By the end of Trump's presidency we will have three super-powers: Europe, China, and the US. The weakest of the three will likely be the US, which has, through Trump's bizarre foreign policy moves, helped unify Europe, pushed South Korea closer to China, and disintegrated its own economic/political bloc (Canada and Mexico) with tariffs on the one hand and racist attacks on the other. The US can not go it alone, and it has an economy that's mostly sustained by what, in the 1960s, French Minister of Finance Valéry Giscard d'Estaing called the "exorbitant privilege," the international primacy of the US dollar. This has meant the US could maintain the kind of deficits that would have, under normal circumstances, weakened its dollar and forced its economy into an export (rather than consumer) position. The primacy of the greenback—which was liberated in 1971 by the closing of the gold window, and made it possible for the US to transition to a post-industrial service economy—can only be eroded by the country's increasing isolation.
This will certainly cause significant problems and hardships for ordinary Americans in the near future, because there is no economy that can replace (or absorb the losses from) the service sector in a conventional manner. This is what Amazon makes all too clear, and why cities are battling for HQ2. There is not much else out there that can fill the void left by the deaths of huge retailers ("Toys R Us. Sam's Club. Sears. Now, Bon-Ton."). And the "retail space going dark in 2018 is on pace to break a record, as companies with massive floorplans are either trimming back their store counts or liquidating entirely." Indeed, investment bank Morgan Stanley recently told Macy's that it wasn't closing stores fast enough, and that Macy's needed "to quicken the pace of its store closures" if it wanted to protect what's left of its stock value.
The whole economy is in transition. But into what is not known. No one has ever lived in a post-service economy. What exactly follows this system, which begins with the prestige of its currency, is then supplied cheap products from low-wage countries, and, lastly, to sustain the demand lost by stagnant and falling wages in the home economy, offers cheap consumer credit? (The last component of this system, cheap credit, of course, connects with its first: the world position of the currency.)
On Thursday, German Chancellor Angela Merkel, who happily played second fiddle to Obama, made it clear that Europe "can no longer count on the United States to protect it" and that it must now “take destiny into its own hands.” The US has not heard that kind of strong language from Berlin in over 70 years. Two days before, French President Emmanuel Macron and British Prime Minister Theresa May sided with Merkel on maintaining the treaty with Iran. This is a blow among other blows. The US is at odds with its strongest allies. Leaving the Iran treaty made the US weaker, and it will come with a huge bill that will be handed to American consumers at the pump. The US is also strengthening the power of Berlin. It turns out that Trump's dismantling of the work of a black president is the dismantling of the American empire.
But what about the bomb and the military? Surely that will maintain the American empire after the displacement of the greenback. It will not for two reasons. One, the bomb doesn't mean anything anymore. Russia is also a nuclear power, but its GDP is smaller than that of Texas and is dwarfed by California's. The bomb is a dead end. Two, as a number of analysts pointed out back in 2007, the Iraq War was a disaster not only because it dragged on for so long and cost lots of American (and even more Iraqi) lives, but because the occupied country only stabilized when more boots were on the ground (the surge). This was a big upset for US generals who wanted the military to rely more on technology than troops in the future. The war in Afghanistan, for example, will not end until the US sends a huge number of boots there. It turns out there isn't a total technological fix for the wars (the whole meaning of shock and awe) in the future.
But there is a war going on in the US. It's happening right now in the White House, which, by all appearances, is occupied by a hostile and second-rate power. The future will certainly look back at this moment and see clearly what happened. How the empire was unraveled by a pee tape and from its ruins, a whole new international configuration emerged. That pee tape will be to the future what the butterfly effect is to the popular imagination.