I'm creating a world where US collapsed as the largest economy in the world, shrinking by more than half of its annual GDP. The new congress slashes all the foreign spending, defense spending goes to minimum with closing all the military bases abroad, the US navy doesn't patrol world oceans, and all the foreign aid is cut.

My story relies on the remnants of Pax Americana (Eu, Japan, Australia, Canada) scrambling to keep as much of the liberal world as possible without any american help, while trying to deal with the newly rising power of China, India & Russia.

What would be most plausible reasons why (or circumstances in which) the US would suffer such a reversal in its economy?

  • $\begingroup$ Welcome to the site RainMan. I have placed this question on hold for the time being. As it stands you are asking us to create plot points for you rather than help you construct a part of your world which is off topic for the site. Check out the help center and tour to get a better idea of the site and how it works. This bit in particular will help. If you have an idea for how to do this and want to lay out your plan we do offer reality-check as a service to make sure idea is internally consistent. $\endgroup$ – James Dec 20 '18 at 18:52
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    $\begingroup$ Is there any reason you do not want to look at the long sad list of real economic crises? en.wikipedia.org/wiki/Economic_collapse $\endgroup$ – Bald Bear Dec 20 '18 at 19:18
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    $\begingroup$ Not sure what "went through a bankrupt" means when dealing with soverign states. It could mean many different forms of fiscal, currency, or economic crises. Perhaps a bit more research would help. $\endgroup$ – user535733 Dec 20 '18 at 19:41
  • $\begingroup$ A country can go bankrupt: en.wikipedia.org/wiki/List_of_sovereign_debt_crises Couple ways to make it happen in US is to have most investors lose confidence in US government, or for China to sell off its vast holdings of US debt. Either way will increase the interest rate that US government has to pay, until they do not have enough money to pay it anymore. $\endgroup$ – Bald Bear Dec 20 '18 at 19:48
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    $\begingroup$ Fiat currency can prevent bankruptcy, but not economic ruin. That said, so many economies are reliant on the US, that if the US economy collapsed, most nations would be negatively impacted just like they were during the huge recession that happened about 9 years ago. $\endgroup$ – Nosajimiki Dec 20 '18 at 22:56

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