As a matter of geopolitics and power, the size of a country's economy by itself is not a great measure. If it were, then China would have been the world's strongest power in 1800, when it had the largest share of global GDP. So the next question is whether China can translate its economic power into geopolitical influence. Again, it will undoubtedly do so to some extent. But power and influence do not stem from economic strength alone, and China is already the best proof of this. Over the past couple of years, as the U.S. economy has been slumping and China's has been booming, the United States has significantly improved its standing in East Asia and Southeast Asia, while China's position has deteriorated. In fact, the more China uses its newfound muscle, the more it sparks a reaction in the region, which then looks to the United States for succor. (This was the key insight of William Wohlforth years ago in his brilliant essay, "The Stability of a Unipolar World.") Gideon keeps predicting that Japan is about to tilt toward China, but all signs point in the opposite direction -- and not only for Japan but also for most of China's other neighbors. The fact that China is the top trading partner of all these countries does not necessarily increase China's clout. I gather that even Brazilians are increasingly unhappy at becoming merely a raw materials provider to the Chinese. No economy in the world is more dependent on China than Australia's, but look at the new U.S. base the Australians just welcomed onto their soil. Trade does not necessarily breed comity or strategic dependence. As many have pointed out, in 1914 Germany and Britain were each other's largest trading partners too.
China, in fact, has significant obstacles to overcome before it can become a global power on a par with the United States -- above all, the fears and suspicions of neighbors who are themselves pretty powerful and, in the case of India, rising almost as fast as China. It is a cliché, but the United States really was blessed with a favorable geographic situation. It has no great powers in its hemisphere and faces no direct threat from any of its neighbors. China is surrounded by past and future adversaries. Even the Soviet Union was in better shape during the Cold War.
This in part answers Dan's question about the state of America's allies. That India and Brazil may not move in lock step with the United States is not all that important. U.S. influence does not derive from being able to tell everyone what to do all the time; it never could, even in Europe at the height of the Cold War. Rather, it is the overall balance of influence in the world that helps determine America's position. In a future where the United States and China are likely to be competitors, a powerful India strengthens the American hand no matter how friendly New Delhi and Washington may be.
As to Europe, let's take a broader perspective, please. Compared with the devastated Europe that the United States inherited as an ally in 1945, today's Europe, even with its economic crisis, is a mega-superpower and a very fine ally to have, indeed.
I agree with you on one important point. Political power and economic weight are different things. That is why -- even if China becomes the world's largest economy around 2018 -- the United States will continue to be the world's dominant political power for a while. America's network of alliances, military strength, technological prowess, "soft power," political stability, and geographic position are all assets China lacks.
That said, even though political power and economic size are not the same thing, they surely are closely related. So as China becomes wealthier, its geopolitical power grows and becomes much more of a challenge to America's. China's growing wealth gives it more money to spend on assets abroad, foreign aid, and its military. Above all, the lure of Chinese investment and the Chinese market become a powerful tool to shape the behavior of other countries. You can see this with Europe right now. China's ability to supply credit and juicy contracts is making Europeans significantly less willing to confront China, whether on human rights or the environment.
That is why I find your point about GDP per capita less than reassuring. Yes, it is true that the average American will be richer than the average Chinese for decades to come -- perhaps forever. But Luxembourg's GDP per capita is already considerably higher than that of both China and the United States. This does not matter geopolitically because there are so few people in Luxembourg.
To a great extent, this is about simple arithmetic. Japan was never going to be "No. 1" because its population is less than half that of the United States. China is almost certain to be No. 1 in economic terms because its population is four times that of the United States. You are right that the relative poverty of the average Chinese citizen will make China an unfamiliar sort of superpower -- simultaneously richer and poorer than us. This could make China relatively introverted, or it could make it more aggressive as it seeks resources to fuel its rise and satisfy the aspirations of its population. For me, the biggest question mark over China's rise is whether the coming of democracy (if it arrives) will provoke the country's breakup, especially as separatist movements gain momentum in Tibet and Xinjiang. But even though these areas represent a big chunk of Chinese territory, they account for only about 2 percent of the population.
Furthermore, it is not just China that faces troubling questions. You are right to point out America's enduring strengths. But the rapid growth of the U.S. national debt raises the prospect of a really nasty fiscal crunch. When it comes to sovereign debt, we in Europe have just discovered the truth of that old economists' joke that "things that can't go on forever, don't." The United States cannot continue running up debts at its current rate. And even a controlled, rational effort to manage the debt will have serious implications for U.S. spending -- and deployable power.