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Question: Why do you believe America is in danger of balkanizing itself?

Juan Enriquez: So, I wrote a book called “The Untied States of America,” as opposed to the United States of America, in 2004 and published in 2005. I did so with one very specific objective in mind. I have extraordinary admiration for Canada, the U.S., and Mexico. The really strange thing is, over the last 60 years, as we tripled the number of countries in the developed and the developing world, in Europe, in Africa, in Asia. The Americas has been a relatively stable continent. The last truly new border we have is Panama in 1903.

I can’t tell you how unusual that is. During a period of time when Italy is talking about splitting northern and southern Italy, France is talking about splitting with Corsica and Normandy, England is talking about splitting with Wales and Scotland and England. And it goes on and on and on. This has been this oasis and anytime you see an outline of that magnitude, you have to ask yourself, why? Particularly given that Canada came in within about .02% of a vote of splitting itself. So, it could even happen to the north of us.

The second reason why it’s important to begin to even consider whether countries can become something that looks very different is because people tend to take their countries for granted. So, they assume, “It’ll never happen here.” One very simple example and one way to get students to thinking about these things; ask your friends how many stars will be in the U.S. flag in 50 years? And the reason why that’s a reasonable question is because there has never been a President of the United States who’s been buried under the same flag he was born under.

The U.S. started with no stars. In fact, it started with a completely different flag. The last two were added in 1959, Hawaii and Alaska. Until there’s a President born after ’59, that dies with no change in the flag and no change in the number of states, that will continue to be a true statement. So, if there hasn’t been continuity, why would you assume continuity over the next 50 years? And if there is incontinuity then you have to ask yourself, does it get bigger? Which is the history of this country, or, like almost every other country on the planet, except Brazil, does it get smaller?

And the first chapter of this book in 2005, unfortunately, said one of the things that the United States is going to face, and it’s going to be really ugly, is a financial crisis and it’s coming because of an excess of debt, because of an excess of leverage, because it’s going to be concentrated in a few organizations that have way too much power and very little supervision outside of us. And it’s probably going to be triggered by a real estate crisis. Because real estate prices are way out of whack with what people earn.

When people go back and they read that first chapter from 2005, it turns out to be not inaccurate, to use a double negative. I hope the rest of the book is not accurate. I wrote that book so people wouldn’t take their country for granted and make sure that their country – they start taking care of it. You don’t do that by increasing the national debt by $2 trillion. You don’t do that by putting out $24 trillion in loan guarantees. You don’t do that by not re-regulating financial institutions that were too large to begin with and now have gotten even larger and it’s even more dangerous for them to fail.

Question: How can this fragmentation be prevented?

Juan Enriquez: So, the thing that’s really important to understand is, the last thing an empire traditionally does is drive itself into bankruptcy. You’ve seen that with the great empires. When you go and you tour Europe, or you go and you tour Egypt, or you go and you tour Iraq, or you go and you tour Afghanistan, or India, or whatever. Governments get to a point where they’re illegitimate because people just give up on them as far as being leaders who have their country’s interests at heart.

The second thing that happens is they start borrowing an incredible amount and figure the next generation will just pay for it.

And then the third thing they do is they get conservative and quit adopting new technologies. They start saying, “I’m just going to shut the door and keep things as they are.”

When countries do that, they become wonderful subjects of archeology museums. They create wonderful ruins. But they don’t survive and they don’t survive for very long. If they do survive, they have far less independence.

So, one of the things we have to do today, is we have to look at where we’re spending our money and about four-fifth’s of the federal budget is being spend on healthcare, even before the healthcare reform. It’s being spent on Medicare, on Medicaid, on Social Security, on defense spending, and on interest. And unless we address those things, every bit of discretional spending, every bit of privatization doesn’t make a dent in what is already an overspending. We are living way above our means. And we have to get serious about living within our means. And if we don’t’ send that signal to other countries, what’s going to happen is we’re going to erode the value of the dollar, people are not going to trust this currency, and like so many other currencies before us, we will go from being the reserve currency of the planet to being the currency that continuously devalues. And boy, that’s an unpleasant place and an unpleasant legacy for our kids.

Recorded on November 9, 2009
Interviewed by Austin Allen

 

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