The world is baffled by the ‘fiscal cliff,’ sees it as a sign of American decline

January 2, 2013

(Win McNamee/Getty Images)

CNN anchor Ali Velshi had a tough word for the U.S. fiscal cliff negotiations: embarrassment. Velshi, lamenting the bitter politics and institutional logjams that nearly sent the world's richest country over a self-imposed cliff, called the whole sordid episode an "embarrassment for America."

The world has been watching the U.S. "fiscal cliff" talks closely, as it does with many American political dramas. Other than the usual critics, though, the global reaction is not quite what Americans like Velshi seem to believe it would be. International coverage has been at turns fascinated or frustrated by the U.S. political system, which many seem to find baffling. Some foreign observers blame the American system itself, while others focus squarely on the Republican Party or its tea party contingent, both of which remain highly unpopular abroad.

American politics often get heavy coverage in foreign media. Part of this seems to be a built-in fascination with the world's richest, most powerful, and third-largest country. But it also seems driven in part by what you might call the world's America problem: people across the globalized world see themselves as directly affected by U.S. policies, but have no real say in the processes that produce them. Their only real recourse is to critique them, which they certainly do.

Australia's national treasurer, Wayne Swan, lashed out on Twitter in apparent frustration. "We're not immune from global developments," he said, citing "the impact of America's fiscal cliff fight" on Australia. Snow, long a critic of conservative American politics, wrote, "It is lamentable that so much of the world’s post-[global financial crisis] economic recovery has been held hostage in such a reckless way by the Tea Party."

The Republican Party is not terribly popular abroad, which may help explain how foreign media are covering the party politics of the fiscal cliff. German publication Der Spiegel runs with the headline "Republican Blockade Paralyzes America." The news magazine explains the crisis down to a unique feature of our system: "In the United States, the opposition also co-governs." From there, it writes: "The fundamental problem behind the stalemate is a divergence of the parties in a consensus-based system of government. Or, to be more precise, the drifting off course of one of the two parties involved: the Republicans."

Leading French newspaper Le Monde, in a news story, slammed Republicans as abusing U.S. congressional rules meant to protect the minority party. The paper's story declares this a bad sign for the future of the American political system and its ability to confront major crises. It linked the spending impasse to foreign policy as well, asserting that the United States never fully recovered from overspending in Iraq and Afghanistan.

America-pessimism seems to be getting a big boost this week. Mexico's El Economista newspaper published a scathing article by editorial director Luis Miguel Gonzalez, who in his first sentence says that the fiscal cliff crisis shows that the United States is now "una república bananera" -- a banana republic. Gonzalez blames Democrats as well, calling the partisan divide an intrinsically American quirk, similar to our "hamburger-eating contests."

Surprisingly, the coverage in Iran seems to be some of the least critical. An extensive story on semi-state-run Fars News explains the process and outcome with unusual objectivity. The strongest criticism it could come up with was noting that the deal did not address entitlement reform. Most of the coverage has been "by the book," Iran-watcher Arash Karami told me, adding, "That in itself is odd because perhaps six months ago many of the more ideological sites would have jumped on this story as if world capitalism were on the verge of collapse."

Probably the strongest critics have been in the state-run Chinese media, which are always happy to predict the decline and fall of the American system. An editorial by the state-run Xinhua news agency argued that the fiscal cliff is just the latest bad sign for the "long-term sustainability" of the American experiment. Here's their case:

In a democracy like the United States, tax increases and spending cuts, the exact dose of medicine needed to cure its chronic debt disease, have long proved hugely unpopular among voters. So the politicians have chosen to kick the can down the road again and again.

But as we all know, the can will never disappear. Sometime and somewhere, you might trip over it and fall hard on the ground, or in the U.S. case, into an abyss you can never come out of.

Of course, this criticism is probably as much about implicitly defending the Chinese system as it is about gleefully condemning the American. But it does have its sincere adherents. On China's ever-raucous social media, some Chinese Web users seemed to agree that the fiscal cliff proves that the American system can't work.

"The essence of the U.S. fiscal cliff is an inability to make ends meet, which is unsustainable in the long term. In the short term, the U.S. will not lack for money, because they can always fire up the printing press,” one user wrote, according to China-focused news site Tea Leaf Nation, which overviews Chinese commentary on the fiscal cliff.

Many Chinese Web users, though, seemed to shrug off the fiscal cliff fight as a pre-determined show, a staged crisis. "It was always going to pass; the Americans always play out Hollywood plots where the lead is saved at the very last second," one Web user wrote, betraying both the fix-is-in perspective common in authoritarian societies where politics are almost never played out publicly, as well as a certain sort of faith in the American system, however misplaced.

Tea Leaf Nation's David Wertime makes the fascinating observation that Chinese Web users expressed jealousy at the U.S. move to raise taxes on the rich from 35 to 39.6 percent, with many urging China to match this higher tax rate. What they don't seem to know is that China's top-level tax rate is actually even higher -- 45 percent. This misperception, Wertime suggests, "likely reflects a general sense in China that wealth inequality has gotten too extreme."

 

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