Friday, October 17, 2008
After hubris comes the fall
William Pfaff: The nuclear physicist Leo Szilard once remarked that the fall of the Soviet system would eventually lead to the fall of the American system. In a two-element structure, the interrelationship and interdependence are such that the one cannot survive without the other... Georgi Arbatov, former head of the USA and Canada Institute of the Soviet Union, said to an American interlocutor: We are about to do something truly terrible to you. We are going to deprive you of your enemy.
Without the enemy, the machinery of power begins to race, with nothing to resist it; megalomania sets in. The end of the Cold War coincided with the beginning in the United States of globalized finance. It operated with ever more daring gambles in which the constraints and tension of the Cold War were replaced by the psychology of greed and excess...
Less apparent to most people, but just as real, are the signs of an impending crash of an American military system... Since the end of the Cold War, Pentagon dysfunction has metastasized uncontrollably... The trend line of Pentagon procurement has been toward lower numbers and higher technology, weapons systems "that have been ever more baroque, ever more costly, taking longer to build, and fielded in ever dwindling quantities."
There could not be a better description of a bureaucracy in decadence, just as the same phrase must be applied to a financial system for multiplying the apparent value of fundamentally worthless securities... I think that what Leo Szilard was saying is that a system cut free from the opposition that kept it honest passes into hubris, otherwise known as irrational exuberance, and after hubris comes the fall.
Image source here.