenlightment (religious fundamentalism), e.g., by funding public services through church-related groups.
The direct consequences of this policy can be seen in education (neglect of scientific infrastructure), climatology (no signing of the Kyoto protocol), biological research (no embryonic stem-cell research), morals (attempts to prohibit abortion again), science (promotion of `intelligent design' versus Darwinism), sex (promotion of abstinence and no support for contraception), social issues (women's rights against the rights of embryos), food protection (abolition of the EPA), theology (crusade against Islam) or business (justify wealth and oppose regulation).
The ultimate aim is to reduce the separation between church and state.
The world's age of oil has been the era of American supremacy. But, oil production has peaked and oil prices in dollar continue to peak. Will OPEC countries continue to be satisfied with their paycheck in devalued dollars?
There is apparently one oil `biggie' left: Iraq. That oil was the critical factor in the Iraq invasion is proven by the fact that after Saddam Hussein was defeated the US troops occupied immediately the Iraq Oil Ministry and seized the seismic maps of its oilfields. For the rest, the Iraqi people were free to loot everywhere and everything else.
`Moving money around' (financial transactions) became a bigger `business' in the US than manufacturing (making things). The population's savings rate is dropping like a stone. Public and private (`I shop, therefore I am') debt reaches all time highs, creating a monstrous `credit-industrial complex'.
The risk of overreach in military human and financial resources for the defense of petro-imperialism is becoming extremely high.
The author compares the actual world context with the ones confronted by other imperialisms (the Roman, Dutch, Spanish and British). He sees dark and ghostly clouds at the horizon for the American theocracy.
Kevin Phillips`s book is a must read for all those interested in world politics.
Stunningly good in its breadth, depth, fresh insights, and great writing. A star amongst stars. - Rated
I have a floor-to-ceiling bookcase on American history in the age of Bush, and I have absolutely no hesitation in recommending this as one of the most gripping analyses I've read on this or almost any other subject. Previous reviewers have noted the author's extraordinary capacity for making connections where one hadn't previously seen them - or seen them so clearly - so I won't repeat them, simply endorse. I feel as if I'm starting to understand linkages that I hadn't seen before or had only dimly grasped at.
One exceptional factor is the authhor's breadth and depth of knowledge. Unlike many American authors, his span is world-wide (one of his earliest topics is the rise of Dutch sea power, for example) and deeply rooted in the past. On a couple of occasions I wondered whether he was giving too much emphasis to a particular issue - for example the popularity of the Left Behind series - but then I looked for myself and saw that he wasn't.
The present situation has called the best out of some of the world's best historians (I can only hope that someone's listening) but this is superlative. Plus it's extremely well-written. I can't recommend it too highly, even to those who might have a bookshelf bigger than mine.
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