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State of the World and where it is heading ..... Part 1

Have written about the economy, the recovery, the fear of hyper-inflation in recent times. Much of it has come true and some of it is unfolding with tell-tale signs seen all around us. Most of it isscary stuff so no great glee in me saying, "I told you so...". So this write-up is certainly not about that but what I foresee as scenarios emerging in the next few years as we close this decade and move to thenext in a few months. Am trying not to be a doomsday prophet but may unwittingly end up sounding like one.

America is continuing to battle terrorism globally but with less and less support from many other countries. While the Obama Administration had originally thought that terrorism has seen its heydey and is starting to dwindle, some recent events have forced a rethink.Yemen and Somalia are emerging as new hubs for global terror apart from the Af-Pak cauldron. There is word that many splinter groups are linking up with the Al Qaeda while operating quite independently. Manyprisoners, especially Yemeni ones, released from Guantanamo Bay seem to have quickly joined splinter groups fighting the jehad (US hasrecently stopped releasing Yemeni prisoners from G bay). Many recent attempts by US forces to infiltrate these organisations have been failures. Al Qaeda is said to be using backyard countries not in theWest's radar screen to quietly prepare for a big sustained campaign against the US that may include use of bio or nuclear weapons. This is a big worry and will come back to it in the next few paragraphs. More importantly, Al Qaeda is becoming a hydra-headed monster that would be difficult to monitor, infiltrate, control and eventually destroy.

The deep-rooted resentment in the Muslim World of America's unstinting and sometimes dubious support of Israel is well known. This has only exacerbated with recent campaigns in the Iraqi and Af-Pak theatres of operation and the attendant collateral damage to civilian lives. Only strong positive signals from Israel itself and well endorsed by the USof A can start the slow healing. This necessarily has to be through Muslim "elders" and statesman with credibility in the Islamic Worldwho can speak to their people. Don't expect miracles. If we start today, the World would see the effects in about 5 years. While the uni-polar makes it easier, China's unrelenting quest for scarce resources will make it harder.Now for the bigger worry....

The state of the US economy at the present time with growing deficit of over $1 trillion has forced it to look more and more inward. It is likely that the Office of the President would be embroiled in important policy battles at home whatwith the filibuster-proof balance tilting in the Senate. Any attack at this time from Al Qaeda or its related outfits on a massive scale and esp. of biological or nuclear nature could cause a major upheaval ofsorts in the American national thinking and attitudes towards the entire World. My sense is that America's isolationist DNA, dormant since Pearl Harbour, would suddenly be activated. Additionally, anymajor act of aggression is likely to further weaken the US economy that is trying to slowly find its feet. If the previous isolationist fervour was stroked by the economic crash of 1929, this time around the scenario is uncannily similar. There would be a nation-wideclamour to completely clam up and go back to the era of non-interventionism, Neutrality pacts and the modern versions of the Kellogg acts. And it could happen inevitably.... Americans could simply choose to mind their own business and go into a self-imposed embargoes on all links with the World, pull back from its forward positions and leave the World and its many little places to take careof themselves.

Could such a scenario play out in the immediate future? What could be the benefits and fall-out of such a scenario? Let me leave you to think abit while I take a small "commercial break" of few days and come backwith Part 2.

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