The most important victory in Indochina was in 1965, a U.S.-backed military coup in Indonesia led by General Suharto carried out massive crimes that were compared by the CIA to those of Hitler, Stalin, and Mao. The mass slaughter was reported accurately with unrestrained euphoria. After the genocidal invasion of East Timor, Suharto was welcomed by the Clinton administration in 1995 as "our kind of guy."
Despite such victories, by 1970, U.S. share of world wealth had dropped to about 25%, roughly where it remains, colossal but far below the 50% at the end of WWII. By then, the industrial world was "tripolar": US-based North America, German-based Europe, and East Asia, already the most dynamic industrial region, first Japan-based, but also former Japanese colonies Taiwan and South Korea, and more recently China.
About that time, American decline entered a new phase: conscious self-inflicted decline. From the 1970s, planners, private and state, shifted the us economy toward financialization and offshoring of production, driven in part by the declining rate of profit in domestic manufacturing. These decisions initiated a vicious cycle in which wealth became highly concentrated in the top 0.1%, yielding concentration of political power and legislation to deepen the cycle: taxation and other fiscal policies, deregulation, changes in the rules of corporate governance allowing huge gains for executives, and so on.
Meanwhile, for most people, real wages stagnated, and people got by only with sharply increased workloads (far beyond Europe), unsustainable debt, and repeated bubbles since the Reagan years, creating paper wealth that inevitably disappeared when they burst (and the perpetrators were bailed out by the taxpayer). In parallel, the political system has been increasingly shredded as both parties are driven deeper into corporate pockets with the escalating cost of elections, the Republicans to the level of farce, the Democrats not far behind.
A recent study by the Economic Policy Institute is entitled "Failure by Design". The phrase "by design" is accurate. As the study points out, the "failure" is class-based. There is no failure for the designers. Rather, the policies are a failure for the large majority, the 99% in the imagery of the Occupy movements, and for the country, which has declined and will continue to do so under these policies.
One factor is the offshoring of manufacturing. As the solar panel example mentioned earlier illustrates, manufacturing capacity provides the basis and stimulus for innovation leading to higher stages of sophistication in production, design, and invention. That, too, is being outsourced, not a problem for the "money mandarins" who make policy, but a serious problem for working people and the middle classes, and a real disaster for the most oppressed, African Americans, who have never escaped the legacy of slavery and its ugly aftermath, and whose meager wealth virtually disappeared after the collapse of the housing bubble in 2008, setting off the most recent financial crisis, the worst so far.
excerpted from Noam Chomsky
