Good Riddance to the American Century

My book “The End of the American Century” appeared in 2009.  There I argued that the combination of domestic decline and global change had put an end to the era of U.S. global dominance, and that American citizens would have to come to terms with a flattening standard of living and reduced global influence.  This was not necessarily a bad thing, either for the United States or for the rest of the world.
     I finished writing the book during 2008, just as Barack Obama was mounting his stunning rise to the presidency.  For the paperbound edition of the book, which appeared just after the election, I added an epilogue called “Reality and Hope in the Obama Era,” where I offered some hope that the new president could temper some of the problems I had raised.  But I also cautioned that America’s problems (for example with education, violence, debt, inequality) were so deep-seated, and the global changes so persistent (e.g. globalization of production, rise of new powers, climate change) that his options would be limited. 

     President Obama, I believe, recognized all of these problems, and tried his best to redress or adapt to them. He rescued an economy in freefall; got us moving on climate change; passed milestone legislation on health care; and restored America’s battered international reputation, winning the Nobel Peace Prize in the process.  He was on track in adapting to the end of the American Century. 

Now we have a President who is intent on returning to that era of American superiority and dominance.  Indeed, Trump rode to power by demagoguing many of the issues of U.S. decline that I had documented in my book: the stagnating incomes of the middle class; the decline of manufacturing; the continuing prevalence of violence; declining trust and confidence in government; the high cost of medical care; and infrastructure decay.   

     Trump knew which buttons to push, but he had no idea how to deal with any of these problems.  He promised to “make America great again” without having any notion of what that might entail.  His vision was to go backwards, not forward.  In a world so rapidly changing, this is no solution at all.  America needs to adapt to change—embrace it, even—and not reject it, as Trump seems to want to do.  His presidency is a dead end. 

     Any progress this country made during the Obama years is quickly being rolled back and reversed in the first months of the Trump presidency.  The most pressing and damaging problems I discussed—debt, inequality, and climate change—are all likely to worsen under a Trump administration. 

     We can not go back to the American Century (which really lasted only about half a century anyway), nor should we.  That era was bred of specific historical, economic and international circumstances.  We are in a different era now, both domestically and internationally.  The U.S. can not and should not dominate the world as we once did.  To think and act otherwise is to court disaster in a globalized and interdependent world.  We should bid adieu to the American Century, and move forward. 

The Age of Uncertainty

These are unsettling times.  Lately we have been witness to a continuing carnival of a presidential election, a series of horrific terrorist attacks and massacres both here and abroad, plus the British Brexit vote.  People here, and in other countries, are unsettled and uncertain.  Indeed, the world is unsettled and uncertain.  In this country, the appeal of Donald Trump is baffling in many ways, but it is also understandable, given the wrenching changes underway in people's lives, and in the world, and the fear and uncertainty that this occasions. This kind of disruption, fear and uncertainty often leads people to seek simple solutions, scapegoats and demagogues.

The reasons behind all this uncertainty are the large-scale shifts in the world, and in the U.S. role in the world.  I call these "systemic changes" and I want to focus on the two most important ones:  first, the decline of the United States as the single dominant and determining global power; and second, the rise of transnational forces and threats that diminish the autonomy and power of ALL nation states, including the U.S.  We are no longer in control of events, either in our own back yard, or on the global stage, and this is discomfiting. 

First let me address the issue of the change of the U.S. role in the world.  Eight years ago, I wrote a book called "The End of the American Century" which addressed this phenomenon.  "The American Century," basically the second half of the 20th century was one of unprecedented global dominance by a single country, the United States.  This was evident in almost every sphere: politics, economics, the military, ideology, and culture.   The Soviet Union, our only real rival during that time, was strong militarily but not in any other respect.  Its standard of living by most measures was about a tenth of that in the U.S., something I can attest to from living in that country briefly in the 1970s

Even in the long course of history, it is rare to find countries or empires that so dominated the world: one thinks only of the Roman Empire or, maybe, the British Empire.  But all empires fade eventually.  Italy and Britain may be very pleasant places to live (and visit!) right now, but they are not the dominant powers they once were.  Something similar is happening to the United States.  This is not necessarily a bad thing, but it contributes to uncertainty.

For the U.S., it is not so much that we have suffered absolute decline, but rather have declined relative to other forces and countries.  The U.S still has the strongest military, the biggest economy, and the most durable and resilient political system.  But we no longer dominate the world as we did during the American Century.  China, for example, has experienced fabulous economic growth in recent decades, and is increasingly asserting itself on the global stage.  Europe, by combining, sort of, into the European Union has created an economic powerhouse, larger than the American one.  Neither China nor the EU is much of a military power just yet, but increasingly it seems that military power is not as useful and determinate as it once was.  Plus, as I will discuss below,  there are transnational forces that also cut into America's ability to shape the world.  So for Americans used to being #1, this relative decline can be unsettling, and speaks to the appeal of Trump's "America First" slogan.

So the relative decline of the U.S. in the global arena is the first major dimension of systemic change.  The other is the rise of transnationalism.  By transnational, I mean problems, forces, movements or institutions that transcend national boundaries, making them difficult for national governments to deal with.   These are proliferating in the modern world, but I will highlight those that have contributed especially to this age of uncertainty:  globalization of the economy; terrorism; and climate change.

Perhaps none of these merit my attention, since they've been so much in the news, and in the current electoral campaign.  Both Donald Trump and Bernie Sanders complained about the maverick status of multinational corporations.  As transnational institutions, these can easily shift operations from one country to another in search of cheaper labor or supplies, while remaining relatively immune from the regulations or taxation of government in any particular country.  Of course, a globalized economy does have its benefits, in terms of more efficient production and cheaper and more abundant consumer goods.  But it also hurts those workers who get left behind.  This is particularly true in manufacturing, which has faced a double whammy of automation and globalization, causing jobs in manufacturing to plunge from 28% of all jobs in 1970 to less than 10% today.  The problem is not going to go away.  The shrinking of manufacturing employment is global--not just in the U.S.

Globalization, automation and the decline of manufacturing have contributed to a stagnation of real earnings in the U.S.  For the average American family, household income is $4,000 less than it was 15 years ago.  Meanwhile economic inequality has grown much worse, with the top 1 percent of American households taking in more than half of the recent gains in income growth. Income and wealth inequality in the United States is now the highest it has been since before the Great Depression of the 1930s, as Bernie Sanders kept reminding us during his own run for the presidency. 

This issue is particularly egregious at the very top of the income scale.  In the 1950s, big-company CEOs earned about fifty times the pay of an average worker.  Even then, that ratio was very high compared to other countries.  But since then, CEO pay in the U.S. has skyrocketed compared to average salaries.  By 1990, average CEO pay was 100 times the average worker's salary.  By 2000, it was more than 500 times.  In Germany, that ratio was only 11 to 1; and in the United Kingdom, 25 to 1.

So it is not surprising that so many people are fearful and angry.  Even though the economy is growing, they are being left behind.  The dislocations caused by globalization though, can only be addressed by collective action, and that requires action by government, and cooperation among national governments.  A weak and ineffective government is no match for the power of large multinational corporations.

Terrorism is another transnational force that has frightened and destabilized us.  It often seems that governments are helpless in the face of this enemy, which is not located in any one region, supported by any particular country, or subject to any conventional norms of morality.   Social media, another transnational force, facilitates the organization, recruitment and concealment of terrorist groups.  Against transnational terrorists, particularly the fundamentalist brand, deterrence and threats are useless, and even conventional military force is only haphazardly effective.  America's vaunted military, the most awesome in the history of the world, is not by itself able to eliminate transnational terrorism.  This too causes fear and uncertainty, and a sense of powerlessness.  But, like the forces of globalization, the solution requires global action and cooperation.

Climate change, another transnational phenomenon, is even more threatening and dangerous than globalization and terrorism, though more baffling because of its inherent invisibility.  Even though the evidence for climate change is overwhelming and irrefutable, most people don't actually see it or experience it.  So they are open to the blandishments of politicians and the fossil fuel industry who prey on their ignorance and fears in claiming it does not exist.  And this contributes to our national sense of unease and uncertainty, since we are not sure what to believe and whom to trust.  Climate change, however, is literally a life-and-death issue that requires strong government action, national sacrifice and global cooperation.  All of these are difficult to imagine in the current political climate in the United States.

These transnational phenomena--globalization, terrorism and climate change-- all threaten the American way of life, and they are devilishly resistant to resolution in the way we have solved problems in the past.  Throwing money at them won't work.  Military power is either irrelevant or ineffectual.  Things have changed since The American Century when our country was, it seemed, both dominant and in control of our fate.  In both the domestic sphere and the international one, things are not like they used to be.  Thus appear opportunistic politicians who promise to roll back the clock, or to "make America great again."

However, America's greatness was never achieved by going back to the past, but rather by finding solutions to new problems, while holding fast to the values that unite us.  These include industry, innovation and individualism, but also compassion, tolerance, and civility.  The U.S. has survived through civil war, world wars, depressions, civil unrest and terrorism.  And we remain the world's oldest and most successful democracy; even if we do not brandish the power and influence we had during the Cold War years.

But we have created a kind of paradox of political life: at a time when we are in desperate need of effective government to address important domestic and international issues, government is increasingly unable to act. Democratic government is not often consensual, but it does, by its very nature, require compromise.  But in American politics, we have one candidate calling for a "political revolution" and another, a billionaire cloaked as a populist, calling for a return to the past and playing on people's fears, angers, and prejudice.  The polarization of American politics has made compromise almost unattainable, and in the process has practically paralyzed the operations of government.

Of course, this simply adds to people's frustration with politics and government, which accounts for polls showing record low levels of trust in the federal government.  This is not a happy situation for a system of government that is supposed to be based on popular will.  And it contributes to the turmoil, alienation, and uncertainty.

Keeping this democracy alive is, in my mind, the single biggest challenge we face at the moment and the key to addressing the systemic transformations we are facing.   In the current political environment, the bedrock principles of democracy--compromise, tolerance, participation, inclusion--are under threat.  There is a disturbing growth of authoritarianism in American political culture, with 44% of non-college grads (in 2011) approving of "having a strong leader who doesn't have to bother with Congress or elections."

The growing authoritarianism in the U.S. may be disturbing, but it is not terribly surprising.  Times of systemic change, fear and uncertainty, especially combined with economic downturn, often foster the emergence of demagogic politicians, and even dictators.  It is also understandable why so many Americans are lashing out at the whole system, given the vast gulf between rich and poor, the continuing pernicious impact of money in politics, and the seeming paralysis of government.

The solution is not to reject the system, but to improve it.  As Winston Churchill famously quipped: "Democracy is the worst form of government, except for all the others."  And democracy is uniquely suited to dealing with problems that are so complex and disruptive, because it demands participation, inclusion, compromise, respect for minorities, and due process.  The problems we are facing are unprecedented, in my view, and signal a systemic shift in U.S. politics and international relations.  The U.S. will not be "great" in the way we were before, but it remains the most important and admired country in the world, and it's involvement in global politics is indispensible.

(Based on a talk I gave at a Kiwanis Club 8/30/16)

Dialogue and Forum on "The End of the American Century"

An extended "dialogue" on the themes of The End of the American Century has been posted on the website of the China-U.S. Friendship Exchange at this link. The interview with me was conducted by the organization's founder and president, Dr. Sheng-Wei Wang, who is based in Hong Kong. The interview focuses especially on America's changing global role and its relationship with China.

This November issue of the China-U.S. Friendship blog also includes two other essays on themes related to my book: "American Power in the 21st Century" by Harvard's Joseph Nye (author of Soft Power); and "Peace, Not War, the Best Strategy," by Professor of Geopolitics Madhav Das Nalapat at the Manipal Academy of Higher Education in India. Those two essays are accessible at this link.

My responses to those two essays will appear in the next (December) issue of China-U.S. Friendship.com.

U.S. Intelligence Report Predicts Declining U.S. Influence

The National Intelligence Council has released its report Global Trends 2025: A Transformed World which forecasts that the relative strength of the U.S. "even in the military realm--will decline and U.S. leverage will become more constrained."

I posted a blog here in September about the preview of this report delivered in a speech by C. Thomas Fingar, the Chairman of the N.I.C. The full 120-page report, like Fingar's earlier remarks, sees the U.S. remaining the single most powerful global actor, but with reduced influence and leverage in the face of the growing clout of China, India, Russia and other countries.

The current report, however, seems less sweeping in its assessment of U.S. decline than Fingar made earlier. In September, he spoke of U.S. leadership eroding "at an accelerating pace" in "political, economic and arguably, cultural arenas." The Global Trends report does not have such language, and focuses more on the rise of other countries than on the decline of the U.S.

The report does, however, call attention to the importance of leadership in managing this transition to a transformed world. "Leadership matters," the first-page summary says. "No trends are immutable," and "timely and well-informed intervention can decrease the likelihood and severity of negative developments and increase the likelihood of positive ones."

Wise leadership, in Washington and elsewhere, is crucial because the scale of global changes are immense. "The international system...will be almost unrecognizable by 2025 owing to the rise of emerging powers, a globalizing economy, and historic transfer of relative wealth and economic power from West to East, and the growing influence of nonstate actors." Indeed, this transfer of global wealth and economic power from West to East "is without precedent in modern history."

The report forecasts a more diffuse distribution of global power, the transformation of current international organizations (like the U.N.), the growing influence of nonstate actors (especially NGOs--non governmental organizations), and "a more complex international system."

In this system, the U.S. will be a "less dominant power" with "less room for the US to call the shots without the support of strong partnerships." Even in the military realm, changes in science and technology and the rise of non-state actors "will construct US freedom of action."

These arguments are similar to those I raise in the last chapter of The End of the American Century, entitled "America and the World After the American Century." A key difference between my book and Global Trends is that most of my book is about trends that have already occurred. Only my last chapter projects into the future, as the NIC report does. In my view, the decline of the U.S. is a fait accompli. As I write on page 1 of my book:

"In the past decade, and particularly since September 11, every aspect of this American predominance has begun to wane. The U.S. economy is riddled with debt [this was written well before the current financial collapse] and unsustainable obligations--by both governments and households--presaging at least long-term economic decline if not general collapse. The educational system, once considered the world's best, now ranks near the bottom among developed countries, and a sizable portion of U.S. citizens is now functionally illiterate. American corporations, once models of dynamism, innovation and efficiency, are hampered by bureaucracy, corruption, and bloated executive payrolls, and few are generating either innovation or growth. Even science is marginalized and beleaguered under the gun of politics qnd religion. While American consumer goods and popular culture remain fashionable in much of the world, there is at the same time increasing resistance in many countries to the erosion of national culture and traditions in the face of U.S.-led globalization."

So a good deal of the decline of U.S. global influence is due to changes within the U.S.--changes that have been accelerating for the last two decades. These internal developments are as much responsible for "global trends" as are the dynamic changes elsewhere in the world.

Can the US Regain Supremacy? Should It?

In my CBC Radio interview yesterday (see previous blog post) with Anna Maria Tremonti, there was one question she asked that gave me pause. She had first asked if I thought the U.S. is losing its superpower status. When I answered in the affirmative, she followed up with “Can it regain it?” I said I thought not, and went on to say that in a globalized and interdependent world, both the country and the world are better off without a superpower. But I think this needs some elaboration.

There is, first of all, both a descriptive (factual) and normative (value judgment) aspect to this question. Will the U.S. regain its superpower status? And should it do so. I believe the answer is negative to both questions, but the reasoning behind them are similar.

Some scholars have argued that the world needs a powerful and stabilizing force, and that the United States is the only country in a position to play this role. The British historian Niall Ferguson has made this case in his book Colossus, as has the U.S. political scientist Michael Mandelbaum in The Case for Goliath. And through much of history, there has been a big single power that has played this role in great swaths of the planet—Rome, Britain, Spain, the Ottomans, etc. All of those empires are now gone.

The 21st century world is different in several important respects. First, power and influence are more diffuse. There are numerous “rising powers”—China, India, Brazil, Iran, Russia, South Africa—and they are spread all over the globe. None of them want or need a super powerful country encroaching on their turf, or telling them how to behave.

Second, the world is more interdependent, particularly in economic terms—“flat” in Thomas Friedman’s evocative phrase. Prosperity and security are being built on trade, cooperation and compromise. Some countries are bigger and wealthier than others and will naturally play a more substantial role in this globalized community. A “superpower”—economic or military—distorts and destabilizes such a system.

Third, the most important issues facing the globe now require cooperation, consultation, compromise and diplomacy rather than brute strength or intimidation. Global warming, environmental deterioration, epidemics, famine, and drought are the most pressing threats to humanity. All of them require the participation of all states, regardless of their wealth, power and ideology. A superpower, with its tendency to unilateralism and arrogance, can only hinder such cooperation.

For all of these reasons, the U.S. will not, and should not, play the dominant and directing global role that it did through most of the 20th Century.

In addition to these global factors are domestic U.S. ones. In the American Century, the U.S. had the world’s biggest economy, its richest citizens, the best schools, the finest system of medical care, and the most successful democracy. It can no longer make such claims, both because of our own decline in the past two decades, and because other countries have been catching up. Most developed countries now surpass the U.S. in the quality of life, health care delivery, and education, and have much lower levels of poverty, inequality and violence. The vaunted U.S. economy (which for so long was a house of cards built on multiple levels of debt) has now begun an inevitable decline. Until the encouraging results of last week’s election, even the U.S. political system was rickety, with low levels of voting and participation, very unequal representation, erosion of fundamental rights, and questionable electoral outcomes.

So whereas in the 20th Century, the U.S. carried global influence because of its own domestic model of success (in addition to its military strength), it can no longer make those claims of exceptionalism. The rest of the world has caught up.

The U.S. has already lost the status of sole superpower. Even if we wanted it, other countries don’t recognize or accept it. And both the U.S. and the rest of the world will be better off if we don’t regain it.

U.S. Loses High-Tech Dominance

For most of the 20th Century, the U.S. was the world leader in science, technology, and innovation, with the best scientists, the best universities and the most advanced research and development programs. But all of that has begun to change as other countries and regions have become more advanced and more competitive and increasingly challenge U.S. dominance.

A recent article in the New York Times addressed the U.S. technological decline, and the ways Senators Obama and McCain have approached the issue. This story includes some eye-opening statistics about the loss of U.S. primacy in technology, innovation and R&D. At the top of the story, the Times points out the importance of this sector for America’s economy and role in the world:

For decades the United States dominated the technological revolution sweeping the globe. The nation’s science and engineering skills produced vast gains in productivity and wealth, powered its military and made it the de facto world leader. Today, the dominance is eroding.

One sees this in multiple indicators, but perhaps the most important is the country’s high-technology balance of trade. Until 2002, the U.S. always exported more high-tech products than it imported. In that year, the trend reversed, and the technology trade balance has steadily declined, with the annual gap exceeding $50 billion in 2007.

The U.S. has also fallen behind in spending on research and development, which drives high-tech innovation and development. As a percent of GDP, total R&D expenditures have remained flat since the 1960s, while federal government spending on R&D has declined steadily. The U.S. has fallen to 8th place worldwide on R&D spending as a share of GDP, behind Israel, Sweden, Finland, Japan, South Korea, Switzerland and Iceland (Popular Science 11/08).

China is not yet on that top-ten list, but may not be far behind. The country is ramping up support for high tech innovation and R&D, and President Hu Jintao this year called on Chinese scientists to challenge other countries in this area: "We are ready for a fight,” he said, “to control the scientific high ground and earn a seat on the world’s high technology board.” ("China's Industrial Ambition")

The U.S. is also slipping, relative to other countries, in the creation of patents, scientific inventions, the publication of science and engineering articles, and the number of students focusing on science, math and engineering. In international comparisons of scientific and mathematical literacy, and in international competitions in those fields, American students fare poorly, often ranking near the bottom of the group of wealthy countries. Increasingly the top science and engineering students in this country are citizens of other countries, who then return home. Science magazine (7/11/08) recently reported that the most likely undergraduate alma maters for those who earned a U.S. Ph.D. were—get this--Tsinghua University and Peking University—both in Beijing.

These worrisome developments prompted a major study recently, “Rising Above the Gathering Storm,” from the National Academies, the nation’s most eminent scientific and engineering organization, calling for the U.S. to strengthen its international competitiveness. The authors of the report were “deeply concerned that the scientific and technological building blocks critical to our economic leadership are eroding at a time when many other nations are gathering strength” and were “worried about the future prosperity of the United States. A review of high tech by the magazine Popular Science (11/08) puts it a but more bluntly: “The technological dominance of the United States may soon go the way of the dollar.”

Fortunately, the man who will probably take over as President next January, Barack Obama, is on top of these issues, often speaks about them, and has aggressively promoted efforts to remedy them. In his book The Audacity of Hope, he called for a doubling of federal funding for basic research and the training of 100,000 more engineers and scientists over the next four years. He co-sponsored a bill in Congress based on the recommendations of “The Gathering Storm” and called for increased federal support of science education, especially for women and minorities. The Senate passed the bill 88 to 8 ( Senator McCain abstained), but has not yet funded the programs. It will be an expensive proposition—about $43 billion for the first three years—which will be all that much more difficult to manage in this time of economic crisis. But these long-term investments are critical to recovering America’s economic dynamism

U.S. Ranks Low on Health Care

Chapter 3 of The End of the American Century, titled "Torn Social Fabric," focuses especially on the relatively poor levels of health care in the U.S., and how badly it fares in comparison to other wealthy countries. As I point out there, this is surprising in many ways "because the United States indeed does have available the best medical care in the world and spends more on health care than any other country." But "because there are so many poor people in the United States and so many people without access to health care, the average level of health and medical care in the United States is among the worst in the developed world" (bold added). In the late 1990s, the World Health Organization ranked the U.S. at 37th in the world in the overall performance of the health system. This was the lowest ranking of any country in the OECD.

New data reported in the New York Times confirms these disturbing trends. The United States now ranks 29th in the world on infant mortality rates which, as the Times points out, is "one of the most important indicators of the health of a nation and the quality of its medical system." The U.S. ranking has declined sharply since 1960, when its ranking was 12th in the world.

This international gap has widened even though the U.S. spends far more on health care than most other wealthy countries, on both a per capita basis and as a percentage of GDP. In 2006, according to the Times, "Americans spent $6714 per capita on health--more than twice the average of other industrialized countries."

Grace Marie Turner, president of the Galen Institute, a conservative research organization, told the Times "infant mortality and our comparison with the rest of the world continue to be an embarrassment to the United States."

The dismal state of health care in the U.S. reflects broader trends of social and economic decline in the U.S.--compared both to our own past and to other countries in the world. It is the major theme of The End of the American Century: that the U.S. has lost ground as other countries have gained; and that we can no longer claim special privilege as the richest, or the most successful, or the most powerful--on almost any dimension.

The poor state of health care, and education, and infrastructure in the U.S. result from inadequate attention and resources to these areas of our domestic health. They pose the second horn of the U.S. dilemma: our economy is collapsing at the very time when we most need resources to rebuild the country at home, and reestablish our reputation abroad.

(See also my 9/23/09 post "U.S. Health Care Compares Badly to Others")

A Power That May Not Stay So Super

New York Times economist David Leonhardt, who is one of the few economists to raise alarms about the long-term structural problems of the U.S. economy, had a column on Oct. 11 that compares the decline of the British empire to the current situation of the U.S. His story raises many of the issues I address in The End of the American Century, including the long-term growth of deficits, debts and excessive consumption, as well as the pressing needs for spending on infrastructure, health, Social Security and Medicare.

America Loses Global Economic Leadership

Over the last decade, the U.S. has lost political, military and international influence in the world; now it has lost its economic clout as well. The collapse of the financial system in the United States, the very linchpin of both the American and global economies, has evoked comments of gleeful retribution from some countries, and worrisome concern from others. But everywhere, now, there is a recognition that the U.S. economy is weak and vulnerable, and hardly a model for emulation by others. The collapse of this final pillar of U.S. global leadership is also encouraging other countries to assume a more assertive role.

Some of the sharpest criticism, and even sarcasm, came from the usual suspects. Venezuela’s Hugo Chavez mocked Lehman Brothers

“They were always producing negative reports about Venezuela. . . .They forgot about themselves ... and 'boom!' they were bankrupt." (Toronto Star, 9/16/08)

and then skipped the opening of the UN General Assembly to visit China instead, saying that Beijing was now much more relevant than New York.

At a meeting of the Nonaligned Movement in Tehran, Iranian President Mahmoud Ahmadinejad proclaimed that

“the big powers are going down. . . .They have come to the end of their power, and the world is on the verge of entering a new promising era.” (NYT 7/30/08).

But even more moderate leaders have echoed such sentiments. The president of Argentina, Christina Fernandez de Kirchner declared that

“We are witnessing the First World, which at one point had been painted as a mecca we should strive to reach, popping like a bubble.” (NYT 10/3/08)

In Latin America, according to the New York Times (10/3/08), governments “have been working for the past decade to reduce their dependence on the American economy,” have “diversified trade with the rest of the world,” and have set aside funds “for times when international conditions turn sour.”

In Moscow, both former President (now Premier) Putin and his successor, Dmitri Medvedev, have been flexing Russia’s diplomatic and military muscles for several years. The Kremlin has repeatedly rejected U.S. global dominance in a “unipolar” world, and with its landmark conflict with Georgia in August, asserted its own “privileged” sphere of influence in the world, “just like other countries in the world.”(NYT 8/31/08). With the U.S. economic crisis, Medvedev, like Kirchner, has called into question even U.S. economic leadership. He asserted last week that U.S. global economic leadership was drawing to a close. “The times when one economy and one country dominated are gone for good.” (NYT 10/3/08).

While the U.S. financial crisis has accelerated these moves away from the U.S. economy, the trend had begun years before, and is an integral part of the decline of U.S global influence more generally. Surveys in recent years by the Pew Global Attitudes Project found surprisingly little support in other countries for “the American ways of doing business.” Antipathy to the U.S. business model is particularly widespread and strong in Latin America and western Europe. In the 2007 Pew survey, in only a third of the 46 countries surveyed did a majority of respondents like the American ways of doing business. Most of those were in Africa.

For most of the postwar era, the United States has been both a political and economic model for countries and peoples around the world. This began to wane in recent years, especially in the face of the belligerent and unilateralist policies of the Bush administration. The financial collapse of the U.S. is one more nail in the coffin of U.S. supremacy and global dominance.

U.S. Intelligence Predicts Reduced U.S. Dominance

A Washington Post article this week (9/10/08) reports on a forthcoming U.S. intelligence agencies report that “envisions a steady decline in U.S. dominance in the coming decades.” Thomas Finger, a top analyst for the U.S. intelligence community, delivered the preview in a speech in which he saw U.S. global leadership rapidly eroding in “political, economic and arguably, cultural arenas.” The one area of continued U.S. dominance—military power—was becoming increasingly irrelevant as an asset in global power and influence.

These are all themes of The End of the American Century, so should not be terribly surprising, except for the source—the U.S. government itself—and the sweep of the conclusions. It is not just U.S. diplomatic influence that is on the wane, but political, economic, cultural and military leadership as well. The multidimensional and interrelated aspects of U.S. decline are the central theme of my book, but it is startling to hear it expressed so bluntly from the top intelligence analysts of the federal government.

The intelligence report, however, misses a key element of the declining global influence of the U.S.: its domestic weakening. Fingar’s speech saw the decline in U.S. dominance coming from exclusively global trends: globalization, climate change, resource shortages. All of these are important, of course, but the root of America’s declining global influence is here at home. Just as at the global level, the domestic decay is multidimensional—it is political, social and (especially) economic; and affects education, health care, infrastructure, and competitiveness.

The United States has become the world’s largest debtor, and the governments of other countries are increasingly worried about the scope and scale of U.S. debt and fiscal weaknesses. Even the International Monetary Fund, normally concerned about debt and insolvency in Third World countries, has warned that the continuing large budget deficits of the U.S pose “a significant threat for the rest of the world.” Other countries are beginning to turn away from the United States, both for investments and for global economic leadership, and are increasingly abandoning the dollar as the favored international currency. This is one reason for the sharp and steady decline of the dollar compared to the euro and other international currencies.

In many other respects, as well, the United States is no longer seen as the standard for emulation by other countries. The U.S. has among the highest rates of both poverty and inequality in the developed world. This poverty and inequality contribute to highly uneven access to health care, so the U.S. ranks near the bottom of developed countries in most measures of health and medical care. Even our vaunted democracy, the “beacon on the hill” for centuries, is now so dominated by money and special interests that it is rarely cited by other countries as a model for political development. Global public opinion polls in the past showed foreign populations skeptical and wary of the U.S. government; increasingly now they reveal negativity toward the U.S. population, and even to U.S. ideals. All aspects of American “soft power” are withering away.

The Fingar report, like Fareed Zakaria’s new book The Post-American World, sees this global shift coming because of “the rise of the rest”—global powerhouses like China, India and Brazil that increasingly cut into the U.S. lead on the world stage. Zakaria asserts, indeed, that the shift is not about the decline of America, and writes about the many elements of this country’s continuing strength. Solidly within the U.S. establishment, both of these analyses ignore the sand shifting beneath their own feet. Only by confronting and addressing our own domestic weaknesses and problems can we begin to solve our international ones.