The first decision has already been made, and was made by the proposed League of Nations back in WWI even before the US actively joined the war (both sides were trying to woo her and other neutrals with this argument). 1 is the default. The US, backed by the UK, made the decision to ignore this in favour of argument 2. We can safely say that argument 2 is no longer fashionable. So we default back to argument 1.
Within argument 1 is the assumption, barring excessively inhuman practices as prosecuted post-WWII, that states have control of their own internal affairs. Self determination is based on the assumption that foreign states have no right to intervene in the affairs of other states, except where they impinge on the affairs of others. One of these internal affairs, implicit in the formation of cohesive nation states, is border control. Borders are inviolate, and controlled by the state whose borders they are. Borders involving multiple states are governed by interstate agreements. Where one side wishes to differ, this difference is governed by the principle of reciprocity. If one side wishes to make a different arrangement, other sides are entitled to reciprocate in the same manner. No outside agency is entitled to impose its decision on another.
If outside countries aren't allowed to bring their preferred brand of government to, say, Iran (as has been made clear in the Iraq fiasco), then we revert to argument 1, which has its own set of rules and assumptions. If you feel victimised by this, too bad. The US, like any other state, is entitled to do what it likes with its own borders. Other states may reciprocate in retaliation, and they may well be morally right to do so. But how you feel in relation to the US has little bearing on what the US is entitled to do.
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