March 17, 2021 Reading Time: 7 minutes

Two tangible factors have held the huge, diverse United States of America together for almost 250 years; the fact that its federal government owes most of its citizens money (bonds and old-age assistance), and the seemingly constant threat to Americans’ security from foes foreign or domestic.

The fiscal glue appears to be in serious trouble. I’ll save analysis for another time but suffice it to say that a nation that wallows in idleness and profligacy cannot long endure.

The most menacing foreign threat now is China, or the Communist Chinese Party (CCP) to make it clear that the American people have no beef with Chinese citizens. 

Explored below is the extent to which the CCP poses an existential threat to America and the extent to which it constitutes a phantom menace, a paper dragon so to speak, a bogeyman that politicians can summon at will to frighten Americans into supporting policies that they otherwise would not.

Throughout its history, America has faced both types of enemies. Conflict with nations of the first type ended in existential war and with the second in the foe’s self-destruction. Intermediate cases ended in limited wars, some quick and others lasting decades and even a century or more.

Before the Revolution, France and eastern tribes of American Indians posed existential threats to British colonial North America for over a century until victory in the big war that Americans understandably call the French and Indian War (The Seven Years’ War for Europeans, 1756-1763).

While the cannons from that war were still hot, the colonists began to perceive their own Mother Country as their next existential threat. Two decades of tumult culminated in an existential war from which America emerged triumphant.

After ratification of the Constitution, Americans divided over who to feel most threatened by. Those on the frontier insisted it was Indians, those in big port cities claimed it was the Barbary pirates, while Federalists (Washington, Hamilton, and Adams) said it was obviously France but Democratic-Republicans (Jefferson et al) claimed it was Great Britain. So in the 1790s, when the Federalists controlled the presidency, the new nation fought Indians and a quasi-war against France

After Jeffersonian Virginians gained control of the White House in 1801, tensions with Great Britain mounted, leading to disastrous trade embargoes and a war (1812-15) that America fought to a draw. Conflict with the Barbary pirates also flared several times early in the nineteenth century.

Indians proved a renewed threat during the War of 1812 (which Europeans rightly see as a side theater in the Napoleonic Wars) and continued as such until the early 1830s when the Indian Removal Act forced them west of the Mississippi in order to ease the extension of slavery. Removal caused an uproar that culminated in a mass petition campaign. The effort failed but the policy, and the subsequent Trail of Tears, radicalized many Americans, turning them from colonizationists who wanted to free the slaves in order to send them “back” to Africa into ultraist (radical) abolitionists who sought immediate emancipation for slaves and equal rights for free blacks.

For the next 30 years, America’s existential enemies were internal, slaveholders for abolitionists and abolitionists for slaveholders. Poor Mexico found itself in the crossfire and paid for it in lost lives and land. In the first half of the 1860s, America paid for it too, in a long, bloody, and costly Civil War.

After that war, though, America finally seemed safe. Mexico was no more a threat than newly independent Canada. Plains Indians won some major battles and slowed colonization of the nation’s great interior but they clearly posed no existential threat. Ditto the remnants of the Spanish Empire, which the U.S. dispatched in 1898. Americans sweated that war only because it was fought in subtropical climes like Cuba and Manila Bay, not because the Spanish menaced Washington, DC, which had remained safe since the British sacked it in 1814.

It is little wonder then, that Americans again turned their fears and hatreds inward after the Civil War. Plutocratic-gilded robber barons became public enemy number one even while the businesses they created and ran spurred productivity increases that gradually raised the standard of living for all. While many Americans were content to finally own good shoes, have access to indoor plumbing, and eat regular meals that included meat, others dwelled on wealth and racial disparities, creating divisions that led to contested presidential elections, assassinations, bombings, and mass strikes that descended into warfare-like violence in places like Ludlow, Colorado (1914) and Blair Mountain, Pennsylvania (1921).

Before social revolution erupted, though, the Great War and an efflorescence of technological advance interceded. Public sentiment, stoked by wartime propaganda (disinformation), soon turned decisively in favor of France and Britain. Fearful of being cancelled, or worse, German-American companies dropped names containing words like Germania in favor of more “American” sounding names like Guardian.

In the 1920s and 1930s, many Americans, still innocent of the plight of millions of men fictionally characterized by Nikolai Salmanovich Rubashov (Darkness at Noon), became fascinated with the new Union of Soviet Socialist Republics (USSR) and fascist Italy. Where some perceived an existential threat, others saw promise. Mussolini, it was said, made the trains run on time (never mind that America’s didn’t because of increasingly oppressive railroad regulation) and that is a good thing, so maybe … And the Soviet Union did not suffer from the Great Depression and that sounds like a good thing, so maybe …

Fact is, Americans often admired their enemies, aping British and French fashions and learning even when they were the “bad guys.” Many considered American Indians “noble savages” with enviable freedom from taxation and hard manual labor (or so it was believed). The U.S. government even compensated Mexico after beating it up in 1846 and 47. Confederate leaders and states were allowed to rejoin the Union, arguably much too easily and quickly. At Paris in 1898-99, America paid the easily vanquished Spanish $20 million for the Philippines. Twenty years later, President Woodrow Wilson tried hard at Versailles to convince the British and French to go easy on the defeated Germans. He failed but was vindicated in death (1924) by the rise of Hitler in the 1930s.

After defeating Germany a second time and learning of the Holocaust, even authoritarian-friendly Americans could no longer countenance fascists, especially Nazi ones. So, they ensured that the most vile ones hung (or killed themselves) while the most useful ones, like rocket scientist Wernher von Braun, joined the struggle against the new existential threat, the USSR. Billions in aid went to rebuilding Germany, Italy, and Japan to inoculate them from the Red menace of communism.

Even while the United States fought the Cold War, though, some Americans admired the Soviet system because they preferred its seemingly precise economic plans and directed strategizing to America’s seemingly chaotic market and democratic processes. Sputnik and other early Soviet victories in the “Space Race” lent credence to Nikita Khrushchev’s 1956 claim that the USSR would “bury” the West.

America, though, lived to see the USSR dissolved in 1991. Some credit Ameria’s victory to strategic decisions to defend South Korea and South Vietnam at the cost of much treasure and blood but another way to view the Cold War is that the USSR and the USA were too frightened of nuclear holocaust to fight each other directly so they commenced to blow their own feet off in proxy wars and nonsensical arms and space races, all in an effort to impress the rest of the world that they must be strong to engage in such stupid behaviors and survive. America simply had more feet to shoot because it had a much freer and more productive economy.

But even as the Soviet menace waned in the 1980s, the Japanese threat loomed ever larger. Pundits blared that an “economic Pearl Harbor” was upon America, which had to immediately adopt Japanese educational and management systems before Japanese companies bought up the entire country and rendered Americans mere economic vassals. Entire university library bookcases were devoted to books, like that of Chalmers Johnson, extolling the virtues of the Japanese “miracle.” Most pundits grossly misunderstood Japanese management culture, however, and only a few realized that the Japanese had overpaid for American assets. Instead of the millennium ending with Japan ascendant, it culminated in bursting asset bubbles in equities and real estate, massive bailouts, and prolonged economic stagnation

Don’t get me wrong; Japan enjoyed high levels of economic growth for decades and may be poised for another spurt now but it didn’t pose an existential threat to the U.S. in the 1980s. Saddam Hussein was a different story, or so we were told after Iraq invaded Kuwait in 1990. Then came al Qaeda and the Taliban. Then Hussein again, until he was caught in a small desert hidey hole, tried, and executed. Then North Korea, Iran, and/or Syria because they had the audacity to develop their own WMD-tipped missiles or buy some from the Russians. Then along came Trump, a trade war with China, and the purported “Wuhan” or “CCP” virus and massive cyberattacks linked to China

Regardless of where the SARS-CoV-2 virus originated, China’s role in spreading the mistaken notion that lockdowns were an effective way of controlling Covid outbreaks is now palpable. The CDC sent scientists to Beijing in March 2020 and some policymakers, including Dr. Anthony Fauci, still fawn over their authoritarian contagious disease mitigation tactics. Whether planned or not, inducing your enemies to cripple themselves economically is an absolutely brilliant tactic.

I used to think that China was going to repeat Japan’s mistake of paying too much for foreign assets, inducing a financial crisis that would end the CCP and lead essentially to Hong Kong-like institutions controlling the mainland and perhaps eventually bringing Taiwan back into the fold.

Now, though, I fear that the real analog is how Europeans conquered American Indians. Initially militarily potent although deeply divided, outnumbered, and wracked by contagious diseases that they did not understand (sound familiar?), Indians traded valuable furs and other natural resources for manufactured trinkets and addictive alcohol. Many fell so deeply into debt to the newcomers that they ceded their land to them to escape with their honor and the ability to borrow more in the future.

Instead of paying dearly for assets, as the Japanese later did, Europeans bought native-controlled lands cheap and strategically purchased the allegiance of some tribes while waging war against others before turning on their own weakened former allies. The process took centuries but the “Celestial Empire” thinks it has all the time in the world so it may well be employing a similar tactic against America right now. With Hong Kong seemingly defeated, America’s leadership weak, and the country divided over race, Covid, and the Constitution, look for another Chinese move soon, though likely a subtler one than that portrayed in Red Dawn (2012, before CCP censors somehow forced the producer to change the invader to North Korea even though the film was never released in China).

In short, the CCP is a long-term existential threat to America and the West more generally but it may still fall apart before achieving its goals, especially if America can decrease its indebtedness and increase its productivity, which will happen only if it focuses on liberty instead of equity, whatever that is. Americans can reunite culturally by exulting their anti-Removal, anti-slavery, and pro-Civil Rights history and rejecting the too-often-untoward policies and actions of its governments and specific individuals, as suggested by the Woodson Center’s 1776 Project. And prosperity will return with economic freedom, especially the termination and disavowal of lockdowns and politicized economic planning more generally.

Robert E. Wright

Robert E. Wright

Robert E. Wright is a Senior Research Fellow at the American Institute for Economic Research.

He is the (co)author or (co)editor of over two dozen major books, book series, and edited collections, including AIER’s The Best of Thomas Paine (2021) and Financial Exclusion (2019).

Robert has taught business, economics, and policy courses at Augustana University, NYU’s Stern School of Business, Temple University, the University of Virginia, and elsewhere since taking his Ph.D. in History from SUNY Buffalo in 1997.

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