Nixon's Successes Could Guide Bush to Re-Election
Pacific News Service, Commentary, Franz Schurmann, Posted: Jan 23, 2004
Editor's Note: America could be on the verge of a major shift in foreign policy. Look toward evolving U.S. relations with an old enemy, Iran, and a plan for a new monetary policy with China, writes PNS Editor Franz Schurmann.
American foreign policy usually evolves gradually, like the slowly shifting policy toward Cuba. But it can change rapidly during times of war, crisis or presidential elections. The year 2004 encompasses all three. And that means the world will soon see some dramatic changes in American foreign policies.
America is stuck in three wars: one in Afghanistan, another in Iraq and a worldwide war against terrorism. President Bush can't win any of these wars during the next 10 months, but he can make deals with his enemies and their supporters. That is what President Nixon did with his breakthrough to Communist China on July 15, 1971. He then won a landslide re-election in November 1972, and on January 27, 1973, signed a peace treaty with Communist North Vietnam.
Bush also faces an ambiguous economic recovery, and he well remembers the slogan that scuttled his father's re-election in November 1992: "It's the economy, stupid." The recovery is ambiguous because the economy still can't create enough new jobs.
America also faces a monetary crisis that could undermine its wars in the Middle East. The American dollar has been the world's most sought-after currency since 1940, when Europe and Asia started depositing in Fort Knox, Ky., what soon became 90 percent of their collective above-ground gold. A year ago, much more than 100 eurocents were needed to buy one U.S. dollar. Now, 80 eurocents can buy $1, and if the dollar falls below 80 eurocents in worth it could generate a global financial crisis.
All oil and natural gas are denominated in U.S. dollars. If the oil producers decide to switch, even partially, to stronger currencies like the euro or the yen, the vast American oil refining sub-empire could collapse. If this should happen, almost any Democrat could defeat Bush in November.
Bush and his advisers are surely looking toward history and examining how Nixon managed to win his landslide re-election. Nixon was a master of secret dealings. He deftly shunted his Secretary of State William P. Rogers out of sight and used his National Security Council director, Henry Kissinger, to make his secret moves. His most spectacular move, one that changed history, was his breakthrough to China, announced in a five-minute speech on July 15, 1971, and anticipated by only a handful of Americans.
Bush's "China" is Iran. Just as China was the key to ending the Vietnam War, so is Iran the key to an end of warfare in Iraq, due to its huge influence over Iraq's Shiite population. Safa Haeri, London editor of the International Press Service, wrote that "prior to dispatching the U.S. (Bam rescue teams), Iranian ambassador to the United Nations Mohammad Javad Zarif was contacted by U.S. Deputy Secretary of State Richard Armitage, who received a prompt reply from Zarif, after he received a positive answer from the office of the leader in Tehran (hardliner Ali Kamen'ei)." Armitage's initiative and Zarif's "prompt reply" point to secret diplomacy between the two countries.
On August 15, 1971, exactly a month after his breakthrough to China, Nixon gave another short speech in which he made the momentous announcement that he was going to cut the dollar loose from gold. The press called it the "Eurodollar crisis." U.S. dollars, once greedily coveted all over the world, instead piled up in banks with fewer and fewer takers. The Europeans complained that there wasn't much they could find to buy because the Vietnam War was gobbling up industrial capital.
But the cutting away of the dollar from gold cleared the way for the global economy to flourish. Coupled with Nixon's new China policy, the economic moves promised a new economy in which the Pentagon would shrink while industrial corporations prospered. Nixon called his new moves the "New Economic Policy," and many intellectuals were astonished that he used that term. In the early 1920s the acronym NEP designated Lenin's attempt to fit together capitalism and socialism.
There is a socialist tinge to Bush's new economic plans, with government taking such an active role in directing the economy. One of Bush's emerging friends is in fact the new Chinese Prime Minister Wen Jiabao. China's economy is officially called a "Socialist Market System." If it weren't for China's goods, most if not all of America's malls would close. But as in Nixon's days, foreigners are finding less and less to buy from America.
America and China are forging friendship much faster than most U.S. media recognize. With the help of 1999 Nobelist in economics, Robert Mundell, a plan is shaping up for China to be the first to try out a new monetary system called a "basket of currencies." Currently, China's yuan is pegged to the U.S. dollar. Under the "basket" idea, with the help of American expert teams the yuan will soon be linked to all the world's major currencies. As with Nixon's monetary move, the idea is to benefit the U.S. economy -- and, for Bush, to win re-election. Could a universal monetary currency be down the road? As the Chinese say, "Every journey begins with a single step."
An emeritus professor of history and sociology, PNS Editor Franz Schurmann (fschurmann@pacificnews.org) is the author of numerous books.
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