On 21 January 2013 Barack Hussein Obama was sworn in as president of the United States of America, in his second inauguration. His inauguration this time around was a much scaled down event from the euphoria of his first term, with a much more conciliatory tone, with lots of talk about the middle ground. It was obvious that the reality of ruling has fundamentally shaped Obama’s perceptions and will dominate his second term. US presidents are constrained by numerous factors in the US political system including the fact that the Democrats will be running for elections in exactly two years’ time, again, for the House of Representatives.
Obama is well known for his oratory skills and has inauguration speech was full of America’s unique role in the world and the opportunities that exist for the US public. It is only natural a US president would give a positive and upbeat speech in his inauguration, however he will ultimately be measured by what he does as this is what will be looked at when he is long gone.
When Obama rose to power in January 2009, the US was reeling from a decade of war, its economy was shrinking after numerous bailouts and stimulus packages failed to halt the ‘great recession,’ and Russia and China were taking a much more aggressive posture towards US global ambitions. The US was caught on the back foot when the Ummah in what has come to be known as the Arab spring took to the streets to bring change in their countries.
Irrespective of the rhetoric from the Whitehouse, there are a number of strategic issues the US will face in the next 5 years and these in all likelihood will not just define Obama’s legacy but US prowess around the world.
US Debt
The USA has a precarious debt situation, one that should have had the US credit rating downgraded a long time ago. Whilst the US may generate more than $15 trillion a year, it is debt that fuels this. The US national debt – the money the central and federal government owes to the US public and the world through the bonds (or IOU’s) they have issued – stands at $16.4 trillion. Interest payments on this debt were $3.3 trillion in 2012. This debt emanates from US citizenry’s huge appetite for imports and credit cards and as a result consumer debt stands at $864 billion. The desire by American’s to own their own homes has resulted in mortgage debts of $12.9 trillion. The debts of US companies amounts to $20.8 trillion. This makes the US indebted to the tune of $52 trillion – more than the combined economies of Japan, China Britain, Germany, France, Brazil, Canada and Italy twice over.
Successive US presidents have increased the amount the US can borrow and constantly rolled over this debt. This rather flexible debt “ceiling” has been raised 34 times since it first was raised over the $1 trillion level in September 1981. The fiscal cliff debacle resulted in congress debating what should happen to the ceiling as the US was fast approaching its limits, due to postponing any solution during the debt ceiling debacle in February 2010. The US once again postponed any tax hikes and spending reduction for another day in effect not dealing with America’s unsalable appetite for debt.
For the moment postponing this debt has been the solution, however as this debt grows, America’s ability to realistically meet its annual payments will raise the prospects of default and this will impact America’s global position which is built upon constantly turning over this debt.
Afghanistan
The US and its allies are all looking to extricate themselves from Afghanistan after a decade of war. Whilst 2014 is the official date when most of America’s allies will completely withdraw their troops the challenge for the US is its small presence, which will remain beyond 2014, will struggle to deal with the political architecture that it created.
The US architecture consists of an acceptable dictator, who has struggled to impose his writ beyond his own headquarters. Hamid Karzai has been struggling for years and its unlikely his government will last. This necessitates negotiations with the real power in the country – the Taliban, to shape the country’s political future. Obama since he has been in power has made numerous statements which reflect Washington’s exploration of ways to talk with and apply pressure on the Taliban to achieve a favourable bargaining position. These have all failed, as the Taliban are winning and do not see the need to negotiate. With a smaller force remaining beyond 2014, the Taliban will be playing a role in the country whatever the outcome, the issue for Obama is can he get the Taliban to enter its political architecture before US elections in 2016.
China
America’s biggest challenge is China’s assertiveness in the Asia-Pacific. The rise of an alternative power in the region means the loss of critical sea routes for trade and energy directly linked to the US economy and the loss of key tools for containing other nations reliant upon the routes in the region for their economies. Dollar-for-dollar the US military has various military systems to deal with any Chinese aggression, however China has a presence in the region, whilst the US just has a coast line thousands of miles away from the Asia-pacific region. As the region is far from the US, any intervention will require long lines of communication, multiple logistical hubs and forward-positioned supplies. Because the Western Pacific constitutes China’s home waters, China’s military assets do not have to travel from half way across the world to get to the Asian military theatre as America’s must. In the event of war, the US may only get to the theatre when the war is over.
For the first time since the collapse of the Soviet Union the US faces a challenge to its hegemony. This challenge, whilst not to its global position, possess a challenge in one region of the world for the US and comes at a time when China views the US to have weakened due to a decade of war.
Whilst the US is developing its Air-Sea battle concept, the central tenet of which involves very close coordination of US Air Force and Navy capabilities. For the moment, the US military will rely on ports and air bases across the Asia-Pacific region.
Economic growth
Obama’s second term will in all likelihood be judged by his domestic performance. The sheer size of the US economy means fluctuations affect the whole global economy. Ever since the financial crisis began various attempts to kick start economic growth have failed one after the other. Initially the Bush government proposed legislation for the government to purchase up to $700 billion of “troubled mortgage-related assets” from financial firms. Then when Obama became president he implemented a stimulus package worth $825 billion (5.8% of GDP). He then later promised more stimulus money for the green economy in the hope of stimulating the wider economy.
The America’s economy is dominated by consumer spending and is heavily dependent on the American population’s appetite to continually consume. The collapse of the sub-prime market and then the whole real estate market in the US led to consumer spending to drop as many lost their homes, this drop in spending led to a fall in spending in wholesale trade and retail – the twin engines of the US economy.
The US administration continued with stimulus plans in the hope of reviving the US economy. Today, 12.8 million Americans are unemployed, 8.2 million cannot find enough work, and 1.1 million have given up looking for work altogether. For 38 straight months, unemployment has been higher than what the US administration promised. Stimulus entails increasing government spending using money that is borrowed primarily from abroad in the case of the US from countries such as China, or simply created by central banks literally by entering digits into a computer. Any stimulus was always a high-octane boost and a temporary measure. They are designed to kick-start stalled economies, not to fuel sustained economic growth. The growth that has been achieved is really the inflated results of stimulus measures achieving their intended effect to be temporary.
Arab spring
Since the events of 9/11 the ideological divide between the US and the Muslim world has become more and more obvious. With issues constantly taking place which are ideological in nature, add to this the Arab spring where the Muslim world is taking its destiny into its own hands the US is losing support in the Muslim world very fast. The film insulting the prophet (saw) in 2012 is a clear case in point.
Human rights and the free market which for long were US brands are no longer values the Muslims globally are aspiring for. US occupation of Muslim lands, Guantanamo Bay, Abu Gharib and the constant attacks on Islam in the name of Freedom have polarised the world. Ideological Muslims globally are calling for Islam, the Arab spring has shown they can rise up to change the status quo, in Obama’s last term the US will have to contend with the political aspirations of the Muslim world.
Syria
The opposition forces in Syria, who lack heavy weapons, have successfully created a stalemate with the regime. The regime has been unable to successfully lead attacks deep into rebel held territory due to the decentralised nature of the uprising. The US has given the regime ample time to quell the uprisings thorough solutions which realistically were never going to placate the opposition. Currently the regime has set up defensive positions in Aleppo and Damascus. Opposition forces have focused on Aleppo and have had success in attacking the regime supply lines from Damascus to Aleppo and are not far away from cutting of Aleppo from the regime. The capture of the Taftanaz base weakened the Assad regime further. When this occurs the regime in Damascus can only hold out for so long and the very real prospect of the overthrow of the regime and replacement by someone who represents the people will likely unfold, bringing an end to US influence in the country.