JoAnna is a member of the Junior State of America (JSA), a student-run political awareness organization for high school students.
Not too long ago, I watched my first Spanish novella while I sat idly in a hair salon, waiting for my hair to get trimmed. The flashing subtitles caught my eye, so I paid closer attention. The complexity of the show, with love-polygons and hundreds of deep dark secrets waiting to be unearthed, fascinated me, and the characters and their cliché actions frustrated me equally. Despite the language barrier and previous prejudices towards shows like these, I watched the drama unfold with rapt attention.
Much as how I closely followed the Spanish drama before me, today, hundreds of thousands worldwide follow the newest American political "novella," flavored with the current plot twist -- the hotly debated fiscal cliff and debt ceiling. Fiscal cliff and debt ceiling negotiations have been closely watched worldwide for two reasons: one, the fascination with the world's richest and most powerful country; and two, the international mindset that everyone is affected by U.S policies. However, international observers can only analyze developments and express their frustrations at the impasses and last-second negotiations. And while the bulk of current criticism first addresses the fiscal cliff crisis and its stalemate negotiations, it ultimately returns to the American system of Republican-Democrat co-government.
Some examples of international commentary include Australia's national treasurer, Wayne Swan's, tweet: "The impact of America's fiscal cliff saga combined with Europe's deep problems is having a real impact on the entire global economy."
Luis Miguel Gonzalez, in Mexico's El Economista, claimed that America's solution to the fiscal cliff is not purely domestic -- "es algo que afecta a todo el mundo" (something that affects the whole world).
A major French publication, Le Monde, reported that for 36 percent of international investors, the disconcerting state of U.S. public finances and the worrisome probability of a deadlock on raising the debt ceiling pose "le plus grand risque pour l'économie mondiale" (the greatest risk to the global economy). Only 29 percent of investors referred to the Euro Zone, and 15 percent to a slowdown in China's economy, as the number one risk in today's world economy.
Since consumer and government spending accounts for a majority of the United States' gross domestic product, a combination of cuts in government and tax increases that would leave Americans with less spending money would push the U.S. off the cliff. On a grander scale, it would affect the world economy because American citizens would be consuming less imported products; the devalued American dollar would not go as far in other countries and thus international areas dependent on tourism would suffer; and foreign investors would be less willing to invest in an economy where they would gain less "bang" for their "buck." However, the more commonly expressed concern is that of bipartisan standstills.
In the same article from El Economista, Gonzalez also lamented the inability of Republicans and Democrats to make any significant agreements after weeks of discussion, nicknaming the United States "una republica bananera," a banana republic.
Max Fisher, blogger for the Washington Post, interprets these criticisms as the world's growing belief that the American system of politics, namely the opposing party's ability to co-govern, is ineffective, and that the fiscal cliff crisis seems to prove it for them. They view this crisis as a cornerstone in the decline of American politics and efficiency.
Many international commentators realize not only the potential threat American economic failings represent, but also recognize how a solution could be reached -- dissolving the bipartisan stalemate. What concerns many of them is that moving past the stalemate is neither perfect nor enduring. It mostly results in a postponement, something to be settled months down the road, when the debt ceiling is higher, the dollar is worth less, and the tensions are tighter.
In the short-term, we can attempt to reduce deficit, raise the debt ceiling and print more money to postpone "falling off the cliff," but that is not a sufficient answer to our problems. Until leading politicians reach the right balance of tax increases and spending cuts (and also find a way to generate new wealth not diverted to paying interest on our current deficit), any chance of long-term sustainability and returning to a Standard and Poor's AAA sovereign credit rating is slim.