The Global Sources of America’s Mess

As a specialist on foreign policy, I am sometimes asked whether international circumstances are at least partly the drivers of the domestic mess of polarization and gridlock in which the country finds itself. I am always tempted to say quickly that our woes are mostly self-inflicted, but the question is a fair enough one to deserve a more thoughtful answer. Here, in no particular order, are not so much firm conclusions as hypotheses about that better answer.

By Gregory F. Treverton

Note: The views expressed here are those of the author and do not necessarily represent or reflect the views of SMA, Inc.

At the grandest level, I sometimes think there was a kind of implicit bargain in the several decades after World War II: prosperity and increasing equality at home made Americans more willing to shoulder leadership abroad than had been their history and was, perhaps, their inclination. By the 1980s, by this logic, with inequality on the rise and the American dream in tatters, global leadership began to look more expensive and thus less acceptable. In that sense, perhaps the precipitous fall in trust in government between 1964 and 1980 is more understandable. When polled in 1958, 73 percent of Americans answered the canonical question—whether they trusted the government to do the right thing all or most of the time, yes.[1] Six years later, 77 percent said yes. By 1980, though, trust in government had cratered, to 27 percent.

Not only did those years see the aftermath of Vietnam and the Watergate affair, but the stagnation of working-class incomes was driven home by the high inflation of the second half of the 1970s—to which I can testify as someone whose first mortgage in those years carried a 17 percent interest rate! The bargain is a construct after the fact, one that, if it existed, was implicit, hardly explicit. Yet the economic roots of America’s discontent fed the country’s international weariness.

To be sure, isolationism in America runs back to George Washington’s famous admonition in 1796 “to steer clear of permanent alliances with any portion of the foreign world.”[2] For much of the Republic’s history, isolation served the country well, laying the basis for the country’s ascendance in the late nineteenth and early twentieth century. Americans wanted the world to emulate their model, but for most of the country’s history they sought to do so only by setting an example, not by strategic actions beyond North America; indeed, staying out of the world was a way to protect the exceptional character of the American experiment.

A related part of the story is the relative stagnation of the middle class over the last forty years. “Middle class” might be defined as the middle three-fifths (or 60 percent) of wages. While the top fifth saw its wages grow by 31 percent over the last forty years and the bottom fifth by nine percent, those three middle three quintiles saw growth of 13, 7 and 6 percent, from the next-to-the top quintile to the next to the bottom.[3] It is also worth noting that the middle class depends more on wages than either richer Americans, who receive increasing amounts of income from capital growth, or poorer ones, who receive transfer payments from the government.

So, too, the actual expenses, in blood and treasure, of foreign policy misadventures, from Vietnam to, more recently, Iraq and Afghanistan—by one estimate, $6.4 trillion through 2019—along with the sad human cost, surely play a role.[4] Those expenses are bad enough, but the public consistently misunderstands the costs of America’s global engagement. For instance, polls have always shown that Americans overstate by a factor of more than ten the costs of foreign aid. In a 2015 poll, the median estimate of foreign aid as a share of the federal budget was 20 percent, when the actual number is one percent.[5]

Polls also demonstrate Americans’ ambivalence about foreign affairs. On one hand, around 70 percent of Americans want the United States to play a leading or major role in international affairs, and about the same share acknowledge that international events affect their lives.[6] That said, about half of registered voters think other countries take advantage of the United States, and, unsurprisingly in light of the pandemic, Americans, as usual but even more so, are focused on issues close to home. While a majority of Americans say foreign policy is “very important” to them, that seems more an artifact of the question: who would admit to a pollster that foreign events weren’t important? Much larger majorities cite the economy (79 percent) or healthcare (68 percent) as very important.

If the costs of America’s expansive global role are visible—if often overstated—many of the benefits of that role are intangible or invisible. An example is the role of the dollar. More than half of global trade is denominated in dollars, and dollars account for a similar share of foreign exchange holdings around the world. The dollar’s role carries monetary benefits, though not very tangible ones. Perhaps more important, it lets the United States use (sometimes unwisely) sanctions with abandon. When European nations sought to trade with Iran despite U.S. sanctions, they created Instex, an alternative clearinghouse, but still could not escape pull of the dollar and Instex failed.

Less visible still is the pull of America as a partner or ally and as an idea. The fact that so many talented foreigners want to be educated, then stay here, is one tangible manifestation. The fact that the United States is so often the “necessary” partner in creating international coalitions of the willing is another example, though one that probably cuts both ways to the extent many Americans regard their country as too willing to engage in those foreign ventures.

The fact that this attraction has waned is a kind of vicious cycle. The more the United States looks xenophobic and ill-governed, the less it becomes a model and a draw. With the end of communism, Francis Fukuyama wrote of the “end of history,” and America’s unipolar moment began. [7] History didn’t end, but the unipolar moment did. Yet in that unipolar moment, with Russia flailing and China only just stirring, countries that wanted to escape America’s embrace couldn’t. Now they can. China and to some extent Russia and others are available as supporters and partners. Moreover, as America’s democracy looks less attractive, other forms, especially autocratic, look better (even to Americans).

Finally, the discontents of globalization bear on our domestic mess. One dimension is economic, the hollowing out of manufacturing between 2000 and 2010. The real causes were complicated—a combination of production moving to China and other low-wage countries, automation continuing apace, and companies scaling back production in the 2008 recession. What economists did not predict was the trade boom in manufactured exports from developing countries: American goods imports from China jumped by a staggering 1,156 percent from 1991 to 2007.[8] Small wonder that globalization seemed a train without a conductor. We had known for a long time that the politics of foreign trade are asymmetric: benefits to consumers are dispersed but costs, often to workers, are concentrated, like those lost manufacturing jobs. As a result, the constituency for trade is weak but that against powerful and organized.

A second downside of globalization is perhaps contact with “the other.” This is most visible in immigration. Here, too, the backlash obscures considerable agreement. in response to a Gallup question in 1986 “immigration should be kept at its present level, increased or decreased?” 49 percent of Americans said it should be decreased. When the same question was asked in June 2018, only 29 percent opted for decrease. In the same poll, 75 percent of Americans thought immigration was a good thing for the country, a number that rose to 84 percent for legal immigration.[9] We have long known that immigration is a boon to the economy, not a bane. In the words of a 2017 National Academies study: immigrants in the “first-generation are more costly to governments, mostly at the state and local level, than are native-born generations. However, however, immigrants’ children—the second generation—are among the strongest economic and fiscal contributors in the population.”[10]

In that sense, immigration, with diffuse benefits but concentrated costs, is akin to trade: those who benefit are scattered and silent, but those who are hurt are visible and vocal. It is no surprise that Latinos in the Rio Grande Valley, many of whom have been Americans for generations, are not enthusiastic about immigration. Overall, the effect of immigration on wages of people already here is very small, and concentrated, unsurprisingly, among previous immigrants and high school dropouts. The backlash is cultural, even tribal, the sense that the nation is changing in ways many people find distasteful. Whether backlash is lessened or increased as immigrants disperse throughout the country, especially including into red states, is hard to assess.

The anger and cruelty loose at home is hard for me to understand, especially from an international perspective. Yet international circumstances probably have fed the polarization between the “anywheres” and the “somewheres”: between those Americans who benefit from globalization and those who don’t; those who value the diversity of immigration and those who fear it; those who value, and perhaps benefit from, American leadership in the world and those overwhelmed with daily necessities and thus prone to see foreigners in transactional terms as taking advantage of us.

Gregory F. Treverton stepped down as Chair of the US National Intelligence Council in 2017. He is now Professor of the Practice at Dornsife College, University of Southern California, Chair of the Global TechnoPolitics Forum, and an SMA Executive Advisor.

[1] Louis Menand, “Legitimation Crisis: Did Liberal Reformers Shake Our Faith in Government,” The New Yorker, August 16, 2021.

[2] Charles Kupchan, Isolationism: A History of America’s Efforts to Shield Itself from the World, Oxford University Press, 2020.

[3] Richard V. Reeves and Isabel V. Sawhill, “A New Contract with the Middle Class,” Brookings, September 2020, https://www.brookings.edu/essay/a-new-contract-with-the-middle-class-money/.

[4] Neta C. Crawford, “United States Budgetary Costs and Obligations of Post-9/11 Wars through FY2020: $6.4 Trillion,” Watson Institute of International and Public Affairs, Brown University, November 1, 2019, https://watson.brown.edu/costsofwar/files/cow/imce/papers/2019/US%20Budgetary%20Costs%20of%20Wars%20November%202019.pdf.

[5] Steven Kull, “American Public Support for Foreign Aid in the Age of Trump,” Brookings Institution, July 31, 2017, https://www.brookings.edu/research/american-public-support-for-foreign-aid-in-the-age-of-trump/.

[6] Bruce Stokes, “US Electorate Shows Distrust of the Realities of Foreign Policy,” Chatham House, 4 September 2020, https://www.chathamhouse.org/expert/comment/us-electorate-shows-distrust-realities-foreign-policy. Poll numbers in this and the following paragraph are, unless otherwise noted, from Stokes.

[7] Francis Fukuyama, The End of History and the Last Man, Free Press, 1992.

[8] Ibid., 2158.

[9] Megan Brenan, Record-High 75% of Americans Say Immigration Is Good Thing, Gallup, June 21, 2018, available at https://news.gallup.com/poll/235793/record-high-americans-say-immigration-good-thing.aspx.

[10] National Academies of Sciences, Engineering, and Medicine. 2017. The Economic and Fiscal Consequences of Immigration. Washington, DC: The National Academies Press. https://doi.org/10.17226/23550, p. 7