Global Courant 2023-05-18 01:50:42
President Biden left for Japan on Wednesday for a meeting of the leaders of seven major industrial democracies that meet annually to try to keep the global economy stable.
But it turns out the United States is the biggest potential threat to global economic stability this year.
When Mr Biden lands in Hiroshima on Thursday for the Group of 7’s annual summit, the United States will be two weeks away from a possible bankruptcy that would shake not only its own economy, but those of the other countries at the table. It is up to Mr Biden to reassure his counterparts that he will find a way to prevent that, but they understand that it is not in his power alone.
Confrontation with Republicans over raising the federal debt ceiling has already upended the president’s international diplomacy by canceling at the last minute two stops he had planned after Japan: Papua New Guinea and Australia. Instead of being the undisputed commander of the most powerful superpower to stride the global stage, Mr. Biden will be a contentious leader forced to rush home to avert a catastrophe of America’s own making.
At least before he left Washington, he was bolstered by signs of progress as both sides emerged from a meeting at the White House on Tuesday expressing optimism that an agreement was possible. In preparations for the G7 meeting, officials from the other participating countries have not been as alarmed by US officials about the possibility of default, perhaps because they trust Mr. Biden, knowing that the moment of truth is still a few weeks away. away and assume that Washington will get its act together in time.
But that just underlines how much volatility has become the new normal in Washington. After generations of counting on the United States as the main stabilizing force in world affairs, in recent years the allies have increasingly come to expect some degree of dysfunction. Protracted government shutdowns, banking crises, debt-ceiling battles, and even political violence would once have been unthinkable, but have prompted foreign leaders to factor US unpredictability into their calculations.
“I think our biggest threat is us,” said Jane Harman, a former Democratic representative from California who later served as president of the Woodrow Wilson International Center for Scholars. “Our leadership in the world is being eroded by our internal dysfunction. The markets are still betting against us defaulting, and that’s a good bet. But if we only manage to secure a short-term extension and the price is a heavy budget cap – including for defense – we will be hampered when Ukraine needs us most and China is building bridgeheads everywhere.”
The White House warned that a default would only embolden American opponents and used the argument against Republicans, whom they blame for playing with fire.
“There are countries like Russia and China that would like nothing more than for us to default so they can point the finger and say, ‘See, the United States is not a stable, reliable partner,'” said John F. Kirby, a spokesman for the National Security Council.
But he tried to play down the effects of the dispute on the G7 meeting, saying he doubted it would “dominate the discussion” and claimed other leaders “don’t have to worry about that”. The president’s counterparts would understand that he had to cut short his trip, he said.
“They know that our ability to pay our debts is an important part of US credibility and leadership around the world,” said Mr. Kirby. “And so they understand that the president also needs to focus on making sure we don’t default and having these conversations with congressional leaders.”
But even if they understand, they see the consequences. Mr Biden’s decision to go home early, analysts say, amplifies questions about US commitment to the Asia-Pacific region and leaves a vacuum for China to exploit. A presidential visit to places like Papua New Guinea, where no American leader has gone before, speaks loudly of diplomatic priorities – as well as failure to fulfill them.
It’s not the first time a US president has canceled an overseas trip to deal with domestic concerns. President George HW Bush canceled a two-week trip to Asia in 1991 to show his focus on a lagging domestic economy, while President Bill Clinton canceled a trip to Japan during a government shutdown in 1995. President Barack Obama postponed a trip to Indonesia and Australia in 2010 to focus on healthcare law, then skipped an Asia-Pacific summit in 2013 during a government shutdown of its own.
However, Washington’s ongoing culture of crisis has only intensified since the arrival of President Donald J. Trump, who threatened to unravel fundamental alliances and embrace long-standing adversaries abroad while disrupting democratic norms and economic conventions at home .
The debt ceiling showdown between Mr Biden and speaker Kevin McCarthy has underlined to the president’s colleagues that as much as he tries to restore normalcy, US politics have not returned to the stable state of the past – not least because Mr. Trump is trying to recover his debt. office in next year’s elections.
World leaders took notice last week during Mr Trump’s CNN interview, in which he refused to support Ukraine in its war against the Russian invasion and casually endorsed the idea of a default, saying it wouldn’t be as damaging and indeed “would can be”. maybe nothing.”
Most policymakers and analysts don’t see it that way.
Treasury Secretary Janet L. Yellen said at a meeting of G7 finance ministers and central bankers in Japan last week that a bankruptcy would “cause a global downturn” and “risk destroying the US’s global economic leadership.” undermine and raise questions about our ability to defend our national security” interests.”
Mr. Biden, a half-century veteran of senior Washington office, has frequently commented on the uncertainty surrounding America’s place in the world that he discovered when he took office after Mr. Trump’s disruptive years. “America is back,” he said he would tell foreign counterparts, only to be told, “But for how long?”
Unlike his predecessor, Mr. Biden has pursued a much more conventional foreign policy familiar to world leaders, and foreign officials view him as a more traditional US president. But they also understand that he is in charge of a country whose democracy has been tested and found to be fragile. And they see a fractious politics in Washington that values confrontation over compromise, even at the risk of something that would once have been unthinkable, like bankruptcy.
“The issue of the US debt ceiling will certainly be a topic of discussion and concern at the G7 summit,” Matthew P. Goodman, a senior vice president for economics at the Center for Strategic and International Studies in Washington, said at a briefing. about last week’s meeting. “I’m sure the other leaders will ask, you know, how serious this risk is. And I assume President Biden will say he is working on it and doing everything he can to prevent it.”
Strangely enough, the American partners have now become accustomed to the culture that dominates Washington. They have looked at the rising debt ceiling with little apparent fear.
“I don’t think many European governments are very concerned, presumably because these crises are quite common but never end in disaster,” said Charles Grant, the director of the Center for European Reform in London. “Cutting the trip is a bad signal, but in most capitals there is such good will with Biden that they are willing to give him some slack.”
