America's economy underpins its position as the world's most powerful nation.  Today's collapses in our strategic and economic strength are linked - and mutually reinforcing.  For eight years the Bush administration allowed our financial markets to leverage themselves toward disaster.  At the same time, its profligate military spending and faulty strategic thinking has left us in an unsustainable global position.  As Secretary Gates explained last week, new military spending programs have "grown ever more baroque, ever more costly, are taking longer to build, and are being fielded in ever dwindling quantities."  These problems have all been exacerbated by the reckless decision to invade Iraq - a decision which likely cost the American economy between $1-$3 trillion.  Today, the financial crisis has spread across the globe and world leaders are questioning our economic and strategic leadership.

Washington's financial rescue package fails to calm global markets.  The plummeting of global stock markets and efforts to assist the European markets come just days after the United States Congress passed a $700 financial bailout.  American officials hoped that the bailout package would help calm global financial markets, but "On the first day of trading after the plan was signed by President Bush, stocks fell across the board. Markets in Asia and Europe were down from between 4 and 6 percent, and U.S. stock market futures pointed to a sharply lower opening." The Bailout package from Washington was not enough to calm nervous investors worldwide. Hiroichi Nishi, equities chief at Nikko Cordial Securities Inc., says that the market "is now concerned about the new law's effectiveness" in easing the crisis in the U.S. credit market. [New York Times, 10/6/08.  Washington Post, 10/6/08]

Financial crisis exposes weaknesses in U.S. global economic position.  The global financial crisis has prompted a worldwide reconsideration of U.S. economic leadership.  David Rothkopf offered assessments from financial leaders around the world: "French President Nicolas Sarkozy concluded recently that the world has seen the end to free-market economies. 'Laissez-faire, it's finished. The all-powerful market that is always right, it's finished,' he said."  "Germany's finance minister offered a similar perspective in remarks to his parliamentary colleagues. 'The U.S. will lose its status as the superpower of the world financial system,' Peer Steinbrück declared. 'This world will become multipolar. The world will never be the same again.'"  "From Beijing, Pan Wei of the Center for Chinese and Global Affairs speculated that the crisis would have a leveling effect: 'My belief is that, in 20 years, we will look the Americans straight in the eye -- as equals. But maybe it will come sooner than that.'"  [Washington Post, 10/05/08]

Unchecked national security policies linked to weakened U.S. economic position and current financial crisis.  Andrew Bacevich offered a scathing rebuke of costly Bush Administration foreign policies linking them to the current economic meltdown: "To understand this link between today's financial crisis and Bush's wider national security decisions, we need to go back to 9/11 itself. From the very outset, the president described the 'war on terror' as a vast undertaking of paramount importance. But he simultaneously urged Americans to carry on as if there were no war."  "The 2008 election finds the Pentagon cupboard bare, the U.S. Treasury depleted, the economy in disarray and the average American household feeling acute distress. Profligacy at home and profligacy abroad have combined to produce a grave crisis."  Another area where the costs of the Bush administration's national security strategy is most evident is general Department of Defense spending.  Secretary Gates recommending a shift in the direction of military spending stated that new military spending programs have "grown ever more baroque, ever more costly, are taking longer to build, and are being fielded in ever dwindling quantities. Given that resources are not unlimited, the dynamic of exchanging numbers for capability is perhaps reaching a point of diminishing returns." [Washington Post, 10/05/08.  Speech delivered by Secretary of Defense Robert M. Gates to the National Defense University, 9/29/08.]