On A Budget, U.S. Faces World As 'Frugal Superpower' When the U.S. was rich, it could afford to be the world's policeman. Now it's strapped for cash, and that might mean a new phase for American foreign policy.
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On A Budget, U.S. Faces World As 'Frugal Superpower'

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On A Budget, U.S. Faces World As 'Frugal Superpower'

On A Budget, U.S. Faces World As 'Frugal Superpower'

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We're back with ALL THINGS CONSIDERED from NPR News. I'm Audie Cornish.

Back in December, when President Obama announced he was sending additional troops to Afghanistan, he said something we don't hear too often from the White House.

President BARACK OBAMA: We can't simply afford to ignore the price of these wars.

CORNISH: Foreign policy professor Michael Mandelbaum says that's a rare admission for an American president, and that it could signal a new phase of foreign policy for the U.S. Mandelbaum explores that topic in a new book, called "The Frugal Superpower: America's Global Leadership in a Cash-Strapped Era."

Mandelbaum argues that with the current economic crisis and the need to pay out vast amounts of Social Security and Medicare benefits down the line, we just won't be able to afford the kind of interventions we've made in the past.

He says a lot of American foreign policy over the past six decades has been driven by one thing - we're rich.

Professor MICHAEL MANDELBAUM (Foreign Policy, Johns Hopkins University; Author, "The Frugal Superpower: America's Global Leadership in a Cash-Strapped Era"): For almost all of history, almost every country, when it decided on a foreign policy, had to ask first and foremost, how much it would cost. But we've been so wealthy since, really, the beginning of World War II in 1941, that that question really has not been all that important. We've asked, what's right for the world? What can we do to make the world a better place? What international duties do we have?

Well, with all of the obligations coming down the road, with all the costs that we're going to have to pay, the American taxpayer is really going to be strapped and stretched. And the taxpayer is going to say, wait a minute, before we undertake any foreign policy, let's think hard about how much it will cost. And that's a question that really hasn't been uppermost in our minds - well, as I say, since the beginning of World War II. And that means that we are entering a very different period in American foreign policy from the one that we've all known.

CORNISH: And it sounds like you're saying there's going to be a change in what it means for America to be a global leader, in a way. What has - sort of been the things we've done that have defined that particular role?

Prof. MANDELBAUM: Well, for all of the criticism that the United States receives around the world and in the United States, I believe - and I say in the book - that America's international role has been very, very constructive. In fact, I compare what the United States has done in the role to what governments do within the countries they govern.

I think the United States has, in some ways, been the world's de facto government and has provided governmental services. And that has helped keep the world prosperous and secure.

CORNISH: I mean, some people might be scared when they hear de facto government for the world. So tell us, what does that actually mean in terms of the nitty-gritty? What are you saying here?

Prof. MANDELBAUM: Well, it is a kind of striking thing to say. But what I mean is, for example, the United States provides the world with its currency, the dollar. The United States has been the world's consumer of last resort. Countries that want to export in order to prosper are going to able to export to us. And the United States has played a kind of policing role around the world, most importantly in East Asia and in Europe.

Those are what I believe are the let's call them quasi-governmental services that will come under pressure in the decades ahead, and that won't be good for the world. In fact, the negative effects may be harsher for other countries than they are for us.

CORNISH: But I cover Congress, and to see a discussion on the floor of the House or the Senate about taking money away from defense initiatives or foreign policy initiatives - honestly, I guess I don't really see what you're saying here. There's always this sense of that's the untouchable part of the budget.

Prof. MANDELBAUM: A very good point, and what I'm predicting in this book is that that is going to change. It's going to change when it turns out that we can no longer borrow the money we need to pay out Social Security and Medicare.

When that happens, people are going to have to pay higher taxes, and they're going to have to forego some benefits. And when that happens, people are going to say, yes, we'd like to have as big a defense budget as possible. But if the choice is between paying out the defense budget and paying out what we are owed in Medicare, we're going to opt for Medicare. We're going to choose domestic spending rather than international spending.

And you already see some straws in the wind. For example, we have seen Secretary of Defense Gates talk quite boldly about making reductions in defense spending because he can see what's coming. He understands that there's going to be enormous pressure on the American taxpayer.

CORNISH: I was surprised to read in your book that your - sort of solution to the changes that are coming was a gas tax.

Prof. MANDELBAUM: Yes, this is the one policy proposal in "The Frugal Superpower." We will reach a point in the United States where there will be a consensus that taxes must go up, and then the question will be not whether to raise taxes but rather, what taxes to raise.

And if you ask that question, a gasoline tax looks - not exactly good, but less bad than the alternatives to it.

CORNISH: Michael Mandelbaum, you've talked a lot about the limitations that this new, sort of cash-strapped era will bring. But I mean, really, what should the role be for America, I guess, in this environment?

Prof. MANDELBAUM: I hope that it will be possible for the United States to continue many of the important international roles that it plays. I do not think we will be able to do everything that we have done for the past several decades.

CORNISH: Michael Mandelbaum is head of the American Foreign Policy Program at Johns Hopkins University School of Advanced International Studies. And he's the author of a new book, "The Frugal Superpower: America's Global Leadership in a Cash-Strapped Era."

Michael Mandelbaum, thanks so much for talking with us.

Prof. MANDELBAUM: It's been a pleasure to be with you and your listeners.

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