PRINCETON – The world should be worried. The possibility that US President Barack Obama and the Republicans in Congress will fail to reach a compromise before mandatory deep spending cuts and tax increases take effect on January 1 is very real. Global markets are well aware of the danger of the United States falling over the “fiscal cliff,” and are watching nervously. They know that this outcome could well throw the US – and the world – back into recession.
Foreign ministries around the world should be equally nervous. Unless the US can get its fiscal house in order, it will be forced to abdicate leadership on a wide range of critical global issues.
In the short term, Syria and its neighbors are already paying the price of America’s inability to focus on anything other than domestic politics since Obama’s re-election. In my view, the Syrian crisis is at a tipping point: while it is now apparent that the opposition will eventually win and President Bashar al-Assad will fall, the endgame’s duration will be a key element determining who actually comes into power and on what terms.
Syria’s implosion, and the chaos and extremism that are likely to breed there, will threaten the entire Middle East: the stability of Lebanon, Jordan, Turkey, Iraq, Gaza, the West Bank, Israel, Iran, and Saudi Arabia hangs in the balance. But we do not even know who will succeed Hillary Clinton as US Secretary of State when Obama’s second term formally begins in January, or who will be on the White House security team.